Findings from AECOM’s Ireland Annual Review of the Construction Industry show that Ireland’s construction industry output value grew by 18% in 2017. Output value is expected to increase by a further 14% to approximately €19.5 billion in 2018. Global infrastructure services firm AECOM launched the Review at an event in Dublin yesterday.
The Review, which includes the results of a survey of professionals in the construction and property sectors in Northern Ireland and the Republic of Ireland, reports that the growth in construction output has been focused on the commercial and Foreign Direct Investment sectors. The residential sector, transportation and utilities sector have not kept up with the demands of a growing economy.
Two thousand and seventeen saw Dublin’s commercial market continue to strengthen, with developers and investors continuing to see strong demand for office accommodation. Currently, a considerable number of commercial properties are still under construction, a sizeable proportion of which may have pre-let agreements in place prior to final completion. Last year also saw increased construction activity extending beyond the Greater Dublin area.
The residential sector, which historically has been the key driver of output, has been struggling to respond to the housing crisis. Last saw some movement with the number of commencements increasing in the first eight months of the year to 4,055 — a 25% increase from a very low base for the same period in 2016.
The report notes that it is very positive that there is an 18.5% increase in value terms in the public sector capital programme budgeted for 2018. However, there is a concern around the delivery of this significant increase, with questions raised regarding whether various government departments have the shovel-ready projects available to implement the planned increase in public capital spending. The pace of development of public infrastructure is likely to continue to be hindered by a lack of internal resources, a challenging planning process, inappropriate procurement routes and time consuming approvals structures.
The construction industry in Northern Ireland has seen the value of output rise by 11.6% in value terms compared to the previous 12 months. The review predicted that 2018 is set to be another stable year for the industry in Northern Ireland.
John O’Regan, Head of Buildings + Places, Republic of Ireland, AECOM, said: “Some big issues remain for Ireland’s construction industry, namely Brexit and its potential impact on new construction project demand, as well as the availability of resources and tender inflation. Despite those issues, the future looks promising. The positive news is that the opportunities for economic growth and increased foreign direct investment are great and dynamic approaches to addressing challenges are making a difference.”
Go to http://bit.ly/2rlnkzd to view an online copy of the 2018 Annual Review