UK construction activity May 2024: South East

Main contract awards fell against the previous quarter and last year. More positively, project starts and detailed planning approvals increased compared to the preceding three months and a year ago.

South East overview

Totalling £4.13bn, work commencing on site in the South East during the three months to May grew 36 per cent against the preceding quarter and 26 per cent up against the previous year. Major project starts (£100m or more) increased 186 per cent against the preceding quarter and 116 per cent against the previous year to total £2.54bn. Totalling £1.59bn, underlying project starts (less than £100m in value) decreased 25 per cent against the preceding three months on a seasonally adjusted (SA) basis and last year.

Adding up to £3.65bn, main contract awards in the South East slipped back 41 per cent to stand 55 per cent lower than a year ago. Major contract awards, at £1.01bn, fell 70 per cent against the previous three months and were 78 per cent down compared with last year’s levels. Underlying contract awards slipped back 19 per cent (SA) against the preceding quarter and were 26 per cent down on the previous year to total £2.64bn.

At £5.75bn, detailed planning approvals in the South East increased 45 per cent against the preceding quarter to stand 44 per cent up against the previous year. Major project approvals, totalling £2.35bn, doubled on the preceding quarter and the previous year. Totalling £3.4bn, underlying approvals grew nine per cent (SA) against the preceding quarter to stand 11 per cent up against the same period a year ago.

Sector analysis: project starts

Utilities accounted for the greatest share (45 per cent) of starts in the South East during the three months to May with the value adding up to £1.85bn, thanks to the value having jumped seven times against last year’s levels. Social Housing also experienced a strong period, having increased 25 per cent to total £325m, accounting for an eight per cent share of starts in the region.

Accounting for seven per cent, health increased 121 per cent against last year to total £274m. In contrast, accounting for 29 per cent, private housing fell two per cent on a year ago to total £1.12bn.

Value of project starts in the South East during the quarter to May 2024 by sector

Sector analysis: detailed planning approvals

Private housing accounted for 39 per cent of detailed planning approvals in the South East during the three months to May, making it the most active sector as a result of the value having grown 14 per cent against the previous year to total £2.23bn. Accounting for 18 per cent, utilities also experienced a strong period, having increased more than five times on a year ago to total £1.02bn. Accounting for a 12 per cent share, offices grew 45 per cent against last year to total £666m.

Approvals for hotel & leisure projects increased 43 per cent on a year ago, totalling £418m, accounting for a seven per cent share of approvals in the region. Accounting for the same share health approvals also performed well, having grown 127 per cent against the previous year to total £396m.

Value of project approvals in the South East during the quarter to May 2024 by sector

Forecast construction starts for the South East

Note: Underlying projects are schemes with a construction value of £250,000 to £100m. Forecast updated in June 2024 p – provisional, f – forecast. Source: Glenigan