Construction Information Services (CIS) are delighted to announce the publication of our Construction Market Review of 2016. Simply request the report via the link below and submit a few contact details before we email you a direct link to the Report.

Key Stats

  • Over €1.4b worth of projects moved on-site in Q1 2017
  • Value of projects on-site down 30% compared to Q1 2016
  • 1,200 projects granted planning in Q1 2017
  • Volume of projects at plans submitted stage remains relatively static

Q 1 2017 Stats Report 3d Cover

About the CIS Construction Market Review

The CIS 2017 Q1 Construction Market Review provides an analysis of activity in the construction sector for the first quarter of 2017 and a comparative analysis against the corresponding period in 2016.

It also provides an insight into the overall planning pipeline for the remainder of the year and beyond on a sector by sector basis and in addition a regional analysis of the Republic of Ireland.

 

Overview

The overall level of construction activity in the first quarter of 2017 were down when compared to the same period in 2016. The number of planning applications lodged (excluding self-build and residential extensions) was almost static at -0.6%, while the construction values were down -29.3%, due to the scale and mixed of projects involved. Projects granted planning permission decreased by -16.7% in volume terms and -15.7% in construction value. The number of developments commencing On-site also remained static. However in value terms, the decrease was -30.1%, which can be attributed to two major road schemes in Wexford, which commenced in the first quarter of 2016 and had a combined value of €600 million.

In analysing these overall numbers, it will be no surprise to read that the Residential sector activity at all three stages continues to increase year on year. There were 281 residential applications (5,300 units) submitted in Q1, up 22.2% on 2016. While the number of applications granted permission increased by just 2 over Q1 2016, the number of units involved decreased by 620 to 3,280 units and this represents a drop in value of €113 million. However, the number of developments which commenced on-site increased by 34.6% to 105 schemes and this represents in excess of 2,800 units. The buoyant self-build market saw 900 projects commence in the first quarter compared to 600 in Q1 2016.

The Educational sector recorded an -11.5% decrease in planning applications in Q1 compared to the same period 2016 and the number of projects granted permission also decreased by -8.7%  or €48 million on the same period last year. There was a slight decrease -3.8% in the number of projects commencing on-site and represents a decrease in construction values of €57 million, part of which can be attributed to the Trinity Business School enabling works which commenced in Q1 2016.

Medical and Care Residential sector followed a similar pattern to the Education sector, in that planning application numbers were down -28.2%, projects granted permission decreased -27.1% and the number of schemes commencing on-site decreased by -8.1%, although the value of projects commencing on-site increased by €35 million, two of which relate to the €25 million Oncology Centre in Cork and a €20 million Nursing and Sheltering Housing Campus in Galway.

Following a surge in activity in the Commercial and Retail sector throughout 2016, the sector has remained static when compared to Q1 in 2016, with only the number of planning applications submitted increasing by 18 to 252 projects. However, the collective value of these projects has fallen by a significant €531 million. The same scenario applies to the values of projects granted permission in Q1 2017. The actual number granted remained static at 209, but the associated values dropped by €293 million. With regard to developments progressing to on-site stage, the numbers and values remain static at 137 projects and €227 million respectively for Quarter 1.

Moving to the Industrial sector, marginal increases year-on-year for both applications submitted and granted were 7.7% and 10.5% respectively. In construction value terms, applications increased by 45.8% to €210 million, however, granted permission values dropped by -60.4% to €113 million. The number of project’s commencing construction remained static for Q1 2017, at 46.

The Community and Sports Sector showed a surge in planning applications in Q1 2017, representing a 135.9% increase to 243, which can be attributed to the Capital Sports Programme. The number of projects granted permission remained static at 102 when compared to the same period in 2016. However, the number of projects progressing to on-site was down -39.1%, or 25 projects compared to Q1 2016, but values are up significantly to €83 million due to the commencement of the Curragh Racecourse redevelopment worth circa €65 million.

The Hotel and Catering Sector continues to push ahead with planning applications up 39.2% in Q1 2017, granted permissions were on par with the same period last year as was the number of developments progressing to on-site. Construction values remained consistent with Q1 2016. We have separated Student Accommodation from the overall stats in this sector, as it is attracting a lot of attention and there is a major drive by the Higher Educational Authority (HEA) to accelerate construction of Student Accommodation. In Q1 2017, 4 planning applications have been submitted for 1,066 units/beds, worth €51 million, which accounts for a 107.4% increase in the number of units/beds to be created compared to the same period in 2016. Planning permissions in Q1 2017 are on a par with 2016, however, the number of developments proceeding to on-site has gone from €40 million in Q1 2016 to €150 million in 2017 and this will result in 2,867 beds becoming available on completion.

The increases in the Civil and Utility sector relate to both planning submitted and granted, with 27.9% and 38.1% respectively recorded in Q1 2017. The number of project commencing construction has fallen by -22.6% in the same period. It should be noted that some projects do not follow the traditional planning channels and will be identified when they reach the Tender stage.

The Agricultural sector recorded decreases in Q1 2017 for projects at plans submitted – 38.2% and plans granted – 44.2%. However, there is a healthy increase in projects moving on-site; up 75% in project numbers and 110% in values to €21 million for the quarter.

In conclusion, the construction sector is continuing with its positive momentum, which was highlighted in the recent Ulster Bank Construction PMI Report for the Republic of Ireland. It reported a third monthly rise in the 2017 index from 57.9 in February, 60.8 in March to 61.3 in April and further noted that this increase was the most marked since October 2016. Many challenges still lie ahead for the Government in terms of the provision of infrastructure and access to finance to fund developments in residential and commercial sectors. Other potential ‘storm clouds’ abound in terms of the impact of Brexit, developments in the USA and what a change in An Taoiseach may have on the Government Capital Expenditure Programme. But that said, the underlying trajectory remains upward and should continue for some time to come.