The JLL & Glenigan UK Commercial
Construction Activity Index

First Look: Q1 2018

Commercial construction activity posts
third consecutive quarter of growth

In the 12 months to the end of Q1 2018, £16.8 billion of commercial construction activity took place, up 8.3% on the previous quarter. New build construction activity represented £10.9 billion of this figure, a quarterly rise of 9.1%. Q1 2018 was also the third consecutive quarter in which construction activity increased, bringing total construction activity to its highest levels since Q3 2016.

These positive headline figures obscure pockets of weakness in the core commercial sectors, and in London. Construction in the offices sector fell by 9% on the previous quarter, while the retail sector was stable.

Commercial construction in Q1
8.3%

Commercial construction in Q1

New builds in Q1
9.1%

New builds in Q1

Q1 2018 Sector Dynamics

The best performing sectors this quarter were hotels (up 38.8%), education (up 20.2%) and industrial (up 11.8%), which all registered reasonable increases. Medical construction registered a small (2.7%) rise this quarter, though was down 13.2% on the same time last year.

Offices
-9.0%
Retail
-1.9%
Hotels
38.8%
Industrial
11.8%
Medical
2.7%
Education
20.2%
Community
1.0%

The picture across the UK

Scotland, which saw £2.9bn of construction activity in the 12 months up to the end of Q1 2018, was the geographical driver of this quarter’s performance. Construction activity rose 136.5% on Q4 2017, in large part due to the commencing of the University of Glasgow’s £700m Gilmore Campus development, and the £850m mixed use development at St James Quarter in Edinburgh.

Yorkshire and the Humber, which registered a more modest quarterly rise of 14.7%, has seen construction activity more than double from Q1 2017. In the 12 months up to the end of Q1 2018, £1.9 billion of construction activity took place, making the region the most active outside London and Scotland.

Click on the circles to see the city indexes by region

Scotland
136.5%
North East
2.5%
Northern Ireland
-11.3%
Wales
-5.8%
South West
-3.6%
London
-11.8%
East of England
-10.5%
South East
-5.6%
Yorkshire & Humber
14.7%
East Midlands
37.8%
West Midlands
8.6%
North West
-4.5%

Q1 2018

East Midlands 37.8%
East of England -10.5%
London -11.8%
North East 2.5%
North Ireland -11.3%
North West -4.5%
South East -5.6%
South West -3.6%
Scotland 136.5%
West Midlands 8.6%
Wales -5.8%
Yorkshire & Humber 14.7%