Brexit Uncertainty For Reduced Construction Output
The uncertainty about whether Britain will leave the European Union (EU) and under what conditions has affected many industries, in particular the construction market.
According to research from Turner & Townsend (T&T), construction cost inflation in London has been especially hit, rising by just 2.1 per cent in the capital during 2018.
Its International Construction Market Survey 2019 reported that London is number 15 of the 64 cities across the globe for construction investment, with build costs coming in at an average of £2,880 per m2.
There has been a marked change since the referendum in 2016 to determine whether Britain should leave the EU, with value for construction inflation in London dropping by three per cent over the last three years.
Neil Bullen, global managing director for real estate at T&T, told Building.co.uk: “If you compare this report to the one from 2016, just before the EU referendum, there are some quite distinctive trends that show the volatility of the economic and political environment.”
He went on to say “a level of correction after Brexit” will be needed, and the client and supplier have to be more prepared for this, as many people still believe it will not affect them.
The city that experienced the biggest increase in construction inflation was Buenos Aires in Argentina. Here, the figure rose by 43.4 per cent due to number of huge projects, including a major urban redevelopment initiative at Parcque Paseo del Bajo.
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