2021 ends well and 2022 is off to a flyer

Construction ended 2021 on an unseasonal high; and started 2022 in a similar fashion, with more than £6.2 billion in new contract awards getting the New Year of to a flying start. Builders’ Conference CEO Neil Edwards reports on three months of positivity and optimism.

December 2021

Total contract awards for 2021 were down around £8.0 billion on the previous 12 months, coming in at £75.8 billion. However, £12 billion of the 2020 figures were HS2-related work. Even though December is traditionally quiet, the month still delivered £4.4 billion in new contract awards with an encouraging geographic spread. French-owned joint venture company CNIM won a £480 million new Energy from Waste (EfW) facility in Cheshire for client Tata Chemicals Europe which will produce 69 MW of clean, renewable energy while diverting 600,000 tonnes of waste per year from landfill.

BAM secured three new contract awards during the month worth a combined £302 million. Wates won six new contract awards worth a total of £297.6 million, the most notable of which is the new build of a research and development laboratory for Public Health England in Harlow. Hill Partnership won three new housing contract awards that together were worth £187.7 million.

electricity whilst diverting up to 400,000 tonnes of waste per year from landfill. Mace won a pair of new contract awards valued at a combined £305 million, the largest being a new court and police complex on London’s Fleet Street.

Kier Group won 13 new contracts totalling £222.5 million, the most notable being the £70 million repurposing of the former BBC Television Centre in London’s Wood Lane.

London contributed 91 new contract awards worth a combined £1.35 billion, with the North West (£1.2 billion) in second place. East Anglia (£837 million), Yorkshire (£389 million) and Scotland (£352 million) experienced a resurgence but Wales secured just £79 million in new awards. Housing (£2.5 billion) notched up 129 new contract awards. Power and energy (£466 million), education (£436 million) and offices (£395 million) also enjoyed a positive January. Railways, meanwhile, went in the opposite direction with two new contracts totalling £4.7 million.

Kier secured 24 new contract awards for a monthly total of £214 million, including the £107 million new build mixed use development at The Forum in Gloucester. Morgan Sindall picked up 16 new contract awards worth a combined £296.9 million including a £65 million refurbishment and repair contract for National Highways. Even though offices (£681 million) education (£542 million) and entertainment (£335 million) enjoyed an uptick during February 2022, house building once again accounted for more than a third of all new contract awards (£2.36 billion). Factor in the housing element of the mixed-use/ miscellaneous sector and it is likely that house building actually contributed around half of all new contract awards.

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Morgan Sindall picked up an impressive 18 new contract awards during the month worth a combined £152.3 million. 11 other companies picked up more than £100 million in new contract awards to further reinforce December’s positivity. London netted 82 new contract awards worth a combined £776 million. The North West (£644 million) and the North (£549 million) enjoyed an upbeat month, while the West Midlands (£201 million) and East Midlands (£138 million) were down on recent highs. Scotland reported 22 new projects valued at £340 million with Wales serving up £71 million split across just 13 new contracts.

January 2022

Construction seemed sure to start 2022 with a hangover caused by the triple threat of skills shortages and both materials and fuel price hikes. However, January lodged £6.2 billion in new contract awards spread across 275 companies. The biggest winner in January 2022 was a Lovell Partnership and Suffolk County Council joint venture established to deliver around 3,000 affordable homes. Valued at £700 million, the 50:50 partnership will run for 15 years. Downing Developments won a £400 million contract for a mixed use development scheme in Manchester, comprising four buildings from 10 to 45 storeys in height.

METKA EGN secured a £350 million contract award for the construction of an EfW plant in Chester, generating up to 49 MW of low carbon

February 2022

As the UK was battered by the high winds of Storms Eunice and Franklin, UK construction was weathering the storm and notching up £6.1 billion of new contract awards in February.

Berkeley Group secured a pair of new contract awards valued at a combined £570 million, including the £320 million new build of 1,214 homes in Watford. BAM won eight new contract awards valued at a combined £474 million. The most notable of these was the new £220 million Dunfermline Learning Centre campus.

Acciona secured a £300 million project to build an energy recovery facility at Giffords Recycling site in West Bromwich for Versus Energy.

The West Midlands (£548 million), the North West (£538 million) and Scotland (£472 million) all reported a significant increase in demand, while London delivered more than £1.55 billion in new contract awards across 118 individual projects. Brexit, COVID and Storms Eunice and Storm Franklin have all failed to blow the construction sector off course. Looking beyond business, we can now only hope that the Ukraine situation is peacefully resolved as soon as possible.

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