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TOP 100 Northern Ireland Companies 2017
BUILDING
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By Dr Patrice Cairns, policy manager, Royal Institution of Chartered Surveyors (RICS) in Northern Ireland
016 was a year of global political turbulence, but for the local construction sector, it was perhaps one of the least tumultuous 12 month periods of the past decade, with signs of activity increasing and sentiment improving. Indeed, much of the data relating to the local construction industry of late has been painting an increasingly positive picture. New figures show that construction output hit a five-year high at the end of 2016, with activity in the sector up by 7%. These figures partly reflect a number of projects on hotels and student accommodation in Belfast. Deloitte’s Belfast Crane Count Survey also highlighted this, pointing out that the rapidly increasing number of cranes dotting the city’s skyline reflected investment in the city coming forward, despite some economic uncertainty. The report highlighted that two new hotels were completed in Belfast in 2016 with at least a further six hotel projects across the city currently under construction, set to deliver in excess of 1,000 new hotel rooms. Deloitte said that the Ulster University’s move to a larger campus in Belfast is a game changer, with a number of student housing schemes already being built. The RICS and Tughans Construction Market Survey for Q4 2016 indicated that confidence in the 12-month outlook is at a nine-quarter high. Indeed, Northern Ireland was one of the only areas of the UK to see a pick-up in the pace of output growth in the final quarter of 2016, according to the survey, and the significant majority of respondents expect workloads to rise during the course of this year. Clearly, whilst the rising activity and sentiment is encouraging, it is not all positive news. Things like skills shortages, low margins, and the uncertainty of the public-sector pipeline of work are to fore of the minds of many in the sector. The RICS and Tughans survey highlighted that infrastructure workload growth remained weak, and significantly below the UK average at the end of last year. And we think it is unlikely that new, novel or contentious capital projects will commence in the absence of ministerial decisions. The latest figures from the Department for the Economy also show that housebuilding, which had been rising, slipped back at the end of last year. That fact that our construction industry is so dependent on work in Great Britain — something that our top construction companies know too well — is also a challenge of sorts. Then there is the B word: Brexit. In some respects, it looks like the construction sector has shrugged off the effects of the UK’s decision to leave the EU to date. However, it remains to be seen what challenges lie ahead. Post Brexit, the lack of EU funding, such as European Investment Bank and European Regional Development Fund (ERDF) funding, will