Dodd Group’s John Kavanagh offers his thoughts and forecasts for the hottest regions and markets.
We have generally seen the construction sector pick up over the past 12 months and long may this continue.
Based on the enquiries we have been getting, the commercial market has still got legs – as has the education sector with the continuation of Education Funding Agency works.
The impending ProCure22 framework may also stimulate the health sector: with the probability that the new P22 rates will be higher than those on P21+, we may see a mini-rush of schemes getting up and running before the new framework kicks in.
It’s not all about London
Regionally we are expecting the commercial market to buck the trend being forecast in London, as it benefits from infrastructure investment such as High Speed 2.
Although we are not looking at HS2 itself, the spin off in terms of city centre regeneration in Birmingham should prolong this growth.
“Outside the West Midlands, our confidence is reflected in the investment into two new branches in Bridgend and Cambridge, both of which have secured substantial orders”
We are currently on site at Arena Central, the new HSBC headquarter building, and I am confident there is more to come in terms of new office development in the city centre – a sector that has been fairly static for some time.
The South and South-west regions have strengthened significantly, with Southampton and Exeter seeing some sizeable projects getting off the ground.
Outside the West Midlands, our confidence in the sector is reflected in the investment into two new branches in Bridgend and Cambridge, both of which have secured substantial orders. We have also moved into larger premises in Exeter.
Term contracts and maintenance continue to provide stability and we have secured £40m of orders this year.
My optimism in the sector’s growth is underpinned by the security of having a continuous workstream from this facilities management-type work, which enables a business to ride the peaks and troughs of the market.
Skills shortages in the construction industry will have an effect on the market and in many cases will restrict companies’ scope for growth.
In this environment, maintaining investment in training and development – irrespective of market conditions – is vital. This means the talent in which firms invest can help them exploit the opportunities now emerging.
For Dodd Group, we are aiming for 10 per cent year-on-year growth over the next four years. It will be crucial to build operations in a steady manner so that quality and safety can be maintained.
John Kavanagh is group managing director at Dodd Group