North West – Overview
While project-starts and main contract awards both weakened, growth in major project approvals against 2021 levels provides a boost to the development pipeline.
At £1.38bn, work starting on-site in the North West during Q4 2022 fell 33 per cent against the preceding quarter and 21 per cent compared with a year ago. Major (£100m or more in value) projects at £213m performed strongly, increasing 76 per cent on the preceding quarter to stand 3 per cent up on 2021 levels. However, underlying (less than £100m) project-starts performed poorly, falling 21 per cent against the preceding quarter on a seasonally adjusted (SA) basis to stand 24 per cent lower than a year ago.
Totalling £2.35bn, main contract awards in the North West slipped back 20 per cent against the preceding quarter and 16 per cent compared with 2021 levels. Underlying contract awards caused the fall, with the value declining 50 per cent (SA) against the preceding quarter to stand 42 per cent lower than 2021 levels. In contrast, major project contract awards performed well having increased 48 per cent against the preceding quarter and 234 per cent compared with a year ago to total £895m.
Adding up to £3.04bn, detailed planning approvals decreased 15 per cent compared with the preceding quarter but increased 24 per cent up on the previous year. Major projects at £882m experienced a mixed period, decreasing 30 per cent against the preceding quarter but advancing 270 per cent up when compared with a year ago. Underlying approvals slipped back 38 per cent (SA) against the preceding quarter and 2 per cent compared with 2021 levels to total £2.16bn.
Sector Analysis – Project-Starts
Private housing accounted for the greatest share (21 per cent) of work starting on-site in the North West during Q4 2022, despite the value falling 63 per cent against the previous year. Private housing construction-starts added up to £292m and included a £35m, 160-unit development in Manchester (Project ID: 12125182). Health was another active sector that experienced a decrease on 2021 levels, with the value of project-starts decreasing 23 per cent against the previous year to total £178m. The sector accounted for 13 per cent of the total value. Utilities also accounted for a 13 per cent share, with project-starts decreasing 18 per cent against the previous year to total £185m.
In contrast, industrial work starting on-site in the North West increased 225 per cent compared with the previous year to total £161m. The sector accounted for the third-greatest share (12 per cent) of project-starts, being boosted by the commencement of a £30m production facility in Rochdale (Project ID: 22365687). Offices also accounted for a 12 per cent share of the total value and also experienced triple-digit growth (+555 per cent) against the previous year to total £169m. The sector was boosted by the consent of the ‘No.3 Circle Square’ scheme in Manchester (Project ID: 19154471)
Value of Project-Starts in the North West during Q4 2022 by Sector
| Sector | Value of Project-Starts (£m) | Change on previous year | Change on two years ago | %Share |
|---|---|---|---|---|
| Private Housing | 292 | -63% | -56% | 21% |
| Utilities | 185 | -18% | 12% | 13% |
| Health | 178 | -23% | 318% | 13% |
| Offices | 169 | 555% | 61% | 12% |
| Industrial | 161 | 225% | 108% | 12% |
| Infrastructure | 105 | 59% | -17% | 8% |
| Social Housing | 95 | -1% | -27% | 7% |
| Education | 73 | -24% | -63% | 5% |
| Retail | 63 | 169% | 67% | 5% |
| Hotel & Leisure | 44 | -64% | 7% | 3% |
| Community & Amenity | 9 | -68% | -63% | 1% |
| Total | 1,375 | -21% | -15% |
Sector Analysis – Detailed Planning Approvals
Private housing was largely dominant for detailed planning approvals, accounting for 39 per cent total value. Unlike project-starts, private housing approvals improved (+22 per cent) against the previous year. Private housing approvals added up to £1.18bn and included the £154m ‘Affinity Living’ development in Manchester (Project ID: 21509552). Four sectors experienced triple-digit growth against the previous year, including offices which saw approvals rise 158 per cent to total £606m, a 20 per cent share in the total value.
Infrastructure, accounting for 18 per cent, was another sector that experienced triple-digit growth (+192 per cent) against the previous year. Infrastructure consents added up to £549m and included the £200m A57 Link Roads development, previously known the Trans Pennine Upgrade Programme (Project ID: 16096374). Retail also performed well, with approvals rising 147 per cent against the previous year to total £91m.
Value of Project Approvals in the North West during Q4 2022 by Sector
| Sector | Value of Project-Approvals (£m) | Change on previous year | Change on two years ago | %Share |
|---|---|---|---|---|
| Private Housing | 1,183 | 22% | -8% | 39% |
| Offices | 606 | 158% | 202% | 20% |
| Infrastructure | 549 | 192% | 447% | 18% |
| Industrial | 270 | -16% | 28% | 9% |
| Retail | 91 | 147% | 26% | 3% |
| Health | 85 | -29% | 5% | 3% |
| Hotel & Leisure | 72 | -64% | -89% | 2% |
| Education | 67 | -14% | -20% | 2% |
| Social Housing | 65 | -75% | -75% | 2% |
| Community & Amenity | 39 | 123% | 247% | 1% |
| Utilities | 12 | -34% | -89% | 0% |
| Total | 3,038 | 24% | -2% |
Forecast Construction-Starts for the North West
|
Underlying project-starts (£ million) |
Change on previous year |
|
|---|---|---|
| Quarter 1, 2021 |
2,208 |
32% |
| Quarter 2, 2021 |
1,496 |
52% |
| Quarter 3, 2021 |
2,012 |
66% |
| Quarter 4, 2021 |
1,538 |
5% |
| Quarter 1, 2022 |
2,273 |
3% |
| Quarter 2, 2022 |
1,956 |
31% |
| Quarter 3, 2022 p |
1,925 |
-4% |
| Quarter 4, 2022 f |
1,137 |
-26% |
| Quarter 1, 2023 f |
1,658 |
-27% |
| Quarter 2, 2023 f |
1,739 |
-11% |
| Quarter 3, 2023 f |
2,008 |
4% |
| Quarter 4, 2023 f |
1,955 |
72% |
| Quarter 1, 2024 f |
2,165 |
31% |
| Quarter 2, 2024 f |
2,069 |
19% |
| Quarter 3, 2024 f |
2,113 |
5% |
| Quarter 4, 2024 f |
1,983 |
1% |