Scottish construction activity showing resurgence

Commercial construction work in Scotland continues to rise. Picture: Ian Georgeson

COMMERCIAL construction in Scotland maintained its growth in the second quarter, new data has found, although concerns remain about the ongoing impact of increasing costs.

The latest JLL and Glenigan UK Commercial Construction Activity Index, published yesterday, found that total starts in Scotland for the year to end-June amounted to £2.5 billion.

That marks an increase of 17.6 per cent, making Scotland the best-performing region in the UK after the east of England, which achieved growth of 23 per cent.

Ken Frew, director of building and construction at JLL Scotland, said: “For the second consecutive quarter, Scotland has proven to be one of the top two performing regions in the UK for new construction starts.”

He said this implies that Scotland is one of the areas “beginning to see the bounceback that had previously been concentrated in the South-east”.

Frew however warned that it was “not all good news” and flagged construction costs having grown “steadily” in the second quarter, with robust growth for contractor order books, especially in the three largest Scottish cities.

“A surge in post-election business and investment decision-making was noticeable and is expected to result in increased construction activity in late 2015 and throughout 2016,” he added. “This will continue to drive costs up and stretch the market’s ability to deliver, particularly at short notice.”

The news comes after the Scottish Building Federation on Monday reported that confidence fell in the three months to end-September after rising for three consecutive quarters.