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University spending ‘boom’ prompts soar in building starts

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Education construction starts have soared since the beginning of the year, new data has revealed

Following a weak 2017, the sector is expected to stabilise following a sharp rise in construction starts, according to industry tracker Glenigan.

The underlying value of construction starts, which last year saw a slump of 19 per cent, rose by 8 per cent as a boom in higher education investment offset weak spending on schools. 

But Glenigan’s economics director Allan Wilén warned the gap between demand for new projects and investment in construction ’continued to persist’ and had produced a significant downturn in the value of underlying starts in 2017.

’Despite both a positive backdrop for university construction and demographic trends requiring investment into the schools’ estate, flagship government spending programmes disappointed in 2016 and 2017,’ he added.

Wilén also pointed out rising pupil numbers had driven recent growth in primary school provision and was expected to move to secondary as pupils age. He said: ’Looking further ahead, we anticipate a gradual recovery in project starts during 2018 and 2019, as local authorities and academies address the need to raise secondary school capacity.’

According to Glenigan, if the government can persuade academies to invest in projects and higher education spending continues, the prospects for this sector could ‘improve drastically’. 

Education-related work by Glenigan’s top 100 clients totalled £3.1 billion in the 12 months to the first quarter of 2018 – up from £2.2 billion in the same period 12 months earlier.

Driven by university spending, the higher education sector made the biggest contribution, providing 74 per cent of contract awards for education work.

Recently approved schemes in the higher education sector include a 5,000m² new facilities hub for the University of Cambridge’s west campus, designed by Jestico + Whiles.

The new hub is part of a wider £300 million project that also includes the new Cavendish Laboratory building which replaces existing facilities for the Department of Physics and was given the go-ahead earlier this year.

Glenigan’s data also revealed regional differences with Scotland likely to see an increase in repair work after a report from the country’s Accounts Commission identified a swathe of defects in at least 20 public buildings.

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