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South Wales Argus
08-08-2025
- Business
- South Wales Argus
RICS: Construction activity is on the rise across Wales
The increase has been reported for the fifth consecutive quarter, according to the latest Royal Institution of Chartered Surveyors (RICS) Construction Monitor for the second quarter of 2025. The growth, driven by both public and private housebuilding, has not been matched by a rise in profit margins. Sam Rees, interim head of public affairs UK and Ireland at RICS, said: "It's encouraging to see construction activity picking up in Wales and housing being the main driver. "This was also evidenced in NHBC's most recent quarterly report which also shows a rise in the number of new homes registered in Wales. "However, it is important to note that even with an uplift in activity, there is still much progress to be made in building enough homes to meet housing need. "The Welsh Government has an ambitious target of creating 20,000 homes by next year, and it's hoped this momentum can continue, particularly in regard to social and affordable housing." A net balance of 22 per cent of surveyors in Wales reported increased construction activity, the highest level since early 2022. Public housing saw the strongest growth, with a net balance of 38 per cent reporting a rise, while private housing recorded a 24 per cent increase. Profit margins are expected to remain flat over the next year. While this figure is subdued, it is up from -7 per cent reported in the previous survey.
Business News Wales
07-08-2025
- Business
- Business News Wales
Wales Construction Workloads Rise for Fifth Consecutive Quarter
Construction workloads in Wales continued to rise through the second quarter of the year according to the latest Royal Institution of Chartered Surveyors (RICS) Construction Monitor, underpinned by activity in both public and private housing. A net balance of 22% of surveyor respondents in Wales reported a rise in overall construction activity, which is the highest this balance has been since early 2022. This includes increases in both public and private sector housebuilding activity, with a net balance of 38% of respondents noting a rise in public housing workloads and a net balance of 24% reporting there was an increase in the private sector. Looking at the other subsectors, 'other public works' (a net balance of 13%), private commercial (a net balance of 29%) and infrastructure (a net balance of 11%) workloads saw increases in activity, whilst the private industrial sector was the only one to see a decline, with a net balance of -25% of Welsh respondents reporting a fall. Surveyors in Wales remain optimistic about future workloads, according to the survey, but less so than seen previously. A net balance of 14% of respondents expect an increase over the next year, which is down from the 20% that was reported in the first quarter of the year. When it comes to profit margins, surveyors in Wales expect that these to be fall flat over the next 12-months. Whilst this figure is subdued, it is up from the net balance of -7% that was reported in the survey previous. Welsh surveyors continue to report shortages in skilled workers. 58% report a shortage in quantity surveyors, 46% note a shortfall in other construction professionals and 47% report a deficit in bricklayers, all of which were similar figures reported in the first survey of the year. Despite the continuing growth in workloads in the sector, survey respondent Richard Blakemore of FR Consultants Ltd in Barmouth noted that there are Building Safety Regulator decision delays. Robert Davies of Penfro Consultancy Limited also said: 'A lack of clear visibility of local government expenditure and the protracted planning process are impacting release of projects to the construction delivery phase.' Sam Rees, interim head of public affairs UK&I at RICS, added: 'It's encouraging to see construction activity picking up in Wales and housing being the main driver. This was also evidenced in NHBC's most recent quarterly report which also shows a rise in the number of new homes registered in Wales. However, it is important to note that even with an uplift in activity, there is still much progress to be made in building enough homes to meet housing need. The Welsh Government has an ambitious target of creating 20,000 homes by next year, and it's hoped this momentum can continue, particularly in regard to social and affordable housing.' Commenting on the UK picture, RICS Chief Economist, Simon Rubinsohn, said: 'The underlying tone in the construction sector remains subdued according to the latest feedback from RICS members. There is a little more positivity looking forward but the indicators, at this point, are consistent with a modest rather than material uplift in development. 'Given that planning continues to be viewed as the major factor hindering the industry from upscaling its building programme, it is quite conceivable that the passing of the Planning and Infrastructure Bill will in due course see industry expectations move onto a firmer footing. That said, the need to ensure the building safety regime works more smoothly is also highlighted quite widely in the survey as a factor that would likely impact the pace of development. 'The other big challenge remains around skills. While typically much of the conversation is focused of shortages of trades such as bricklayers and plumbers, the RICS survey highlights recruitment issues amongst professionals involved in the construction industry with building control surveyors and quantity surveyors in short supply.'
The Citizen
05-08-2025
- Business
- The Citizen
SA fixed investment almost halves, after public sector projects slump
Nedbank report says the private sector is responsible for 100% of the announced capex plans in the first half of 2025. South Africa's public and private sectors announced new capital projects valued at an annualised R316.2 billion during the first half of this year. However, this is almost half of the R592.2 billion recorded in 2024 – and, according to the Nedbank Capital Expenditure Project Listing for the first half of 2025, the private sector is responsible for 100% of the announced plans. The report further said that no new projects were announced by the government and public corporations, following a surge in investment plans in 2024. 'Last year, the public sector accounted for 83% of the total project listings. Many of those projects are still in the early stages of implementation. 'As these projects break ground, its impact should begin to filter into actual gross fixed capital formation (GFCF) numbers, as was seen in Q1 when outlays by public corporations and the government increased by 13.8% and 0.3% respectively,' it said. ALSO READ: Identifying the bugs in SA's long-promised infrastructure boom However, Nedbank's claim that no new public sector projects were announced in the first half of 2025 is at odds with information disclosed by construction sector services company Industry Insight. Its Construction Monitor for June 2025 only said several large-scale infrastructure and property developments were confirmed or progressed in June 2025, reflecting 'renewed momentum in both public and private sector investment'. Industry Insight referred to the Airports Company South Africa's announcement of a R22 billion national infrastructure programme across multiple airports, which it insists will proceed despite threats from the construction mafia. It also said Transnet outlined plans for a major upgrade and expansion of the Cape Town harbour, aimed at improving port efficiency and unlocking trade, while in KwaZulu-Natal, the R10 billion Colenso Power Project entered the final pre-construction stages, although contracts are only expected to be awarded in the third quarter of 2025. However, Industry Insight stated that South Africa's construction sector remained under pressure in the first half of 2025, with a notable decline in private sector building activity and muted growth in public infrastructure rollout. It said building completions and plans passed declined sharply year-on-year in June 2025, by -12.0% and -21.0% respectively, pointing to a weaker pipeline in terms of private sector development. ALSO READ: Should government use pensions to fund its projects? Industry Insight said public sector tender activity remained depressed, as building tender values were down 15% year-to-date, with a similar decrease in civil tender values, despite a surge in the value of awards, suggesting a weakening pipeline. It attributed the lacklustre public infrastructure pipeline to under-expenditure and institutional delays, adding that this continues to weigh on the construction outlook. Nedbank expects GFCF to contract by 1.5% in 2025, less than the 3.9% decline in 2024, despite the significant decrease it reported in the capital projects listed in the first half of 2025. It said underlying conditions remain unsupportive of a broad-based upturn in fixed investment activity, despite pockets of improvement which will support a modest uptick in GFCF during the remainder of the year. The project listing records the major capital projects undertaken in South Africa, but only includes projects that have been announced publicly and are valued at R20 million or more. ALSO READ: SA needs trillions to achieve infrastructure goals, says Ramaphosa Private sector activity Nedbank attributed the increase in private sector activity to the structural shift to renewable energy and the central role of energy security in investment decisions, and improved macroeconomic conditions, particularly easing financial constraints and its positive impact on demand dynamics. It said the electricity, gas, and water sector led investment activity in the first half of 2025, with new non annualised projects totalling R72.7 billion. Nedbank said this momentum reflects continued efforts to tackle South Africa's energy crisis and move away from coal-fired generation. Major investments include Earth & Wire's large-scale Energy Fields project, the Overberg and Ishwati Emoyeni wind farms, Photon Energy's concentrated solar PV plant with thermal hydrostorage, and the Khauta solar project, it said. ALSO READ: Macpherson vows action on failed projects and EPWP reform Nedbank said mining and quarrying projects worth R45.2 billion were announced, anchored by Suiso's R31.5 billion coal-to-fertiliser facility in Kriel, which aims to produce 1.5 million tons of nitrogen-based fertilisers annually and reduce reliance on imported fertilisers. It said Meta is the largest investor in the transport, storage, and communications sector, with Project Waterworth accounting for 75% of the R26.4 billion worth of planned projects. This initiative involves developing a 50 000km global subsea cable system linking the US, India, Brazil, South Africa and other strategic regions to support growing demand for AI and data infrastructure. Manufacturing projects valued at R12.9 billion were announced, the most significant being Astron Energy's R6 billion upgrade of its Cape Town refinery to meet South Africa's Clean Fuels II regulations by the 2027 deadline, and PPC's expansion of its Riebeeck West cement facility at a cost of R3 billion. ALSO READ: At least R900 billion needed to fix SA's water woes A single project worth R1 billion was announced in finance, real estate, and business services, which was the Olympus Sandton mixed-use residential and retail development by Growthpoint Properties and Tricolt Group. It involves the development of two towers consisting of 22 and 16 storeys each, and will include hotel rooms, residential units, spa facilities, a restaurant and retail space. Nedbank said its Capital Expenditure Project Listing highlights three key trends: Investments remain heavily concentrated in energy, underscoring the central role of energy security in driving capital formation. The modest recovery in private sector announcements appear to be supported by improved macroeconomic conditions, including lower inflation and interest rate cuts. The lull in new public sector announcements follows the surge in 2024, with many of those projects still in the early stages of implementation. This article was republished from Moneyweb. Read the original here.
Business News Wales
01-05-2025
- Business
- Business News Wales
Construction Workloads Boosted in First Quarter by Public Housing Activity
Construction workloads in Wales rose through the first three months of 2025 according to the latest Royal Institution of Chartered Surveyors (RICS) Construction Monitor, as a rise in public housing activity bolsters the sector. A net balance of 10% of surveyors in Wales reported a rise in overall construction activity, up from 3% seen in the final quarter of 2024. Public housing continues to see the highest workloads balance, with a net balance of 50% reporting an increase, the highest this balance has been in three years. Workloads in the private industrial subsector fell flat, and the net balances of the rest of the subsectors were all in negative territory; private housing (-14%), private commercial (-26%), infrastructure (-7%) and other public works (-5%). Surveyors in Wales remain optimistic about future workloads, with a net balance of 20% of respondents expecting an increase over the next year, up from 16% in the survey previous, and above the UK average of 17%. In saying this, profit margins are still expected to fall over the next 12-months. A net balance of -7% of surveyors in Wales anticipate that profit margins will decline. Welsh surveyors continue to report shortages in skilled workers. 60% report a shortage in quantity surveyors, down from 65% in Q4 2024, and 48% note a shortfall in other construction professionals compared to the 50% reported in the previous survey. 47% report a deficit in bricklayers which is down from 66% that was reported in the final quarter of 2024. Survey respondent John Pugh, chartered building surveyor and conservation consultant in Ruthin noted that the sector appears to be very buoyant. Jodie O'Connor of Penfro Consultancy Limited in Pembroke Dock said: 'Improved access and additional investment in training and retaining professionals across the West Wales region is essential to support the growth and development of sustainable energy projects and related infrastructure.' Commenting on the UK picture, RICS Chief Economist, Simon Rubinsohn, said: 'Construction activity was largely flat over the quarter with respondents expressing a little more caution in the face of the heightened level uncertainty both at a global and domestic level. In particular, concerns about the implementation of tariffs and what this might mean for costs and economic activity as well as the potential impact of the uplift in employer NI contributions are highlighted in the feedback. 'Significantly, aside from financial issues the most cited obstacle to activity referenced in the survey is planning and regulation which chimes neatly with the government's agenda. Addressing this issue is critical if the ambitions around housing and infrastructure are to be met. 'That said, for now the forward-looking metrics point to a relatively modest uplift in construction workloads over the next twelve months with profitability in the sector remaining under pressure.'
