Featured Region: London

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Table 1: London Construction (£ million)

Underlying value of construction projects starting on site. (Excludes individual projects of more than £100 million and framework agreements).

London is well placed to enjoy a continued strengthening in construction over the next eighteen months. Nationally, we are forecasting an increase in the value of office and private housing building over the next two years. London is likely to enjoy a good share of this growth.

The housing market in London is much more buoyant than elsewhere in the country, with average house prices increasing at a faster pace. In addition, office development is likely to be focussed in prime locations and so will not be spread evenly across the UK.

During the slump in private sector building, London benefitted from government funded construction in Olympic projects and infrastructure schemes. While the Olympic building is all complete, there will continue to be significant investment in the rail network in London and the South East of England.

We forecast that London will see an 11% increase in the underlying value of project starts this year, with further increases in 2013 and 2014.