Featured Region: London

London is the currently the largest region we are tracking for project starts and despite a marginal dip in the value of starts during 2012 it is still one of the most active for new construction activity. Project starts last year were still above pre-crisis levels and growth is expected to resume over the next two years.

In recent years the capital has benefitted from surges in private housing and office construction, indeed the region has been the driving force behind the surge in office project starts accounting for over half of total UK starts. The private housing sector has remained firm in the capital even as other regional housing markets have stagnated; during 2012 it was one of only a few regions that saw house prices increase.

While office and housing starts remained strong last year the region did see declines from some sectors, the education sector was the worst hit with underlying project starts falling by nearly half. Civils starts also fell as large declines in infrastructure and utilities projects dragged overall starts lower. Despite this weakness from last year we are forecasting starts to pick up over the next two years with growth in underlying starts accelerating during 2014.