Featured Sector: Retail

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

Retail construction has seen its prospects closely follow that of the wider economy. After the financial crisis three years ago, retail construction was badly hit: the underlying value of project starts almost halved between 2007 and 2009.

However, since the economy exited from the recession at the end of 2009, retail has seen a resurgence in building. Over 2008 and 2009 a lack of available finance and diminished consumer confidence hit retailers and retail construction. However, conditions improved last year, as retail became one of the fastest goring sectors in the construction industry.

Fuelling much of this growth was expansion by leading supermarket chains; Tesco and Sainsbury’s in particular. Over 2010, supermarket projects accounted for 66% of the underlying value of retail construction starts, compared with just 31% during 2007.

The retail sector has, by and large, continued to see the growth experienced over 2010 during the last year, albeit at a slightly reduced rate. Again, this is largely due to supermarket building, with huge investment in new premises around the country by the largest chains. However, according to Glenigan figures, there was a new emphasis on refurbishment and extension.