Featured Sector: Retail

Retail Construction (£ million)

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 value of underlying 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 recovery in building. Fuelling much of this growth was expansion by leading supermarket chains; Tesco and Sainsbury’s in particular. Over 2011, supermarket projects accounted for 60% of the underlying value of retail construction starts, compared with just 31% during 2007.

This good performance has carried over into 2012. Although retailers are still struggling in the weak economic environment, many resorting to heavy discounting, and supermarket firms have now reigned in their expansion programmes signalling and end to expansion in the sector for now.