- Survey finds businesses are generally positive, but see skilled workforce shortages and post Brexit uncertainty as main challenges
- Nearly half feel planning regulations negatively impact on their business
- Lower Thames River Crossing seen as key opportunity in the region
Confidence in the South East property and construction sector is high, according to the results of new research, carried out by leading law firm Thomson Snell & Passmore. It surveyed businesses from across the region that operate in the sector, including developers, construction companies, surveyors, banks and architects.
When asked ‘given the political developments in 2019, how confident do you feel planning ahead, compared with a year ago?’, nearly half of the 38 organisations that responded to the survey (42%) said they felt more confident, with a further 47% saying they felt as confident as a year ago.
Similarly, in responding to the question ‘how confident do you feel in the outlook for the property and construction sectors for 2020 and beyond?’ the vast majority (82%) said they felt either extremely or somewhat confident.
In terms of expectations for the residential property development market in 2020 and beyond, over three quarters of respondents (76%) predict either increased or sustained growth.
However, while confidence in the sector may be buoyant, businesses do have concerns. When asked what they see as the key challenges during 2020 and beyond, 68% said skilled workforce shortage, 66% cited post Brexit transition period uncertainty and 42% said access to and cost of materials.
Respondents also voiced concerns about planning rules. When asked ‘how do you feel current planning regulations are impacting your business?’ nearly half (47%) said they were having a negative impact.
When asked about key opportunities for the property and construction sector, ‘realisation of current pipeline opportunities’ and ‘infrastructure investment’ led the way, being cited by over half of respondents (55%). These were closely followed by ‘increased government spending’, which was identified by 47% of businesses.
On a regional level, the Lower Thames River Crossing and Ebbsfleet Garden City were seen as offering the greatest scope for opportunity locally, followed by Paramount Pictures London Resort. 51% of respondents also saw outlying developments associated with those major projects as providing significant scope for extra opportunities in the region.
Commenting on the results, Chris Whittington, Head of Construction at Thomson Snell & Passmore says: “It is really positive to see that confidence in the South East property and construction sectors is so high. After periods of uncertainty over the past few years, it is encouraging that businesses are now keen to move forward and embrace the opportunities present in the region.
“We have certainly seen this trend reflected in the types of work we are delivering for property and construction clients across the sector in the South East and beyond, and are looking forward to helping the sector continue to realise its potential and grow.”
Chris Kirby-Turner, Construction Partner at Thomson Snell & Passmore adds: “While it is fantastic that so many businesses from across the sector feel confident about its growth prospects over the coming year, key challenges still remain. In particular, this survey has highlighted ongoing issues with access to skilled workers, post Brexit transition, access to and cost of materials.
“The South East in particular undoubtedly offers huge potential to property and construction organisations, but they will need to ensure they have the right support and advice in place to help them navigate any challenges.”
The survey was carried out in January 2020. A full version of the results can be found here.