Build values up €800m in first half of the year

The combined value of new construction projects, started during the first half of 2015, has grown 41%.

New data, published by construction research body, Building Information Ireland, shows that new build projects with a combined value of €2.75bn were started during the first six months of this year; just over €800m higher than the value for the corresponding period last year.

“The strong growth recorded in the first six months of 2015, in the value of applications as well as the value of project commencements, is further evidence that the construction industry in Ireland is continuing to recover,” said Building Information Ireland managing director, Danny O’Shea.

“When these figures, for the value of project commencements, are broken down for the different regions, the Building Information Index shows that the recovery in the construction sector is being felt across the whole of Ireland, with Munster recording the largest increase with gains of 116%, while Dublin (+34%), Leinster (+27%) and Connacht/Ulster (+8%) also performed strongly,” he said.

“Critically, the index reveals that the source of funding which is driving this recovery is coming from the private sector. Funding from the private sector for applications was €6.428bn in the first six months of 2015, which represented an increase of 30% when compared to the first half of 2014.

“By comparison, in the first six months of 2015, public sector funding for applications only increased by 2%, rising to €584m from €573m in the first half of 2014,” Mr O’Shea said.

It was a strong first half for planning applications, which in value terms rose by 27% to just over €7bn, on an annualised basis.

Regarding project commencements, the strongest performing area was commercial and retail, where the value of projects increased by 141%, on a year-on-year basis, to €624m.

The industrial sector also recorded strong gains, at 58%, while the residential sector recorded growth of 44%, year-on-year, with the value of construction projects started in the period valued at €1.43bn.

Education (down 37%), agriculture (down 12%) and medical (down 6%) all recorded a fall in the value of construction projects in the first half when compared to the same period last year.

While the most recent Ulster Bank Construction PMI showed that the sector’s growth slowed down in July, the industry on a whole extended its sequence of expansion to nearly two years in the month; with new orders, business activity and job hiring still on the up among respondent firms.