Building industry has ‘overcorrected’ in slump

The construction industry is heading into recovery mode — but it will be patchy in terms of sectors and areas.

So says southern director of the Construction Industry Federation Joe O’Brien, in advance of a CIF-organised business breakfast

tomorrow morning which will look at the regional property market’s performance and prospects,

addressed by NAMA chairman, Frank Daly,.

“All the indications point to the fact that the construction industry has begun its long road to recovery,” notes Mr O’Brien pointing to a number of new projects in the pipeline locally and nationally and publicly and privately financed, with new FDI projects due to start in the Cork area in 2014.

He welcomed local plans for new high-spec office accommodation to attract FDI investment as “a great boost to attracting industry to the area”, and warned of a notable shortage of suitable housing in certain parts of the metropolitan Cork area which will be exacerbated during 2014.

With the value of the industry nationally slumped to under 7bn, from a height of 37.5bn in 2007, and employment down from 280,000 to less than 90,000, there’s now an acceptance that the industry has overcorrected, said Mr O’Brien, adding that European norms would indicate a steady industry here should be worth 15-19bn pa, and employ between 150,000 and 180,000.

Mr O’Brien said that despite a return of confidence, it would be a while before those “normal level” targets were reached and “even then the upturn will be patchy, and will vary from sector to sector and from area to area”.

Tomorrow’s CIF briefing with NAMA’s Mr Daly, starts at 7.30am in the Rochestown Park Hotel, Cork.