The Week That Was - 15 December 2023
Welcome to The Week That Was, a round-up of key events in the construction sector over the last seven days.
Construction professionals failing to measure embodied carbon
A survey carried out by the Royal Institute of Chartered Surveyors ("RICS") shows that nearly half of construction professionals do not consider carbon measurements when selecting materials, despite growing enthusiasm for green schemes from occupiers and investors.
RICS considers that the lack of adoption of embodied carbon measurements could be linked to investors seeing the high initial costs as a hinderance to investing in green buildings. However, a third of construction professionals point to a lack of common standards and the lack of clarity around new UK energy performance certificate (EPC) standards for commercial real estate as a major outstanding issue.
For further reading, please see here. A copy of the RICS survey can be found here.
HS2 scale-back releases supply chain capacity
In a recent report, Turner & Townsend highlight the opportunities for real estate and infrastructure programmes to draw upon the supply chain capacity which has been released following the cancellation of the northern leg of HS2.
The report also highlights a number of challenges that the construction sector faces, including high interest rates, skills shortages and price volatility for materials, plant and equipment.
For further information, please see here.
Government grant to develop reactor technology
A US nuclear firm, Holtec International, has been awarded a £30m UK government grant to advance nuclear reactor technology. The funding aims to support the development of innovative nuclear reactor systems. The grant could facilitate research and infrastructure, fostering progress in the nuclear energy sector. UK Minister for Nuclear Andrew Bowie said: “As the Government that revitalized the UK nuclear industry, committing public funds to nuclear for the first time in a generation, we’re rapidly expanding our nuclear power capacity to move towards a cleaner energy mix and help deliver net zero. Today’s news represents a multi-million investment to develop cutting-edge technology which could transform how power stations are built by making construction faster and cheaper.”
Find further information here.
RAAC: over 100 schools likely require a complete rebuild
Over 100 schools are likely in need of complete reconstruction as a result of the reinforced autoclaved aerated concrete (RAAC) crisis, according to evidence given to the Education Select Committee by the Education Secretary, Gillian Keegan. The update followed further surveys of the school estate to identify the material, which was commonly used in buildings in the post-war era and about which safety warnings have been issued since 2018.
This raises concerns about the overall safety, functionally and compliance of these educational facilities. Gillian Keegan told the Select Committee on Wednesday that there will probably be only a “handful of more cases” cases identified, with surveys being conducted over the Christmas holidays.
Find further information here.
Knock on Wood
The Government is set to announce a timber-house-building roadmap to push for lower embodied carbon in the construction of England’s homes. The roadmap is set to be announced by the Government to drive lower CO2 emissions when constructing homes in England. An update is projected to follow COP28.
The objective of the roadmap is to ‘set out the current landscape and future potential for the use of timber as a sustainable construction material’. The Department for Environment, Food and Rural Affairs (Defra) has clarified that, in conjunction with the road map, a nationwide plan to boost wood production is in progress. The roadmap is expected to include caps on using materials that contribute to embodied carbon emissions.
In addition to the roadmap, the Government has pledged that it will work alongside the industry to reduce and measure embodied carbon in new buildings by 2025.
For further information, please see here.
Construction predictions for 2024
Whilst it has been a challenging year across all sectors in the construction industry, Allan Wilen, Economics Director at Glenigan UK, predicts that the industry will witness improvements in project starts across the board in 2024 and 2025.
Several factors contributed to a sharp decline in new projects starts over the past year, including: increased interest rates; high mortgage costs; and the cost-of-living crisis. Interest rates are likely to remain at similar rates during 2024, although weakened house prices and the rise of average earnings are projected to improve the affordability of housing steadily over the next few years. It is anticipated the knock-on effect of these factors will positively impact project starts for house builds during 2024 and 2025.
The last 12 months has seen a change in demand in the retail market and for office space, however adapting to new demands is predicted to drive new growth across both sectors.
For further information, please see here.
Authors for this week's edition: Charlie Underwood, Ella Crawley-Till, Nazia Mohammed and Olivia Bradfield
Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice. We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date. You should seek legal or other professional advice before acting or relying on any of the content.