Here we go 2018!

Richard Davidson predicts what 2018 will mean for construction in London...

What a year 2018 looks like being!

We’ll get a clearer idea on the shape of Brexit and what it means for UK plc, and this greater certainty of our trading position post-Brexit will create new business confidence for construction to thrive on.

We should also see whether the Government’s focus on housebuilding in the recent Budget turns into reality. The London Mayor certainly wants it to happen, targeting 66,000 homes per year in the draft London Plan. That’s ambitious and will need London boroughs aligned to many of the exciting regeneration schemes emerging from developers across London.

With so much likely to happen that affects the construction industry, I’m making four predictions for 2018!

  1. The word is…quality!

With question marks over defects that have to be resolved after completion, I expect to see an increase in the scrutiny of the design, specification and construction phases. This will require a greater collaboration between all parties, to not turn a blind eye or pass the risk around.

I expect to see the rise of the quality inspector, employed on both sides of the contract divide. This may attract an initial cost premium, but it will pay dividends to the safety of the occupants, the quality of the buildings and the reputation of our sector.

  1. Build to Rent

With new investment coming from internal and foreign markets attracted by a maturing market place, I expect to see more political and legislative changes to support longer term rental agreements that underpin stability in the sector.

There’s a world of difference between the well-run, high quality rental experience provided by companies like Be Living and the unscrupulous landlords who have given the sector a bad-name in the past.

For builders, the rise of BtR will create more innovation in the product offering with off-site and factory processes normal. R&D expenditure to create better off-site manufacture, pre-assembled products and autonomous equipment will mushroom in 2018.

  1. Skills Changes

With increased demand and continued squeeze on labour, expect to see closer collaboration directly between employers and education providers – we will see contractors looking to secure their skills supply chain through a more diverse education and skills offering. With Brexit looming large, expect more clarity on the rights of EU workers in the UK as they are the lifeblood for construction; I expect free movement of labour to continue for our industry!

  1. Rise of Local Housing Companies

With approximately 50% of the 353 Local Authorities now having formed Local Housing Companies and of these 65% being directly involved with housing delivery we expect to see many more considering their position on this during 2018.

As well as providing additional, much needed new housing, the local housing company plays a role in placemaking whilst producing a financial return for the authority.

The growth will stimulate a welcome growth and stability to the marketplace. I expect to see earlier engagement between funders, developers and contractors – starting at business case stage - and leveraging the power of each organisation to mitigate risk.

Richard Davidson is director (new business) for Willmott Dixon in north London and Northern Home Counties