Regional Construction Hotspots in Great Britain

There are clear hotspots for upcoming construction activity over the next 6-24 months in Great Britain, with hotspots outnumbering coldspots by two-to-one overall and seven-to-one for infrastructure, which continues the trend of infrastructure driving hotspot activity seen in previous reports. There were equal numbers of residential hotspots and coldspots in 2024, which reflects weakness in the housing market and house building activity, which reached a nadir at the end of 2023 and early 2024, before interest rates started to be reduced by the Bank of England. Residential coldspots were most prevalent in regions with higher house prices – London, the East of England and the South East, likely indicating that demand in these regions was most affected by the affordability of higher mortgage repayments.

There were no broad hotspots in 2024 – where contract awards in each of the three main construction sectors of residential, commercial and infrastructure, were significantly above the long-term average. In this year’s report, single-sector hotspots in residential, commercial or infrastructure were most common, although there were several reporting hotspots in two sectors of construction. Encouragingly, regions with single or double hotspots were spread across Great Britain. Moreover, hotspots outnumbered coldspots in all regions of Great Britain except Wales and the most hotspots were registered in Scotland, the East of England, and the South East.

Given the varying nature in the size of construction projects, construction hotspots may also show due to a single large project in one sector (see table below). Although these may be viewed as skewing results, they still represent a significant driver of regional growth and activity and were a key driver of hotspots throughout the country. These tend to be high-value transport or utilities projects in the infrastructure sector where contracts are awarded, but take time to build out – such as the Hornsea Project Three offshore wind farm, the Lower Thames Crossing and two projects for the Eastern Green Link 2. There was also a broader spread of construction sectors in the top ten in this year’s report – the Google data centre in Waltham Cross, the former ITV studios redevelopment into offices on the South Bank in London, as well as the Agratas gigafactory in Somerset.

In smaller sub-regions, single, large offices, retail and residential projects can also generate hotspots: two residential retirement complexes totalling over £100 million in West Malling and Tunbridge Wells underpinned West Kent’s hotspot status, for example.  

Construction coldspots featured only lightly across Great Britain. The fewest were registered in the West Midlands (one), the North East, Yorkshire and the Humber, the East Midlands and Wales (two each).