Healthcare construction - a market overview


The very-latest construction figures explained - what does this mean for the healthcare industry?

The volume of healthcare construction projects increased in February, despite overall activity showing a decline over the past two years, industry experts have revealed.

Barbour ABI’s March issue of its Economic Construction Market Review, showed that, across the construction industry as a whole, the value of building contracts awarded in February 2018 was £4.9billion, with London topping the regions with 24.8% of activity.

While the value of contract awards was down by 9.1%, following an unturn in January; the actual number of projects increased by 3.1% and was 3.4% ahead of February 2017.

The residential sector came out on top, with a 40% share of contract awards in February, followed by the commercial sector at 16% and retail at 14%.

And, while medical and health projects made up only 3% of overall activity; the number of contract awards increased by 17.3% in February this year, compared to January – standing at £148m – up by 15.7% on February 2017.

But, in three months to February 2018, the value of contracts was £375m – a decrease of 13.8% on the previous three-month period and 2.7% lower than the quarter ending February 2017.

London saw the most activity overall and in the healthcare sector

London saw the most activity overall and in the healthcare sector

While overall figures have been on upward trend since December 2017; values for February 2018 remain around 38% lower than in 2016.

In the medical and health sector, just one project appears in the overall construction top 10 – the £90m development of the Dovehouse Street extra care facility in Chelsea.

Awarded to Knight Build; it will deliver a 55-bed facility including a café, hairdressers and landscaping.

A smaller £17.5m mental health unit and inpatient facility is also proposed at St Ann’s Hospital in South Tottenham.

Awarded to Integrated Health Projects, a joint venture between Sir Robert McAlpine and Vinci; it will provide four new inpatient wards with a floorspace of 2,300sq m.

After London, the South East has the second-largest share of contract wins, including an £8.5m minor works programme for the Milton Keynes University Hospital NHS Trust.

The contract has been awarded to Galliford Try Construction Central under the Procure 22 programme and will see a series of improvements, refurbishments, reconfigurations and upgrades undertaken over a five-year period.

In terms of type of project, public hospitals accounted for the largest share of contract awards in February at 33%, an increase of 16% on February 2017.

Hospices, nursing and psychiatric homes were the second-largest sector with 27% of activity, which compares to 40% in February 2017.

This was closely followed by surgeries, health and medical centres with 25%, a 2% decrease on February 2017.

Most of the spending was in public hospitalsSign up for your free email newsletter

Most of the spending was in public hospitals

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