In the Republic of Ireland, the volume of projects On-site in the first 9 months of 2017 has fallen by 5% or 116 projects when compared to the same period in 2016. All regions, with the exception of Leinster and Connacht have fallen in volume terms. The value of these On-site projects is down 9.4% to €4.7 billion with Leinster, Dublin and Ulster ROI all experiencing sharp decreases in activity, while Connacht and Munster recorded increases.
The Residential sector now represents over 30% of the value of projects On-site. According to our research, almost 11,300 units in multi phased developments commenced On-site in the first 9 months of 2017. This represents an increase of 26% on the same period last year. Significantly, Dublin has shown a very small fall in the number of units On-site in the period, with Leinster recording an increase of 89% in the volume of units for the period. Dublin is still the largest region in volume terms but Leinster commenced just 300 units less in the period. When we drill down into the Leinster data, both Meath (1420) and Kildare (1310) have the majority of the units commenced followed by Louth. (Of note:- a further 2,895 self-build houses have commenced building in the first 9 months of 2017).
On-site activity in the Industrial sector has remained almost static at 163 projects commencing during 2017, with 162 in the same period in 2016.
Looking at Civil & Utilities only 128 projects went On-site in the period under review, down 28% on 2016 and the value of these is just €300 million (incl. Transport) for the first 9 months of 2017, down from almost €1.3 billion in the same period last year. This can be attributed to the €455 million M11 Gorey to Enniscorthy and €220 million N25 New Ross Bypass road schemes which commenced in 2016.
The €220 million N25 New Ross Bypass road scheme
The Medical & Care Residential sector recorded a decrease of 19% or 109 projects (of which 32 are Care Residential) in the number of projects beginning construction in the first 9 months of 2017 when compared to the same period last year. However the value of these projects increased to over €455 million, a 73% increase on 2016 levels. This can be attributed to the three large schemes commencing On-site this year including the €125 million National Forensic Mental Health Facility in Portrane, the first phase (valued at €40 million) of the National Rehabilitation Hospital redevelopment in Dun Laoghaire and the €64 million extension of the Bon Secours Hospital in Cork.
The €64 million extension of the Bon Secours Hospital in Cork
The volume of projects in the Commercial & Retail sector decreased by 16%, to 396 from 474 in the same period last year. In project value terms, On-site commencements in the first 9 months of 2017 were down 5% to €735 million on the comparative period in 2016. All regions have experienced decline, while Dublin has recorded the largest decrease – 14% to €470 million. This can partly be attributed to a number of large commercial developments in Dublin Docklands having commenced On-site in the first 9 months of 2016, including the €100 million Reflector development and €65 million City Quay development.
The volume of Educational projects going On-site fell to 302, down from 325 in 2016. Connacht was the only region which showed positive growth in terms of volumes with 52 projects starting, up from 46 in 2016. CIS estimates that over €288 million worth of projects have moved On-site in the first 9 months of 2017. This represents a decrease of 19% on the same period in 2016.
In the Hotel & Catering sector the volume of projects On-site is static at 192 projects (versus 193 in 2016). Only Munster has shown growth in the period under review by volume.
The Community and Sport sector continues to underperform as only 142 projects started On-site in the first 9 months of 2017, a 37% drop on 2016 levels. In value terms, only €122 million in projects have begun construction in the last 9 months, down 32% on 2016 levels. The only region to experience growth was Connacht, up 22% on 2016.
The €65m Curragh Racecourse Development at On-Site Stage in Co. Kildare
Agriculture recorded an increase of 33% in the number of projects moving On-site on the same period last year. The value of projects is estimated at over €100 million with all regions showing positive growth with the exception of Leinster.
Looking at the pipeline for the construction sector, the volume of projects granted planning is also down by 7% on the same period last year with 4,155 major projects granted planning in the period under review compared to 4,468 in 2016. In continuing trends from H1 2017, the value of plans granted has fallen by 23%. All sectors have experienced a decrease in the value of projects granted planning with the exception of Hotel & Catering which is up 17% and Residential which is up 27%. The greatest drops have been in the Medical, Commercial and Community & Sport sectors.
However, the volume of projects submitted for planning increased slightly by 4% to over 5,220. This increase of 200 projects equates to an increase of project values of over €400 million. The volume of projects has fallen in the Connacht and Munster regions while all other regions have shown an increase from the same period in 2016. The value of projects submitted for planning in the first 9 months of 2017 is down slightly in comparison with the same period last year. Residential is worth almost €2.75 billion in projects submitted for planning, an increase of 27% on the same period in 2016. The growth of the Residential sector masks the decrease in value of projects in the Agriculture, Civil, Commercial, Education and Industrial sectors.
Overall activity in the sector remains strong and is set to continue, having built up momentum during 2015 and 2016 across all sectors. However, as our research demonstrates when a comparison is done on a year-on-year basis, activity has plateaued in volume terms at On-site and Plans Granted stages, while the scale and type of these projects has led to an overall decrease in project values.