Investment in residential, commercial and infrastructure projects in several areas of Great Britain is expected as part of Phase 1 of the HS2 high-speed rail line project connecting London and the north of England, a report is suggesting.
It said that this would be where HS2 hubs are built, and five regions were said to be reaping the benefits of £7.2 billion (€8.08 billion) in contracts, including West Northamptonshire which saw a 200% increase in construction contracts awarded in 2017.
The Regional Construction Hotspots in Great Britain 2018 report was prepared by industry analysts Barbour ABI and the UK’s Construction Products Association, and it highlights the levels of construction contract values awarded in 2017 across all regions of Great Britain.
Hotspots and coldspots identify the areas where contract awards were significantly above or below previous years, highlighting pockets of activity or contraction.
The regions that have been awarded contracts for five new or redeveloped railway lines and tunnels are Haringey and Islington in London; Hounslow and Richmond upon Thames, also in the Greater London area; Birmingham; Warwickshire; and West Northamptonshire.
It was felt that the new sites and related infrastructure such as stations would be used as a tool to unlock development in wider housing and commercial projects, falling in line with the government’s strategic objectives in the Housing White Paper to increase housing provision around key transport hubs.
City centres on the route are said to be taking advantage of the new connectivity already, including two 2017 residential contracts in Birmingham – the £77 million (€86.41 million) Bristol Street project, and the £50 million (€56.11 million) Selly Oak development.
Birmingham was also found to have received more commercial investment than the other regions on the route, as well as coming top for infrastructure investment with more than £2.8 billion (€3.10 billion) of work awarded.
In 2017, the transport hubs triggered housing hotspots in Haringey and Islington – with £100 million (€112.16 million) of housing contracts – and Hounslow and Richmond with £76.5 million (€85.80 million).
Commercial investors have also been attracted to Northampton with a £30 million (€33.65 million) contract awarded for Four Waterside, which will form part of the region’s new enterprise zone.
Michael Dall, lead economist at Barbour ABI, said, “The sheer size of the HS2 contracts will have a transformational impact on the amount of infrastructure work over the coming years, and will also create associated residential and commercial construction opportunities.
“The commercial sector in particular has been challenged since Brexit (the UK’s decision to leave the EU) so it will be interesting to see whether the HS2 development provides a boost to this sector.”
Construction Products Association senior economist Rebecca Larkin said, “The first contract awards for work on HS2, a project costing £55.7 billion (€62.46 million) in total, will shore up confidence for investment into the long-term regeneration of towns and cities along its route.
“As the first city stop on the route from London, Birmingham has been a construction hotspot for two years, and illustrates the potential for infrastructure improvements to unlock projects in the residential and commercial sectors as well.”