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30th October 2012
Glenigan have now revised their long-term forecast and can offer an initial look at which sectors we think will be the growth areas for project starts next year. Overall we expect project starts in the UK to grow by 2% in 2013.
We expect the education sector to grow at the fastest rate, 18%, mainly because of the extremely low base that the sector has been taken to this year. The sector will benefit from the Priority Schools Programme that will provide a large amount of refurbishment and maintenance work after the lull in investment seen in the sector in 2012.
We also expect strong growth from the office and commercial sector, the sector is looking set to be our best performing in 2012 and we are forecasting this to continue next year with starts up 15% by the end of 2013. Commercial property and large office projects continue to be seen by overseas investors as a safe haven that provides stable long term returns at a time of so much uncertainty in financial markets.
Private housing, which continues to perform well as 2012 draws to a close will continue to do so next year. The sector has been the focus of a number of policy interventions including proposals to relax planning laws and measures to stimulate lending to individuals by the Bank of England. This combined with the chronic shortage of housing in the UK could see the sector towards making up some of the ground in getting back to pre-crisis levels of output by 2015.
Uncertainty is still hovering over the infrastructure sector, we are at this point in time forecasting a contraction in the sector next year, but that is highly dependent on if, when, and how the replacement for the PFI scheme is introduced. We suspect that even if an announcement is made towards the end of this year as expected, there will be little action on the ground in 2013 with regard to project starts.
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