Planning & Construction Activity Gathering Momentum into 2022
Planning activity which includes planning applications submitted and granted, is a useful indicator of the overall health and direction of the Irish Construction Industry. In this month’s blog, we take a summary look at overall activity trends over 2020/2021 and see evidence of some positive trends emerging. For further more detailed analysis of these trends, click onto our Other Services dropdown and connect with our Construction Information Services partner homepage.
Republic of Ireland
In 2021, the overall value of planning activity, (plans submitted and plans granted), grew by 12% from 2020 to €38.5bn. This was a significant rise given that there had been a 3.7% fall in such activity in 2020. The biggest driver in these figures was the residential sector which represents 63% of all planning activity and grew by 13.7% in 2021. Other significant movements in pipeline activity were a 22% fall in hospitality and a 21% fall in commercial activity. The industrial sector, which includes warehousing and data centre, rose by 24% reflecting lifestyle changes exacerbated by the pandemic.
While the pipeline activity represents the mood and optimism of the economy, the progression to on-the-ground activity is not always certain. Looking at projects starts in 2021 (representing new project starts and excluding phase starts of ongoing projects), there has been a 26.7% rise in the value of projects starts which more than offsets a 12.5% fall in starts in 2020. Again, the residential and industrial sectors lead the way with 37% and 42% rises in the value of starts over 2020.
Great Expectations for 2022 despite supply issues
According to the latest BNP Paribas Real Estate, construction purchasing managers index, activity in Ireland’s construction sector has accelerated since the start of 2022. As construction activity grew across commercial, residential and civil works, the pace of growth appears to be strongest in the commercial sector. Given the number of projects already onsite, John Mc Carthy Head of Research and Director at BNP Paribas Real Estate Ireland, believes that 2022 will be the strongest year for Dublin Office completions since the global financial crisis. However, the report also noted that input costs have continued to rise and this together with supply chain issues are expected to continue during the year.
Contact Mr John Mc Carthy, BNP Paribas Real Estate for further information on their latest CPMI figures.
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