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A round up of the sector's biggest news
8 December 2021
It’s been a busy few months for the Construction & Built Environment Sector and here is our round up of some of the biggest news to hit the sector in recent months…
Construction activity slows after supply issues and staff shortages
As feared, the construction sector lost momentum last month as supply chain disruption and staff shortages put pressure on costs and rising prices weighed on demand.
The unpredictable pricing environment had slowed clients’ decision-making on new orders and led to delays with contract awards.
Architects remain optimistic although concern over escalating inflation
The Royal Institute of British Architects (RIBA) Future Trends survey in October revealed architects remain optimistic about future workload, but that optimism’s softening in the face of external pressures.
In October, workloads were 7% up on a year ago.
On balance, all regions and practice sizes remain confident about future workloads, although confidence has dipped in London and among small practices. Both the Housing and Commercial sectors continue to expect expanding workloads but the Public and Community sectors remain weak. Supply-side constraints on workload show no sign of abating. Shortages of materials, tradespeople, contractors and (for those seeking to recruit), architects are putting a brake on project delivery.
But the institute’s Head of Economic Research and Analysis Adrian Malleson said “practices were increasingly having to deal with growing inflation as the cost of materials and labour headed north”.
Practices in the capital are more worried about gathering storm clouds than those elsewhere in the country
He added: “Shortages of materials [and] tradespeople is fuelling project cost inflation, making estimating and managing project costs exceptionally challenging. There’s a growing concern that a prolonged period of general inflation may come, threatening the economic recovery, reducing overall confidence and dampening client demand.”
Post-Brexit material certification changes should be ‘pushed back’
Construction chiefs warned ministers last month that a Brexit-related switch in product certification processes could delay thousands of projects, and hamper attempts to tackle the housing crisis and climate change.
The Construction Leadership Council (CLC) wrote to business secretary Kwasi Kwarteng and housing secretary Michael Gove to demand urgent action to ease the adoption of the UK Construction Products Regulations (Amendment etc. and EU exit). It warned that glass, fire-protection material and sealants might fail to receive new certification to enable them to be sold in the UK.
The new law will require certain products to have a UK Conformity Assessed (UKCA) marking to be sold in Great Britain after 1st January 2023, which requires testing to be carried out by an accredited body.
CLC Co-chair Andy Mitchell told Gove and Kwarteng that this would be difficult to achieve due to a lack of testing capacity.
“Our main cause of concern is that for a significant range of construction products there is limited or no capacity for these tests to be carried out in line with the regulations,” he wrote. “Unfortunately, this expansion of capacity isn’t happening quickly enough.”
The UKCA standard was meant to take over from the existing CE standard from 1st January 2022, but in August the government pushed back the transition to 2023.
Foster & Partners sold to private investor
Canadian family investor takes ‘significant’ interest in practice founded by Norman Foster in 1967.
Foster & Partners has been bought by a Canadian private investor for an undisclosed sum.
Britain’s biggest architect, with 1,500 staff in 13 studios, announced that a “significant” stake had been acquired by Hennick Company.
The Toronto-based family firm will have the biggest shareholding, with Norman Foster and his family the next biggest stake.
RIBA president welcomes COP26 pact – but calls for ‘meaningful action’ from government
RIBA president Simon Allford welcomed the Glasgow Climate Pact following COP26 but said ‘it’s what happens next that really matters.’
Following weeks of negotiation at COP26, almost 200 countries agreed to ‘phase down’ the use of fossil fuels and revise their targets for reducing greenhouse gas emissions so global warming could be limited to 1.5°C.
“Importantly, the pact also requires governments to ‘revisit and strengthen’ their 2030 targets by the end of next year – we must welcome that. But ultimately, these are words on paper. It’s what happens next that really matters.”
“In the UK, we’ve got to make the Future Homes and Buildings Standards more ambitious. This includes setting actual energy and embodied carbon targets and introducing a national retrofit strategy to improve the energy efficiency of our existing homes.
There can be no delays or excuses. The pact leaves the door open to limit global warming to 1.5°C, but without meaningful action, it won’t remain open for long.”
ZAHA HADID ARCHITECTS BECOMES LATEST ARCHITECT PRACTICE TO MOVE TO AN EOT
The Top 3 AJ100 practice announced last week that they had moved to an Employee Ownership Trust (EOT).
The 42 year old company, which has 500 global employees, said its new structure meant it had no external shareholders, enabling all profits to be reinvested back into the company.
A growing number of UK architect practices including Make, Hawkins\Brown and Allford Hall Monoghan Morris (AHMM) have converted to employee ownership. Read more here.
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