UK commercial activity continues to rise strongly in November

The index increased to +17.7% last month, up from +16.9% in October, meaning that expansion in the sector has now continued for 27 months. This was driven primarily by the private sector, although the net balance for the public sector also increased.

Industrial/warehouse topped the commercial activity rankings, while public retail & leisure was the worst performing of the surveyed sub-sectors.

Commercial developers in the UK signalled positive sentiment regarding prospects for commercial work over the coming three months in November. Despite this, the degree of optimism deteriorated to the weakest since mid-2013, with the net balance posting +14.0% (down from +14.4%).
 

Duncan Kreeger, director of West One Loans, said:

“Commercial activity remains robust and you only have to glance around most towns to observe a vista of cranes and construction. The rate of growth has tailed off slightly as we head towards the end of the year, but is still streets ahead of where we were a few years ago, so it’s important to focus on the positives. Private sector growth still underpins much of this overall improvement, although the rate of growth of public sector projects has also improved of late. Developers remain positive about the outlook for the coming months, although the strength of this confidence is beginning to waver slightly.

“London is once again leading the charge, with the South East and the rest of the UK posting more modest net balances. This is often the case and you can barely move in the City for construction vehicles at present, but it is encouraging that the rest of the UK is posting the quickest rate of growth. If commercial activity is to continue to rise across the nation then the capital can’t be solely responsible for future growth.”