Monday, October 15, 2018

Construction in the Higher Education and Student Accommodation Sector - 5 Key Facts

  • Current forecasts are for a substantial increase in capital investment, at over £17.1bn this is around 60% higher than the previous 4-year average.
  • In 2013, the private sector formed around 39% of supply, but in 2016 this increased to over 46%.
  • Only 18% of students are currently catered for in university-operated halls.
  • London is the most undersupplied area in the student property market.
  • The outlook for investment in higher education facilities and student accommodation remains positive, as student numbers expected to increase and demand is rising for higher specification facilities.
These facts have been extracted from AMA Research's 'Construction in the Higher Education and Student Accommodation Sector Report - UK 2018-2022' available for purchase now. 


Friday, October 12, 2018

Contract Floorcoverings Market - 5 Key Facts

  • Contract floorcoverings sales have grown steadily by 12% over the last 4 years.
  • The contract sector currently accounts for around 50% of the total floorcoverings market.
  • Sales of contract vinyl floorcoverings are estimated to have increased by 7% between 2015 and 2017.
  • Modular flooring, such as carpet tiles and LVT products, are becoming an increasingly prominent feature of the market.
  • Commercial buildings, including offices, are the largest end use sector, accounting for 24% of the market.
These facts have been extracted from AMA Research's 'Contract Floorcoverings Market Report - UK 2018-2022' available for purchase now. 


Thursday, October 04, 2018

Plumbers’ merchants market in the UK worth over £4.2bn


The plumbers’ merchants market was worth an estimated £4.2bn in 2017, representing growth of around 2% from 2016. The overall trend in recent years has been positive, and early indications for 2018 are for a continuation of the modest recovery experienced from Q3 2017 onwards, although there is still a degree of restructuring activity, as major players adapt to changing conditions and slowing growth in some key end use sectors.
Although the plumbers’ merchants market has experienced 5 years of growth since construction output recovered in 2013, there has been considerable variation in the rates of growth between the various end use sectors. Sectors that have been strong include housebuilding, while residential RMI activity, a significant sector for plumbing & heating materials, has been more modest. Some non-domestic sectors, such as infrastructure have remained positive, but in the education, commercial offices and healthcare sectors there was an overall fall in output in 2017.
Expectations are for more modest annual rates of growth to 2022, for both new construction and non-residential RMI. Skills shortages remain critical and are a major concern in the plumbing and heating sector, with the skills gap said to be one of the biggest threats facing the UK’s plumbing industry.
The plumbers merchants’ market, which comprises national, regional and local merchants, is dominated by four major merchant organisations, which together account for an estimated 65-70% share, in value terms. These firms operate via a number of subsidiaries, each supplying a range of plumbing and building products.
The main competitors for the merchants are the home improvement retail and specialist outlets, as well as manufacturers and suppliers that deal direct with the construction trade. There has been strong competition from alternative suppliers, particularly online companies, retail outlets and DIY multiples, which is being driven by a shift in customer buying behaviour, with online shopping via PCs and laptops - as well as via mobile phones and tablets - becoming increasingly popular among tradespeople.
Some of the major nationals have responded to recent challenges in the plumbing and heating sector by restructuring and streamlining their operations, which has led to a number of branch closures, as well as the opening of new, more efficient outlets, enhancement of online and/or multi-channel offerings and a stronger focus on digital technologies. This focus on e-commerce has helped to offset some of the shift to internet-only distributors.
Prospects for plumbers’ merchants are relatively positive, although current political uncertainties surrounding the UK’s exit from the EU and the consequences in terms of trade, business investment and the availability of skilled labour are already affecting growth, and will continue to do so in the short to medium term. While construction activity and output levels will continue to increase, the rate of growth is expected to fall and remain relatively modest to the end of the forecast period.
A stronger focus on energy efficiency and water saving will continue to drive growth in the plumbing and heating sector, providing new opportunities for merchants, and a growing number of merchants have already expanded their ranges to include renewable energy and sustainable heating products as well as water saving solutions. Ongoing changes to building regulations will also boost demand for higher specification products.
The 'Plumbers Merchants Market Report - UK 2018-2022' report is available now and can be ordered online at www.amaresearch.co.uk or by calling 01242 235724.

Wednesday, October 03, 2018

Facilities Management Outsourcing - Central and Local Government Sector - 5 Key Facts

  • In 2017, Facilities Management outsourcing in the central and local government market was estimated to be worth over £4.3bn.
  • Social housing accounts for 45% of market value.
  • The total running cost of the central government mandated estate in 2015/16 was estimated at over £2.5bn.
  • The housing associations' stock has generally been rising over the last few years, increasing 6% between 2012 and 2016.
  • The UK FM market is fragmented in nature, with the leading 5 operators only accounting for an estimated 35% of market value.
These facts have been extracted from AMA Research's 'Facilities Management Outsourcing – Central and Local Government Sector Report – UK 2017-2021 Analysis' available for purchase now. 


Tuesday, September 25, 2018

Modest growth forecasts for passive fire protection products in the UK


The UK market for passive fire protection products is estimated to be worth around £650m at manufacturers selling prices - excluding installation. The market has grown by around 2% in 2017, with forecasts for 2018 at a similar level. This follows good growth between 2013 and 2015, which represented a period of recovery for the overall construction industry, especially in the education, offices, retail and leisure sectors. The forecasts indicate a more subdued performance, with lower levels of construction activity anticipated as investor confidence has fallen, in the lead up to Brexit.
In terms of structure, the passive fire protection market is comprised of fire resistant doors, fittings and intumescent seals, cables, partitions and suspended ceilings, glass, structural protection and ductwork and damper systems. Fire resistant doors, fitting and seals account for the largest shares of the market, with around 60% of the total value.
Recent product innovations in the sector include; intumescent coatings with faster drying times, electronic fire door closers that are linked to fire alarm systems, and more flexible fire stopping pipe collars that allow a greater range of applications compared to conventional collars.
Key drivers, such as the regulatory aspects of the fire protection sector, are expected to remain unchanged in the short term, since the Hackitt Review into the Grenfell Tower disaster only covered high-rise buildings and provided no recommendations for immediate change in the technical aspects of Building Regulations. However, modifications are expected in the medium to longer term, and AMA Research also anticipates that there will be other implications for the wider industry, as manufacturers and specifiers alike seek to provide safer environments, possibly leading to positive growth by value.
Forecasts for the passive fire protection market in the medium-term are for modest growth in 2018 and 2019, with slightly higher growth levels by 2020. While the longer-term impact of Brexit remains unclear, investors are likely to remain cautious, and this has resulted in recent forecasts being less optimistic for overall construction sector output growth.
In the short term, activity in the non-domestic construction sector is likely to slow down, with more subdued growth of around 1-2% 2018-19. The overall market for passive fire protection products such as cable, glass, ceilings, partitions and doors, is dependent on the performance of key construction sectors, such as offices, industrial, entertainment, health and education.
In terms of output, new office construction is forecast to be less positive over 2018-22, following strong output growth of 70% between 2013 and 2017, something which may impact on demand in sectors such as structural fire protection, suspended ceilings and partitions.
However, the hotel and entertainment sector has shown good growth in recent years and is attracting substantial investment, especially in the budget sector. The university sector has also been positive in terms of new orders in 2018, with future output having the potential to be boosted by demand for new accommodation and facilities for additional students following the removal of the cap on student numbers.
Uncertainty regarding Brexit is expected to have less of an impact on residential construction, where the outlook remains modestly positive, driven in particular by the ongoing imbalance between demand and supply for new housing. Increasing numbers of new flats and apartments built will be the primary source of demand for passive protection in the residential sector.
Other factors influencing the market include the performance of Sterling against both the US dollar and the Euro. Since the 2016 Referendum, Sterling’s fall in value and continued relative weakness has meant that materials price inflation has become a key influence in the UK construction market. If this situation continues, it will prompt some value growth in the passive fire protection sector, since a wide range of materials and products is imported.
The 'Passive Fire Protection Market Report- UK 2018-2022' report is available now and can be ordered online at www.amaresearch.co.uk or by calling 01242 235724.

Door and Window Fittings Market - 5 Key Facts

  • The market for door and window fittings is estimated to have grown by 11% since 2013 but remains significantly below the pre-recession peak.
  • Locks and latches represent the largest product sector, accounting for around 30% of market share.
  • Low cost imports continue to limit value growth in some sectors, with imports of door and window fittings up 16% between 2013 and 2016.
  • The residential sector accounts for over 60% of market value.
  • In 2017 we estimate that the share of ironmongery distributed through door and window fabricators has increased to over 40%.
These facts have been extracted from AMA Research's 'Door and Window Fittings Market Report - UK 2018-2022' available for purchase now. 


Monday, September 24, 2018

29% growth in the UK generator hire market since 2014


The market for diesel generator hire, which according to AMA’s definition excludes ancillary products, has performed well in recent years, having experienced growth of 29% from 2014. Over this period, the market has benefitted from increasing demand across most many application areas including construction, events, infrastructure and industrial. Other drivers include rising power demand in several sectors, such as events and industrial, as well as ‘critical’ applications requiring more secure back-up support.
The generator hire market is part of the larger construction equipment rental market that includes products typically hired out by plant and tool hire companies, such as earth moving, lifting, pumping, road-making, power and tools. It is estimated that the generator hire market accounts for only around 2% of the overall construction equipment rental market.
Opportunities in the generator hire market range from very large and infrequent situations to very small & recurring events. High value, one off sources of demand include major entertainment events and natural disasters; whilst other application areas include temporary construction usage and the need for power while a company’s own equipment is repaired.
Construction is a key end-use sector, and accounts for around one third of the market. Generators are required in a number of applications, such as for powering site cabins and welfare facilities, as well as powering pumps, lighting, crushing plant, tower cranes and tools & equipment etc. Generators are often one of the first pieces of equipment to arrive on site and the last to leave.
The industrial sector is the largest non-construction sector and the second largest overall, with demand driven by sectors such as manufacturing, refining & processing, recycling & waste, and data centres. Infrastructure and events are also important sectors for generator hire, each accounting for a significant share of the market. Further demand comes from the public sector as well other sectors including extractive, agriculture, commercial, retail and landscaping.
By volume, generators with a rating of 21-350kVA hold the largest share and account for close to half of the market, with generators up to 20 kVA having the second largest share at around a third of the market. The former are typically used in construction and events as well as in small offices, industrial units or hospital departments.
In terms of distribution, the market continues to be dominated by large, national multi-branch organisations that have expanded through a combination of organic growth and acquisition. In addition, a wider range of outlets including builders’ merchants, DIY multiples and garden stores now offer a hire service. Generator hire is also offered by both plant hire and tool hire companies, with the former focusing on larger generators with a higher generator rating and the latter focusing on smaller generators, typically up to around 20-25 kVA. Specialists can offer generators with a wider range of power ratings, up to around 2,000 kVA.
Prospects for the generator hire market into the medium-term remain relatively optimistic with the market forecast to experience annual growth rates of 4-5% following a slightly smaller increase of 2% in 2018. Going forward, construction sectors likely to be the main drivers of growth in the next 3-4 years are housing, infrastructure and entertainment & leisure.
The effect of the ‘Brexit’ negotiations on levels of confidence and investment remains the biggest risk factor to business confidence, which, if it falls further will have a direct effect on project starts. Additionally, any slowdown in non-construction activities, such as manufacturing or events, will negatively impact market value.
The ‘Generator Hire Market Report - UK 2018-2022’ report is available now and can be ordered online at www.amaresearch.co.uk or by calling 01242 235724.

Thursday, September 20, 2018

Over 20% growth forecast for the UK kitchen & bathroom worktops market over the next five years


There has been good growth in the domestic kitchen and bathroom worktops market in recent years. Between 2014 and 2017, the UK overall worktops market is estimated to have grown by 13%. The worktops market has performed fractionally better than in the kitchen furniture and overall bathroom markets over the last few years, reflecting a shift to higher value worktops and a trend for larger worktop areas, such as islands and peninsulas with waterfall worktops.
Kitchen worktops account for 95% of the overall domestic worktop market. Value growth has been slightly higher in the worktops market than in the overall kitchen furniture market, reflecting a slow shift to more expensive materials such as granite and solid surface, following the relatively buoyant economic conditions over the last five years. This trend is continuing, and it is expected that value growth in the worktop market will be slightly ahead of the wider kitchen furniture market in the medium term.
The bathroom worktops market has followed a growth pattern similar to the bathroom furniture market, mainly due to a lower level of separate worktop replacements in this sector compared with the kitchen sector. Overall, the bathroom worktops market has grown, due to factors such as the increasing popularity of bathroom furniture, but as for kitchen worktops, the market has also benefited from the use of more expensive materials, including quartz, solid surface and granite surfaces, and features such as worktops with integrated basins.
Laminates continue to dominate the kitchen worktops market, making up just under half of all kitchen worktops installed by value, and almost 75% by volume. However, the share of laminates has declined notably in recent years, something which has been accelerated by the development of stone and engineered stone products for worktops in bespoke installations.
In the bathroom worktops sector the material mix is somewhat different. Laminates still dominate this market, making up over 60% of material used in terms of value, followed by solid surface and composite materials, whose shares has increased partly because of their flexibility in structure. The rest of the market is made up by stone and other materials, but so far, stone has not made the headway in this sector that it has in the kitchen worktops market.
The UK kitchen worktop supply chain is complex, with builders and plumbers’ merchants accounting for the largest distribution share by value. This channel has grown significantly in recent years followed by the retail kitchen specialists, while the DIY multiples sector has lost some market share. The sale of kitchens with installation included is likely to continue to increase, with many large suppliers now promoting this service.
Within the bathroom worktops market, builders and plumbers’ merchants are also the major distribution channel, followed by bathroom equipment specialists and DIY Multiples. One of the major differences between the kitchen and bathroom worktops sectors is that within the bathroom sector a larger proportion of worktops are incorporated into the furniture itself.
“The market for kitchen and bathroom worktops is expected to achieve reasonably good growth and is forecast to increase by 21% in value terms between 2017 and 2022, although the volume and price of imported materials is expected to account for a proportion of that increase” said Hayley Thornley, Market Research Manager at AMA Research.
“Kitchen worktops are expected to account for around 15% of the total kitchen furniture market by the end of the forecast period.”
The Domestic Kitchen and Bathroom Worktops Market Report - UK 2018-2022 report is available now and can be ordered online at www.amaresearch.co.uk or by calling 01242 235724.

Tuesday, September 18, 2018

Social Housing Construction & Maintenance Market - 5 Key Facts

  • Housing Association completions were down by around 3% in 2016-17.
  • Around 68% of social housing completions in 2016-17 were for affordable rent, an increase of around 40% on completions in the previous year.
  • Going forward, social housing completions are expected to increase by around 2% per annum to 2021-22.
  • Total expenditure on housing association repair and maintenance is expected to decline to around £2.8bn by 2022.
  • Under the London Affordable Homes Programme 2016-2021, the Greater London Authority has secured £3.15bn to start building at least 90,000 new affordable homes.
These facts have been extracted from AMA Research's 'Social Housing Construction & Maintenance Market Report - UK 2018-2022' available for purchase now. 


Monday, September 17, 2018

Decline forecast for UK wall cladding market volumes


The UK market for wall cladding is estimated to have increased by around 40% between 2013 and 2017 in volume terms. In 2017/18, growth has been driven by strong growth in new build and major refurbishment output in the broader residential, commercial office, schools and universities, hotels & leisure facilities and warehousing sectors. However, in the retail and healthcare sectors and in certain segments of the leisure market, output levels have either declined or remained static. The forecast for 2018 is also for little to no growth.

Other than the state of the general economy and issues emanating from the ‘Brexit’ negotiations, it is the Grenfell Tower fire in 2017 that could have the greatest impact on the cladding market going forward. A possible ban on the use of combustible materials on buildings over 18 metres tall may well depress demand for cladding systems comprising rigid polymer insulation while benefitting those classified as A1 under Euroclass definitions e.g. stone and glass wool, concrete and fibre cement.
While investigations into other high-rise residential towers, with cladding similar to that installed on Grenfell Tower, have revealed that around 500 are similarly vulnerable to rapid fire spread, relatively few buildings have so far had the old ACM cladding replaced. With a number of local authorities and housing associations experiencing severe financial problems, that is unlikely to change in the near future.
Although modest annual economic growth levels are currently forecast to 2020, the medium-term outlook will be dependent upon the path taken to exit the EU and the type of trade and legislative deals formulated. As a result, our view is that demand for cladding will decline. Over the period ending March 2019, at the very least, the uncertainty created by the Brexit situation is likely to create more volatility in the construction market at large, which in turn will lead to a lack of confidence among property investors and business owners.
Other issues include a weakening of Sterling against the Euro and the US dollar, endemic problems concerning skills shortages in key areas, and the challenges associated with the changes to fire regulations and changed specifications for cladding products.
Other factors that are expected to contribute towards slower growth include the cutting or ending of subsidies for certain products and development programmes. For example, the government’s Energy Company Obligation (ECO) expires next April. A key driver stimulating demand for external wall insulation, it is likely that, as with previous government energy efficiency schemes, once ECO is complete there could be a large drop in demand.
The ‘Wall Cladding Market Report - UK 2018-2022’ report is available now and can be ordered online at www.amaresearch.co.uk or by calling 01242 235724.