Regional funding pledges and steady price forecasts expected to deliver Midlands' construction boost - report shows
An acceleration of priority construction projects is expected in the Midlands as the latest Construction Market Intelligence (CMI) report from global property firm Rider Levett Bucknall shows the Autumn Budget has had minimal impact on tender price forecasts.
According to the independent construction and property consultancy business, which has an office in Birmingham, several funding announcements present opportunities for renewed momentum in the Midlands - despite the national picture for new work seeing only modest improvement in 2025.
A £500m Mayoral Revolving Growth Fund for the North and Midlands, an £820m Youth Guarantee scheme, supporting future skills pipelines, and a share of the £13bn integrated settlement funding for the West Midlands, aimed at boosting housing, employment, and regeneration, have the potential to accelerate key regional projects, including Birmingham’s proposed Sports Quarter, as well as unlocking further development across health, industrial, education and housing sectors - RLB's latest report shows.
Tom Caesar, an RLB associate based in its Birmingham office, said: “The Autumn Budget may not have delivered major surprises, but for the Midlands there are clear positives. The integrated settlement funding and additional contributions to the Local Growth Fund and Mayoral Revolving Growth Fund give Birmingham and the wider region a platform for renewed progress.
"RLB expects this to support an acceleration of priority schemes such as the new Sports Quarter, as well as strengthen the pipeline for social and affordable housing. Additional NHS capital allocations should also bring opportunities to invest in and modernise existing estates.
“The challenge now lies in the pace at which these funds are released. With the Budget finalised, developers at least have a clearer picture, even if it isn’t everything they hoped for. Market conditions remain tough, and careful delivery will be essential to maintain balanced risk and ensure schemes remain viable.”
RLB’s CMI shows no movement in Midlands tender price inflation, with forecasts for 2025 remaining the same at 3 per cent and forecasts for 2026 remaining the same at 3.5 per cent.
Across the UK, near-term market conditions remain challenging as rising input costs, including higher wage rates, continue to place pressure on contractors and outpace tender price movements.
RLB’s CMI shows marginal movements in national tender price inflation with forecasts for 2025 seeing a slight uplift from 3.03 per cent to 3.17 per cent, and forecasts for 2026 easing marginally from 3.41 per cent to 3.27 per cent
