Adam Posner, Associate Director of KPMG’s northern property and construction team, forecasts the North West’s property and construction industry is set to thrive in 2017, despite facing challenges. He said:

“Demand for housing across the North West remains high. This, combined with low interest rates, makes for a bright outlook for the residential construction market in 2017.

“Developers are already exploring innovative building practices and housing models to capitalise on this demand, with Private Rented Schemes (PRS) expected to gain considerable traction in 2017. For example, Allied London is commencing construction on three landmark towers in the St John’s district of Manchester in March to create 600 purpose-built homes and Peel Land & Property has just announced a £21m multi-storey PRS scheme within the Liverpool Waters development. These are just two of a very large number of projects underway in the North West.”

“There is also a healthy pipeline of commercial developments across the region. A great example is the extension of Bruntwood’s Citylabs concept on Manchester’s Oxford Road. The 250,000 sq ft development will provide high spec office and lab space for the city’s burgeoning healthcare technology scene. It’s clear that the North West is set to thrive. Elsewhere developments which depend largely on commercial demand could see a decline in demand as corporates continue to delay investment decisions pending clarity on Brexit.

“While the pipeline is strong, challenges do remain. The industry as a whole has suffered from an endemic skills shortage in recent years. To tackle this in 2017, firms across the North West need to make a concerted effort to retain the talent being nurtured in our universities and offer attractive, long-term opportunities for young people. Additionally, rising material costs, the fall in the value of sterling, and the political uncertainty throughout 2016 have all hit the construction sector hard over the last 12 months.

“It’s important to remember that amidst this macro-economic uncertainty, the fundamentals of business still apply. Demand remains high and contractors that look beyond political and economic instability, plan for the long-term and produce a high-quality product, with high-quality customer service will succeed.”