The time taken to
get construction projects from planning approvals to a start on site has
widened by nearly 14% over the past five years according to Glenigan’s
construction market research.
The housebuilding
sector attracts plenty of criticism over the time taken between securing
approval and construction starting on site.
However, Glenigan’s
industry analysis suggests claims of
landbanking are unfounded. Instead, other sectors are taking far longer.
Over the past five
years, the median time for a project to go from an approval to a construction
start is 23 months. In 2012, this gap was 22 months but by last year the lag
had widened to 25 months.
Glenigan economics
director Allan Wilen said: “This research shows that while red tape has been
loosened to make planning permission easier, other factors are also part of the
reason for the gap.
“Concerns over the
economy and the time taken to negotiate a Section 106 agreement are also likely
factors, as is the Brexit vote, which was taken in 2016.”
That vote appears to
have influenced some sectors reliant on private sector funding, such as hotel
& leisure work and retail.
In the hotel and
leisure sector, the median time taken from an application being approved to
construction work starting on site has extended by nearly a quarter from 2012
to 2017, as operators sit on approved projects.
In the private
sector, the gap between a planning application gaining approval and retail
sector construction projects starting on site widened by three months between
2012 and 2017.
Retailers have begun
to rein in spending as consumers shift towards online shopping and away from
the High Street.
As a result, some
major grocery chains such as J Sainsbury and Tesco sold off land earmarked for
housing, which invariably involves re-submission of a new planning application.
Out of nine building
sectors monitored by Glenigan, the area with the biggest gap between planning
approval and construction work starting on site is the community & amenity
sector.
This sector has
suffered from years of cuts to spending at the local authorities, which make up
the key clients. Last year, the median gap between approval and construction
starting on site was 45 months.
A planning consent
lapses after three years. This suggests that swathes of projects in the
community & amenity sector are unlikely to be built.
The sector with the
shortest time lag is education, where the median time between projects gaining
consent and construction starting is 19 months.
However, even here
that time has lengthened since 2012, when the median time was 16 months.
The building sectors
to record a shortening in the gap between approval and construction starting
between 2016 and 2017 were offices, private housing and social housing.
That suggests that
the latest landbanking enquiry is likely to absolve the housebuilders again.
