The education construction industry continues to face challenges with main contract awards and detailed planning approvals declining against both the previous quarter and last year, but project starts growing on the preceding three months and a year ago.

According to Glenigan’s June Construction Review, totalling £1,36bn, education work starting on site grew 3% on the preceding three months to stand 14% up on the previous year.

No major projects (£100m or more) started during the period, a decrease from the preceding quarter, but unchanged from a year ago.

And underlying education work starting on site (less than £100m in value) increased 35% against the preceding three months on a seasonally-adjusted (SA) basis and was 14% up on a year ago.

Education main contract awards decreased 18% against the preceding three months to total £980m, with the value remaining 40% lower than the previous year; while underlying contract awards decreased 28% (SA) against the preceding three months and by 40% against the previous year.

No major projects reached the contract awarded stage, unchanged on the preceding three months and the previous year.

Totalling £1.2bn, detailed planning approvals fell 7% against the preceding three months and last year.

However, major project approvals totalled £120m, an increase on both the previous quarter and last year when no major projects were approved.

Underlying project approvals fell 13% (SA) against the previous three months to stand 17% down against last year, totalling £1.08bn.

Types of projects

School project starts totalled £1bn during the three months to May and accounted for the largest share of education construction starts (74%), having grown 48% on the previous year.

Universities, on the other hand, fell 32% against last year to total £167m, accounting for 12% of the total value.

And college project-starts also experienced a weak period, with the value having fallen 3% against the previous year to total £135m, accounting for an 10% share of education work starting on site.

Regional variation

London was the most-active region for education project starts during the three months to May, accounting for a 25% share of the sector to total £337m, having increased 131% on last year’s levels.

Growth in the capital was accelerated by the commencement of the £74m Downderry Primary School development in Lewisham.

Yorkshire & the Humber accounted for 16% of starts in the sector and tripled against the previous year to total £219m.

The South East was the most-active region for detailed planning approvals in the education sector, accounting for a 21% share, with the value having grown 69% on a year ago to total £251m.

Key players

The report also provides details of the leading clients and contractors in the sector, with the Department for Education topping the client table, with 185 projects worth £896m, followed by Kier with six projects worth £129m.

The top contractors were Royal Bam (15 projects worth £575m) and Kier with 23 projects worth £466m.