The return of the mega project helps value of construction schemes hit £74bn in 2015

 
Kasmira Jefford
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Renewable energy projects including wind farms made up a big proportion of construction contracts last year (Source: Getty)

Construction projects soared by £10bn in value last year to £74bn thanks to a resurgence in large-scale schemes.

The number of projects commissioned in 2015 decreased by 4.7 per cent year-on-year to under 12,000.

However, the total value increased overall as schemes grew bigger, with the average project value rising by 18 per cent to £6.2m, according to research from construction data firm Barbour ABI.

A large proportion of these so-called mega projects were in the renewable energy sector, including the £1.3bn Rampion offshore wind farm and the £1bn Thames Tideway Tunnel, dubbed the super sewer.

Transport for London also pressed ahead with £760m of tube upgrades across District, Circle, Metropolitan, Hammersmith & City lines.

This resulted in the infrastructure industry having a bumper year, increasing its total contract value by 47 per cent to £18.9bn.

A £200m contract to build 1000 apartments next to Media City in Salford Quays topped the list of the UK’s biggest housebuilding contracts last year.

The was followed by US private equity group Lone Star, which started £180m of work on the development of a 41-storey residential tower in Elephant and Castle, called Two Fifty One.

Other projects included Cain Hoy and Sager Group’s luxury development of a former Royal Mail sorting office in Islington, where £100m of work got underway.

Michael Dall, lead economist at Barbour ABI, said: “Confidence seems to have returned for many of the larger companies within the industry, who must have felt that the time was right in 2015 to start commissioning mega projects that should provide a boost to the industry for years to come.”

“However, the question remains as to whether the construction industry has the supply, principally skilled labour, to deliver on these contracts awarded in the timescales envisioned. Solving these supply side problems will be critical for constructions prospects in 2016 and beyond.”

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