Australian is seeing continued strength in construction applications, with 2,210 new projects entered in the country’s construction work pipeline in November 2018, with a combined worth of $25 billion – nearly double the three-year median value.
Infrastructure projects continue to dominate new project work in both quantity and value, although apartments and units are a close second for quantities of projects, according to CoreLogic’s latest Cordell Construction Report.
“The number of new construction projects entering Australia’s pipeline was just below the yearly high of 2,292, which was recorded in October 2018,” said James Shang, CoreLogic commercial research analyst.
“Although the total estimated value of new projects is approximately 16 per cent lower than the yearly high, it’s a strong indicator of continued strength in construction applications.”
A stand-out infrastructure project is the Aerotropolis project in Western Sydney, which is described as a ‘game-changer’, the project has an estimated cost of $8 billion, accounts for 50 per cent of the total new project applications in NSW for November and is expected to create 200,000 new jobs.
Whilst the number of new project applications is strong, the picture for projects further down the pipeline and actually moving into construction is less positive. These projects have fallen for a third consecutive month – the impact from a tightening credit environment clearly extending beyond the residential market.
“The estimated value of projects shifting into the construction stage during November was just over $2 billion,” Shang said.
“Whilst this figure is 53 per cent higher than the recent low (in October), it’s actually low when you factor in the strong level of activity in new development applications and when compared to historic levels too.”
Civil engineering projects accounted for 52 per cent of those projects moving into construction phase, whilst 54 per cent of value for projects moving into construction was thanks to the commercial sector. Mining held the highest median project value at $4.15 million.
For detailed industry and state-wide analysis, including project specifics, head over to the CoreLogic website.