Detailed planning approvals decreased against both last year and the previous three months. More positively, main contract awards grew on the preceding quarter while project starts increased on a year ago, providing a boost to the development pipeline.
Health overview
Adding up to £969m, underlying health work starting on site (less than £100m in value) during the three months to March fell 13 per cent against the preceding three months on a seasonally adjusted (SA) basis to stand 26 per cent up against the previous year. There were no major projects (£100m or more) starting on site, a decline against the previous quarter and last year. Overall, health starts slipped back 4 per cent against the previous quarter but increased 9 per cent on a year ago.
Totalling £1.036bn, health main contract awards were up 39 per cent against the preceding three months but 36 per cent down against a year ago. Major projects totalled £257m, up on the preceding three months where there were no major projects but down 70 per cent against the previous year. Underlying contract awards experienced a mixed performance, decreasing 18 per cent against the preceding three months (SA) to stand 4 per cent up against the previous year.
Detailed planning approvals, totalling £1.348bn, slipped back 17 per cent against the preceding quarter and fell 46 per cent on the previous year. Major project approvals, totalling £377m, decreased 38 per cent against the previous quarter to stand 71 per cent down against last year. Underlying approvals, at £971m, experienced a 10 per cent decrease (SA) compared with the preceding three months to stand 19 per cent lower than a year ago.
Types of projects started
Hospitals accounted for 57 per cent of health work starting on site during the three months to March, with the value having increased 42 per cent against the previous year’s levels to total £553m. Nursing home project-starts, accounting for 18 per cent of the sector, grew 50 per cent compared with the previous year to total £178m.
Accounting for 7 per cent of health projects starting on-site, dental, health, and veterinary centres increased 42 per cent on a year ago to total £63m. In contrast, day centres slipped back 59 per cent to total just £1m, accounting for less than 1 per cent of health project-starts during the period.
Regional
Totalling £190m, the South West was the most active region for health project-starts during the three months to March, having grown 37 per cent against the previous year to account for 20 per cent of health project-starts. At £165m, the East of England accounted for a 17 per cent share. The value of the projects starting on-site in the region jumped 157 per cent compared with last year’s levels.
Health starts in London accounted for 14 per cent and more than doubled compared with the previous year’s levels, totalling £139m, mainly thanks to the £80m South West London Tolworth Hospital Development in Kingston upon Thames. Accounting for 9 per cent, Yorkshire & the Humber also experienced a strong period in health starts, having grown 13 per cent on a year ago to total £83m. In contrast, accounting for a 12 per cent share, starts in the South East fell 54 per cent against the previous year to total £113m.
With a total value of £320m, the East of England was the most active region for detailed planning approvals, having more than doubled on a year ago to account for 24 per cent of the health sector. Approvals in London jumped nearly six times compared with the previous year to total £310m, a 23 per cent share of health consents. This growth was boosted by the £250m Whitechapel Life Sciences Cluster development.
Accounting for a 10 per cent share, health approvals in the West Midlands grew 33 per cent against the previous year to total £135m. In contrast, accounting for the same share of consents, project approvals in the South West were 81 per cent lower than last year to total £136m. At £134m, health consents in the South East also accounted for a tenth of the total value, having declined 67 per cent against the 2023 levels.
