Sense provides second cost update to Building magazine
Media
10/07/2009
In the second of its series of cost updates for specialist trades, the Sense Cost Consultancy team considers refurbishment and fit-out in the office and retail market for Building magazine.
The value of the commercial refurbishment and fit-out sector rose to a record £7.8bn in 2007 after several years of buoyant growth. Together the offices and retail sectors account for about half of this market and both enjoyed strong demand in the mid-2000s. In 2009 commentators expect the value of this work to plummet to £4.7bn, 40% down from the 2007 peak. Some industry sources fear this may prove too optimistic and warn that a 50% contraction is not beyond the realms of possibility. Tender prices have fallen sharply and the supply chain has consequently taken steps to minimise preliminaries and cut overheads
Conclusive evidence of green shoots have yet to emerge but there are signs that the market is nearing its nadir. Exactly when the recovery will arrive divides experts. Optimists say early 2010, whereas the more pessimistic suggest it early 2011.
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This article was researched and written by project director, Tim Spencer, and economist Kelly Forrest at Sense, part of the Mace Group of companies.
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