In a volatile, uncertain and complex environment, success will rely on the willingness and ability to take greater risks. Clients will need to take risks on project decisions, whilst suppliers will need to do the same when it comes to pricing. A key question is whether the adversarial tactics of previous downturns will make a comeback. With this in mind, the winners will be those who manage to create the greatest certainty.
Registrations for private new homes are reported to have dipped 5 percent towards this end of 2016 with transactions in the UK also decreasing by over 4 percent between August and September. On top of this, residential development land prices have fallen with prime central London land prices down by almost 10 percent. In recent times, residential construction has been one of the growth engines in construction demand so any potential fall in activity could have a knock-on effect in wider markets.
The Bank of England indicates that occupier demand, particularly in London, is dropping and its recent financial stability report said that risks from an adjustment in the UK commercial market have in part begun to crystallise. That said, the go-ahead for Google and Apple’s London schemes is positive news and reflects, in part, confidence in London’s status as a global city.
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