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Property and infrastructure contributing £570 billion to UK GDP

The proportion of GDP generated from the UK’s built asset stock has fallen in the last two years from 27.2% to 26.3%. Britain now lies behind some of the world’s major economic powerhouses such as China and the USA, according to Arcadis’ latest report, the Global Built Asset Performance Index.

Greg Bradley

Head of UK Infrastructure Advisory Ask me a question

“The productivity of our buildings and infrastructure remains hugely important to the country’s economic growth, especially in a world where funding challenges exist and everything needs to stand the test of time.”

While overall returns from the UK’s built assets – which include buildings, infrastructure and other fixed assets such as homes, schools, roads, airports, power plants, malls, railways and ports - have marginally increased from £565 billion in 2014, to £571 billion by the end of 2016. However, the rate of growth has slowed relative to GDP, resulting in the UK’s relatively low ranking.  This is due in part to comparatively low rates of both public and private investment, and investors more cautious in the wake of the EU referendum.

UK has been too slow to invest, but things could be changing

The historically slow rate of investment in major infrastructure programmes has reduced GDP growth. Therefore, to improve productivity it is crucial that investment programmes in major schemes are speeded up, including Nuclear New Build, High Speed 2 and Crossrail 2, whilst sustaining the delivery of investment in existing transportation and utility assets.

Despite this, the level of investment now going into these schemes, including from cities and local authorities, suggests that we could expect to see some pick up in the performance of the UK’s built asset stock over the coming years. The priority should be around developing investible programmes that can be funded, planned and procured with a minimum of delay. 

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Greg Bradley

Head of UK Infrastructure Advisory Ask me a question

Arcadis White paper

Global Built Asset Performance Index 2016

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