According to management consultancy firm Turner & Townsend the outlook for construction will become increasingly positive across Australia’s five major capital cities from 2022 onward as a strong pipeline of public sector projects is supported by renewed momentum in private sector construction.
Simon Kearney, Director at Turner & Townsend, said the market for major construction is currently focused on public sector projects as governments seek to fast-track major road and rail developments along with social infrastructure projects such as schools and hospitals.
Across major markets, according to Turner & Townsend:
- Construction cost pressures in New South Wales will build from 2022 onward as private sector construction investment gains momentum. Whilst the market will remain competitive for 2021, confidence is returning and contractors and consultants report an upturn in enquiries.
- Queensland’s construction market has a reasonably healthy outlook thanks to a robust pre-existing pipeline of committed major projects.
- Activity in South Australia will soften over 2021 notwithstanding ongoing government investment in school building and major defence projects.
- Tendering remains competitive in Melbourne as construction expenditure has been subdued following the second wave of COVID-19. Private sector work is expected to pick up from the end of 2021 into 2022 and there are major public sector projects in the pipeline including health and infrastructure projects.
- In Western Australia, the economy and construction market appear to have stabilised after recent uncertainty and volatility. Government stimulus in education and infrastructure sectors, together with a steady progression of works in food retail are expected to uphold construction activity over 2021.