Construction in New Zealand - Key Trends and Opportunities to 2023
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Construction in New Zealand - Key Trends and Opportunities to 2023
Summary
The pace of expansion in New Zealands construction industry slowed in 2017 and 2018, as investment growth was undermined by weak investor confidence as a result of a shortage of a skilled workforce, high wages and a lower profit margin. The industrys growth will pick up pace in 2019, in part supported by government plans to boost infrastructure spending.
In real terms, New Zealands construction industrys output grew at a compound annual growth rate (CAGR) of 4.85% during the review period (2014-2018). Although output growth slowed in 2017 and 2018, the general upward trend can be attributed to public and private sector investment in residential and transport infrastructure projects. Under the National Land Transport Programme, the government invested NZD13.9 billion (US$9.7 billion) to develop the countrys overall transport infrastructure during 2015-2018.
Industry growth over the forecast period (2019-2023) will be supported by public and private sector investments in transport, institutional and residential construction projects. In September 2018, the government announced plans to invest NZD16.9 billion (US$11.2 billion) on the development of the countrys overall transport infrastructure over the next three years; of the total, NZD5.3 billion (US$7.7 billion) will be spent on improving state and highways roads. The governments effort to balance the demand and supply of affordable residential buildings for first-time buyers is also expected to attract investments in the residential market. Under the KiwiBuild program, the government aims to construct 100,000 affordable homes across the country by 2028, of which 50,000 will be built in Auckland. Moreover, an increase in the number of residential building permits issued is expected to support new construction activity over the forecast period.
The industrys output value in real terms is expected to rise at a CAGR of 3.57% over the forecast period.
"Construction in New Zealand - Key Trends and Opportunities to 2023", report provides detailed market analysis, information and insights into New Zealands construction industry, including -
- New Zealands construction industrys growth prospects by market, project type and construction activity
- Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in New Zealands construction industry
- Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.
Key Highlights
- GlobalData expects the residential construction market to retain its leading position over the forecast-period and account for 43.8% of the total value in 2023, driven by the government efforts to balance housing demand and supply through the construction of affordable housing units. In the 2019 budget, the government announced plans to invest NZD197 million (US$136.1 million) to construct 2,700 housing units by 2023 under the Housing First Programme.
- In May 2019, the government announced that it increased the 2019 budget by 8.8%, going from NZD102 billion (US$70.4 billion) in 2018 to NZD111 billion (US$75 billion) in 2019. Of the total budget, it allocated NZD19.9 billion (US$13.4 billion) to the Ministry of Health, NZD16.1 billion (US$16.1 billion) to the Ministry of Education, NZD5.8 billion (US$3.9 billion) to the Ministry of Transport and NZD2.2 billion (US$1.5 billion) to the Ministry of Housing and Urban Development.
- GlobalData expects the infrastructure construction market to post a forecast-period CAGR of 3.89% in nominal terms, driven by the governments plan to develop the countrys transport infrastructure. In September 2018, the government announced plans to spend NZD16.9 billion (US$11.7 billion) to develop the country road transport infrastructure under the National Land Transport Program during the period of 2019-2021.
- Forecast-period growth in the energy and utilities construction market will be driven by the governments efforts to develop the telecommunication infrastructure in order to improve broadband and mobile coverage in the rural and remote locations of the country. In December 2018, the government announced the expansion of the Rural Broadband Initiative Phase 2 (RBI2) and Mobile Blackspot Fund (MBSF) program, through which it plans to extend broadband and mobile coverage to 99.8% of the population by 2022.
- The total construction project pipeline in New Zealand - as tracked by GlobalData, and including all mega projects with a value above US$25 million - stands at NZD73.1 billion (US$50.5 billion). The pipeline, which includes all projects from pre-planning to execution, is skewed towards late-stage projects, with 66.7% of the pipeline value being in projects in the pre-execution and execution stages as of July 2019.
Scope
This report provides a comprehensive analysis of the construction industry in New Zealand. It provides -
- Historical (2014-2018) and forecast (2019-2023) valuations of the construction industry in New Zealand, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants
Reasons to buy
- Identify and evaluate market opportunities using GlobalDatas standardized valuation and forecasting methodologies.
- Assess market growth potential at a micro-level with over 600 time-series data forecasts.
- Understand the latest industry and market trends.
- Formulate and validate strategy using GlobalDatas critical and actionable insight.
- Assess business risks, including cost, regulatory and competitive pressures.
- Evaluate competitive risk and success factors.
Summary
The pace of expansion in New Zealands construction industry slowed in 2017 and 2018, as investment growth was undermined by weak investor confidence as a result of a shortage of a skilled workforce, high wages and a lower profit margin. The industrys growth will pick up pace in 2019, in part supported by government plans to boost infrastructure spending.
In real terms, New Zealands construction industrys output grew at a compound annual growth rate (CAGR) of 4.85% during the review period (2014-2018). Although output growth slowed in 2017 and 2018, the general upward trend can be attributed to public and private sector investment in residential and transport infrastructure projects. Under the National Land Transport Programme, the government invested NZD13.9 billion (US$9.7 billion) to develop the countrys overall transport infrastructure during 2015-2018.
Industry growth over the forecast period (2019-2023) will be supported by public and private sector investments in transport, institutional and residential construction projects. In September 2018, the government announced plans to invest NZD16.9 billion (US$11.2 billion) on the development of the countrys overall transport infrastructure over the next three years; of the total, NZD5.3 billion (US$7.7 billion) will be spent on improving state and highways roads. The governments effort to balance the demand and supply of affordable residential buildings for first-time buyers is also expected to attract investments in the residential market. Under the KiwiBuild program, the government aims to construct 100,000 affordable homes across the country by 2028, of which 50,000 will be built in Auckland. Moreover, an increase in the number of residential building permits issued is expected to support new construction activity over the forecast period.
The industrys output value in real terms is expected to rise at a CAGR of 3.57% over the forecast period.
"Construction in New Zealand - Key Trends and Opportunities to 2023", report provides detailed market analysis, information and insights into New Zealands construction industry, including -
- New Zealands construction industrys growth prospects by market, project type and construction activity
- Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in New Zealands construction industry
- Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.
Key Highlights
- GlobalData expects the residential construction market to retain its leading position over the forecast-period and account for 43.8% of the total value in 2023, driven by the government efforts to balance housing demand and supply through the construction of affordable housing units. In the 2019 budget, the government announced plans to invest NZD197 million (US$136.1 million) to construct 2,700 housing units by 2023 under the Housing First Programme.
- In May 2019, the government announced that it increased the 2019 budget by 8.8%, going from NZD102 billion (US$70.4 billion) in 2018 to NZD111 billion (US$75 billion) in 2019. Of the total budget, it allocated NZD19.9 billion (US$13.4 billion) to the Ministry of Health, NZD16.1 billion (US$16.1 billion) to the Ministry of Education, NZD5.8 billion (US$3.9 billion) to the Ministry of Transport and NZD2.2 billion (US$1.5 billion) to the Ministry of Housing and Urban Development.
- GlobalData expects the infrastructure construction market to post a forecast-period CAGR of 3.89% in nominal terms, driven by the governments plan to develop the countrys transport infrastructure. In September 2018, the government announced plans to spend NZD16.9 billion (US$11.7 billion) to develop the country road transport infrastructure under the National Land Transport Program during the period of 2019-2021.
- Forecast-period growth in the energy and utilities construction market will be driven by the governments efforts to develop the telecommunication infrastructure in order to improve broadband and mobile coverage in the rural and remote locations of the country. In December 2018, the government announced the expansion of the Rural Broadband Initiative Phase 2 (RBI2) and Mobile Blackspot Fund (MBSF) program, through which it plans to extend broadband and mobile coverage to 99.8% of the population by 2022.
- The total construction project pipeline in New Zealand - as tracked by GlobalData, and including all mega projects with a value above US$25 million - stands at NZD73.1 billion (US$50.5 billion). The pipeline, which includes all projects from pre-planning to execution, is skewed towards late-stage projects, with 66.7% of the pipeline value being in projects in the pre-execution and execution stages as of July 2019.
Scope
This report provides a comprehensive analysis of the construction industry in New Zealand. It provides -
- Historical (2014-2018) and forecast (2019-2023) valuations of the construction industry in New Zealand, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants
Reasons to buy
- Identify and evaluate market opportunities using GlobalDatas standardized valuation and forecasting methodologies.
- Assess market growth potential at a micro-level with over 600 time-series data forecasts.
- Understand the latest industry and market trends.
- Formulate and validate strategy using GlobalDatas critical and actionable insight.
- Assess business risks, including cost, regulatory and competitive pressures.
- Evaluate competitive risk and success factors.
TABLE OF CONTENTS
1 Executive Summary
2 Construction Outlook: At-a-glance
3 Latest News and Indicators
4 Key Drivers and Risks
4.1. Economic Performance
4.2. Political Environment
4.3. Demographics
4.4. Risk Profile
5 Construction Outlook
5.1. All Construction
5.1.1. Outlook
5.1.2. Project analytics
5.2. Commercial Construction
5.2.1. Outlook
5.2.2. Project analytics
5.3. Industrial Construction
5.3.1. Outlook
5.3.3. Project analytics
5.4. Infrastructure Construction
5.4.1. Outlook
5.4.2. Project analytics
5.5. Energy and Utilities Construction
5.5.1. Outlook
5.5.2. Project analytics
5.6. Institutional Construction
5.6.1. Outlook
5.6.2. Project analytics
5.7. Residential Construction
5.7.1. Outlook
5.7.2. Project analytics
6 Key Industry Participants
6.1. Contractors
6.2. Consultants
7 Appendix
7.1. What is this Report About?
7.2. Definitions
8 About GlobalData
8.1. GlobalData at a Glance
8.2. GlobalData Construction
8.3. Disclaimer
8.4. Contact Us
List Of Tables
Table 1: Construction Outlook
Table 2: New Zealand, Key Economic Indicators
Table 3: New Zealand, Construction Output Value (nominal, NZD Million)
Table 4: New Zealand, Construction Output Value (nominal, US$ Million)
Table 5: New Zealand, Top Commercial Construction Projects by Value
Table 6: New Zealand, Top Industrial Construction Projects by Value
Table 7: New Zealand, Top Infrastructure Construction Projects by Value
Table 8: New Zealand, Top Energy and Utilities Construction Projects by Value
Table 9: New Zealand, Top Institutional Construction Projects by Value
Table 10: New Zealand, Top Residential and Mixed-Use Construction Projects by Value
Table 11: New Zealand, Key Contractors
Table 12: New Zealand, Key Consultants
Table 13: GlobalData Construction Market Definitions
Table 14: Construction Risk Index Ratings and Scores
List Of Figures
Figure 1: Key Markets, Construction Output Growth Matrix and Risk Matrix
Figure 2: New Zealand, Construction Projects Pipeline by Sector (NZD Billion)
Figure 3: New Zealand, Building Permits (Total Numbers)
Figure 4: New Zealand, Total Number of Residential Buildings Constructed and Renovated (Number, Thousands)
Figure 5: New Zealand, Risk Comparison, Q2 2018
Figure 6: New Zealand, Risk Comparison Review
Figure 7: New Zealand, Construction Output Value (Real, US$ billion, 2017 prices and exchange rate)
Figure 8: New Zealand, Construction Output Value, Growth Matrix
Figure 9: New Zealand, Construction Output Value, by Sector (NZD Million), 2014-2023
Figure 10: New Zealand, Construction Projects Pipeline, Projected Annual Spending by Stage (NZD Million), 2018-2023
Figure 11: New Zealand, Construction Projects Pipeline, Value by Stage (NZD Million)
Figure 12: New Zealand, Commercial Construction Output by Project Type (NZD Million), 2014-2023
Figure 13: New Zealand, Commercial Construction Projects Pipeline, Value by Stage (NZD Million)
Figure 14: New Zealand, Commercial Construction Projects Pipeline, Projected Annual Spending by Stage (NZD Million), 2018-2023
Figure 15: New Zealand, Industrial Construction Output by Project Type (NZD Million), 2014-2023
Figure 16: New Zealand, Industrial Construction Projects Pipeline, Value by Stage (NZD Million)
Figure 17: New Zealand, Industrial Construction Projects Pipeline, Projected Annual Spending by Stage (NZD Million), 2018-2023
Figure 18: New Zealand, Infrastructure Construction Output by Project Type (NZD Million), 2014-2023
Figure 19: New Zealand, Infrastructure Construction Projects Pipeline, Value by Stage (NZD Million)
Figure 20: New Zealand, Infrastructure Construction Projects Pipeline, Projected Annual Spending by Stage (NZD Million), 2018-2023
Figure 21: New Zealand, Energy and Utilities Construction Output by Project Type (NZD Million), 2014-2023
Figure 22: New Zealand, Energy and Utilities Construction Projects Pipeline, Value by Stage (NZD Million)
Figure 23: New Zealand, Energy and Utilities Construction Projects Pipeline, Projected Annual Spending by Stage (NZD Million), 2018-2023
Figure 24: New Zealand, Institutional Construction Output by Project Type (NZD Million), 2014-2023
Figure 25: New Zealand, Institutional Construction Projects Pipeline, Value by Stage (NZD Million)
Figure 26: New Zealand, Institutional Construction Projects Pipeline, Projected Annual Spending by Stage (NZD Million), 2018-2023
Figure 27: New Zealand, Residential Construction Output by Project Type (NZD Million), 2014-2023
Figure 28: New Zealand, Residential Construction Projects Pipeline, Value by Stage (NZD Million)
Figure 29: New Zealand, Residential Construction Projects Pipeline, Projected Annual Spending by Stage (NZD Million), 2018-2023
Figure 30: New Zealand, Headquarters of Key Contractors (% of Total Project Pipeline)
Figure 31: New Zealand, Headquarters of Foreign Contractors (% of Project Pipeline with Foreign Contractor)
Figure 32: New Zealand, Headquarters of Key Consultants (% of Total Project Pipeline)
Figure 33: New Zealand, Headquarters of Foreign Consultants (% of Project Pipeline with Foreign Consultants)
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