The hotel and
leisure construction sector has been one of the industry’s bright spots over
recent years, partly as a lower pound has created demand and building projects
involving more hotel rooms.
The early signs are
that the upturn in leisure construction market trends is continuing into 2018.
As well as continued expansion by the major hotel chains, building contractors
in the leisure sector are set to benefit from some major new sports stadiums.
Glenigan Construction market analysis shows that the value of underlying hotel and
leisure construction sector starts rose by 16% last year and the momentum
appears to be being maintained.
Glenigan research
for JLL shows construction starts in the leisure sector rose 16% in the three
months to February 2018, compared to the period a year earlier, and as the
pipeline strengthens, it should translate into an 11% rise in construction
projects starts in the sector this year.
Despite some market
weakness in the London, the large hotel chains are continuing to invest in
construction projects involving new rooms. Premier Inn, part of Whitbread, has
added more than 10,000 rooms in the past two years to a total of 71,282 rooms
in the UK. But with its latest occupancy standing at 83.3% it is planning to
expand capacity to 85,000 by 2020 and has secured sites for the extra 13,700
rooms it plans to build.
Meanwhile,
Travelodge last month unveiled plans for further significant expansion in the
UK which should provide a rich source of tender opportunities. Having opened 78
hotels over the past five years, the group now plans to open 20 new hotels
(with over 1,900 rooms) across the UK in 2018, creating 550 new jobs in a £240
million development to be funded with third party investors. As part of its
‘premium economy concept’, the chain is also investing in a further 400
SuperRooms which will be rolled out to its hotels in London and regional
centres such as Bristol, Edinburgh, Manchester and York.
Hotels increasingly
play a central role in major mixed-use building projects. A 171 bed hotel, for
example, is a key part of Endurance Land’s £35 million office/retail/restaurant
scheme at 68 Farringdon Road in central London. The scheme is at the pre-tender
stage and construction works are set to start in Spring 2019. A hotel is also a
major part of British Land’s £25.3 million Gateway Building at 1a Sheldon
Square in Paddington which also includes retail and leisure facilities and
where construction works are set to start this Autumn.
The hotel &
leisure sector is also set to benefit from a pick-up in on construction works
on sports stadiums.
Detailed plans have
been submitted for a £100 million extension to the main stand at Crystal Palace
FC’s Selhurst Stadium in Croydon where work is set to start next Spring and
should run for 36 months.
Elsewhere, Fulham
has recently been granted permission for an £80 million redevelopment of its
Riverside Stand at Craven Cottage, where construction works are expected to
start next year.
Meanwhile, new
sports stadiums are part of a mix of construction projects worth £750 million
for the 2022 Commonwealth Games in Birmingham – including an upgrading of
Alexandra Stadium and a new aquatic centre in Sandwell – which is at the
pre-tender stage and is set to start in the city this summer.
Pictured is the new Holiday Inn Express in Birmingham city centre features sets of three of Kawneer's AA®540
windows as fixed lights designed in L-shapes within checks of
multi-coloured rainscreen cladding by KKA Architecture.
