With one year to go until Brexit, over 50% of UK real estate and construction businesses say they feel no clearer on the UK’s future with the EU, according to our recent Brexit poll: one year on, one year to go. However, businesses are still taking action. Almost half (46%) of those surveyed have revised their business strategy in order to support the economic and political developments that may affect them as an outcome of Brexit.
Brexit is certainly not dampening investment plans. Only 14% of real estate and construction firms surveyed have put a pause on investment – a contrast to 29% of businesses across all sectors that have made the decision to halt investment for the time being.
When asked what government policies should be focused on to help the sector grow, 49% said simplifying tax will make doing business in the UK easier. Investment in smart physical and digital infrastructure should be the government’s priority, according to 34% of those surveyed.
The recruitment of skills into the sector appears to be less of an issue than in many others, with just 17% identifying this as the area that needs the most focus from government.
Though economic uncertainty is clearly an issue, almost three-quarters (71%) of businesses in the sector are feeling confident or very confident that they will achieve their growth ambitions for this financial year. Saying that, only a third (31%) are expecting up to 5% growth with a very small proportion (3%) expecting growth of over 10%.
More than half of those surveyed (54%) believe the best outcome to achieve these growth ambitions would be for the UK to remain in the single market, while 37% would prefer to leave the EU altogether.
As BDO’s Managing Partner Paul Eagland said, “The business community has been left in limbo while the Government continues its Brexit discussions; however, I am pleased to see the real estate and construction sector has remained resilient and is confident about future growth and investment.”
The contribution of the real estate and construction sector to our economy is clear and profound, so it is vital that the Government put in place policies that will allow our sector to continue to thrive.
Written by Russell Field, National Head of Real Estate and Construction at BDO