Infrastructure drives construction activity

Infrastructure drives construction activity

Queensland businesses are favoured to work on the $5.4 billion Cross River Rail project that’s boosting Australia’s commercial building activity, while residential construction falters.

As one star falls, another rises.

This could be a fitting description for construction activity in Australia right now, if the reports are anything to go by.

Although apartment building has dropped significantly in recent months, engineering construction is faring much better. Queensland is boosting the national performance through large scale infrastructure projects, such as the Cross River Rail in Brisbane, which will stretch across 102 km of land.

Construction is already underway for the 5.9 km tunnel that will travel under the Brisbane River, connecting Dutton Park to Roma Street station. The entire project is set to transform the South-East Queensland transport network and create 1500 jobs each year, until it’s expected completion date in 2024.

This is welcome news for local construction businesses, who are favoured to work on the project over interstate and international companies, under a new policy that was announced by Queensland Premier Annastacia Palaszczuk.

The ‘Buy Queensland’ procurement strategy prioritises Queensland businesses, even over-riding free trade arrangements between Australia and New Zealand.

On a national scale, the Cross River Rail project helped to lift the value of development applications to $11.2 billion in September.

Australia’s infrastructure pipeline contained 2,018 development applications and proposals last month – soaring far above the five year average of 1,775.

Even though this figure is 15.4 per cent lower than development applications captured in August, it’s a relief to see that construction value is still higher than average, by around $9 billion.

If you look to the skyline, you’ll no doubt see this reality being played out at building sites. The number of cranes has jumped from 654 in the second quarter of this year to 685 in the most recent count – reflecting growing construction activity.

This is the highest number of cranes since the survey began in 2012.

Most of the activity is happening in Brisbane, Sydney and Melbourne, with hotels and civil construction (train stations) forming the most active sector.

This strong crane count challenges reports that indicate a slowdown in building activity for the multi-residential sector in Queensland and across Australia.