While major projects in Brisbane are helping to underpin the construction sector there is a growing number of deferred projects around the state
Billions of dollars of major infrastructure projects are helping to keep the impact of COVID-19 at bay in Brisbane, but there’s bad news in other areas.
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MAJOR infrastructure projects will continue to underpin the construction sector in Brisbane but there is a growing list of developments on hold because of the coronavirus pandemic with the Gold Coast one of the hardest hit.
Quantity surveyor and cost consultant Rider Levett Bucknall’s 2nd Quarter 2020 Australia Report found there was reduced construction activity across Australia and warned of a potential spike in insolvencies.
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RLB state managing director David Stewart said Queensland was “multifaceted” with
Brisbane managing COVID-19 with broader economic spread and large legacy projects.
“However, the Gold Coast, Sunshine Coast and Cairns have been the greatest affected with construction adjusting to new workflows,” he said.
“It’s likely these tourist assisted economies will see continuing tightening of construction projects and need the greatest assistance particularly post Jobkeeper.”
RLB offices reported that construction sites have continued to work throughout the lockdown and there were no reported site closures.
Major projects such as Cross River Rail, Queens Wharf and Brisbane Metro continue to progress and will provide a major stimulus in Brisbane while there is a pipeline of major expansions of Caboolture, Logan and Ipswich hospitals on the way.
However, the private sector which accounts for 90 per cent of building construction work in Queensland is contracting, particular in the residential, retail, tourism/hospitality and aviation sectors.
According to the report RLB’s Gold Coast office has seen about $150 million in deferred projects.
“The current impacts of COVID-19 have seen projects put on hold and changing work practices on sites however the future impact is likely to be more serious,” the report said.
“The potential for increased insolvencies as construction volumes contract, are likely and the pipeline of future projects is likely to be severely compromised.”
Mr Stewart said RLB was anticipating a slow recovery with the major impact of COVID-19 on the business to hit in September and October,
“The forthcoming state election in October with a lengthy caretaker period and uncertainty will further suppress activity,” he said.
“Should a change in state government occur we would anticipate it will take several months before policy action can be implemented.”