Construction activity in London is gaining momentum across leisure, education, and civil engineering sectors, even as residential building continues to hit the buffers in the capital.
Hotel and leisure project starts surged 93 per cent in the three months to September 2025, with London leading the way with 152 approved schemes, including the Grade I listed £64 million Custom House redevelopment.
Education construction is also gaining momentum, with £934 million worth of projects underway and a 49 per cent increase in the value of major contracts awarded.
This includes 331 school projects approved across the UK, with 49 set to begin in London alone.
While short-term project starts have dipped, long-term, government-backed school rebuilding programmes are expected to inject nearly £2.8 billion over the next decade, ensuring sustained growth through to 2031.
Civil engineering shows positive momentum – up four per cent with a 38 per cent rise in the value of main contract awards – driven by energy and road projects, including £622 million in new road construction this quarter.
The water sector is poised for growth, as utility companies received approval from the Competition and Markets Authority to invest an additional £556 million in infrastructure upgrades and resilience.
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The data, revealed by market analysts Glenigan, highlights these sectors’ resilience in contrast with ongoing challenges in residential construction, which faces supply chain issues, high costs, and a “crisis” in new housing starts.
The Home Builders Federation has warned that London’s housing delivery is in “alarming decline”, with completions down 12 per cent and starts at “crisis levels”.
HBF chief executive Neil Jefferson called this a “wake-up call” for urgent government action to meet housing targets.
The overall shift highlights new construction opportunities amid pressures on the capital’s housing market.
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