As spring gets underway the construction sector has reasons to be cheerful, argues Terry Lloyd, Head of Construction Finance, in the latest issue of Demolition Hub. 

After an uncertain start to the year our sector is headed into spring with reasons to be cheerful.

Supply chains are improving, inflation is set to fall, and the economy is predicted to perform better than had been expected.

Given these positive developments it is no surprise that businesses are becoming more optimistic for the future. Research conducted by Paragon Bank, where I am Head of Construction Finance, found that the majority of our sector is predicting solid turnover growth for the year ahead.

The research also found further cause for optimism with many firms planning on increasing their number of full-time staff and over two-thirds looking to increase investment in their operations.

The ability of businesses to invest is set to receive a further boost thanks to the introduction by the Government of Full Capital Expensing. A replacement for the old Super-Deduction scheme, Full Capital Expensing will allow firms to write off 100% of qualifying capital expenditure in the UK against taxable profits for the next three years.

Smaller businesses have also had their Annual Investment Allowance increased to £1m, allowing them to deduct the full value of their investment from taxable profits – creating fresh incentive to invest and to acquire the latest technology. 

Attending this year’s Executive Hire Show, it was great to see the new kit coming to market and to see the benefit they can bring. Improved energy efficiency and the increased availability of electric assets was a recurring theme of the show, providing a glimpse into how the sector is going to change in the years to come.

While the challenges of recent years are still not fully behind us, that businesses are eyeing growth, looking to invest and have an improving range of assets to acquire demonstrates both the strength of our sector and the way we have successfully responded to what we’ve faced.

The optimism of the sector was also evident at one of the first big social events of the year - the NFCD’s Midlands and Welsh region’s annual ball. It had been far too long since we all had a chance to get together – but even though work wasn’t on the agenda for the evening it was clear that businesses are feeling confident and ready to make 2023 a strong year.

As demolition and construction lending specialists, Paragon is always ready to listen and learn from clients about the support they require. Just as every project you undertake will have its own unique requirements, we also appreciate that for each business there will be individual circumstances that need to be considered when working on a funding package.

With new assets coming onto the market, Government support available and growth on the horizon, there really are reasons to be cheerful in the months ahead. Developers are ready to get to work and now is the time to be looking to the future and investigate which assets a business will need – and we can’t wait to work with you to take full advantage of what the future has to offer.

Visit our website to learn more about how our Constuction Finance team can support your business.