Australian Construction Outlook – Non-Residential Building

Non-residential building activity is in the midst of a strong upswing. The value of work commenced has been rising strongly for the last four years (2015/16 to 2018/19 inclusive), and the value of work done has increased markedly over the last two years (2017/18 and 2018/19). The upturn has been driven by two main factors:

  • High demand for new commercial, industrial and other types of building space, primarily in the areas experiencing strong economic growth (the eastern states), and
  • Increased capital spending on social infrastructure by state governments, whose revenues were boosted by the residential property market boom and healthy rates of economic growth.

Accordingly, most of the upturn is taking place in Sydney and Melbourne. Western Australian and Queensland should experience some delayed, and more modest, growth in work done through 2019/20 and 2020/21.