Queensland state government joins east coast push for infrastructure

Large scale infrastructure is inflating activity taking place across the construction industry according to the CoreLogic October Construction Monthly report.  

CoreLogic captured 2,018 development applications and proposals flowing into the construction pipeline across Australia in the month of September.

While 15.4% lower than the number of development applications captured in the previous month, it is above the five year average of 1,775.  

The total value of development applications was $11.2 billion over the month.

Again, this construction value is above the 5 year average of AU$9.3 billion, and was partially driven by the development proposal for a component of the Cross River Rail Line in Brisbane, a project which was first reported by CoreLogic in 2002.  

The Cross River Rail project reached a milestone, following Deputy Premier Jackie Trad's announcement that 5.9 km of tunnelling, four new underground stations and associated work, will be carried out under a pubic private partnership.

(Note: Tenders were called for a $2.5 million tunnel, stations and development package as of the 22nd of September)  

This is the third consecutive month where the value of construction work entering the pipeline has been inflated by a large civil engineering project.

While development applications remain buoyant, CoreLogic captured just 658 projects moving into the construction stages in September. This is far lower than the 5 year average of 1,041 projects per month, and is 27.9% less than moved into construction in the previous month.  

The combined value of projects that moved into construction over September fell by 36.8% on the previous month, to AU$3.5 billion. While all segments outside of commercial building saw a decline, the largest by far was in civil engineering. The value of civil engineering projects commencing was $722 million, down from $1 billion in the previous month.  

While far fewer projects are currently moving into construction, the resilience of the pipeline may see higher levels of construction commencing over the next 6-12 months.

CoreLogic commercial research analyst Eliza Owen.