What are off-site hubs and how will they benefit the construction industry?
One of the major complaints against the focus of huge construction projects in key areas such as London is that all the economic benefit of those projects is confined to the capital and its surrounding areas. With the expansion of Heathrow via a third runway now confirmed, the focus is on how to deliver the benefits of this major piece of UK construction to businesses further afield. The answer to this may well be off-site hubs and their ability to spread the benefit of new construction right across the industry.
What are off-site hubs?
Off-site hubs provide a way of managing construction projects using multiple businesses. Off-site management and construction is a key part of the industry, allowing more parties to be involved in projects and often enabling better terms, higher quality products or lower costs to be achieved. Off-site hubs essentially enable anything, from key material production, to management of systems, to be handled off the main project site.
What are the key benefits of off-site hubs?
There are two main ways in which the use of off-site hubs creates an advantage. For a large project such as the expansion of Heathrow, an off-site hub will help to reduce the impact that such major construction tends to have on the local population and the surrounding area. Instead, elements of the construction are handled in other parts of the country so that the communities in West London don’t bear the brunt of the activity. The second major advantage is that the economic benefit of the construction has a much broader reach. Rather than it only being the south of the country that benefits from the influx of construction demand, this can be spread to other areas too. According to WPI Economics, an approach such as this – if adopted more widely than simply the Heathrow expansion – could generate productivity worth £30bn for the industry outside of London by 2025.
Off-site hubs at Heathrow
Currently, Heathrow Airport has reached the stage of revealing a long list of potential off-site hubs that will be used to complete construction on the third runway. The 65 sites on the existing list are being considered for their suitability to form a part of the airport’s supply chain – reduced down from 121 sites considered at the end of 2017. 60% of procurement will be achieved outside of London for the third runway to ensure that it is not only the London area that benefits from the spike in construction demand. Heathrow Airport Chairman Lord Deighton has highlighted how crucial off-site hubs are in ensuring that the £187bn economic benefit of the expansion is spread to regions right across the UK. Businesses on the current short list are located in areas such as The East Midlands, Northern Ireland, Scotland, as well as Wales and Yorkshire and the Humber.
Off-site hubs have an important role to play, not just in the Heathrow expansion, but in the growth and development of the broader construction industry. If you have a construction project you’d like to discuss please get in touch with The RG Group today.