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Victoria's Civil Industry Outlook - Amid COVID-19

Author: Brendan Redwood

Published date: 2020/05

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As COVID-19 continues to disrupt Australian society and our economy the civil construction industry seems to be one that has been able to withstand any crippling effects. This has been aided by the government's decision to not have restrictions directly impact the construction industry and allow it to operate at almost normal levels.

 

Here at Fetch, we pride ourselves on our strong relationships with our clients and decided to use these relationships to further learn and then deliver direct industry insight from civil leaders across the sector. We spoke with seven leading civil construction businesses across Victoria to gauge their positioning and company feel amid the COVID-19 pandemic.


The overall sentiment coming from the business leaders were of a positive note and the term used by many was cautious optimism. All businesses have had to adapt to COVID-19 by increasing hygiene and adhering to strict social distancing on sites. This has seen a slight impact on programs but doesn’t feel it will be a major issue for current projects at this stage. It seems all nonessential site staff have been working remotely now for 5 weeks and their team had adapted well to the situation with no major issues. One manager noted that materials and supplies are getting harder to source, which may see some challenges but feels the supply chain will be back operating normally soon enough.


A common theme throughout speaking with the Executives and Directors of these companies was that they expected government intervention or support would be required in the future surrounding private projects and developments. Whilst they all felt positive about the government’s commitment to infrastructure and projects spend, and that they will be likely to see further increases from them in the coming months to ensure the economy keeps moving and more jobs are created. Although, a couple of leaders discussed that many tenders were yet to be awarded and the government is trying to bring forward some projects and will likely change the contractual arrangement it has with contractors and may move to a cost plus arrangement to site quicker.


Below is a list of Civil & Rail projects which are trying to fast track or project award could be in the next month or two.

  • - Melbourne Airport Link - Stalled $17bill AirRail Melbourne bid (MTM, Southern Cross Station, Melbourne Airport & ifm investors) is now a real consideration

  • - North East Link Road

  • - Southern Roads Upgrade – Made up of 8+ Road upgrade projects. Due to be awarded in coming weeks          

  • - Northern Roads Upgrade – Made up of 7+ Road upgrade projects. Due to be awarded in coming weeks

  • - Barwon Heads Road Duplication

  • - Kilmore-Wallan Bypass

  • - Regional Rail Revival – Shepparton line project announcement in August 


Construction/ Residential Sector – According to BCI data and trend​s from April 13th – April 24th

  • - 186 Development approvals – value $1.177bill

  • - 55 Tenders called value $177mill

  • - 28 Tenders awarded value $121.2mill


Despite the economic and societal disruptions, there is still much movement and project announcements to come that the civil industry continues to move forward. Adapting their worksites and future plans many civil companies will ensure they aren’t crippled by an economic downturn. 



Brendan is our Director who specialises within the civil industry, with a large network within the market. You can connect with him on LinkedIn here.