The cancellation meant that national contractors and the regional firms that would have picked up spin-off development lost out. But one year on, the Arts Council snub has had no visible effect on firms with Bristol offices. In fact, they are reporting a recovery, with an improving market in jobs under £10m and rich pickings for the regional offices of major contractors such as HBG and the recently opened Wates office.
Local contractors such as Cowlin are finding that work in their £1m-5m price range is also on the rise. Cowlin’s marketing manager, Hugh Dalton, says: “At the beginning of July, we had £19m of work being dealt with in the estimating office.” And the jobs themselves are becoming larger: Cowlin’s average contract is worth £2m, but this is steadily increasing to almost £4m. For example, in June, the firm began a £3.6m call transfer facility for Cellnet in Yate, north Bristol; and it also completed a £2.2m community centre and residential development in Knowle West for Knightstone Housing Association and Bristol City Council. It also won several jobs outside the city, Meanwhile, another local firm, Midas, is bidding to become a major player in the city by cashing in on the upturn in small projects. It is signalling its ambition by moving into Tarmac’s former offices in the city, so Tarmac House will become Midas House. In Bristol, Midas is building a £3m extension to the Cadbury Garden Centre, as well as working on a number of office refurbishment schemes and university projects.
Bristol’s £382m kick-start
So, where have all the small projects come from? A Gleeds director, Ian Miller, says the market has been sustained by the start of two major projects: a regeneration of the Temple Quay area of the city centre that could reach £300m, and the £83m @Bristol scheme, another lottery-funded project to regenerate the harbourside. The scheme comprises two Millennium Commission-funded education centres, Wildscreen and Explore, that will open in spring 2000.
“These schemes have activated the market,” Miller says. “And without them as a catalyst, it wouldn’t have happened.” At Temple Quay, Wates is now on site with a £20m office for the DETR designed by local architect Stride Treglown, Laing is building a £30m office for Bristol & West, and developer Castlemore Securities is submitting a planning application for one £5m and two £10m office schemes. These are the kinds of project that put a sparkle in the eye of a regional contractor.
It is not just private sector money fuelling the boom in small to medium-sized projects. The universities of Bristol and the West of England are letting student accommodation, extensions to existing facilities and new-build work.
Richard Bailey, HBG’s regional director in the South-west, says 40% of HBG’s jobs are in the public sector. “It is a big shift from four years ago when it was pretty much all private,” he adds. Tony Harden, a director at multidisciplinary consultant Symonds, says he is seeing a surge in healthcare projects.
There may be more jobs for regional contractors but all those bidding for work in Bristol are finding it a savagely competitive market. Prices for materials and trade contractors have all increased in line with inflation, but tender prices have remained steady – a sure sign that contractors are taking lower margins to protect their turnover.
Managing risk
Midas and Cowlin are targeting negotiated and partnering contracts to eliminate the expensive and risky competitive tendering process. Midas chief executive Steve Hindley says Midas currently negotiates 35% of its business, but he aims to double that within two years.
HBG is able to tender for more substantial schemes than either Cowlin or Midas because it can call on the expertise and financial muscle of its parent, but Bailey is less optimistic about opportunities for repeat work in Bristol. He says it lacks the industrial heartland of, say, the Midlands or North-west. “If you take Cardiff and Bristol out, the rest of the South-west is one big farmyard.”
What’s in the cupboard?
Apart from local speculation that Bristol needs a concert venue similar to Cardiff Arena, there are no major projects in the pipeline. One proposal, developer Crest Nicholson’s £300m mixed-use development in the harbourside, is hanging in the balance while planning approval is sought.
So, what will the big players with bases in the city do? Tony Court, area manager for Laing’s South-west office, says Cardiff, not Bristol, is the city of opportunity for major contractors. But regional contractors should beware, he warns; if the national firms are not kept busy on major projects, they will begin to bid for smaller schemes. “We will not go under £3m, but we will be looking at jobs under £10m,” he says.
