While the national construction picture may not seem too rosy, prospects for the construction sector in the Western Cape are set to continue to grow over the next few years, helped by a good dose of residential construction.

This was according to Industry Insight senior economist David Metelerkamp, who told the Cape Construction Conference and Trade Expo in Cape Town that the construction sector would be one of the biggest drivers of the Western Cape economy over the next five years.

The sector is expected to grow at around 4% in 2015, rising to 4.5% in 2017.

Metelerkamp’s analysis is based on building plans, which gives a good indication of what is happening in the market as around 80% of building plans move to the construction phase.

“The Western Cape definitely outperforms the national average, with fantastic growth in new residential construction in excess of 70% over the past year.”

Growth is being driven by developments such as flats and townhouses, as well as privately built houses, while devel-opment-driven projects in the Western Cape have seen a growth of 50% in the last year.

The national trend is also on its way up with regard to the number of residential plans passed. However, construction growth in other provinces, including Gauteng, lags that of the Western Cape.

There is also good news for office space growth in the Western Cape, with demand in the province still good.

“The province outpaces the rest of the country on the private side of building. If you are a private developer in office space, the Western Cape is the place to be.”

There was also some good growth reported in pockets of South Africa on the office space front, particularly in the Free State and Mpumalanga, Metelerkamp advised.

Nationally, the nonresidential construction picture is not looking as solid.

Metelerkamp noted that nonresidential building growth had slumped to –1.7% nationally and 15.5% in the Western Cape for 2015.

The number of civil projects awarded across South Africa is also continuing to peter out and, while performing better, the Western Cape is also experiencing a more depressed civil environment.

A worrying factor for construction in the country is the climbing rate at which building projects are being postponed, with KwaZulu-Natal one of the provinces battling on this front.

A major obstacle is nonpayment by govern-ment and municipalities in the country. Projects are often stalled, as developers wait to be paid.

With a government squeeze on infra- structure spending, the outlook for civil construc- tion is tight. This is a result of unsustainable debt to gross domestic product ratings and warnings from international ratings agencies, among others.

“Government’s cut in infrastruc- ture spending has come at a bad time, with load-shedding and supply-side constraints. There will be a decline in spending in health over the next two to three years, mainly the construction of hospitals and clinics,” Metelerkamp forewarned.