Pipeline Infrastructure Spending

LendLease and CIMIC................both have Enterprise Agreements with ACX


We hosted a Macquarie event with leading industry participants to gain a better understanding of the current infrastructure construction outlook.


Impact


Plenty in the pipeline... All speakers confirmed an abundance of infrastructure work in the pipeline for the next 7-10 years, most predominately along the east coast. Encouragingly, Macromonitor expect this not just solely in roads spend ($23b by 2021 [current prices] vs $17.2b in 12m to Mar ’17) but also in rail spend ($13b to 2021 [current prices] vs $4.1b 12m to Mar ’17, ex rolling stock). This combined with an increase in non-residential activity is expected to help offset cyclical declines in residential activity.


Which requires careful management. A potential speedbump to this upcoming infrastructure spend remains labour constraints with trade and specialised skills scarcity potentially requiring a staggered approach in medium-term project commencement. Participants noted that collaboration is important to avoid bottlenecks and overheating of the market. Positively for the contractors, the large body of work available has kept bidding processes relatively rational so far.