At a glance
UK construction growth forecasts have been cut sharply for 2025–26 as output falls for an eleventh straight month and firms pause projects amid tax and regulatory uncertainty. (Sources: UK Construction News, Building)
Government has moved to accelerate the energy transition with a 132GW prioritised grid-connection pipeline, multibillion-pound renewables investment and the UK’s first full-scale cement carbon capture scheme. (Sources: Transport + Energy, MHI)
Property markets remain subdued but not stalled, with modest national price growth masking a 10% slide in London prime values and weaker buyer demand ahead of the Budget. (Sources: Fine & Country, RICS)
Major contract awards from TfL, North Sea operators and government approvals for roads, wind farms and airport expansions show a robust pipeline of large schemes despite wider market softness. (Sources: Find a Tender, World Oil)
Today’s update: softer macro indicators for construction and property are meeting an active public and energy-infrastructure pipeline, with net zero and resilience driving new work even as developers delay decisions. Budget timing, tax treatment and regulatory clarity now sit alongside delivery capacity as core risks for 2026 pipelines. Here’s what you need to know to stay ahead today.
Ongoing Stories
Following earlier coverage of pressures on the £530bn UK construction pipeline, today’s market outlook downgrades growth forecasts to 1.1% for 2025 and 2.8% for 2026, with 35% of firms pausing or reviewing projects and output declining for an eleventh consecutive month. (Sources: UK Construction News, Building)
Building on recent focus on planning and infrastructure reform, the latest government energy and grid announcements add a 132GW prioritised connection queue and multibillion-pound renewables spend, reinforcing that delivery risk is shifting from consent to connection and system capacity. (Source: Transport + Energy)
Top 5 Headlines
💰 UK construction growth forecasts cut as output slide extends
Industry forecasts for UK construction growth have been downgraded from 1.9% to 1.1% for 2025 and from 3.7% to 2.8% for 2026, as firms cite uncertainty around tax, demand and regulation. Around 59% of businesses now describe conditions as “static” and 21% as “contracting”, with 35% pausing or reviewing projects, while official data show construction output falling for the eleventh consecutive month in November 2025. Returning to our ongoing theme of pipeline fragility, this underlines rising bid and investment risk, particularly in private housing where 2025 growth expectations have been trimmed to 2%. (Sources: UK Construction News, Building)
🚆🌱 NESO sets 132GW grid-connection priority pipeline to unlock renewables
The National Energy System Operator has confirmed a prioritised queue of electricity grid-connection projects totalling 132GW aimed at supporting net zero over the next decade, while signalling that a further 151GW will be needed by 2035. The move, coupled with multibillion-pound government investment in renewable infrastructure, is designed to clear gridlock and speed clean energy deployment. For developers, contractors and manufacturers, a clearer view of connection priorities should translate into more bankable timelines, but also sharper competition for delivery capability on grid and generation schemes. (Source: Transport + Energy)
🌱 First full-scale UK cement carbon capture plant awarded for Padeswood
Mitsubishi Heavy Industries and Worley have secured the contract to deliver the UK’s first full-scale carbon capture facility at Heidelberg Materials’ Padeswood Cement Works in north Wales. Due to be operational by 2029, the plant is expected to capture around 800,000 tonnes of CO2 per year, marking a significant escalation in industrial decarbonisation. This creates a major reference project for carbon capture, utilisation and storage (CCUS), opening a pipeline of complex civils, process and grid-connection work across hard-to-abate sectors. (Source: MHI)
🏗️🏛️ Property market cool but stable ahead of expected rate cut
National average house prices stand at about £271,531, up 2.6% year-on-year but 0.6% below August levels, with buyer demand down 12% on last year amid pre-Budget uncertainty. Mortgage approvals have eased month-on-month but remain 4% higher year-to-date than in 2024, while London prime values are around 10% lower year-on-year and new housing supply remains financially constrained, particularly in the capital. With an anticipated Bank of England rate cut in mid-December and further rental tax changes from 2026, residential developers and investors face a delicate timing decision on starts, acquisitions and disposals. (Sources: Fine & Country, RICS)
🚆 TfL lets £700m framework as major transport awards continue
Transport for London has awarded an infrastructure improvement framework worth around £700m covering station upgrades at locations including Elephant & Castle and South Kensington between 2025 and 2027, with extension options. In parallel, TechnipFMC has won a major subsea contract for Ithaca Energy’s Captain field in the North Sea, and government reports record approvals for major roads, wind farms and airport expansions such as Gatwick. These awards point to a strong pipeline of high-value civils, rail and offshore packages even as smaller schemes pause, favouring contractors and consultants positioned for complex, multi-year programmes. (Sources: Find a Tender, World Oil)
🌱🏛️ Energy Resilience Strategy, Sizewell C close and offshore wind surge reshape risk
The government has launched an Energy Resilience Strategy to harden critical assets such as substations and cables against climate, cyber and geopolitical threats, responding to incidents including the North Hyde substation fire. Sizewell C has now reached financial close, while new analysis shows offshore wind has overtaken domestic gas as the UK’s largest power source and cut spending on imported fuels by at least £30bn to date; at the same time, Oil & Gas UK warns that the windfall tax and regulatory uncertainty are eroding North Sea investment and jobs. For the sector, this combination of nuclear expansion, offshore wind dominance and upstream oil and gas strain will reshape UK energy workloads and risk-sharing models over the next decade. (Sources: DESNZ, ECIU)
Also in the news
🚆 A new Railways Bill will establish Great British Railways and provide multi-year funding uplifts for buses, station upgrades such as Cardiff Central, and EV infrastructure, signalling a more programmatic approach to transport investment. (Source: Transport + Energy)
🌱 The UK and Ukraine have launched the second round of InnovateUkraine, backing 14 green energy innovation projects and creating potential collaboration channels for UK consultants and technology suppliers. (Source: Gov.uk)
⚙️ Recent British Construction and Infrastructure Awards highlighted projects including the Cross Tay Link Road, Silvertown Tunnel and Kirkstone Pass safety works, underscoring ongoing demand for complex regional transport and tunnelling expertise. (Source: NCE / BCIA)
🚆 Airport and road schemes, alongside wind farms, have reached record levels of government approval, reinforcing that planning risk for nationally significant infrastructure is easing even as local-plan uncertainty persists. (Source: NCE / BCIA)
⚙️ BT has launched a UK sovereign digital platform aimed at supporting secure data and AI infrastructure for public and private clients, with implications for how major programmes manage information, cybersecurity and digital twins. (Source: MHI / related coverage)
The Daily Build is written for people shaping the UK’s construction and infrastructure pipeline, from boardrooms to site offices. If this briefing sharpens your next bid, investment committee or project review, consider forwarding it to your wider team.