Midlands construction sector shows resilience despite slowdown in Build to Rent market- report
The construction sector in the Midlands remains resilient, despite a noticeable slowdown in new Residential Build to Rent (BTR) project starts, according to the latest report from independent construction and property consultancy, Rider Levett Bucknall (RLB UK).
The firm attributes the stalled activity to a combination of investor caution surrounding the new Building Safety Act gateways and an increase in recently completed schemes, which has temporarily boosted supply. This is despite a strong pipeline of planning consents. Beyond BTR there are signs of resilience and there is more breadth to the market than one sector alone.
These insights are drawn from RLB UK’s Construction Market Intelligence Q3 2025 report which also highlights that tender price inflation continues to rise at an annual rate of between 3 per cent and 4 per cent – a trend expected to persist through to 2029.
Adam Hope, partner in RLB’s Birmingham office, said: “RLB believes the region’s strong infrastructure pipeline should drive growth and open up new opportunities. While material cost inflation has eased, cumulative cost levels remain high compared to pre-pandemic levels which could deter speculative schemes.
“Contractor appetite in the Midlands remains high, offering clients opportunities to secure competitive tenders on their construction projects. However, inflationary pressures and persistently low margins are driving contractors to seek contractual terms which give them greater protection. These combine to paint a more resilient sector into 2026.
“We’re seeing a growing appetite for true partnering approaches, where shared risk can unlock mutual value. Tender price increases signal the need for investors to act decisively – delaying decisions may only mean paying more later.”
Infrastructure continues to drive momentum, with high profile schemes ongoing and strong activity across all parts of the sector. In the longer term, reforms to the Nationally Significant Infrastructure Projects (NSIP) regime are expected to accelerate approvals, bringing greater clarity for large-scale schemes and giving further confidence to investors.
According to the report, the logistics and manufacturing sector is holding firm, particularly in the mid-box logistics subsector. While the number of speculative builds has fallen, demand for modern warehousing remains strong. Most new starts are now anchored to pre-let deals, reflecting a cautious but steady market.
RLB UK says there is a balanced picture of growth for the Midlands construction industry, with commercial development, infrastructure investment, logistics demand and longer-term housing delivery all set to drive momentum in the years ahead.
