Denmark’s residential construction market CAGR expected to grow 1.44%, while the industry outlook remains bleak.
|LONDON –The Danish residential construction market is expected to record positive growth in 2014 with a CAGR of 1.44% over the forecast period, after recording a decline of 0.3% in 2013. Residential construction constituted the largest market within the construction industry, accounting for a 46.8% share of industry output in 2012. Overall, the Danish construction industry recorded a negative growth CAGR of -3.31% during 2008 -2012, residential construction emerged as sole market with any expected growth.
Residential construction markets expected to grow despite relatively strong property prices
Accounting for a 46.8% share of industry output in 2012, residential construction constituted the largest market within the construction industry. Despite a decline in property prices during the past few years, they remain considerably higher compared with neighboring countries, leaving the residential market in a fragile situation
Industrial construction market expected to register CAGR 0.33% by 2017
Industrial construction recorded a CAGR of -3.99% over 2008 -2012, the largest decline of all the construction markets. Owing to uncertainty in the global economy, exports declined, resulting in the decline of local demand which affected the manufacturing industry in particular. With the Eurozone crisis continuing to fester and many Danish trade partners suffering as a result, Timetric forecasts the Danish industrial construction market to register a CAGR of 0.33% over the forecast period.
Due to a highly-developed transport network the infrastructure market only recorded a mild decline
Owing to strong transport networks of roads, railways, airports and ports, the infrastructure market was only slightly impacted by the economic crisis. Supported by 130 commercial ports and 30 airports including five international airports, with Copenhagen’s airport acting as Europe’s main gateway to Scandinavian countries, the infrastructure construction market to emerged reasonably unaffected recording a CAGR of ‑1.74% over 2008 -2012.
Weak economic growth is affecting urban development
In 2012, the Danish commercial construction output valued DKK26.3 billion (US$4.9 billion), recording a CAGR of -3.68% during 2008 – 2012. With the Danish economy remaining in turmoil and caught in a period of sluggish growth, the demand for commercial properties such as retail, office and leisure and hospitality remained low. As a result of the continuing gloomy conditions across most of Western Europe, the main trading partner for Denmark, Timetric expects the commercial construction output to register a CAGR of 0.88% by 2017.