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South Africa Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2028 (Q2 2024)

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    Report

  • 51 Pages
  • June 2024
  • Region: South Africa
  • GlobalData
  • ID: 5782607
Description Jump to:
The Construction in South Africa - Key Trends and Opportunities to 2028 (Q2 2024) report provides detailed market analysis, information, and insights into the South African construction industry, including :
  • The South African construction industry's growth prospects by market, project type, and construction activity
  • Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the South African construction industry
  • Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.
The analyst expects the construction industry in South Africa to shrink by 2.7% in real terms in 2024, owing to headwinds such as elevated cost of production, rising energy prices, rising debt level, insufficient power supply, and railway and port crisis. In November 2023, South Africa's rail and port utility company Transnet witnessed congestion and blockages with rising containers in the Port of Durban (commonly called Durban Harbour - the largest and busiest shipping terminal in sub-Saharan Africa) and derailment of the rail network due to poor policy, negligence in maintenance, operational challenges, equipment failures, corruption, and incompetence of authority. This ongoing crisis is likely to impact the country’s imports and exports. Additionally, a fall in foreign direct investment (FDI) will also weigh on the industry’s output in 2024. According to the South African Reserve Bank, the total FDI inflows fell by 36.1% year-on-year (YoY) in 2023, following an overall annual fall of 75% in 2022. The construction industry witnessed a weak start in 2024, with the industry’s value add falling by 8.7% YoY in Q1 2024, following Y-o-Y falls of 4.5% in Q4 and 3.2% in Q3 2023, according to Statistics South Africa (Stats SA).

The South African construction industry is however expected to rebound in 2025 and record an average annual growth rate of 3.5% during 2025-28, supported by investments in renewable energy, electricity, transportation, and industrial projects. The government aims to produce 26% of the total electricity from renewable energy sources by 2030. To achieve this goal, the state-owned electricity public utility company Eskom plans to invest ZAR106 billion ($5.7 billion) on the construction of wind farms and solar plants. The government’s focus on increasing the number of Special Economic Zones (SEZ) across the country will also support the industry’s growth over the coming years. The government plans to boost infrastructure development in the country by increasing public-private collaborations and partnerships with regional governments. In March 2024, the Deputy President of South Africa mentioned that ZAR230 billion ($12.4 billion) worth of infrastructure projects are in the construction phase as of March 2024. Growth during the forecast period will also be supported by the updated Integrated Resource Plan (IRP) to 2030 and 2050. This was revised in January 2024 and outlines the necessity to build substantial new capacity with a mix of nuclear power, renewables, clean coal, and gas to ensure reliable electricity supply and achieve a net zero electricity sector by 2050. This plan will be executed in two phases, one from 2023 to 2030 and the second from 2031 to 2050. It includes the addition of 29.3GW of new energy generation capacity in South Africa by 2030, including more than 7GW of new gas projects, 4.5GW of wind, and 3.6GW of solar PV.

Scope

This report provides a comprehensive analysis of the construction industry in South Africa. It provides :

  • Historical (2019-2023) and forecast (2024-2028) valuations of the construction industry in South Africa, featuring details of key growth drivers.
  • Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
  • Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
  • Listings of major projects, in addition to details of leading contractors and consultants

Reasons to Buy

  • Identify and evaluate market opportunities using the analyst's standardized valuation and forecasting methodologies.
  • Assess market growth potential at a micro-level with over 600 time-series data forecasts.
  • Understand the latest industry and market trends.
  • Formulate and validate strategy using the analyst's critical and actionable insight.
  • Assess business risks, including cost, regulatory and competitive pressures.
  • Evaluate competitive risk and success factors.

Table of Contents

1 Executive Summary2 Construction Industry: At-a-Glance
3 Context
3.1 Economic Performance
3.2 Political Environment and Policy
3.3 Demographics
3.4 Risk Profile
4 Construction Outlook
4.1 All Construction
  • Outlook
  • Latest news and developments
  • Construction Projects Momentum Index
4.2 Commercial Construction
  • Outlook
  • Project analytics
  • Latest news and developments
4.3 Industrial Construction
  • Outlook
  • Project analytics
  • Latest news and developments
4.4 Infrastructure Construction
  • Outlook
  • Project analytics
  • Latest news and developments
4.5 Energy and Utilities Construction
  • Outlook
  • Project analytics
  • Latest news and developments
4.6 Institutional Construction
  • Outlook
  • Project analytics
  • Latest news and developments
4.7 Residential Construction
  • Outlook
  • Project analytics
  • Latest news and developments
5 Key Industry Participants
5.1 Contractors
5.2 Consultants
6 Construction Market Data
7 Appendix
7.1 What is this Report About?
7.2 Definitions
7.3 CRI Methodology
  • About the Analyst
  • Contact the Publisher
List of Tables
Table 1: Construction Industry Key Data
Table 2: South Africa, Key Economic Indicators
Table 3: South Africa, Commercial Construction Output by Project Type (Real % Change), 2019-28
Table 4: South Africa, Top Commercial Construction Projects by Value
Table 5: South Africa, Industrial Construction Output by Project Type (Real % Change), 2019-28
Table 6: South Africa, Top Industrial Construction Projects by Value
Table 7: South Africa, Infrastructure Construction Output by Project Type (Real % Change), 2019-28
Table 8: South Africa, Top Infrastructure Construction Projects by Value
Table 9: South Africa, Energy and Utilities Construction Output by Project Type (Real % Change), 2019-28
Table 10: South Africa, Top Energy and Utilities Construction Projects by Value
Table 11: South Africa, Institutional Construction Output by Project Type (Real % Change), 2019-28
Table 12: South Africa, Top Institutional Construction Projects by Value
Table 13: South Africa, Residential Construction Output by Project Type (Real % Change), 2019-28
Table 14: South Africa, Top Residential Construction Projects by Value
Table 15: South Africa, Key Contractors
Table 16: South Africa, Key Consultants
Table 17: South Africa, Construction Output Value (Real, $ Million)
Table 18: South Africa, Construction Output Value (Nominal, ZAR Million)
Table 19: the analyst Construction Market Definitions
Table 20: Risk Dimensions
Table 21: Ratings, Scores and Definitions
List of Figures
Figure 1: Sub-Saharan Africa, Construction Output (Real % Change), 2022-28
Figure 2: South Africa, Construction Output by Sector (Real % Change), 2022-24 and 2025-28
Figure 3: South Africa, Risk Summary
Figure 4: South Africa, Risk Regional Comparison
Figure 5: South Africa, Construction Output Value (Real, $ Million, 2022 Prices and Exchange Rate), 2019-28
Figure 6: South Africa, Construction Output Value, by Sector (Real, $ Million), 2019-28
Figure 7: South Africa, Construction Value Add (ZAR Billion, Constant 2015 Prices)
Figure 8: South Africa, Gross Fixed Capital Formation (ZAR Billion, Constant 2015 Prices)
Figure 9: South Africa, Employment in the Construction Industry (In Thousands)
Figure 10: South Africa, Total value of recorded building plans passed by larger municipalities, 2019 Constant Prices (ZAR Million)
Figure 11: South Africa, Value of Buildings Reported as Completed in Larger Municipalities, 2019 Constant Prices (ZAR Million)
Figure 12: South Africa, Construction Materials Price Index, Total Construction, December 2023=100
Figure 13: South Africa, Construction Projects Momentum Index
Figure 14: Sub-Saharan Africa, Construction Projects Momentum Index
Figure 15: South Africa, Commercial Construction Output by Project Type (Real, $ Million), 2019-28
Figure 16: South Africa, Commercial Construction Projects Pipeline, Value by Stage ($ Million)
Figure 17: South Africa, Total Value of Building Plans Passed for Office and Banking Space and Shopping Space, Current Prices (ZAR Million)
Figure 18: South Africa, Total Value of Building Plans for Office and Banking Space and Shopping Space Reported as Completed, Current Prices (ZAR Million)
Figure 19: South Africa, Income from Accommodation and Food Services (ZAR Million, Current Prices)
Figure 20: South Africa, Total Retail and Wholesale Trade Sales (Constant 2019 Prices, ZAR Billion)
Figure 21: South Africa, Industrial Construction Output by Project Type (Real, $ Million), 2019-28
Figure 22: South Africa, Industrial Construction Projects Pipeline, Value by Stage ($ Million)
Figure 23: South Africa, Manufacturing Value Add (ZAR Billion, Constant 2015 Prices)
Figure 24: South Africa, Total Value of Industrial and Warehouse Space Plans Passed, Current Prices (ZAR Million)
Figure 25: South Africa, Volume Index of Manufacturing Production (2019=100)
Figure 26: South Africa, Absa Purchasing Managers’ Index (PMI), Business Activity Index and New Sales Orders Index, Seasonally Adjusted
Figure 27: South Africa, Total Merchandise Exports (ZAR Billion)
Figure 28: South Africa, Volume Index of Mining Production (2019=100) and Mineral Sales (Current Prices, ZAR Billion)
Figure 29: South Africa, Infrastructure Construction Output by Project Type (Real, $ Million), 2019-28
Figure 30: South Africa, Infrastructure Construction Projects Pipeline, Value by Stage ($ Million)
Figure 31: South Africa, Construction Materials Price Index, Civil Engineering Construction, December 2023=100
Figure 32: South Africa, Energy and Utilities Construction Output by Project Type (Real, $ Million), 2019-28
Figure 33: South Africa, Energy and Utilities Construction Projects Pipeline, Value by Stage ($ Million)
Figure 34: South Africa, Electricity, Gas and Water Value Add (ZAR Billion, Constant 2015 Prices)
Figure 35: South Africa, Electricity Production (GWh)
Figure 36: South Africa, Institutional Construction Output by Project Type (Real, $ Million), 2019-28
Figure 37: South Africa, Institutional Construction Projects Pipeline, Value by Stage ($ Million)
Figure 38: South Africa, Residential Construction Output by Project Type (Real, $ Million), 2019-28
Figure 39: South Africa, Residential Construction Projects Pipeline, Value by Stage ($ Million)
Figure 40: South Africa, Real Estate Value Add (ZAR Billion, Constant 2015 Prices)
Figure 41: South Africa, Gross Fixed Capital Formation Residential (ZAR Billion, Constant 2015 Prices)
Figure 42: South Africa, Total Value of Residential Building Plans Passed, 2019 Constant Prices (ZAR Million)
Figure 43: South Africa, Total Value of Residential Buildings Reported as Completed, 2019 Constant Prices (ZAR Million)
Figure 44: South Africa, Headquarters of Key Contractors (% of Total Project Pipeline)
Figure 45: South Africa, Headquarters of Key Consultants (% of Total Project Pipeline)

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