New data shows UK construction performance ending 2025 positively, offering optimism for digital construction professionals nationwide.
UK construction performance closed 2025 on a stronger footing than many industry observers expected, according to the January 2026 Glenigan Construction Index. Produced by Glenigan, a Hubexo product and established construction insight expert, the Index provides a detailed assessment of project starts across the UK construction sector, offering valuable intelligence for digital construction, planning, and investment decision-making.
The Construction Index analyses the three months to the end of December 2025 and focuses on underlying projects valued at £100 million or less, unless otherwise stated. All data is seasonally adjusted, ensuring a reliable comparison of year-on-year construction activity. For built environment professionals, including those working in digital construction, BIM, and data-led project delivery, the report offers a comprehensive view of how the sector performed during a challenging year.
Construction rose
Overall construction project starts rose by 7% in the three months to December, marking a clear improvement after a sluggish second quarter and a notably depressed third quarter of 2025. While activity remained 7% below 2024 levels, the upward trend suggests the UK construction industry is entering 2026 with greater stability than the previous quarter.
Public sector investment is expected to play a central role in shaping construction output over the coming year. Significant Government funding commitments covering housebuilding, public amenities, critical infrastructure, and major capital projects are widely anticipated to support confidence across the supply chain. For digital construction specialists, this potential increase in publicly funded work may accelerate demand for data-driven delivery, compliance technology, and productivity-focused digital tools.
The Index highlights a clear divide between residential and non-residential performance. Residential construction remained under pressure, while non-residential and civils sectors delivered robust growth both quarter-on-quarter and year-on-year.
Sigh of relief
Commenting on the findings, Allan Wilen, Economics Director at Glenigan, said: “Contractors and subcontractors across the UK will be breathing a sigh of relief that, contrary to expectation and speculation, the sector finished up 2025 on a positive note, buoyed by significant Q4 growth across non-residential verticals, particularly office and industrial where work has skyrocketed providing much needed momentum.”
Looking ahead, Wilen emphasised the challenges still facing parts of the market. “Looking at the year ahead, whilst it won’t be a cake walk by any means, hopefully this non-residential activity boost will provide the basis for a further strengthening, reflecting the 2026 return-to-growth predictions we made in our recent Construction Forecast. However, this only addresses half the story. In the short term, the toughest nut to crack will be the persistent private residential market stagnation,” he explained, citing subdued buyer confidence and delays in Building Safety Regulator approvals for high-rise schemes.
Residential construction performance
Residential construction delivered mixed results. Overall activity declined by 2% over the preceding three months and stood 20% lower than in 2024. Private residential construction continued its downward trend, falling 15% during the quarter and 29% year-on-year, reinforcing concerns about prolonged market stagnation.
In contrast, social housing construction performed more strongly. Project starts rose by 28% during the Index period and finished 16% higher than last year, underlining the importance of public sector-led development in supporting residential output.
Non-residential and civils growth
Non-residential construction recorded a strong fourth quarter, with most verticals posting growth. Office construction was a standout performer, rising 11% against the previous three months and reaching 53% above 2024 levels. This growth was supported by major project starts, including the £70 million Dirac Building at Cambridge’s St John’s Innovation Park.
Industrial construction also surged, increasing by 41% during the quarter and 57% year-on-year. Community and amenity projects followed a similar trajectory, rising 29% quarter-on-quarter and 37% compared with 2024.
Civils and infrastructure activity strengthened, with civils project starts up 17% during Q4 and 15% year-on-year. Infrastructure rose 8% and utilities 28% during the Index period, reflecting continued investment momentum.
Other sectors showed mixed results. Retail and education posted short-term gains but remained below 2024 levels, while health and hotel and leisure construction experienced notable declines.
Regional Construction Outlook
Regionally, London delivered the strongest performance, with project starts rising 35% quarter-on-quarter and 33% year-on-year. The North East and Yorkshire and the Humber also recorded positive growth, while the South East and West Midlands experienced continued weakness.
The Glenigan Construction Index confirms stabilising momentum across UK construction, with non-residential growth, regional variation, and public investment shaping digital construction priorities as the sector cautiously enters 2026.
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