New construction slows in Leeds city centre amid ‘challenging’ economic backdrop
Leeds city centre has experienced a slowdown in new construction starts as inflation and wider economic challenges impacted development activity throughout 2024, according to a new survey.
Deloitte’s latest Leeds Crane Survey, now in its 18th year, monitored construction activity in Leeds city centre across a range of sectors including offices, residential, hotels, retail and leisure, education and student housing during the 12 months of 2024.
The survey recorded 11 new schemes breaking ground on site - the lowest number of new construction starts since 2013.
However, there remains a healthy development pipeline of activity with 26 sites under construction, and a further 19 projects were completed in 2024.
Nolan Tucker, infrastructure and real estate director at Deloitte, said: “Leeds city centre has seen exponential growth in development activity over the last decade, but this survey paints a more challenging picture of progress.
"Construction inflation costs and evolving occupier needs have seen a recalibration in developer and investor plans. However, despite new construction starts falling overall, the residential sector continues to demonstrate resilience, while Leeds’ substantial student population maintains a healthy demand for student accommodation.”
In the residential sector, 1,361 homes were brought to market in 2024 with a further 4,185 under construction. The development pipeline suggests there will be a "healthy number” of homes likely to complete in 2025, with record-breaking levels anticipated for 2026.
Five new residential schemes were launched in 2024, down from seven in 2023.
In the student residential sector, 1,622 bedspaces were completed in 2024, with a further 2,511 under construction. Three student residential schemes started construction.
Leeds saw two new office developments start construction in 2024, below the five-year average of four new starts.
All new office space currently under construction is located in the City Core and South Bank.
While 2023 saw a notable amount of new education space delivered (197,462 sq. ft.), 2024 saw no completions. However, Leeds City College Mabgate Campus and the Arts University Extension, are expected to deliver 83,562 sq. ft. in 2025.
One new hotel scheme commenced construction in 2024, while there was no new activity in the hospitality, retail and leisure, education, healthcare or transport sectors.
Councillor James Lewis, leader of Leeds City Council said: “Leeds continues to demonstrate its resilience and ambition even amidst a challenging economic backdrop. The latest Crane survey figures reflect the city’s ongoing commitment to inclusive and sustainable growth, with significant development and investment happening across the city.
The Leeds Crane Survey is part of Deloitte’s Regional Crane Survey series, which monitors construction activity within four UK cities. Across all surveys – Belfast, Birmingham, Leeds and Manchester – 47 new construction starts were recorded in 2024 compared to 63 in 2023.