What is hindering your market at the moment?

Operationally, owners are facing rising costs, such as food, staff wages, and power, which are putting pressure on profits. Lower profits make selling more challenging, and banks are less inclined to lend to the hospitality sector than before.

What opportunities are you seeing in your market at the moment?

There continues to be a strong pool of buyers actively seeking hospitality investment opportunities. At present, our sales figures match those of last year, and the number of sales agreed this year exceeds typical levels.

What's the biggest change you have seen in your sector throughout your career?

Hotel décor! When I started in the late 1980s, it was not uncommon to come across candlewick bedspreads (a relic from another era – ask your grandparents Gen Z) and brightly coloured bathroom suites. Swags and tails and floral prints were considered the epitome of style.

What differentiates the service you offer to your clients, from your competitors?

Experience and a long-term view. While it is slightly shocking that I saw my first hotel as a trainee surveyor 36-years ago, it does mean that it is highly unusual for a situation to arise that I have not come across. If it does, I can say with confidence that it is an outlier! I believe my clients really benefit from the level of experience I can provide.

Furthermore, I approach my work with a long-term mindset. I have always believed in giving potential clients my honest advice, even if this means telling them not to sell their property. This level of transparency often surprises them, but I do so with the understanding that they will usually return to me when the time is right. Over the years, I've witnessed numerous competitors come and go, many of whom adopted a short-term, "promise the earth" approach. However, I prefer to build lasting relationships based on trust and integrity.

What advice would you give your younger self when you first started your career in property?

Relax and don’t get frustrated or despondent when good advice seems to get you no-where in the short-term - it will pay off in the end. Accept that the advice you give at 35 is less likely to be acted on than when you give the same advice at 45.

What is hindering your market at the moment?

Operationally, owners are facing rising costs, such as food, staff wages, and power, which are putting pressure on profits. Lower profits make selling more challenging, and banks are less inclined to lend to the hospitality sector than before.

What opportunities are you seeing in your market at the moment?

There continues to be a strong pool of buyers actively seeking hospitality investment opportunities. At present, our sales figures match those of last year, and the number of sales agreed this year exceeds typical levels.

What's the biggest change you have seen in your sector throughout your career?

Hotel décor! When I started in the late 1980s, it was not uncommon to come across candlewick bedspreads (a relic from another era – ask your grandparents Gen Z) and brightly coloured bathroom suites. Swags and tails and floral prints were considered the epitome of style.

What differentiates the service you offer to your clients, from your competitors?

Experience and a long-term view. While it is slightly shocking that I saw my first hotel as a trainee surveyor 36-years ago, it does mean that it is highly unusual for a situation to arise that I have not come across. If it does, I can say with confidence that it is an outlier! I believe my clients really benefit from the level of experience I can provide.

Furthermore, I approach my work with a long-term mindset. I have always believed in giving potential clients my honest advice, even if this means telling them not to sell their property. This level of transparency often surprises them, but I do so with the understanding that they will usually return to me when the time is right. Over the years, I've witnessed numerous competitors come and go, many of whom adopted a short-term, "promise the earth" approach. However, I prefer to build lasting relationships based on trust and integrity.

What advice would you give your younger self when you first started your career in property?

Relax and don’t get frustrated or despondent when good advice seems to get you no-where in the short-term - it will pay off in the end. Accept that the advice you give at 35 is less likely to be acted on than when you give the same advice at 45.

What has been the best piece of advice that you’ve been given during your career?

Arrive at a hotel with noticeable energy and enthusiasm. Jog up the steps to the front door; it energises you, and if the owners see you, it creates a much more positive impression than a slow trudge!

What’s the best work decision you have ever made?

Taking a risk by moving my young family from Bristol to Harrogate and leaving a large firm for a tiny specialist hotel agency, Robert Barry & Co, proved to be a valuable experience. The partnership taught me well and when it was acquired by Colliers, I came along for the ride and have enjoyed the experience.

What’s your greatest work achievement?

Selling businesses for people who have no experience of that process and who therefore need help and support - and receiving their gratitude post-completion, is incredibly rewarding. The best thing is that this is an achievement I can continuously replicate!

What has been the best piece of advice that you’ve been given during your career?

Arrive at a hotel with noticeable energy and enthusiasm. Jog up the steps to the front door; it energises you, and if the owners see you, it creates a much more positive impression than a slow trudge!

What’s the best work decision you have ever made?

Taking a risk by moving my young family from Bristol to Harrogate and leaving a large firm for a tiny specialist hotel agency, Robert Barry & Co, proved to be a valuable experience. The partnership taught me well and when it was acquired by Colliers, I came along for the ride and have enjoyed the experience.

What’s your greatest work achievement?

Selling businesses for people who have no experience of that process and who therefore need help and support - and receiving their gratitude post-completion, is incredibly rewarding. The best thing is that this is an achievement I can continuously replicate!

The changing demographic within the UK has resulted in a situation where, for the first time, there are more people of pensionable age than there are children under the age of sixteen. This, coupled with the aging workforce in the construction industry, both within the contracting and consultancy markets, means that it is an alarming time for the industry. Satisfying labour workforces and recruitment demands has become a very real and pertinent issue for both contractors and consultancies.

Recruiting people into the industry is not a new challenge, but the changing demographic of the country is exacerbating the problem, requiring immediate attention. ​

Challenges caused by the construction skills shortage

It is essential to view these challenges within the broader context of the changing modern world, including increased flexible working, EU worker policy, the implementation of modern construction methods, and the efficiencies being driven through these technologies.

However, in the short to medium term, the aging workforce is straining the labour supply, leading to increasing labour costs. Wages have risen by 6% from a shortage of skilled tradespeople.

This is putting upward pressure on outturn construction costs as clients and developers strive to make their schemes viable. ​ Contractors are grappling with inflation, supply chain disruption, and a diminishing supply of workers to choose from as costs increase. Some contractors have even been forced to cease trading due to these challenges. All this has been too much for some contractors and we have seen some notable companies cease trading.

In terms of growth, the UK will look to construction to kickstart the economy in Q3 2023 and beyond. However, the drain of resources will put sustained growth at risk and make it difficult to meet the aforementioned numbers over the next few years.

Construction has historically leaned on workers from the European Union to satisfy this demand but according to the ONS, between 2020 and 2017 there was a 42% decline in the number of EU workers, compared to just a 4% drop from that of UK workers.

It remains to be seen what the effect of the ‘Back to Work’ budget will have on the industry after the government has relaxed migration requirements for key workers and whether this will mitigate some of this decline.

What are some of the schemes trying to help?

The government is trying to do its bit by the introduction of schemes to flood the younger end of the industry with the next generation. One such initiative is the introduction of the T Level in construction. This new technical qualification can be pursued after GCSEs and is the equivalent of 3 A Levels. Schemes like this can be used in collaboration with companies to meet their resourcing requirements and prepare the apprentices for the workplace. The courses are two years long and include nine weeks minimum working with an employer as an industry placement.

Although similar to apprenticeships, T levels will be more classroom-based, and give young people a route to academic achievement in a technical role.

In addition to the T level, there is the Construction Skills Fund, funded by the CITB, which aims to set up training hubs across the country. The funding supports live projects, providing to onsite experience to nearly 20,000 participants. Major contractors Wilmott Dixon, Balfour Beatty, and Morgan Sindall are just some of the major players in this scheme and have directly hired individuals for various roles.

Opportunities to help mitigate the skills shortage ​

The skills shortage is also impacting the consultancy sector of the industry. There is still a large proportion of the workforce that is aging, and the industry needs to do more to attract young talent.

The consultancy workforce has still seen the effects of Brexit and Covid 19; the exodus of EU workers and ‘big resignation’ of the older workforce after the pandemic. This is compounded by the globalisation of the construction industry and the attractiveness of international markets such as Australia, New Zealand, and USA in drawing talent away from UK consultants.

To address this, the Colliers Bristol Project and Building Consultancy team are actively contributing to rebalancing the scales by having over 25% of the team composed of apprentices. Two of them are pursuing their education at the University College of Estate Management, while the other two are enrolled in the local University of the West of England. ​

Additionally, there are a further two apprentices within the Bristol office that are part of the larger Colliers ‘Emerging Talent’ programme’. ​

Applicants are being encouraged for the next intake in 2024 and applications will open in autumn 2024.

In conclusion, there is a growing recognition within the industry of the challenges we currently face, particularly in the short to medium term, concerning the skills shortage. Initiatives like the government's T level and CITB Construction Skills Fund serve as positive starting points. However, it is now the responsibility of companies to drive their own programs, such as Colliers' Emerging Talent, to address these challenges.

The industry must adopt a cohesive and collaborative approach to: Attract skilled workers already working elsewhere in the industry

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The changing demographic within the UK has resulted in a situation where, for the first time, there are more people of pensionable age than there are children under the age of 16. This, coupled with the aging workforce in the construction industry, both within the contracting and consultancy markets, means that it is an alarming time for the industry. Satisfying labour workforces and recruitment demands has become a very real and pertinent issue for both contractors and consultancies.

These are the numbers that the UK construction industry is faced with currently.

Recruiting people into the industry is not a new challenge, but the changing demographic of the country is exacerbating the problem, requiring immediate attention. ​

Challenges caused by the construction skills shortage

It is essential to view these challenges within the broader context of the changing modern world, including increased flexible working, EU worker policy, the implementation of modern construction methods, and the efficiencies being driven through these technologies.

However, in the short to medium term, the aging workforce is straining the labour supply, leading to increasing labour costs. Wages have risen by six per cent due to a shortage of skilled tradespeople.

This is putting upward pressure on outturn construction costs as clients and developers strive to make their schemes viable. ​ Contractors are grappling with inflation, supply chain disruption, and a diminishing supply of workers to choose from as costs increase. Some contractors have even been forced to cease trading due to these challenges. All this has been too much for some contractors and we have seen some notable companies cease trading.

In terms of growth, the UK will look to construction to kickstart the economy in Q3 2023 and beyond. However, the drain of resources will put sustained growth at risk and make it difficult to meet the aforementioned numbers over the next few years. ​

Construction has historically leaned on workers from the European Union to satisfy this demand but according to the ONS, between 2017 and 2020 there was a 42 per cent decline in the number of EU workers, compared to just a four per cent drop from that of UK workers.

It remains to be seen what the effect of the ‘Back to Work’ budget will have on the industry after the government has relaxed migration requirements for key workers and whether this will mitigate some of this decline.

 

What are some of the schemes trying to help?

The government is trying to do its bit by the introduction of schemes to flood the younger end of the industry with the next generation. One such initiative is the introduction of the T Level in construction. This new technical qualification can be pursued after GCSEs and is the equivalent of three A Levels. Schemes like this can be used in collaboration with companies to meet their resourcing requirements and prepare the apprentices for the workplace. The courses are two years long and include nine weeks minimum working with an employer as an industry placement.

Although similar to apprenticeships, T levels will be more classroom-based, and give young people a route to academic achievement in a technical role.

In addition to the T level, there is the Construction Skills Fund, funded by the CITB, which aims to set up training hubs across the country. The funding supports live projects, providing to onsite experience to nearly 20,000 participants. Major contractors Wilmott Dixon, Balfour Beatty, and Morgan Sindall are just some of the major players in this scheme and have directly hired individuals for various roles.

Opportunities to help mitigate the skills shortage ​

The skills shortage is also impacting the consultancy section of the industry. There is still a large proportion of the workforce that is aging, and the industry needs to do more to attract young talent.

The consultancy workforce has also seen the effects of Brexit and Covid 19; the exodus of EU workers and ‘big resignation’ of the older workforce after the pandemic. This is compounded by the globalisation of the construction industry and the attractiveness of international markets such as Australia, New Zealand, and USA in drawing talent away from UK consultants.

To address this, the Colliers Bristol Project & Building Consultancy team are actively contributing to rebalancing the scales by having more than 25 per cent ​ of the team composed of apprentices. Two of them are pursuing their education at the University College of Estate Management, while the other two are enrolled in the local University of the West of England. ​

Additionally, there are a further two apprentices within the Bristol office that are part of the larger Colliers Emerging Talent programme. ​

Applicants are being encouraged for the next intake and applications will open in autumn 2024.

In conclusion, there is a growing recognition within the industry of the challenges we currently face, particularly in the short to medium term, concerning the skills shortage. Initiatives like the government's T level and CITB Construction Skills Fund serve as positive starting points. However, it is now the responsibility of companies to drive their own programs, such as Colliers' Emerging Talent, to address these challenges.

The industry must adopt a cohesive and collaborative approach to:

Attract skilled workers​ alreadyworking else where in the industry

Attract people​ back to the industry that have now left

Shortening qualification periods​ through intense training​ to meet demand quicker

Improving​ the retention of staff​ within the industry

Striving to increase productivity​ through innovation​

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Alex Vacher​
Director
Cost Management alex.vacher@colliers.com

Alex is ​ Director and Chartered Quantity Surveyor with over 10 years of industry experience in Cost Management and Quantity Surveying.

Alex is passionate about delivering excellent commercial advice for our clients for them to obtain best value. His focus is on how he can apply commercial acumen to add value for our clients through all stages of the project.

As the head of the Cost Management team at our Bristol office, Alex assumes the responsibility of leading a highly skilled and dedicated team, ensuring the delivery of outstanding results for our esteemed clientele.

 

Alex Vacher​
Director | Cost Management

Alex is ​ director and Chartered Quantity Surveyor with over 10 years of industry experience in Cost Management and Quantity Surveying.

Alex is passionate about delivering excellent commercial advice for our clients for them to obtain best value. His focus is on how he can apply commercial acumen to add value for our clients through all stages of the project.

As the head of the Cost Management team at our Bristol office, Alex assumes the responsibility of leading a highly skilled and dedicated team, ensuring the delivery of outstanding results for our esteemed clientele.