Public administrations have cut the investment they allocate to housing by 18% this year, according to data published by Seopan, the association of large construction companies, analyzing data from public works tenders.
Thus, until October, administrations have tendered contracts worth 643.9 million euros in the residential sector, which represents only 2.8% of the public works tender that has been carried out in Spain. This has reached 23,292 million euros in the first ten months of the year, and has grown by 6.1% compared to the same period of the previous year.
The majority of the investment in housing made by public administrations (59%) was allocated to building it, with a budget of 379.6 million euros, which represents a decrease of 30% compared to 2022. On the other hand, the Tenders for rehabilitation were 264.3 million, 10.3% more. In total, public administrations have put out to tender works to construct buildings worth 8,898 million euros, 0.2% more than a year ago.
Public administrations have concentrated their investment on building administrative buildings, which will house their own offices, in which they will invest 2,215 million euros, 50% more than last year. Behind these buildings, the budget tendered to build health facilities (1,432 million) and educational facilities (1,058 million) stands out.
According to data collected by Seopan, public works bidding in Spain has grown so far this year, driven by the rise in projects opened by the state and its dependent organizations, which increased by 48% to 8,934 million euros. This has maintained public investment in a year marked by the electoral cycle, which led local and regional administrations to reduce it, once the elections were over, in May. Thus, city councils and councils tendered 7,982 million, 7.7% less, and the autonomous communities 6,375 million, 12.2% less.
For public entities, the first bidder was Adif, with 3,940 million, 27% more, followed by the General Directorate of Highways, with 1,438 million, more than double that of 2022.
The autonomous community that tendered the most work was the Generalitat of Catalonia, with 1,608 million (48% more), followed by the Junta de Andalucía with 1,592 million (63% more) and Madrid, with 1,140 million (which fell by 37%).
The majority of the budget tendered this year, almost 62%, was allocated to civil works contracts, with more than 14,394 million until October, 10.2% more. In this area, the largest volume was in the transport tender, with 8,561 million, while the sector that grew the most was the environment, with 53%.
According to an analysis by the consulting firm Gobierto, specialized in contracting and public management, part of the stoppage of local and regional administrations could be reversed in the last months of the year, once their new governing bodies already established start contracting again. local.
The public tender, the consultant points out, is beginning to overcome the impact of the rise in inflation, which led many companies to desist from submitting offers for works due to the risk that costs would skyrocket before finishing it. Now, however, material prices have stabilized, and some have been reduced, although without returning to pre-Ukraine war levels.
Thus, if at the beginning of 2019 there were 3.56 offers for each contract that was put out to tender, in the fourth quarter of 2022 it dropped to only 2.9 and has now exceeded 3 offers again, says Gobierto. In the same sense, the reduction offered by construction companies on the starting price proposed by the administration also increases again. The consulting firm points out that the number of contracts that remain void is also beginning to reduce.
