2011 ended immersed in uncertainty. The Eurozone had lurched from crisis to crisis unresolved throughout the autumn and into winter. The year had begun somewhat optimistically: the austerity measures were anticipated but had hardly begun to bite; and there were signs of life in the private commercial property market, at least in London. Indeed the button was pushed on a number of large office construction schemes in London, including the towers at Leadenhall Building and 20 Fenchurch Street, the “Walkie-Talkie.” But the wind was slowly sucked from the sails as the economy refused to grow and uncertainty returned to haunt the boardrooms.

Although statistic show that construction activity picked up in some areas, it was not enough to cause any rebound in construction prices after the 18 percent fall that occurred in early 2008. In fact, prices ‘bumped along the bottom’ for the whole year, edging up mid-year where conditions allowed, and in response to higher materials prices, but dropping back in the fourth quarter as materials price pressures eased and sentiment about 2012 order books hardened. Overall, at the end of the year, prices were on average one percent lower than at the end of 2010.

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