New Zealand Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (H1 2025)

New Zealand Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (H1 2025)

Summary

GlobalData expects the construction industry in New Zealand to contract by 1% in real terms in 2025, owing to mounting debt, a fall in building permits, labor shortages, and rising construction material costs - especially for cement. According to Statistics New Zealand, the total value of building consents issued fell by 12.4% year-on-year (YoY) in the first two months of 2025. By sector, residential consents fell by 1.4% YoY, while non-residential consents fell sharply by 28% YoY during the same period. Earlier, building consents fell by 5.1% in 2024. Also, gross fixed capital formation (GFCF) in residential buildings declined by 10.2% in 2024, while that for non-residential buildings fell by 2.6% over the same period. In another setback to the industry, the annual average number of people employed in the construction sector fell by 2.6% in 2024, decreasing from 213,475 in 2023 to 207,825. Several projects are facing cost overruns or halts owing to tighter regulations and a sluggish construction market, thereby negatively affecting the industry. For instance, in March 2025, the government rejected the NZD1 billion ($603.6 million) Southland wind farm project due to environmental concerns.

However, the industry is expected to rebound at an average annual growth rate of 4% from 2026 to 2029, supported by investments in transport, health, and education infrastructure projects. In May 2024, the government approved a 10-year plan for the upgradation of the transport network in the Canterbury Region. The plan is expected to include an investment of NZD10.4 billion ($6.2 billion) to increase road capacity in the region to accommodate the growing population. Growth will also be fueled by the transport arm of the government-NZ Transport Agency Waka Kotahi’s National Land Transport Programme (2024-27), announced in September 2024. This program includes a total expenditure of NZD32.9 billion ($19.9 billion), with some of the major allocations including NZD7 billion ($4.2 billion) for state highway improvement, NZD5.5 billion ($3.3 billion) for road pothole maintenance, and NZD4.6 billion ($2.8 billion) for overall road maintenance by 2027. According to the National Infrastructure Pipeline’s data published in March 2025, a total of 7,600 projects totaling NZD204 billion ($123.1 billion) were either under construction or in the planning stage as of December 2024. In another boost to the industry’s output, the local Council of Auckland announced the NZD13.8 billion ($8.3 billion) water infrastructure plan in March 2025. Under this plan, more than 1,000 water infrastructure projects will be undertaken to improve Auckland’s water systems over the next ten years. Growth over the forecast period will also be supported by the government's plans to meet 100% of its electricity demand from renewable sources by 2030 and achieve its net-zero emissions target by 2050.

GlobalData’s Construction in New Zealand - Key Trends and Opportunities to 2029 (H1 2025) report provides detailed market analysis, information and insights into New Zealand's construction industry, including -

• New Zealand's construction industry's growth prospects by market, project type and construction activity
• Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in New Zealand's construction industry
• Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.

Scope

This report provides a comprehensive analysis of the construction industry in New Zealand. It provides -

• Historical (2020-2024) and forecast (2025-2029) valuations of the construction industry in New Zealand, featuring details of key growth drivers.
• Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
• Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
• Listings of major projects, in addition to details of leading contractors and consultants

Reasons to Buy

• Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies
• Assess market growth potential at a micro-level with over 600 time-series data forecasts
• Understand the latest industry and market trends
• Formulate and validate business strategies using GlobalData's critical and actionable insight
• Assess business risks, including cost, regulatory and competitive pressures
• Evaluate competitive risk and success factors