Economic development in Europe is expected to gradually pick up as private consumption grows. According to European Central Bank’s (ECB) December estimate, short-term indicators suggest that GDP growth will continue to be moderate. ECB expects favourable financing conditions and low mortgage interest rates, combined with the increase in households’ disposable income, to boost demand for housing. The need for new construction, renovation and temporary facilities also increases due to intensely increasing immigration. Nevertheless, in its March review, the Bank of Finland estimated that investments will increase slowly in Europe, primarily due to the weakening of the world trade growth outlook.
In Cramo countries, the construction market outlook for 2016 is positive. The construction market analysts Euroconstruct and Forecon estimate that construction will increase in all of Cramo’s operating countries with the exception of Russia and Slovakia. The Confederation of Finnish Construction Industries RT also estimates that construction will take an upward turn in Finland.
In the long term, the equipment rental market is expected to grow faster than construction. Changes in demand usually follow those in construction with a delay. In addition to construction volume, the demand for equipment rental services is affected by industrial investments and the increase in the rental penetration rate. Tightening legislation and the requirement to improve the efficiency and quality of construction increase the need for different types of rental-related services.
The demand for modular space is boosted by the increase in the need for and popularity of modifiable and easily implementable space solutions. Demand is also increased by migration flows within countries, demographical changes as well as by completely new applications, such as asylum seeker reception centres. Furthermore, the long-term demand for both equipment rental and modular space is supported by many megatrends, such as urbanisation and the increasing emphasis on sustainability.
The European Rental Association (ERA) expects the use of equipment rental services to increase in all of Cramo’s markets in 2016. According to Cramo’s estimate, the demand for modular space has increased in the Nordic countries by nearly 6% per year during the past five years. Cramo estimates that in the Baltic countries and Germany, market growth is stronger.