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Crane index Q4, 2017

KPMG Deal Advisory

To increase the awareness of and contribute to Georgian construction market, KPMG in Georgia has started the publication of the biannual study of Crane Index for Tbilisi, Georgia. The Crane Index is a tool utilized across the world in order to monitor the activity in the construction sector. By physically counting the number of cranes in a city on a periodic basis, it enables the reader to understand the construction trend over time.

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In the crane index survey we count the number of cranes currently installed throughout Tbilisi. During our survey we have covered the tower cranes and, due to the identification complexity, excluded the mobile (small) cranes.

As of the fourth quarter of 2017 we have identified a total of 117 cranes installed at the construction sites, compared to 107 cranes in Q1 2017 (resulting in a growth rate of 9.3%), out of which 16 cranes have been idle (18 cranes in Q1 2017) either because of suspended construction works or due to them being dismantled

The results of our survey have also revealed that the construction of residential buildings have been the most attractive for developers and private investors, with 67.2% of construction works being related to residential premises followed by multifunctional complexes with a 15.5%share. The latter involves the development of a mix of residential, commercial, office and hotel premises.

Residential constructions recorded the only growth rate of 36.8% (+21 units) among other categories reaching 78 cranes in total, compared to 57 cranes as of Q1 2017. However, the highest decrease of 80.0% (-4 units) and 66.7% (-4 units) were identified in other and hotel constructions now showing one and two cranes, respectively. The 11.1% (-2 units) and 5.3% (-1 unit) decreases were observed in suspended/finished and multifunctional constructions, respectively (18 and 19 cranes in Q1 2017, respectively). There was no change in the number of cranes of the commercial constructions.

During our survey, we have identified 117 cranes installed in different parts of the city, with the most constructions situated in the western part of Tbilisi. It is important, to outline, that we have allocated cranes among the regions based on official administrative borders of the city of Tbilisi published by the National Agency of Public Registry (NAPR). The area covered by our survey amounts to 262 km2, representing 52% of the total area of the city.

Regions with populations of less than 10,000 individuals (Lilo, Telovani, Tsknetietc.) were excluded from our analysis

As evident on the map below, the leading region as of Q4 2017 with the highest number of construction sites is Vake(31 cranes), followed by Saburtalo(27), together covering 50% of all cranes. The highest concentration of construction in VakeandSaburtalocan be explained by their attractiveness, popularity among the citizens and increased commercial activity (Vakeis perceived as the most prestigious district in the city)

Crane Index growth for Q4 2017 was mainly driven by significantly more cranes in Nadzaladevi(+6), Isani-Samgori(+5), Vake(+5), Gldani(+4), Krtsanisi(+4), that was partially offset by negative growth recorded in Saburtalo(-9), Mtatsminda(-3) and Didube-Chughureti(-2)

 

© 2018 KPMG Georgia LLC, a company incorporated under the Laws of Georgia, a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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