Singapore 4th Priciest Asian Market For Constructions
SINGAPORE –The city-state emerged as the 4th most expensive market in Asia Pacific to build in, according to Turner & Townsend’s International Construction Market Survey 2021.
The UK-based professional services firm said average construction cost in Singapore reached US$2,079.7 per sq m in its latest research, amidst high building material costs and shortage of skilled labour.
As at June 2021, prices of crucial building materials like cement and steel bars in the city-state increased by 6 percent and 36.2 percent respectively compared to December 2020.
The spike in prices is in line with those seen in other parts of the world due to widespread disruption caused by the COVID-19 pandemic to global supply chains, in addition to high demand and stiff competition for such construction materials.
Meanwhile, Singapore imposed border curbs on South Asian migrant workers to control the spread of COVID-19. However, this has led to a slowdown in construction activities and raised manpower costs because of the lack of skilled labour, with substantial cost increases witnessed in electrical and mechanical works. The lack of skilled labour is also forecasted to negatively impact construction output over the coming quarters.
Due to this situation, construction tender prices in Singapore are projected to remain volatile for the rest of the year, with tender prices possibly increasing by 10 percent to 15 percent, exceeding Turner & Townsend’s earlier forecast range of 6 percent to 10 percent.
In Asia Pacific, Tokyo was named as the most expensive construction market, with an average building cost of US$4,001.5 per sq m. This was followed by Hong Kong (US$3,893.8 per sq m), Macau (US$3,125.0), Singapore, and Auckland (2,069.4 per sq m).
Globally, Tokyo was ranked as the most expensive, followed by Hong Kong, San Francisco (US$3,720 per sq m), New York City (US$3,511 per sq m), and Geneva (US$3,478.1 per sq m).
To determine the most expensive place to build in, Turner & Townsend calculated the average cost of four different building types – medium standard townhouses, large warehouse distribution centres, huge shopping centres including malls, and CBD Grade A office buildings with up to 20 levels.