Singapore remains the fourth most expensive city in Asia for construction, according to the International Construction Costs 2019 report published by Arcadis, the leading global Design & Consultancy for natural and built assets.
The report details and ranks the relative cost of construction in 100 of the world’s major cities.
Singapore follows Hong Kong, Macau and Tokyo as the most expensive Asian cities for construction
and ranks 48th in the world.
Last year, Singapore was 27th but the change in its ranking is largely due to an increase in the size of the index from 50 cities in 2018 to 100 in 2019.
The Asian cities ranking in Arcadis’ International Construction Costs 2019:
Asia Ranking/World Ranking City
1 3 Hong Kong
2 7 Macau
3 9 Tokyo
4 48 Singapore
5 59 Seoul
6 82 Manila
7 88 Beijing
8 89 Bangkok
9 90 Shanghai
10 92 Jakarta
11 93 Chengdu
12 94 Guangzhou / Shenzhen
13 95 Wuhan
14 96 Ho Chi Minh
15 97 Kuala Lumpur
16 98 Mumbai
17 99 New Delhi
18 100 Bengaluru
Singapore’s construction market is experiencing growing trade conflicts, nervous financial markets and
signs of its GDP growth reducing. The Singapore government has indicated that the economy could
cool even further in 2019, with a forecast of 1.5% to 3.5% GDP growth.
The construction sector shrank by 3.4% for the whole of 2018, primarily due to a slowdown in public sector construction activities. However, it is likely to see an improvement in 2019 as successful en-bloc transactions awarded from 2017 to the first half of 2018 are likely to translate into construction activities in the next few quarters.
Prices for key construction materials remained stable over 2018, and prices are expected to rise in
2019. Labor costs remain relatively high in Singapore.
Digital transformation can help solve productivity challenges, and in Asia acknowledgment of its
importance is now more widely accepted, with adoption becoming a higher priority.
The Singapore government is pushing for a transformation roadmap for its construction industry. One of the key focuses is on Integrated Digital Delivery (IDD) to connect stakeholders in building and construction projects through digital information.
This involves mandatory adoption of Building Information Modelling (BIM), the establishment of Singapore Virtual Design and Construction Guide and the development of IDD standards and allowing smaller firms to testbed IDD solutions.
Khoo Sze Boon, Head of Cost Management & Quantity Surveying at Arcadis Singapore, said: “The International Construction Costs 2019 report provides important insights into construction markets around the world. Singapore remains the fourth most expensive city in Asia to build in and it’s clear that many developers are keenly aware of the pressing need to improve productivity.
“By investing in technology and digitalisation, it can help create better quality development, strengthen their competitive advantage and, ultimately, light a path towards long-term value creation.”
The Singapore government’s push to transform the construction industry will stimulate greater
technology adoption and digitalisation. This will then help transform the built environment industry to
be more efficient and sustainable, equipping citizens with new capabilities and skillsets.
Arcadis expects construction demand in Singapore to grow by 5% in 2019, and the tender price index to
increase by 1% to 3%.
Methodology
The comparative cost assessment of 100 cities is based on a survey of constructions costs undertaken by Arcadis covering 20 building types. Costs are representative of the local specification used to meet market needs. The building solutions adopted in each location are broadly similar and, as a result, the cost differential reported represents differences in specification as well as the cost of labor and materials.
Arcadis is the leading global Design & Consultancy for natural and built assets. Applying deep market sector insights and collective design, consultancy, engineering, project and management services, it works in partnership with clients to deliver exceptional and sustainable outcomes throughout the lifecycle of their natural and built assets.
It is 27,000 people active in over 70 countries that generate €3.3 billion in revenues. Arcadis supports UN-Habitat with knowledge and expertise to improve the quality of life in rapidly growing cities around the world.
More information can be found at www.arcadis.com
