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Singapore slides five places in global ranking for construction costs: Arcadis index
SINGAPORE has moved down five positions on the global ranking for construction costs, making it the 15th most expensive city in the world to build in, based on the International Construction Costs Index published by global design and consultancy firm Arcadis.
But it remains the third most expensive Asian city for construction, after Hong Kong and Macau.
This relative decline in construction costs here vis-a-vis other global cities came amid a correction in the Singapore construction market since 2014.
The annual Arcadis index, which analyses the relative cost of construction across 44 major cities, finds that world cities, including New York and Hong Kong, continue to be some of the most expensive locations in the world in which to build.
The comparative cost assessment is based on a survey of construction costs in 44 locations undertaken by Arcadis, covering 13 building types.
"The future of the construction industry in Asia is looking optimistic. However, we believe that the construction industry drivers for the future will change," said Alan Hearn, head of buildings solutions.
Four out of 10 highest value construction projects in 2017 are located in Asia, he pointed out. Among them are One Belt One Road (OBOR) initiatives and the Delhi Mumbai Industrial Corridor.
"Mega projects like these are mainly funded by public-private partnership (PPP) and will continue to fuel the development of the construction industry in Asia," he said.
In Singapore, sustained workload in the public sector, such as public housing and civil engineering, in recent years has supported the industry during the slowdown in the private sector. As a result, prices have remained broadly stable, the Arcadis report says.
Singapore's Building and Construction Authority (BCA) projects the total value of construction contracts to be awarded in 2017 to reach between S$28 billion and S$35 billion. The numbers are higher than last year's preliminary estimate of S$26.1 billion.
The report notes that growth rates in many Asian construction markets have eased significantly over the past 18 months mainly due to the peak in commercial and residential development rates, and projects an expansion of 5-7 per cent per year for many construction markets in Asia.