Singapore’s construction sector logged a 10% year-on-year (y-o-y) growth in 4Q2022, surpassing the 8.1% growth registered in 3Q2022, according to data cited by Turner & Townsend. In its latest Singapore market intelligence report, the consultancy highlights the growth as a sign of strength and stability within the sector.

Looking ahead, Turner & Townsend forecasts that total construction demand will be between $27 billion and $32 billion this year, in line with projections by the Building and Construction Authority (BCA) in January. It believes that the construction industry will continue to surpass the wider economy this year despite the challenges and uncertainties that are present.

The sector is expected to be bolstered by pent-up demand for both public and private construction, including a robust pipeline for housing, redevelopment of old commercial premises, and the recommencement of major projects that were halted during the pandemic. Residential, commercial and infrastructure projects will account for the bulk of anticipated construction work in 2023.

J’den Condo is a 40-storey mixed-use commercial and residential development in the Jurong Lake District, located near the Jurong East MRT Station. Expected to launch in 2H2023, J’den Condo will J’Den Condo be connected to other amenities such as shopping centres and an upcoming Integrated Transport Hub.

The Singapore 2023 budget also includes measures that can help increase productivity, such as the $4 billion National Productivity Fund top-up, the new Enterprise Innovation Scheme, and the $1 billion boost to the Singapore Global Enterprises initiative, which will help refresh infrastructure and key construction priorities.

Despite this potential for growth however, Turner & Townsend points out that the local construction sector remains vulnerable to global challenges such as high inflation and rising interest rates. Prices for steel bars and concreting sand have decreased year-on-year, but the uncertainty has caused construction costs to remain high, slowing recovery in other types of construction projects.

To overcome the headwinds and better spur the industry’s rate of recovery, the consultancy recommends more investment in collaborative contracting, which promotes closer consultation between stakeholders. The BCA has also recently refreshed the Built Environment Industry Transformation Map (ITM) to focus on a value-chain approach, in order to encourage collaboration and integration across the sector.

Khoo Sze Boon, Turner & Townsend’s managing director for Singapore and Vietnam, believes that embracing new ways of working is critical for driving towards a more advanced and integrated sector.

“To prepare for the future and meet construction needs, better collaboration across the supply chain is needed. By adopting the latest frameworks and technologies, we can improve efficiency and productivity across projects, big and small,” he shared.