Construction demand in Singapore is expected to remain strong in the coming years. The Building and Construction Authority (BCA) projects the value of construction contracts awarded in 2023 will be between $27 billion and $32 billion, similar to last year’s forecast. According to preliminary figures, construction demand totaled $29.8 billion in 2022, in line with BCA’s forecast range.
Public and private sector projects both contributed to the sustained level of construction demand. Public sector construction demand was at $17.9 billion in 2022, slightly higher than the $17.8 billion seen in 2021. Major projects included the Cross Island MRT Line (Phase 1), Jurong Region MRT Line, Ministry of Health healthcare facilities, and new Build-To-Order (BTO) units.
Meanwhile, private sector construction demand slightly moderated to $11.9 billion due to “various economic downside risks.” Private residential and industrial building developments stayed resilient however.
In 2023, public sector contracts awarded are projected to make up nearly 60% of total construction demand, estimated at between $16 billion and $19 billion. Public sector demand will be driven by a ramp-up in the supply of BTO flats by the HDB, and by construction of industrial buildings, educational buildings, community clubs, and other infrastructure works.
BCA anticipates private sector construction demand to range between Senja Close EC $11 billion and $13 billion in 2023. Residential and industrial building construction demand are expected to be similar to that of last year, while commercial building demand is anticipated to go up – supported by the rescheduling of some projects from 2022 to 2023, as well as the redevelopment of old commercial assets.
Total nominal construction output, based on the value of certified progress payments, is projected to reach between $30 billion to $33 billion this year, slightly higher than the $30.2 billion recorded in 2022. BCA attributes the increase to a steady demand and the backlog of remaining workloads caused by the Covid-19 outbreak.
Looking ahead, BCA expects total construction demand from 2024 to 2027 to range between $25 billion and $32 billion annually. Public sector demand is estimated at between $14 billion and $18 billion per year, while private sector demand is projected to be around $11 billion to $14 billion. The forecast does not factor in the Changi Airport Terminal 5 development, its associated infrastructure projects, or the expansion of two integrated resorts.