Building Costs Per Square Metre in Hong Kong 2025 to 2026 – Arcadis Guide

Introduction: Hong Kong’s Construction Landscape in 2025

Hong Kong’s construction industry stands at a pivotal juncture in 2025, navigating a complex interplay of public sector initiatives and private market challenges. According to the Long-Term Housing Strategy Annual Progress Report released in October 2024, the government has set an ambitious private housing supply target of 132,000 units for the 10-year period from 2025/26 to 2034/35. Through strategic land sales and railway property developments, the anticipated supply in the first-hand private residential property market is approximately 108,000 units over the next three to four years. However, this optimism is tempered by recent failures in land tender exercises and a persistently subdued property market, prompting the government to adopt a more cautious approach to land production.

The cost dynamics of Hong Kong’s construction sector reveal a fascinating story of adjustment and adaptation. Arcadis’ Tender Price Index (TPI) showed a mild increase of just 0.5% in tender prices during 2024, reflecting the market’s cautious stance. Data from the Census and Statistics Department (C&SD) from October 2024 indicates that prices of major construction materials declined compared to the previous year. Specifically, high tensile steel bars, plywood, Portland cement, sand, concrete blocks, and UPVC pipes all saw price reductions, with sand and steel both falling by approximately 10%. Diesel fuel prices remained relatively stable throughout 2024, providing some consistency in transportation costs.

Labor market dynamics present a mixed picture. According to November 2024 data from the C&SD, yearly wage inflation ranged from 1.7% to 10.4% across 11 trades and general workers, with the notable exception of bricklayers who experienced a significant drop of 7.3%. The most substantial wage growth was observed among general workers, carpenters (formwork), painters, and mechanical fitters. In October 2024, the Hong Kong Construction Industry Employees General Union proposed new daily payroll rates for workers in 16 major trades, recommending a salary freeze for 14 trades and an approximate 3% increase for metal scaffolders and excavators. The unemployment rate in the construction sector hovered between 4.1% and 4.5% throughout 2024, higher than the rates observed in the second half of 2023 (3.7% to 3.9%).

Looking ahead to 2026, Arcadis maintains a cautiously optimistic outlook for public sector construction activity, which continues to be supported by projects funded in recent years. The ongoing challenges in the property market persist, effectively positioning the public sector as the primary driver of growth. The adoption of innovative construction methods and prefabrication is expected to alleviate some labor supply shortage issues. Material and labor costs are anticipated to remain stable in the coming year, but due to the contraction in the private sector, competition in tender prices is expected to intensify. Construction costs are projected to decline by approximately 2% in 2025, creating a more competitive environment for developers and contractors alike.

This comprehensive guide draws upon Arcadis’s extensive data and expertise to provide stakeholders across the construction and real estate sectors with detailed insights into building costs across various categories in Hong Kong for 2025. From residential to commercial, hospitality to industrial, and everything in between, we break down the numbers that matter for your projects and investments.

 

Residential Building Costs in Hong Kong

Public Authority Apartments

At the most affordable end of Hong Kong’s residential spectrum, public authority standard high-rise apartments represent the government’s commitment to addressing housing accessibility. These developments typically feature functional design with an emphasis on efficiency and cost-effectiveness.

Construction Cost Breakdown:

• Building Works: HK$10,050 – HK$11,830 per m²
• Services: HK$2,150 – HK$2,570 per m²
• Total Cost: HK$12,300 – HK$14,400 per m²

These costs reflect the no-frills approach to public housing, with efficient space planning and standardized components that keep expenses manageable while maintaining basic quality standards.

Average Standard Apartments

Mid-market residential developments cater to Hong Kong’s growing middle class, offering improved finishes and better amenities compared to public housing. These buildings typically feature enhanced common areas, more attractive facades, and higher-quality fixtures.

Construction Cost Breakdown:

• Building Works: HK$21,130 – HK$23,480 per m²
• Services: HK$4,370 – HK$5,820 per m²
• Total Cost: HK$25,500 – HK$29,300 per m²

The significant jump in costs compared to public housing reflects better materials, more sophisticated designs, and improved services including enhanced security systems, more elevators, and better recreational facilities.

High-End Apartments

Luxury high-rise apartments represent the premium segment of Hong Kong’s residential market, catering to discerning buyers with high expectations for quality, design, and amenities. These developments often feature renowned architects, imported materials, and extensive facilities.

Construction Cost Breakdown:

• Building Works: HK$27,450 – HK$30,980 per m²
• Services: HK$5,350 – HK$6,920 per m²
• Total Cost: HK$32,800 – HK$37,900 per m²

The premium paid for high-end apartments goes toward superior finishes, advanced building systems, prestigious locations, and extensive amenities such as concierge services, swimming pools, fitness centers, and private gardens.

Terraced and Detached Houses

Low-density housing represents a luxury in space-constrained Hong Kong, with terraced and detached houses commanding significant premiums due to land costs and the exclusivity they offer.

Terraced Houses (Average Standard):

• Building Works: HK$30,350 – HK$34,450 per m²
• Services: HK$4,750 – HK$5,750 per m²
• Total Cost: HK$35,100 – HK$40,200 per m²

Detached Houses (High End):

• Building Works: HK$44,000+ per m²
• Services: HK$6,800+ per m²
• Total Cost: HK$50,800+ per m²

These substantial costs reflect the individualized design, higher-quality materials, and extensive services required for standalone properties, including private drainage, electrical systems, and security provisions.

Commercial and Office Space Construction Costs

Medium/High Rise Offices (Average Standard)

Hong Kong’s commercial heartland features numerous office towers catering to various business needs. Average standard offices provide functional workspace with adequate services and finishes for general business operations.

Construction Cost Breakdown:

• Building Works: HK$18,900 – HK$20,950 per m²
• Services: HK$6,500 – HK$7,750 per m²
• Total Cost: HK$25,400 – HK$28,700 per m²

These costs cover standard finishes, efficient mechanical and electrical systems, basic common areas, and reliable elevators sufficient for general commercial use.

High Rise Prestige Quality Offices

Prestige office developments target top-tier financial services, legal firms, and multinational corporations with high expectations for building quality, technological infrastructure, and architectural distinction.

Construction Cost Breakdown:

• Building Works: HK$23,300 – HK$26,050 per m²
• Services: HK$6,900 – HK$8,350 per m²
• Total Cost: HK$30,200 – HK$34,400 per m²

The premium for prestige offices includes higher-quality cladding systems, more sophisticated building management systems, larger elevator capacities, enhanced security features, and superior common area finishes that project corporate image and status.

Retail Spaces

Hong Kong’s retail sector ranges from out-of-town shopping centers to high-end urban retail malls, each with distinct cost structures reflecting their target markets and operational requirements.

Out-of-Town Shopping Centre (Average Standard):

• Building Works: HK$18,650 – HK$22,050 per m²
• Services: HK$6,350 – HK$7,250 per m²
• Total Cost: HK$25,000 – HK$29,300 per m²

High-End Retail Malls:

• Building Works: HK$25,300 – HK$29,100 per m²
• Services: HK$7,000 – HK$8,300 per m²
• Total Cost: HK$32,300 – HK$37,400 per m²

The higher costs for premium retail spaces reflect more elaborate architectural features, enhanced lighting systems, superior finishes, and more complex mechanical systems required to maintain comfort for high volumes of shoppers.

Hospitality Sector Construction Costs

Budget Hotels (3-Star, Mid-Market)

Hong Kong’s budget hotel sector caters to cost-conscious travelers while maintaining basic comfort standards. These properties prioritize efficiency and functionality over luxury.

Construction Cost Breakdown:

• Building Works: HK$24,000 – HK$24,700 per m²
• Services: HK$8,000 – HK$9,300 per m²
• Total Cost: HK$32,000 – HK$34,000 per m²

These costs cover durable but economical finishes, efficient space planning, and basic services sufficient for short-stay guests without extravagant amenities.

Business Hotels (4/5-Star)

Business hotels cater to corporate travelers with enhanced services, better facilities, and higher quality accommodations than budget options, while maintaining efficiency and functionality.

Construction Cost Breakdown:

• Building Works: HK$24,600 – HK$27,950 per m²
• Services: HK$8,400 – HK$9,950 per m²
• Total Cost: HK$33,000 – HK$37,900 per m²

The increased investment goes toward better finishes, more sophisticated building systems, enhanced common areas, meeting facilities, and fitness centers that appeal to business travelers.

Luxury Hotels (5-Star)

Hong Kong’s luxury hotel segment competes on the global stage, offering exceptional quality, extensive amenities, and impeccable service to discerning international guests.

Construction Cost Breakdown:

• Building Works: HK$29,800 – HK$32,750 per m²
• Services: HK$8,500 – HK$10,050 per m²
• Total Cost: HK$38,300 – HK$42,800 per m²

These substantial costs reflect premium materials, sophisticated design, extensive back-of-house operations, multiple food and beverage outlets, spacious rooms, lavish common areas, and extensive amenities including spas, pools, and business centers.

Industrial and Specialized Facilities

Owner Operated Factories

Light industrial facilities in Hong Kong accommodate various manufacturing, assembly, and storage functions with practical designs focused on functionality rather than aesthetics.

Construction Cost Breakdown:

• Building Works: HK$16,300 – HK$20,150 per m²
• Services: HK$2,800 – HK$3,550 per m²
• Total Cost: HK$19,100 – HK$23,700 per m²

These costs cover robust construction, basic services, adequate loading facilities, and functional space planning suitable for light industrial operations without extravagant finishes or complex building systems.

Car Parking Facilities

Parking structures in space-constrained Hong Kong represent significant investments, with underground facilities commanding premium costs due to excavation and engineering challenges.

Underground/Basement Car Parks (<3 levels):

• Building Works: HK$25,700 – HK$29,250 per m²
• Services: HK$3,100 – HK$3,950 per m²
• Total Cost: HK$28,800 – HK$33,200 per m²

Multi-Storey Car Parks, Above Ground (<4 levels):

• Building Works: HK$14,100 – HK$16,000 per m²
• Services: HK$2,800 – HK$3,700 per m²
• Total Cost: HK$16,900 – HK$19,700 per m²

The significant cost difference between above-ground and underground parking highlights the substantial expenses associated with excavation, waterproofing, and ventilation required for below-grade facilities.

Educational Facilities

Schools and educational institutions require specialized spaces, durable materials, and specific safety features that influence their construction costs.

Schools (Primary and Secondary):

• Building Works: HK$18,300 – HK$19,050 per m²
• Services: HK$3,300 – HK$4,150 per m²
• Total Cost: HK$21,600 – HK$23,200 per m²

Students’ Residences:

• Building Works: HK$19,250 – HK$21,300 per m²
• Services: HK$5,150 – HK$6,100 per m²
• Total Cost: HK$24,400 – HK$27,400 per m²

Educational facilities require robust construction, specialized spaces (classrooms, laboratories, sports facilities), enhanced safety features, and durable finishes that can withstand heavy use by students.

Sports and Leisure Facilities

Recreational buildings serve community needs with specialized spaces that accommodate specific activities and equipment.

Sports Clubs, Multi-Purpose Sports/Leisure Centers (Dry Sports):

• Building Works: HK$25,450 – HK$27,850 per m²
• Services: HK$6,450 – HK$7,950 per m²
• Total Cost: HK$31,900 – HK$35,800 per m²

These costs include air conditioning, specialized flooring, enhanced ventilation, and appropriate lighting for sports activities, plus furniture, fixtures, and equipment (FF&E) specific to recreational use.

Healthcare Facilities

General hospitals represent some of the most complex and costly building types due to their specialized spaces, advanced equipment, and critical building systems.

General Hospitals – Public Sector:

• Building Works: HK$30,650 – HK$32,700 per m²
• Services: HK$9,250 – HK$11,100 per m²
• Total Cost: HK$39,900 – HK$43,800 per m²

Hospital costs reflect specialized requirements including medical gases, infection control measures, sophisticated mechanical systems, structural capacity for heavy equipment, and layouts that support complex medical workflows.

Mechanical and Electrical (M&E) Costs Breakdown

Residential M&E Costs

M&E systems vary significantly across residential segments, with public housing featuring basic systems while premium developments incorporate advanced technology and higher capacities.

Public Authority Standard Apartments:

• Mechanical Air Conditioning: HK$730 – HK$850 per m²
• Fire Services: HK$170 – HK$220 per m²
• Hydraulic Services: HK$300 – HK$350 per m²
• Electrical Services: HK$950 – HK$1,150 per m²
• Total Services: HK$2,150 – HK$2,570 per m²

Average Standard Apartments:

• Mechanical Air Conditioning: HK$950 – HK$1,200 per m²
• Fire Services: HK$1,200 – HK$1,400 per m²
• Hydraulic Services: HK$420 – HK$670 per m²
• Electrical Services: HK$450 – HK$750 per m²
• Lifts/Escalators: HK$1,350 – HK$1,800 per m²
• Total Services: HK$4,370 – HK$5,820 per m²

High-End Apartments:

• Mechanical Air Conditioning: HK$1,300 – HK$1,600 per m²
• Fire Services: HK$1,450 – HK$1,750 per m²
• Hydraulic Services: HK$450 – HK$720 per m²
• Electrical Services: HK$550 – HK$850 per m²
• Lifts/Escalators: HK$1,600 – HK$2,000 per m²
• Total Services: HK$5,350 – HK$6,920 per m²

The progression from basic to premium M&E systems reflects increasing complexity, higher quality equipment, enhanced comfort controls, better energy efficiency, and more sophisticated safety systems.

Terraced and Detached Houses M&E Costs

Low-density housing features different M&E requirements compared to high-rise developments, with individual systems rather than centralized building services.

Terraced Houses (Average Standard):

• Mechanical Air Conditioning: HK$1,400 – HK$1,700 per m²
• Fire Services: HK$1,500 – HK$1,800 per m²
• Hydraulic Services: HK$100 – HK$200 per m²
• Electrical Services: Not Applicable (N/A)
• Lifts/Escalators: HK$1,750 – HK$2,050 per m²
• Total Services: HK$4,750 – HK$5,750 per m²

Detached Houses (High End):

• Mechanical Air Conditioning: HK$2,200+ per m²
• Fire Services: HK$2,500+ per m²
• Hydraulic Services: HK$100+ per m²
• Electrical Services: N/A
• Lifts/Escalators: HK$2,000+ per m²
• Total Services: HK$6,800+ per m²

The M&E systems for houses typically include individual HVAC units, comprehensive electrical systems, and sometimes residential elevators, with high-end properties featuring smart home technology, energy management systems, and premium fixtures.

Fit-Out Costs in Hong Kong

Hotel Fit-Out Costs

Hotel interiors vary dramatically by segment, with budget properties emphasizing durability and efficiency while luxury properties invest heavily in aesthetics, comfort, and brand differentiation.

Public Areas (Front of House):

• 3-Star Hotel: HK$11,500 – HK$17,000 per m²
• 4-Star Hotel: HK$17,000 – HK$24,000 per m²
• 5-Star Hotel: HK$24,000+ per m²

Guest Rooms:

• 3-Star Hotel: HK$9,500 – HK$11,200 per m²
• 4-Star Hotel: HK$11,500 – HK$15,000 per m²
• 5-Star Hotel: HK$15,500+ per m²

These costs include furniture, floor, wall and ceiling finishes, drapery, sanitary fittings, and light fittings. They exclude partitioning, M&E works, building shell, chandeliers, operational items and equipment (cutlery, crockery, linen, television, refrigerator, etc.), opening expenses, stage equipment, and computer systems.

Office Fit-Out Costs

Office interiors reflect corporate image, functional requirements, and workplace strategies that vary across different business types and cultures.

• General Office: HK$7,500 – HK$11,500 per m²
• Executive Office: HK$12,500 – HK$15,500 per m²
• Prestige Office: HK$15,500+ per m²

These costs include furniture, partitioning, electrical work, minor alteration to air-conditioning, fire services, and suspended ceiling to suit layout. They exclude telephones, data cabling, and office equipment (computers, photocopiers, fax machines, UPS, etc.). General offices typically allow local/PRC furniture, while prestige offices feature higher-quality imported furniture and finishes.

Retail and Restaurant Fit-Out Costs

Retail and food service environments require specialized finishes, lighting, and equipment that support their commercial operations and brand identity.

Department Stores:

• General Department Store: HK$9,500 – HK$14,500 per m²
• Prestige Department Store: HK$15,500+ per m²

Restaurants:

• General Dining Restaurant: HK$13,500 – HK$21,000 per m²
• Fine Dining Restaurant: HK$25,000+ per m²

Department store fit-out costs include electrical work, additional FCUs, and minor alteration of fire services to suit layout. They exclude facade modification, data cabling, operational items and equipment (computers, P.O.S., office equipment), and opening expenses.

Restaurant fit-out costs include furniture, floor, wall and ceiling finishes, electrical work, minor alteration to air-conditioning, and fire services installation to suit layout. They exclude exhaust flue and operational items (cutlery, crockery, linen, utensils, etc.).

All cost per square meter figures are based on fit-out area measured to the inner face of the perimeter wall.

Ancillary Facilities and Unit Costs

Recreational Facilities

Hong Kong’s limited space makes specialized recreational facilities valuable amenities in residential and commercial developments.

Squash Courts:

• Single court with glass backwall including associated mechanical and electrical services but excluding any public facilities (enclosing structure not included): HK$800,000 per court

Tennis Courts:

• Single court on grade with acrylic surfacing and complete with chain link fence: HK$1,800,000 per court
• Single court on grade with artificial turf surfacing and complete with chain link fence: HK$2,000,000 per court
• Extra for lighting: HK$700,000 per court

Swimming Pools:

• Half Olympic (25m x 10.50m) outdoor swimming pool built on-grade, fully tiled; complete with 5m wide deck and associated pool equipment and ozone system: HK$11,400,000 per pool

Playground Equipment:

• Outdoor playground equipment comprising various activities: HK$350,000 to HK$840,000 per set

Wellness Facilities

Wellness amenities have become increasingly important in residential and hotel developments, adding value and appeal to properties.

Saunas:

• Sauna room for 4-6 people complete with all accessories (enclosing structure not included): HK$340,000 per room

Steam Baths:

• Steam bath for 4-6 people complete with all accessories (enclosing structure not included): HK$340,000 per room

Specialized Landscape Features

Green elements have gained prominence in Hong Kong’s built environment, contributing to sustainability and quality of life.

Green Roof:

• Proprietary lightweight green roof system; with automatic irrigation system (roofing and roof structure not included): HK$2,000 to HK$5,000 per m²

Vertical Green:

• Vertical green system; wire frame type, with automatic irrigation system (background supporting wall not included): HK$5,000 to HK$10,000 per m²

Golf Courses

While limited by space, golf facilities represent significant investments where they can be accommodated.

• Based on average cost of an 18-hole golf course: HK$8,000,000 to HK$14,000,000 per hole
• Excluding associated buildings and equipment

These specialized facilities represent significant investments but add substantial value to developments through enhanced amenities, improved quality of life, and distinctive features that differentiate properties in competitive markets.

2025 Outlook and Conclusion

As Hong Kong’s construction sector navigates through 2025, the industry faces a complex landscape of challenges and opportunities. The government’s commitment to housing delivery—with a target of 132,000 private units over the coming decade—provides a foundation of ongoing work, particularly through land sales and railway property developments. However, the recent failures in land tender exercises and a subdued property market have prompted a more cautious approach to land production.

The cost environment reflects this uncertainty, with Arcadis’ Tender Price Index showing only a mild 0.5% increase in tender prices during 2024. Material costs have generally declined, with steel and sand both falling approximately 10%, while labor costs have shown mixed trends with wage inflation ranging from 1.7% to 10.4% across most trades, offset by a 7.3% decrease for bricklayers.

Looking toward 2026, the public sector is expected to remain the primary driver of construction activity, supported by projects funded in recent years. The adoption of innovative construction methods and prefabrication should help alleviate labor supply issues, while material and labor costs are anticipated to remain generally stable. However, with the private sector continuing to face challenges, competition for projects is expected to intensify, likely driving tender prices down by approximately 2% in 2025.

For developers, investors, and construction professionals, understanding these cost dynamics is essential for successful project planning and execution. The detailed cost data provided in this guide offers valuable benchmarks for budgeting, feasibility studies, and strategic decision-making across various property sectors.

Hong Kong’s construction industry remains resilient despite current challenges, with innovation and efficiency gains helping to navigate the complex market conditions. As the city continues to evolve and develop, the careful management of construction costs while maintaining quality standards will be crucial for sustaining Hong Kong’s position as a world-class city with a built environment that meets the needs of its residents and businesses alike.

All costs in this guide are at 4th Quarter 2024 levels and are based on data from Arcadis’s extensive experience and research in the Hong Kong construction market. Actual costs may vary based on specific project requirements, market conditions, and other factors.