Building Costs Per Square Metre in Singapore

Building Costs Per Square Metre in Singapore

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The Building Price Index measures changes in the cost of construction materials and labour over a given period of time. Construction costs have increased by 10% in Singapore since 2021. Singapore is the 4^th most expensive city to build among the 20 Asian countries surveyed by Arcadis consulting firm. Hong Kong takes the top position, followed by Macau and Tokyo. The RLB Report released in December 2021 shows us that the Tender Price Index (TPI) in Singapore increased by 8.2% from the last quarter of 2020 to the first quarter of 2021. It is forecasted to increase by a percentage range of between 3% and 8%. The total construction output in the 3^rd quarter of 2020 was S$14 billion, and it increased to S$19.1 billion in the 3^rd quarter of 2021. The volume of demand in the construction sector is expected to increase to a value ranging from S$25 billion to S$32 billion. On the overall, tender prices have been rising since 2020 and in December 2021, intervention was made to stabilize the residential property market.

The RLB Report (6 January 2022) shows a chart depicting the RLB Building Tender Price Index (TPI)  as well as the BCA Tender Price Index over the period 2011 to 2021. The BCA index is produced by the Building and Construction Authority of Singapore, a government department. The two curves are fairly similar in shape, depicting the same trends over 10 years although the RLB index is higher than the BCA index.

The RLB index rose from 103.1 in 2011 to 112 in 2014. It then declined to 101.5 in 2017, and rose slightly to 103.3 in 2018, remaining stable until 2019. The TPI rose sharply to 119.6 in 2021. The BCA index followed a fairly similar trend but at deviations below the RLB curve, remaining stable from 2011 to 2012 at 99.7 to 99.8. It rose to 106.8 in 2014, and then declined to 96.7 in 2017. The BCA index rose to 102.8 in 2020, and then climbed steeply to 115.4 in 2021.

The BCA Index (2011 to 2021) is displayed in another chart, this time it’s divided into 3 components – HDB Flats, Private Non-Landed properties (PNL) and Commercial Office. The three curves are almost similar in shape on the overall, but the  PNL curve is higher, whereas the HDB Flats curve is at the bottom. The Commercial Office curve runs in the middle slightly below the PNL curve.

The tender price index for PNL properties rose gently from 101.7 in 2011 to 110.1 in 2014. It then declined smoothly to 102.3 in 2017, before remaining relatively stable until 2019 at 103.2. The index slightly rose to 105.7 in 2020 before rising sharply to 120.8 in 2021.

The tender price index for HDB Flats deviated downwards from the PNL curve by a wide margin, starting at 93 in 2011, and then remaining relatively stable until 2012 at 92. The index rose to 97.8 and 99.8 respectively in 2013 and 2014. It declined to 83.2 in 2017, before rising sharply along a fairly steep slope to 109.4 in 2021.

The tender price index for commercial offices resembled the PNL index from 2011 to 2012. It the deviated away from the PNL curve, falling to 106.3 in 2013 and remaining stable until 2014 at 107. It declined gently to 97.8 in 2017, before stabilizing up until 2020 at 99.1. The index rose steeply to 111.5 in 2021.

Price of Construction Materials in Singapore 2020 to 2021

The RLB Report (2022) includes a BCA Chart which shows the price trends of major construction materials – cement, ready-mixed concrete, sand and granite. The chart shows monthly prices of construction materials in Singaporean Dollars per cubic metre and tonne, over a span of 12 months from September 2020 to September 2021. According to the charts, the price of cement increased by 5.8% over the year, whereas ready-mixed concrete increased by 7%. The price of sand aggregate went down by -2.7%, and the price of granite increased by 7%.

The monthly price of cement in Singapore remained stable from September 2020 to March 2021, staying between $85.70 and $85.80 per tonne, and not exceeding $86/ton. The price rose gently to $95/ton in July and then levelled off until 21 September 2021 at $95.1/ton.

The monthly price of ready-mixed concrete is measured in dollars per cubic metre. It remained relatively stable from September 2020 to May 2021, starting at $94.50/m3 and ending at $96.20/m3. It then rose over a medium slope to $104.60/m3 in August 2021, before stabilizing to $104.10/m3 towards the end of September 2021.

The price of sand is measured in dollars per tonne. Sand is 3.5 to 4.12 cheaper than cement, therefore its curve is extremely lower on the graph. The monthly price of sand remained stable over the 12-months period from September 2020 to 2021, hovering between $24.70/ton and $23.10/ton, and not exceeding $24.90/ton.

Granite is the cheapest of all construction materials surveyed in this report, thus its curve is at the bottom of the chart. Just like sand, the price of granite was stable over the year September 2020 to 2021. Its price hovered between $18.50/ton and $20.90/ton, not exceeding $21.50 per tonne. Delivery charges are not included in the price of granite and sand.

According to the Arcadis Report 2021, Singapore has the fourth highest building costs in Asia and internationally the country occupies 46^th position. During the 2020 Covid-19 pandemic, construction volumes declined by 37% to $21 billion, a reversal in annual trends observed since 2014 which registered a record value of $39.8 billion in projects. The volume fell to $24 billion in 2015 and then rose to $32 billion in 2019, with a large percentage of construction activity being attributed to public works and civil engineering projects. Labour shortages induced by the pandemic as well as workplace compliance checks and orders are some of the reasons behind increasing costs in 2021 but recovery in construction demand is expected in 2022 and onwards.

BCA Construction Demand Estimates 2021 and 2022

The Building and Construction Authority of Singapore (BCA) recorded $5.34 billion worth of public residential building projects and $3.89 billion worth of private residential building projects in 2021. In this same period, the volume of projects in the private commercial sector was $2.69 billion whereas government-funded commercial projects were valued at $0.07 billion. A total of $4.06 billion was registered in private industrial projects whereas public-funded industrial projects were valued at $0.93 billion. An estimated total value of $2.35 billion was invested in public institutional facilities, whereas $1 billion was invested in private facilities. The government invested $9.16 billion in civil engineering works while the private sector contributed $0.45 billion. All in all, a total sum of $29.93 billion was invested in the Singaporean construction sector, of which $17.84 billion went to the public sector and $12.09 billion went to the private sector.

The BCA forecast for 2022 expects $4.8 to $5.1 billion to be invested in the public residential sector whereas $3.5 to $4 billion is expected for the private residential sector. About $2.6 to $3.1 billion should be invested in private commercial building whereas $0.1 billion worth of public-funded commercial projects are expected. An estimated $3.5 to $4.1 billion should be invested in private industrial projects whereas the government is expected to contribute $0.6 to $1 billion. The government is expected to invest $2.5 to $3.1 billion in institutional facilities, while the private sector should chip with $0.8 to $1 billion. A total volume of $8 to $9.7 billion in publicly-funded civil engineering projects is expected in 2022, whereas the private sector should contribute $0.6 to $0.8 billion. All in all, a total sum of $27 to $32 billion should be invested in the Singaporean construction sector in 2022, and $11 to $13 billion of this sum should go to the private sector, whereas $16 to $19 billion is expected to go to the public sector.

The BCA Tender Price Index was 104 in 2015. It fell to 98 in 2016, and then declined to 96.7 in 2017. From 2017 onwards, the TPI has been on a steady rise, making positive gains each year until the end of 2021 where it hit an annual average of 117.1. The quarterly BCA index in the first, second, third and last quarter of 2021 was 110.8, 116.1, 119.2 and 122.2 respectively.

Construction Material Costs and Demand

The BCA Report (15 February 2022) shows that 413,440 tonnes, 316,700 tonnes and 365,980 tonnes of cement were used in October, November and December of 2021 respectively. In the same period, 61,800 tonnes, 17,630 tonnes and 8,030 tonnes of steel bars were used in the construction industry. The last quarter of 2021 also realized monthly quantities of 1,530,700 tonnes, 1,593,000 tonnes and 1,786,100 tonnes in granite. A total volume of 3,118,200 cubic metres of ready-mixed concrete was used in the last quarter of 2021, broken down into monthly quantities of 1,016,300 tonnes, 1,007,300 tonnes and 1,094,600 tonnes.

The price of major construction materials in the last quarter of 2021 was as follows: Ordinary Portland cement was $98 per tonne in January 2021, $96.10/ton in November 2021 and $97.50/ton in December 2021. In the same months, the price of 16-32mm high tensile steel bars was $1106 per tonne, $1113.47/ton and $1105.50/ton respectively. Ready-mixed concrete was going for $104 per tonne in January and $104.20/ton in November and December respectively.

Material price indices for concrete and steel reinforcement were measured in October, November and December of 2021. The monthly price index for concrete was 133.7, 134 and 134.8 in the last quarter of 2021. The monthly price index for steel reinforcement was 145.2, 145.3 and 144.3 in the last quarter of 2021. A price index indicates a change in the price of materials and it is derived from a base year (an older date).

Building Costs Per Square Metre in Singapore

Major sources of building cost rates such as Davis Langdon (Acquired by AECOM),  Acardis and Turner & Townsend do not have the latest GFA construction costs in Singapore so the only solution is updating previous estimates by applying the current index. Shown below is the square-metre rates obtained in 2016 as well as the updated ones. The BCA and AECOM construction tender price indices have been used to update the rates to December 2021. Cost adjustments using BCA indices gives a higher estimate, whereas AECOM indices give a lower estimate. The price is given in Singaporean Dollars (SGD per Square Metre).

Building Costs in Singapore Updated with AECOM Price Indices 2022

Residential Buildings:

As at 31 December 2021, the cost of building a terraced house in Singapore ranges from $2,696 per m2 to $3,026 per m2. Semi-detached houses are $2,916 to $3,411 per m2. Building a detached single-family house costs $3,411 per m2 to $4,512 per m2. An average standard condominium takes $2,091 per m2 to $2,366 per m2 to build. The cost of building a good-standard condominium is $2,366 per m2 to $3,191 per m2. Building a luxury condominium will cost you $3,191/m2 to $4,732/m2.

Building Costs Per Square Metre in Singapore_AECOM Indices

Commercial / Office & Retail Buildings:

• Average Standard Offices – $2,696 to $2,971 per m2
• Prestige Offices                – $2,971 to $3,301 per m2
• Shopping Centres (Average Quality) – $2,971 to $3,191 per m2
• Shopping Centres – (High Quality) – $3,191 to $3,522 per m2
• Theatres, Cinemas – $2,201 to $2,476 per m2

Industrial Buildings:

• Flatted Light Industrial Buildings                – $1,398 to $1,563 per m2
• Flatted Heavy Industrial Buildings – $1,563 to $2,113 per m2
• Single Storey Industrial Buildings – $1,299 to $1,453 per m2
• Flatted Warehouses – $1,299 to $1,453 per m2
• Single Storey Warehouses – $1,133 to $1,453 per m2

Hotels:

• Resort Hotels – $3,246 to $3,522 per m2
• 3-Star Hotels – $3,356 to $3,632 per m2
• 4-Star Hotels – $3,522 to $4,237 per m2
• 5-Star Hotels – $4,292 to $4,842 per m2
• Serviced Apartments – $2,476 to $3,246 per m2

Health:

• Private Hospitals – $4,292 to $4,512 per m2
• Polyclinics, non air-conditioned – $1,783 to $1,992 per m2
• Nursing Homes, non air-conditioned – $1,783 to $2,102 per m2
• Medical Centres – $3,301 to $3,522 per m2

Car Parks:

• Multi-Storey Car Parks – $1,023 to $1,453 per m2
• Basement Car Parks – $1,453 to $1,981 per m2

Residential Building Costs Updated with BCA Price Indices (2022):

As at 31 December 2021, the cost of building a terraced house in Singapore ranges from $2,903 per m2 to $3,258 per m2. Semi-detached houses are $3,139 to $3,673 per m2. Building a detached single-family house costs $3,673 per m2 to $4,857 per m2. An average standard condominium takes $2,251 per m2 to $2,547 per m2 to build. The cost of building a good-standard condominium is $2,547 per m2 to $3,436 per m2. Building a luxury condominium will cost you $3,436/m2 to $5,094/m2.

Building Costs Per Square Metre in Singapore_BCA Indices

Residential Building Costs by Davis Langdon & Seah 2016:

In 2016, the cost of building a terraced house in Singapore ranged from $2,903 per m2 to $3,258 per m2. Semi-detached houses were $3,139 to $3,673 per m2. Building a detached single-family house was $3,673 per m2 to $4,857 per m2. An average standard condominium took $2,251 per m2 to $2,547 per m2 to build. The cost of building a good-standard condominium was $2,547 per m2 to $3,436 per m2. Building a luxury condominium was $3,436/m2 to $5,094/m2.

Building Costs Per Square Metre in Singapore_Davis Langdon

Residential properties in Singapore are divided into HDB Flats, Condos and Landed properties.