58 Economic Survey of Singapore 2023

Chapter 6.2

CONSTRUCTION
OVERVIEW
The construction sector grew by 5.2 per cent year-on-year in the fourth quarter of 2023, faster than the 3.7 per
cent expansion in the previous quarter.

For the whole of 2023, the sector expanded by 5.2 per cent, faster than the 4.6 per cent growth in 2022.

CONSTRUCTION DEMAND For the full year, total construction demand expanded
by 13.5 per cent to $33.8 billion (Exhibit 6.4), backed by
Construction demand (contracts awarded) increased by increases of 12.8 per cent in public sector construction
43.8 per cent year-on-year to $10.4 billion in the fourth demand and 14.4 per cent in private sector construction
quarter, supported by expansions in both public and private demand.
sector construction demand (Exhibit 6.3).
Exhibit 6.4: Contracts Awarded, 2023 ($ Billion)
Exhibit 6.3: Contracts Awarded
Total Public Private
$ Billion
12 Total 33.8 19.5 14.3

10
Residential 13.0 7.6 5.4

Total Commercial 3.4 0.01 3.4

8

Industrial 4.6 0.5 4.1

6

Institutional & Others 5.5 4.8 0.6

Private
4
Civil Engineering
7.3 6.5 0.8
Works
Public
2

0 Public Sector
IV I II III IV
2022 2023
In the fourth quarter, public sector construction demand
grew by 67.2 per cent year-on-year to $7.1 billion. Except
for commercial building construction demand which
registered a contraction of -26.2 per cent, demand for all
development types registered growth, ranging from 9.4
per cent for civil engineering works to 472 per cent for
industrial building developments.

1 In 2023, public commercial building’s contracts awarded was 45 million.

 Chapter 6: Sectoral Performances 59

For the full year, public sector construction demand Exhibit 6.5: Certified Payments
increased by 12.8 per cent to $19.5 billion (Exhibit 6.4).
The expansion was supported by an increase in contracts $ Billion
10
awarded for public institutional & others (64.4 per cent),
industrial (55.0 per cent) and residential building (43.0
Total
per cent) projects. Some of the major projects awarded
8
during the year include (i) MINDEF’s NS Square; (ii) MND’s
Bay East Garden with a visitor centre; (iii) SLA’s Chong
Pang Integrated Development; and (iv) PUB’s Tuas Water 6
Reclamation Plant Contract 4B.
Private

4
Private Sector
Public

In the fourth quarter, private sector construction demand 2

increased by 10.6 per cent year-on-year to $3.3 billion.
Except for industrial and institutional & others building
projects, which registered contractions of 35.3 per cent 0
IV I II III IV
and 63.1 per cent respectively, demand expanded for all 2022 2023
other types of projects, ranging from 11.1 per cent for
residential building projects to 249 per cent for commercial
building projects. Public Sector
For the full year, private sector construction demand Public sector construction output rose by 18.3 per cent
grew by 14.4 per cent to $14.3 billion, on the back of year-on-year to $4.7 billion in the fourth quarter. With the
higher demand for private commercial (120 per cent) and exception of public commercial building works, construction
residential building (39.9 per cent) projects (Exhibit 6.4). output for all types of works expanded, supported by
Major projects awarded in 2023 include (i) redevelopment public industrial (42.3 per cent), institutional & others
of various office premises such as Clifford Centre and PIL (16.0 per cent), residential building (14.1 per cent) and
Building; (ii) major hotel refurbishment works at Marina Bay civil engineering (19.3 per cent) works.
Sands and Resorts World at Sentosa; and (iii) development
of various past en-bloc sales and GLS sites. For the full year, public sector construction output increased
by 14.3 per cent to $17.3 billion, underpinned mainly by
public residential (22.6 per cent), institutional & others
CONSTRUCTION OUTPUT (21.4 per cent), industrial building (13.0 per cent) and civil
engineering (6.8 per cent) works. Major projects supporting
Construction output (or nominal certified payments) rose the growth include (i) MOH’s Woodlands Health Campus,
by 14.9 per cent year-on-year to $9.4 billion in the fourth SGH Elective Care Centre/National Dental Centre and SGH
quarter, supported by expansions in both public and private Emergency Medicine Building; (ii) SIT Campus@Punggol
sector construction outputs (Exhibit 6.5). (Plots 1 & 2); (iii) Sport Singapore’s Punggol Regional
Sports Centre (iv) JTC’s Punggol Digital District and Bulim
For the full year, construction output increased by 15.4 per Square; (v) PUB’s Tuas Water Reclamation Plant for the
cent to $34.9 billion, extending the 15.8 per cent growth Deep Tunnel Sewerage System (Phase 2); and (vi) LTA’s
in 2022. Cross Island MRT Line, Jurong Region MRT Line, East
Coast Integrated Depot and North South Corridor.
60 Economic Survey of Singapore 2023

Private Sector CONSTRUCTION COSTS

In the fourth quarter, private sector construction output Based on BCA’s Building Works Tender Price Index (TPI),
increased by 11.6 per cent year-on-year to $4.7 billion, tender prices increased by about 4.1 per cent year-on-
as all types of private sector construction works, except year in 2023, a decline from the 11.6 per cent growth in
for institutional & others building works, expanded. These 2022, following the easing of some key input costs (e.g.,
include private civil engineering (28.7 per cent), commercial construction material costs) and of global inflation (Exhibit
(21.4 per cent) and industrial building (19.5 per cent) works. 6.7). However, there are several factors that could put
upward pressure on the TPI in 2024. These include likely
For the full year, private sector construction output tighter manpower and sub-contracting resources, amid
increased by 16.4 per cent to $17.6 billion. All types of anticipated strong construction activities over the medium-
private sector construction output expanded, led by private term, and the possibility of a resurgence in global inflation.
commercial (39.4 per cent), industrial (19.3 per cent) and
residential building (10.7 per cent) works. Major ongoing Exhibit 6.7: Changes in Tender Price Index
projects include (i) mixed-used integrated developments;
Per Cent
(ii) refurbishment of existing hotels and development of
15
new hotels; (iii) data centres; (iv) semiconductor production
plants; (v) cogeneration plants; and (vi) the redevelopment
of past en-bloc sales sites and development of Government
Land Sales (GLS) sites. 10

CONSTRUCTION MATERIALS 5

In tandem with the rise in construction output, total

consumption of steel rebars2 rose by 31.0 per cent year-
on-year to 1.5 million tonnes in 2023. Similarly, the total 0
2019 2020 2021 2022 2023
consumption of ready-mixed concrete increased by 4.9
per cent in 2023 to 12.3 million m3.

The average market price of Grade 40 pump ready-mixed

concrete3 decreased by 2.1 per cent to about $115.7 per
m3 in the fourth quarter, amid easing freight and fuel costs
coupled with diversified import sources of raw materials.
Likewise, the average market price of steel rebars4 fell
by 17.5 per cent to around $824.7 per tonne in the fourth
quarter, due to softening of global steel demand (Exhibit
6.6).

Exhibit 6.6: Changes in Market Prices of Construction

Materials

Per Cent
20

10 Ready-Mixed
Concrete

-10

-20
Steel Bars

-30
IV I II III IV
2022 2023

2 Rebar consumption is estimated from net imports plus local production (without factoring in stock levels).
3 The market prices are based on contracts with non-fixed price and market retail price.
4 The market prices refer to 16mm to 32mm High Tensile rebars and are based on fixed price supply contracts with a contract period of 6 months or below.
 Chapter 6: Sectoral Performances 61

CONSTRUCTION OUTLOOK IN Exhibit 6.8: Projected Construction Demand in 2024

2024 $ Billion

According to BCA, total construction demand is projected Public Sector 18.0 – 21.0
to be between $32.0 billion and $38.0 billion in 2024
(Exhibit 6.8). Demand from the public sector is expected Building Construction Sub-total 10.7 – 12.8
to stay strong at between $18.0 billion and $21.0 billion,
supported by a continued strong pipeline of public Residential 6.6 – 7.6
housing, institutional building and infrastructure projects.
Meanwhile, total private sector construction demand is Commercial 0.1 – 0. 1
projected to be between $14.0 billion and $17.0 billion in
2024, bolstered by an anticipated increase in commercial Industrial 0.5 – 0.7
building developments including the expansion of the
two Integrated Resorts (IRs). Key upcoming projects in
Institutional & Others 3.6 – 4.4
2024 include (i) continued ramp-up in Build-To-Order
HDB flats; (ii) development of new major mixed-used
properties; (iii) high-specification industrial premises Civil Engineering Works Sub-total 7.3 – 8.2
such as biomedical plants and fuel storage facilities; (iv)
major public institutional building developments such as Private Sector 14.0 – 17.0
relocation of Singapore Science Centre and construction of
Founders’ Memorial Building and (v) remaining contracts Building Construction Sub-total 13.4 – 16.3
for Cross Island MRT Line (Phase 2).
Residential 3.7 – 4.5
Total construction output in 2024 is projected to increase
to between $34.0 billion and $37.0 billion, in tandem with Commercial 5.8 – 6.6
the recovery in the construction demand since emerging
from the COVID-19 pandemic. Industrial 3. 0 – 4.0

Institutional & Others 0.9 – 1.2

Civil Engineering Works Sub-total 0.6 – 0.8

TOTAL CONSTRUCTION DEMAND 32.0 – 38.0