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Built Environment Sector Sees the Light in 2022

SBD2223_ED01-Pix01The COVID-19 pandemic may have sparked an unprecedented crisis in the economy of Singapore, but for the Built Environment (BE) sector, there is an upside. The pandemic highlighted the urgency for a change in the industry. It surfaced weaknesses and vulnerabilities such as the over-dependency on unskilled foreign labour and the lack of supply chain resilience. The challenges spotlighted the need for the BE sector to step up digitalisation and streamline projects with digital solutions.

After a bruising battle with COVID-19 in the past two years, the BE sector is beginning to see light at the end of the tunnel.

The news of the sector’s recovery was announced at the BCA-REDAS Built Environment and Property Prospects Seminar 2022. The annual flagship seminar on 26 January 2022, saw industry experts giving a preview of the year ahead for the industry.

Based on the Building and Construction Authority (BCA) survey of progress payments, where the nominal construction output is estimated to have almost reached pre-COVID levels, Mr Tan Kiat How, Minister of State for National Development, and Communications and Information was happy to share the encouraging signs in the sector’s recovery at the seminar. He said in his opening speech, “This indicates that construction works are progressing at a steady pace. The inflow of foreign workers has steadily improved. As compared to the period when travel restrictions and tightened entry approvals were in place last year, the current monthly inflow of foreign workers has more than doubled.”

Below are the outlook and opportunities for local and regional built environment, construction, and property sectors, as shared at BCA-REDAS Built Environment and Property Prospects Seminar 2022.


BCA projected that the total value of construction contracts awarded in 2022 would be between S$27 billion and S$32 billion.

Group director of BCA’s strategic planning and transformation office Mr Teo Jing Siong said the construction sector’s prospects are “bright” and that average annual demand from 2023 to 2026 should be between S$25 billion and S$32 billion.

BCA noted that the projection does not include Changi Airport Terminal 5 development and its associated infrastructure projects as well as the expansion of the two integrated resorts, which would cost roughly S$5 billion to S$7 billion, as their construction timelines are still under review due to the impact of the COVID-19 pandemic.

The BE sector was urged to get over the “humps” of the Omicron variant, as well as supply disruptions over the next few months, before the industry can look forward to long-term growth.

Companies were encouraged to continue adopting innovative technologies, upskilling their workforce, using less foreign manpower and becoming more productive and less reliant on labour-intensive construction.

Of the total construction demand reported by BCA, some 60 percent of them, worth between S$16 billion and S$19 billion, will come from the public sector, amid a strong pipeline of public housing projects and those under Home Improvement Programme, healthcare developments and infrastructure works such as the first phase of the Cross Island MRT Line.

From the private sector, the construction demand is expected to reach between S$11 billion and S$13 billion in 2022, comparable with the volume in 2021. “Given the latest property cooling measures, residential building demand is anticipated to moderate year-on-year amid more cautious market sentiments,” BCA reported. However, the construction demand for commercial buildings such as hotels and attractions is expected to increase in preparation for inbound tourism revival, and redevelopment of older commercial premises ramped up to enhance their asset values. Additionally, private sector industrial building demand is expected to come from the construction of energy storage facilities and biopharmaceutical manufacturing plants.

Preliminary Actual Construction Demand in 2021

BCA revealed that in 2021, the preliminary total construction demand had increased by 42 percent to about S$30 billion compared to 2020, driven mostly by public housing and infrastructure projects, and an improvement in investment sentiments. The figure was 7 percent higher than the upper bound of BCA’s earlier forecast of S$23 billion to S$28 billion, mainly due to increase in tender prices from manpower and materials cost inflation.

The public sector construction demand increased from S$12.2 billion in 2020 to S$18.2 billion in 2021, underpinned by major projects such as the Cross Island MRT Line, Jurong Region MRT Line, Tuas Water Reclamation Plant and new Build-To-Order (BTO) units. Correspondingly, the private sector construction demand expanded from S$8.9 billion in 2020 to S$11.8 billion in 2021. There is a higher demand for residential, commercial and industrial building developments as the economy recovers.

Forecast for 2023 to 2026 

The increase in construction demand is expected to be sustained for the next few years, with BCA estimating that the figure will reach between $25 billion and $32 billion annually from 2023 to 2026.

Leading the demand will be the public sector with a contribution of S$14 billion to S$18 billion per year from 2023 to 2026. Half of the demand from the public sector will come from building projects and the other half from civil engineering works.

Seminar attendees were told that public residential construction demand should moderate to about S$4.8 billion to S$5.1 billion, lower than the preliminary demand of S$5.5 billion seen in 2021. Between S$3.5 billion and S$3.7 billion are expected to go towards new flats, while S$1 billion is expected to be used to upgrade existing HDB flats. “HDB did announce that they will ramp up (demand), but by the time they ramp up, the effect will only come in 2023 due to the time lag between launches and construction commencement.”

Besides public housing developments, there are various major developments in the pipeline, such as MRT projects including the Cross Island Line (Phases 2 and 3) and its Punggol Extension and the Downtown Line Extension to Sungei Kadut, the Toa Payoh Integrated Development, redevelopment of Alexandra Hospital and a new integrated hospital at Bedok.

Meanwhile, the private sector construction demand is expected to remain steady and reach about S$11 billion to S$14 billion per year from 2023 to 2026. “This is in view of the healthy investment appetite amid Singapore’s strong economic fundamentals.” said BCA.

It was announced that there will be 109 projects in the next two years using Design for Manufacture and Assembly (DfMA) technologies, with the Advanced Precast Concrete System (APCS) being the most widely used in residential, healthcare and school projects.

Geopolitical tensions could further impact the price of construction materials, which are already set to rise.

Currently, ready-mixed concrete demand is expected to increase to between 12.5 million and 14 million cubic metres, from 11.6 million cubic metres in 2021. Demand for precast concrete is also projected to rise to between 1.6 million and 1.8 million cubic metres, up from 1.1 million cubic metres in 2021, while steel rebar demand is expected to climb to between 1 million and 1.2 million tonnes, up from 0.9 million tonnes last year.

Construction Output

BCA figures noted that progress payments for work being done are projected to hit $29 billion to $32 billion this year, up from the preliminary estimate of about $26 billion for 2021. The uptake is due to a steady level of construction demand and the backlog of remaining workloads that were affected by the COVID-19 pandemic since 2020.

Singapore’s BE sector is also well-prepared to seize the growth in the region.


p: Preliminary
f: Forecast
* Construction demand: Value of contracts awarded
^ Construction output: Value of certified progress payments

Note: Construction demand forecast in 2023-2026 excludes any potential awards of construction contracts for the development of Changi Airport Terminal 5 and its associated infrastructure projects as well as the expansion of Integrated Resorts as their construction timelines are still under review due to the impact of the COVID-19 pandemic.


Prospects for the construction industry in Asia is also looking up. Known to be the fastest-urbanising region in the world, Asia is projected to have a compound annual growth rate of 8.9 percent by 2023 in the Asian construction industry – a forecast that will be boosted by massive infrastructure projects.

“The opportunities in the region are large – the solutions all sit in Singapore,” said Mr Lavan Thiru, Executive Director at Infrastructure Asia, an organisation set up by Enterprise Singapore (ESG) and Monetary Authority of Singapore (MAS) to connect private investors with public infrastructure needs.

Singapore’s “very strong” ecosystem – ranging from planning, installation, financial to technical expertise – is able to address green demands in Indonesia and the Philippines.

This regional demand for infrastructure is also backed by recovery in Southeast Asian economies.

Ms Selena Ling, OCBC Chief Economist, noted how ASEAN 5, comprising Indonesia, Malaysia, Philippines, Singapore, Thailand, is set to buck the worldwide slowdown with growth picking up to over 5 percent this year.


While local and regional opportunities abound, businesses were advised to continue to innovate with technology, digitalisation and collaboration to succeed in the post-COVID landscape.

Sharing his outlook for the year, Mr Kelvin Wong, BCA CEO said, “I am relatively bullish about the pipeline that is coming up, but I think the main fear I have is going back to the old ways of doing things.”

Mr Wong highlighted three areas for businesses to progress.

1. Transform to improve productivity

Companies are encouraged to tap on various Government initiatives to transform their businesses and hire locals.

• Enterprise Development Grant (EDG), which provides customised support to help firms upgrade their business capabilities, innovate or venture overseas

• Productivity Solutions Grant (PSG), which provides co-funding (capped at $30,000) to support costs of adopting pre-approved digital solutions for local Small and Medium Enterprises (SMEs)

• Productivity Innovation Project (PIP), which provides up to 70 percent co-funding for the costs of adopting technologies such as Design for Manufacturing & Assembly (DfMA) and Integrated Digital Delivery (IDD) in the Construction sector

Initiatives that involve growing a productive workforce include:

• Career Conversion Programmes (CCP), which offer up to 90 percent funding support for salary and training costs for firms to hire mid-career jobseekers and equip them with the necessary skills to take on jobs

• Jobs Growth Incentive (JGI), which provides salary support for firms looking to hire new local mature workers who have not been employed for at least six months, persons with disabilities, and ex-offenders

• iBuildSG Scholarship and Sponsorship Programme, which offers scholarships/sponsorships jointly with firms in the Construction sector to high-calibre students intending to pursue Built Environment courses at Institutes of Higher Learning

2. Improve regulatory processes by using digital innovations such as CORENET X, a one-stop integrated regulatory system.

With CORENET X, project teams can collaborate upfront to de-conflict their designs before making a coordinated Building Information Modeling (BIM) model to agencies, instead of individual consultants submitting plans to different agencies separately. This helps reduce discrepancies and abortive reworks downstream. It is expected to enable an efficient, faster and easier-to-navigate regulatory process to benefit both industry practitioners and regulatory agencies when it is ready by end-2023.

3. Establish clearer benchmarks in quality, maintainability and sustainability.

On 7 September 2021, Green Mark 2021 criteria and technical guide were refreshed with its official launch at Singapore International Built Environment Week. The BCA Green Mark 2021 (GM: 2021) is an internationally recognised green building certification scheme tailored for the tropical climate. It encourages the industry and professionals to collaborate and develop green building solutions, raising the sustainability standards of Singapore’s built environment. GM: 2021 is aimed at raising standards in energy performance and placing greater emphasis on other sustainability outcomes such as

– Designing for maintainability,

– Reducing embodied carbon across a building’s life cycle,

– Using smart technologies,

– Enhancing a building’s resilience to climate change and

– Creating healthier environments for building users.

GM: 2021 which took effect from 1 November 2021, applies to new and existing buildings including commercial buildings, industrial buildings, institutional buildings and residential buildings.

Mr Seah Chee Huang, CEO of DP Architects, agreed with BCA CEO that the industry should pick up the pace on transformation efforts. “It’s very important we use this moment to continue to upgrade and upskill ourselves,” he noted.

Mr Wong also pushed for collaborative contracting arrangements, a redesign of the traditional contracting model to be less oppositional and isolated, but bringing parties together towards common project goals.

“Globally, there are many markets that are using collaborative contracting and evidence demonstrates that it’s good for business,” Mr Wong noted.

Such a model may just be the driving force for the BE sector to show greater unity and achieve greater things together.

Mr Liam Wee Sin, Group Chief Executive of property developer UOL Group, echoed his support for such an aggregated delivery approach and voiced his aspirations for the sector. Calling Singapore’s built environment world-class, Mr Liam gave credit to good planning, building design, contracting, and facilities management.

Therein lies a lot of potential and prospects for Singapore.

Vision for the built environment industry

“We want to create a built environment that meets Singapore’s needs for the future, essentially a liveable and smart built environment. Right now, the challenges that Singapore faces in the future are an ageing and declining workforce, infrastructure that is getting old, and the threat of climate change. On the upside, the upcoming disruptive technologies, and the urbanisation of Singapore and Asia present promising growth opportunities. I am confident that the industry can face these challenges by taking steps to anticipate these upcoming changes, embrace greater innovation, and use technology to boost productivity and be highly automated,” said Mr Kelvin Wong, CEO of BCA.