Despite mixed economic conditions, the construction outlook for Asia is set to remain buoyant. The latest edition of the International Construction Market Survey by consulting firm Turner & Townsend charts the average construction cost per sqm for commercial, residential and industrial projects in 89 markets worldwide.Japan dominates the list of Asia’s most expensive cities for construction. Tokyo has the highest rate at US$4,567 ($6,167) per sq m, followed by Osaka at US$4,497 per sq m. Globally, Tokyo ranks fifth, and Osaka sixth in construction cost.Hong Kong comes in at 11th with the average construction cost per sqm standing at $4,292. Singapore’s construction cost averages US$3,307 per sqm, placing it fourth in Asia and 31st globally.However, Singapore saw the highest rate of construction cost escalation last year, at 12%, due to the market’s skills capacity challenges and high labour and material costs. This is expected to lead to continued high construction costs with a projected growth rate of 8% for 2023.Major drivers in Singapore are public housing, infrastructure, commercial developments, and its rising biomedical industry.Meanwhile, Japan’s construction activity is witnessing a surge due to its large number of construction projects ahead of the World Expo 2025 in Osaka. Hong Kong and Mainland China are also expected to witness increased activity following the lifting of prolonged Covid-19 restrictions.Construction activity in emerging markets is also set to warm up. India, Indonesia, Malaysia, Vietnam and the Philippines will see investments in real estate, as well as the expansion of data centres, manufacturing and life sciences.“Asia’s diverse and ambitious market economies place it in a strong position to command sustained construction growth and attract investment, particularly in industrial, science and technology, healthcare, transport and real estate developments,” notes Cheryl Lum, director and head of data and research at Turner & Townsend Asia.Asia is expected to remain a key contributor to global construction activity in the coming years, owing to the numerous projects underway in the region. Singapore, Japan, Hong Kong and Mainland China are all set to benefit from increased infrastructure and property developments. Emerging economies such as India, Indonesia, Malaysia, Vietnam, and the Philippines are also likely to capitalize on the abundance of investment opportunities in this space.

JCube Residence Capitaland is set to bring new life to the Jurong Lake District (JLD) in Singapore. This redevelopment project, which was announced by Capitaland last November, will bring various services and amenities to the area. It comprises of a mall, a community plaza, and a tower that will house over 1,000 homes. In addition, JCube Condo Residence has also set aside retail space and commercial offices for businesses and recreational facilities. The project is expected to be completed by 2025.

Despite economic uncertainty, Asia’s construction market looks set to remain buoyant in the near future. This is according to the latest edition of the International Construction Market Survey by consulting firm Turner & Townsend, which charts the average construction cost per sqm for commercial, residential and industrial projects in 89 markets worldwide.

Japan maintains the highest construction cost in the region, with Tokyo standing at US$4,567 ($6,167) per sqm and Osaka at US$4,497 per sqm. Globally, Tokyo is placed fifth, and Osaka sixth in terms of construction cost. Hong Kong sits in eleventh position, coming in at $4,292 per sqm. Singapore, in fourth place in the region and at thirty-first in the world, has an average construction cost per sqm of US$3,307.

Singapore also saw the highest rate of construction cost escalation last year, at 12%. With the market still facing skills capacity challenges and the ongoing rise of labour and material costs, it is expected that construction costs will stay at a high level, with a projected growth rate of 8% for 2023. Infrastructure developments, public housing, commercial buildings, and a burgeoning biomedical industry make Singapore a standout real estate market in the region.

Turner & Townsend predicts that Japan’s construction activity will be heavily driven by a backlog of projects in the lead up to the 2025 World Expo in Osaka. Similarly, Hong Kong and Mainland China are also expecting a resurgence in their construction markets, as Covid-19 restrictions are lifted.

In emerging markets, investments into real estate, as well as data centres, manufacturing, and life sciences, are expected to further boost construction activity. India, Indonesia, Malaysia, Vietnam, and the Philippines are all predicted to gain from the surge in investment opportunities.

“Asia’s diverse and ambitious market economies place it in a strong position to command sustained construction growth and attract investment, particularly in industrial, science and technology, healthcare, transport and real estate developments,” remarks Cheryl Lum, director and head of data and research at Turner & Townsend Asia.

Asia is set to continue its status as a key player in global construction activity, with Singapore, Japan, Hong Kong, and Mainland China all being prime beneficiaries of the abundance of infrastructure and property projects. Emerging economies such as India, Indonesia, Malaysia, Vietnam, and the Philippines also stand to gain substantially.