Construction demand in Singapore to increase this year to up to $31 billion: BCA

The Building and Construction Authority (BCA) estimates that between $16 billion and $19 billion worth of public projects will be awarded this year. ST PHOTO: LIM YAOHUI

SINGAPORE - Building firms here can expect a rise in the total value of construction contracts to be awarded this year, which is projected to be between $26 billion and $31 billion.

The figure is up from the $24.5 billion last year, mostly due to an expected increase in public sector construction demand, which will make up about 60 per cent of total projected demand.

In a media release on Thursday (Jan 11), the Building and Construction Authority (BCA) estimated that between $16 billion and $19 billion worth of public projects will be awarded this year, more than the $15.5 billion last year.

The projection of increased building demand comes amid a challenging past few years for the property and built environment sectors.

To help firms ride out the economic slowdown last year, the Government brought forward $1.4 billion in public projects, said Mr Desmond Lee, Second Minister for National Development, on Thursday at the BCA-Redas Built Environment and Property Prospects Seminar.

He said at the event at the Grand Copthorne Waterfront hotel: "We have also been encouraging government agencies to parcel out large infrastructure projects into smaller chunks where possible. This helps agencies diversify risk and creates more opportunities for our local firms."

Some of the projects expected to be awarded this year include additional major contracts for infrastructure projects like the Land Transport Authority's North-South Corridor, national water agency PUB's Deep Tunnel Sewerage System and various healthcare facilities.

Construction demand in the private sector is also expected to improve to between $10 billion and $12 billion this year, up from $9 billion last year.

This comes on the back of a strengthened overall economic outlook and an upturn in property market sentiment, as well as the redevelopment of collective-sale sites.

Mr Lee also noted that there will be a continued push to use manufacturing methods involving prefabrication as outlined by the Construction Industry Transformation Map launched in October last year.

Such methods use Design for Manufacturing and Assembly (DfMA) technologies, which include prefabricating parts to improve and regulate the quality of building components.

Mr Hugh Lim, chief executive officer of BCA, said: "We want to promote the widespread adoption of DfMA and Integrated Digital Delivery (IDD). The new technologies and techniques... facilitate greater integration among the various disciplines in the industry, helping us to achieve timely, cost-effective, productive and high-quality project delivery."

IDD is a method that factors in construction and maintenance considerations into building design, and helps to streamline the process.

Mr Lee, who is also Minister for Social and Family Development, said there are currently more than 40 projects that have adopted DfMA, with 59 more expected this year. Four years ago, there were fewer than 10.

Join ST's WhatsApp Channel and get the latest news and must-reads.