Deep State Pockets To Drive Singapore Construction Recovery
After a predicted slump of 36.5% in demand for construction in Singapore last year owing to the coronavirus pandemic, public sector orders are projected to drive a recovery this year to between S$23bn and S$28bn (US$17-21bn), Singapore’s Building and Construction Authority (BCA) stated. That would be an improvement from the S$21.3bn in demand – a preliminary estimate – seen in 2020
Public sector orders would contribute some 65% of the total new demand this year, with contracts scheduled to be awarded in public housing and infrastructure projects, including on the Jurong Region MRT Line, the Cross Island MRT Line Phase 1 and the Deep Tunnel Sewerage System Phase 2. These will account for between S$15bn and S$18bn in anticipated demand. Public sector demand dropped from S$19bn in 2019 to S$13.2bn in 2020, as Covid disrupted project schedules.
The projected increase in public sector construction demand for this year and beyond excludes any potential awards of construction contracts for the development of Changi Airport Terminal 5 or the expansion of Integrated Resorts because their construction timelines are still under review due to the impact of the pandemic.
Private sector construction demand is projected to remain suppressed at between S$8bn and S$10bn in 2021. The Covid-induced recession saw private sector demand fall from S$14.5bn in 2019 to S$8.1bn in 2020.
BCA projects the bulk of private sector construction demand in 2021 to comprise development of the remaining en-bloc residential sites, major retrofitting of commercial developments as well as construction of high-specification industrial buildings to meet business needs.