Private sector construction demand is set to see strong growth in commercial development and sustained levels in residential developments. This growth is driven by the increased availability of Government Land Sales (GLS) sites and renovation of old structures like the former Peace Centre and Golden Mile Complex.

Commercial construction is projected to continue rising with the creation of new mixed-use properties, alongside refurbishments of existing buildings, an estimated 7.0 percent increase from the previous year. Civil infrastructure projects such as MRT line expansions, road and drainage systems upgrades, and works to support the development of Changi Airport Terminal 5 (T5), Tuas Port and the Bulim area will further boost the sector.

However, challenges that may affect sector growth persist, including inflation and increasing interest rates. Geopolitical instability continues to strain supply chains, with lengthy lead times needed for acquiring construction materials and equipment. While timelines have improved since the COVID-19 pandemic, they still remain extended.

Changes in manpower regulations, effective January 1, 2024, also pose a challenge. The Dependency Ratio Ceiling (DRC) measures are set to fully replace the current Man Year Entitlement (MYE) rule, as part of Singapore’s drive for greater productivity, outlined in the BCA’s industry transformation map (ITM). The DRC is the maximum ratio of foreign employees to total employee count that a company in a specified sector can employ, now dropped to 1:5 from 1:7 previously. The DRC change amplifies the paucity of skilled labour, especially those with job-specific competencies.