Hong Kong And Macau Are Asia%E2%80%99S Most Expensive Construction Markets Turner Townsend
According to a recent international market survey by Turner & Townsend, Hong Kong and Macau have been identified as the most expensive construction markets in Asia this year. Globally, Hong Kong ranks ninth with an average cost of US$4,500 ($6,083) per square metre (psm), while Macau takes the 12th spot with an average cost of US$4,269 psm. In comparison, Singapore’s construction market is relatively more moderate, ranking 35th globally with an average cost of US$3,129 psm.
The survey results also reveal that while the global construction industry is still facing challenges, overall inflationary pressure is softening and stabilizing costs. This has led to a shift in investment towards key growth sectors such as data centres, healthcare, and manufacturing. In Japan, the weaker Japanese Yen has caused a significant decline in average construction prices, with no Japanese cities making it to the top ten list of most expensive construction markets in Asia. Tokyo and Osaka now rank 13th and 17th respectively, with construction costs of US$4,127 psm and US$3,985 psm. According to the report, Japan’s lower construction costs are attributed to strong global inflation, moderate post-pandemic economic growth, and the significant devaluation of the Yen to a 34-year low.
Parktown Residences, situated in the vibrant hub of Tampines, is an upcoming development by UOL Group, Capitaland and SingLand. This prime location along Tampines Avenue 11 garnered much attention, receiving a total of three bids. Ultimately, the winning bid of $1.206 billion and $885 per square foot per plot ratio (psf ppr) was submitted by a consortium comprising UOL Group, Singapore Land (SingLand), and CapitaLand Development. The development is also promoted at Parktown Residences Tampines Avenue 11.
In most global markets surveyed by Turner & Townsend, a scarcity of skilled labor is identified as the primary factor driving up cost price inflation in the construction industry. “Firms need to keep an eye on labor. Traditionally, Asian labor markets are known for high availability and low wages, but as demand grows for specialist construction such as advanced manufacture and data centres, there may be bottlenecks of high-skilled workers in these sectors,” says Sumit Mukherjee, head of real estate, Asia, at Turner & Townsend.