Singapore’s construction sector is forecasted to remain robust in 2026, driven by public sector demand and significant infrastructure projects, despite global geopolitical tensions and supply chain disruptions. This is according to the Singapore Construction Market Review and Outlook 2026, released by SJ Group’s Project and Cost Management unit.
The report highlights that Singapore’s built environment sector continues to demonstrate resilience and adaptability. Senior Executive Director for Project and Cost Management at SJ Group, Ho Kong Mo, noted, “Even as global uncertainties drive cost pressures, a steady pipeline of public sector projects and continued infrastructure investment will underpin demand.”
Total construction demand is projected to range between S$47b and S$53b this year, following a peak of S$50.5b in 2025. However, construction costs are expected to rise by 2 to 5% in 2026, with material prices already increasing by 5 to 15% due to Middle East tensions. Oil prices exceeding $100 per barrel and ongoing supply chain volatility are anticipated to further impact project costs and timelines.
Key developments such as Changi Airport Terminal 5, MRT expansions, and healthcare projects are set to support the sector. Civil engineering demand alone is expected to reach between S$11.6b and S$13.4b. Meanwhile, the commercial segment is projected to recover, with demand rising to between S$6.1b and S$6.7b, led by projects like the Marina Bay Sands expansion.
The report underscores the importance of technology adoption and productivity improvements to manage costs and support long-term growth. Despite challenges, the sector is expected to remain supported by sustained government investment and a steady project pipeline.
