Building in Manila remains inexpensive

MANILA remains one of the least expensive cities to build in the world, according to the International Construction Costs 2019 report published by Arcadis, the leading global Design & Consultancy for natural and built assets. The report details and ranks the relative cost of construction in 100 of the world’s major cities.

Manila ranks 82nd in the world, following Hong Kong, Macau, Tokyo, Singapore and Seoul in the Asia rankings. Manila moves down from 39th in 2018, however the change in its ranking is due to an increase in the size of the index from 50 cities in 2018 to 100 in 2019.

The Asian cities ranking in Arcadis’ International Construction Costs 2019 are below:

Philippine GDP grew over 6% in 2018, maintaining its position as one of the fastest growing economies in Asia with significant growth in the construction sector, particularly in infrastructure, residential and commercial. The growth in tourism had led to more commercial and institution construction and put increased pressure on Manila’s infrastructure.

To support this growth, the Philippine government is investing in infrastructure under the “Build Build Build” program. Due to the time needed in feasibility, procurement and investigation, these projects have been slow to take off, and the increase in the number of jobs available has not translated into an increase in the number of works.

“We expect the construction market to remain strong in 2019 and 2020 due to ongoing government and private investments in major projects. The government’s commitment to decongest Metro Manila and provide accessible travel to Manila and Clark International Airport is expected to create more jobs and spur economic growth in the city and across other parts of the country. However, a true driver of change will be the mandated use of ‘digital’ tools, including Building Information Modelling (BIM) to increase productivity and reduce construction costs. Presently the adoption of BIM is being led by a few private construction companies, however this would accelerate with a Government mandate on technology like BIM similar to elsewhere,” said Ross McKenzie, Head of Philippines for Arcadis.