What are the keys to overcoming challenges hammering the construction sector?
The sector's major challenges include supply chain and labour shortages.
Whilst still facing major challenges such as supply chain and labour shortages, experts believe that the construction sector will be well on its way to recovery with the support of two factors.
According to Turner & Townsend's Hong Kong Market Intelligence Report, The first key to overcoming headwinds in the sector is through closer collaboration between developers and suppliers.
"For real estate and infrastructure developers to tackle the current challenges in the Hong Kong market, greater attention will need to be paid to allocating risk fairly between client and contractor. This will enable contractors to build the resilience they need to navigate through and survive unexpected external events," Turner & Townsend's Strategic Lead for South China, Daniel Cheung, said.
A collaborative approach will likewise help real estate and infrastructure developers to mitigate the impact of tender price inflation and the competition for resources.
Based on the report, tender prices are estimated to rise between 2% to 4% in 2022.
The other key that will push the sector further to recovery is the measures in the 2022 budget.
Under the 2022 budget, the government has expressed plans to boost the housing supply in Hong Kong, identifying 350 hectares of land for the provision of 330,000 public housing units in the coming decade.
The government has also estimated the completion of private residential units to average over 19,000 units annually in the next five years from 2022.
Another measure in the 2022 budget that can help the sector is the proposed $1b fund to train and upskills workers.
The government expects the training and upskilling of workers to "encourage the adoption of new materials and modern methods of construction to improve productivity."