What our index tells us globally

International ranking – the most expensive global construction markets

The map below presents a snapshot of the market average project costs per sqm globally.

For ease of understanding, the average market costs only take into consideration the locations that have been earmarked for Shell real estate’s capital investments. The costs have been amalgamated to country level and include both relevant archetypes showing up Japan as the most expensive market, followed by Singapore, the UK and Switzerland.

The top 10 most expensive cities globally in the figure below also provides an interesting insight into the diversity of the portfolio. Second place is occupied by industrial sites in the city state of Singapore, and this is due to the recent strength of the Singapore dollar when compared to the pound and Euro, coupled with intricacies around logistics, permits and work restrictions that usually apply with protected, operation-critical hydrocarbon manufacturing sites.

As expected, the remainder of the top 10 list is dominated by corporate downtown office locations, and in harmony with real estate’s preferences, the base assumptions are that these areas are within multi-tenanted Grade A sustainable office buildings and in a CBD area of the city, where labour costs are generally high, with construction activities restricted to non-business hours.

The complete ranking of all locations is provided in the chart below, and while the corporate downtown sites show a good mix of locations globally, the industrial portfolio shows a larger presence in the Asian continent, in line with the on-boarding activity done in recent years.