Designing a whole-life building cost index in Singapore

Abstract

Purpose

The purpose of this paper is to investigate the whole-life costs of non-residential green-rated building developments in Singapore to derive useful information for research and practice. When industry stakeholders like building owners, architects, engineers, quantity surveyors, builders and facility managers have detailed information about the initial and operating costs of different types of buildings, they will be able to apply whole-life costing to their existing or new projects with the intention of achieving value for money, as well as environmental sustainability. The developed index is useful to green policymakers and building owners.

Design/methodology/approach

Data are collected from building projects certified by the Building and Construction Authority (BCA) of Singapore under the Green Mark scheme, starting from 2005. Statistical analysis is performed on the collected data to generate the information required to build the index as well as cost database. The Paasche price index method is used to produce a weighted composite index for Singapore’s non-residential building sector.

Findings

The results show the classification of whole-life costs components by two main groups – “development and construction costs”, and “operating and maintenance costs”. There are a total of 68 cost significant items selected from 13 construction work categories. Comparing the weights for three non-residential building types, the highest is obtained for industrial building, which is followed by institutional and commercial buildings.

Research limitations/implications

Without data, the description of the research has primarily dealt with the formulation of the proposed index because designing an appropriate methodology is key to ensure widespread acceptance and use.

Practical implications

Prospective users have to be aware that the index cannot provide information about change in absolute terms and is not very accurate as such in reflecting the actual level of costs or prices of the variable of interest. However, it is a good indicator of the relative change over time in the level of costs or prices.

Originality/value

It is expected that this method contributes additional information to BCA’s existing tender price index about a building’s operating costs as well since the proposed index is a measure of change in the average whole life-cycle costs of buildings over time.

Citation

Goh, B.H. (2016), "Designing a whole-life building cost index in Singapore", Built Environment Project and Asset Management, Vol. 6 No. 2, pp. 159-173. https://doi.org/10.1108/BEPAM-09-2014-0045