According to a report by Currie & Brown, construction costs in the Middle East are predicted to rise by up to 7% in 2024. The report stated that construction costs in the UAE are expected to increase by 2-3%, while in Saudi Arabia, they are estimated to increase by 5-7%. Rising inflation in the region is the primary challenge facing the industry and the key driver of cost increases.
Currie & Brown stated that cost increases are expected to be experienced across every one of its operating regions in the year ahead. The unpredictable price swings are challenging developers in the region; however, this is offset by stability in the current oil price.
To keep costs under control and projects on track, construction firms should develop new processes and capabilities, according to the company, which provides cost management, project management and advisory services. Builders can consider adopting new ways of working, such as modular construction, to cushion the impact of local skills and materials shortages. They can also incorporate sustainability at every stage of the project and embrace digitisation.
While the construction industry in the Middle East is expected to face rising costs in the coming year, the report highlights opportunities available for firms and clients to adopt new ways of working, embrace digitization and incorporate sustainability at every stage of the project. By doing so, they can benefit from operational efficiencies and mitigate the impact of construction cost increases.
