The upgrading of the construction sector, through a combination of "pain and gain" is one that the sector will have to come to terms with.

The pain - tight labour market and increased foreign worker levies - combined with the gain - strong government subsidies - is a strong incentive for the upgrading of the sector, said Deputy Prime Minister Tharman Shanmugaratnam, at the opening of the Singapore Construction Productivity Week yesterday.

"We will have to let this process work itself out, so that we move the sector to a new level in the coming years - technologically advanced, highly integrated, led by forward-looking and dynamic firms and supported by a skilled and experienced workforce," he said.

As the sector is urged to achieve tighter integration within the construction value chain, the Building and Construction Authority (BCA) has moved to ease the introduction of new technology by walking interested parties through the regulatory approval processes.

Two technologies - cross laminated timber (CLT) and prefabricated prefinished volumetric construction (PPVC) - have successfully received in-principal approval from all the regulatory authorities, and are being showcased for the first time in Singapore at the BuildTechAsia Exhibit as part of efforts to raise awareness.

Lend Lease, the developer behind Forte, the tallest residential timber building in the world, is keen to introduce CLT in Singapore in the coming 12 months, said Mann Young, head of CLT business Asia, at Lend Lease.

Despite in-principle approval, certain restrictions have been placed on the technology. For their pilot project in Singapore, Lend Lease will only be able to build up to four storeys; development options exclude residential and healthcare projects.

"One major project we would love to do is to build our own Asia head office in Singapore," said Mr Young. "The other is a school or office application."

"They have achieved the first breakthrough, which is to get all the regulatory agencies to agree that this can be used in Singapore. So the next breakthrough will be to get a developer - private or public - interested in trying out this pilot project," said John Keung, chief executive at BCA.

"We are quite prepared to co-fund some of these pilot projects, using the Construction Productivity and Capability Fund to make sure that the cost factor is not a major hurdle that will stop the show."

Separately, the sector might see PPVC in action in the coming months, with the Nanyang Technological University (NTU) intending to use PPVC for the construction of three residential halls at its NTU North Hill Student Hostel.

PPVC involves the manufacturing of apartment-sized units complete with internal finishes, fixtures, and fittings in the factory. These "boxes" are then installed on-site.

According to NTU Development & Facilities Management's chief executive officer Paul Chain, the university has previously used other precast and semi-precast systems.

He added that using PPVC will shorten the time needed to construct the building by about four months, and result in 40 per cent savings in on-site manpower.

Civil engineering firm Swee Hong will be one of the contenders when the tender is called in August.

Since UB Australia formalised a licence agreement with Swee Hong to implement unitised building in Singapore, the firm has been gearing up for the introduction of this technology.

Its semi-automated factory, which is expected to be ready by February next year, is expected to roll out about 30,000 sq m a year. The factory has the capacity to roll out up to 100,000 sq m a year, the equivalent of about 1,000 HDB flats.

Despite its obvious benefits, cost is an issue, said Dr Keung.

"One of the key reasons is that in the UK, there is a huge steel industry. we don't have such an industry, so we import and that's where we are subject to international market forces. That's why steel construction is still, by and large, more expensive than concrete construction," he said.

It's a "chicken and egg problem", given that if there is no demand for the products, there will limited suppliers which drives prices up.

It is for this reason that the buildability and cosntructability score will be further tightened, and even make prefabricated bathrooms a requirement in the coming two years. Already, new requirements will see the minimum acceptable score on the index increase by three points by Sept 1.

Today, prefab bathrooms are expensive because labour cost is low at traditional construction sites, but in the future, when labour cost rises and with economies of scale, there will be a change in the cost equation, he said.

To support the use of prefab and precast materials, the government has also set aside land for integrated construction and precast hubs. The first, SEF Group's SEF SPACEHub, was launched earlier this week. A separate tender was rolled out yesterday, with two or three more expected by the end of the year.