Construction costs continue to stabilise: CIOB

Latest survey reveals Colombo among Asia's lowest-cost markets | Upward pressure continues on labour cost prompting increased reliance on foreign talent.

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SRI Lanka's construction sector has entered a period of cost stabilisation, with Colombo maintaining one of the most competitive construction cost positions in the Asian region, according to the latest Ceylon Institute of Builders (CIOB) Sri Lanka Construction Cost Report 2025 Colombo, prepared by VFORM Consultants Ltd. The annual report provides updated benchmarks across six major building categories and confirms that Colombo ranks among the lowest-cost construction markets in Asia, despite moderate increases in labour-driven costs during 2025.

The report compares construction costs per square metre in Colombo against key Asian cities including Singapore, Hong Kong, Seoul, Shanghai, Beijing, Kuala Lumpur, Jakarta, and Bangalore.

Findings show that in 2025: Colombo recorded the lowest construction cost position in five of the six building categories analysed, Colombo held the second-lowest position for industrial warehouses. This positioning is reflected across: High-rise apartments, Prestige office towers, 3-star hotels, 5-star resort hotels, large shopping complexes, and industrial warehouses.

The report's overall cost comparison places Colombo as the second-lowest cost city in Asia in aggregate construction cost per m².

A key contributor to cost stabilisation has been the reduction in several major material inputs.