FOCUS ARE GCC-WIDE RULES NEEDED FOR SCAFFOLD SAFETY? N E W S • A N A LY S I S • I N T E L L I G E N C E • P R OJ E CT S • C O N T R ACT S • T E N D E R S
AN ITP BUSINESS PUBLICATION LICENSED BY DUBAI MEDIA CITY
Setting the pace EC Harris ME chief on embracing expansion Page 28
SEPT 4-10, 2010 • ISSUE 334
CONSTRUCTIONWEEKONLINE.COM
Recovery remedy Arabtec, ALEC money men say cash is still king Page 24
PORTS OF CALL
The $50bn mega-projects transforming the Gulf into a global shipping hub
COMMENT
CONTENTS SEPTEMBER 4-10, 2010 • ISSUE 334
34 Expanding horizons The massive Khalifa Port and Industrial Zone project set to escalate Abu Dhabi’s fortunes
REGULARS
10 16 18 56
ONLINE EDITOR’S LETTER GUEST COLUMN FOREMAN
INTELLIGENCE
4
OCTOBER CONTRACT AWARD FOR BAHRAIN HOUSING PROJECT Consortiums that have prequalified for the project will find out who has won the main contract next month. FINANCE
8
NMDC UP AS CONTRACTORS SLIP The National Marine Dredging Company was the sole rising stock during August. ROUND UP
12
SKILLED TRADES SHORTAGE COULD STYMIE GLOBAL GROWTH Skilled trade positions are some of the hardest to fill in the world.
ANALYSIS
24
MONEY TALKS Part 1 of a CW series asking whether the GCC construction sector is prepared for an upturn.
SAFETY
46
STRUCTURED PRODUCTS Quality equipment and early training are the key to scaffolding safety, according to industry experts.
FACE TO FACE
28
A CENTURY OF CONSULTANCY ANCY EC Harris ME regional managing naging ks to director John Williams talks Elizabeth Broomhall about the company’s diversification.
ON SITE
34
HARBOURING OPPORTUNITIES NITIES CW journeys to the massivee Khalifa Port and Industrial Zone to get the low down on development.
TOP PROJECTS
42
Top 10 Port Projects A closer look at the top ten port projects transforming y. the GCC’s shipping industry. SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 1
The most important project, contract and tender information, updated every week
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2 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
INTELLIGENCE
Three consortiums have prequalified to build the housing, according to Mott MacDonald.
October contract award for Bahrain housing project
C
onsortiums that have prequalified for a 4,500-unit affordable housing project in Bahrain will find out who has won the main contract in October, according to the project’s technical advisors. Speaking exclusively to Construction Week, Mott MacDonald’s divisional director John Seed said the main contract would be awarded to one of three consortiums who prequalified for work earlier this year. “Three consortiums have prequalified for work on the project,” he said, but declined to name who they were. “The government started the proceedings for this development towards of the middle of 2009. They’re at a critical stage of the tendering process at the moment, but are likely to announce the winner of the main contract this October.”
4 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
The project itself, which is being launched in response to a high demand for affordable housing in the region, will involve the construction of thousands of residential units across three sites in the north of the country, according to Seed. To effectively manage a project of this scale, he explained how each consortium is made up of 10-20 companies, including developers, several contractors, funders, facilities management companies (that will manage the project for 25 years) and a design team including architects and quantity surveyors. Other advisory teams to the development include Ernst and Young, the project’s financial advisors, and Freshfields, the project’s legal directors. – By Elizabeth Broomhall
INTELLIGENCE For up-to-the-minute tenders log on to constructionweekonline.com
Jazan Eco-City port Al Jaber gets US$300m tender delayed for Shah Gas project The tender details for the construction of the port in Jazan Economic City in Saudi Arabia are to be revised on the back of a change in plans for the Jazan oil refinery. Malaysia’s MMC, which is leading the consortium of developers on the JEC, informed investors of the decision by Saudi Aramco, the state-backed oil supplier, to change the upcoming refinery’s location. “The port’s location will likewise be changed accordingly,” the company stated. The tender was deferred in May in light of ongoing talks between MMC and Saudi Aramco as to the refinery’s position. A change of location would affect on the port and utility infrastructure of the area. Jazan Economic City will be located in the Province of Jazan, 60 km northwest of Jizan City, home to the Port of Jizan.
The energy project division of Al Jaber Group has secured US$300 million to finance the Shah Gas project in Abu Dhabi from the emirate’s top Islamic bank. Abu Dhabi Islamic Bank announced the payment to Al Jaber Energy Services, according to ADIB in a note to the Abu Dhabi Stock Exchange. The contractor is in the middle of early work on the Shah plant on behalf of Abu Dhabi National Oil Company. Work includes the grading and leveling of the site and construction of a four-lane carriageway among other tasks. The contract value is US$299.2 million and work is to be completed by next August. The project was awarded by Abu Dhabi Gas Development Company and is part of a US$12 billion development.
Majid Alm Futtaim was behind Dubai’s Mirdif City Centre mall.
Mall of Egypt open to bidders from November Construction firms will soon be able to bid for work on an AED 2.83 billion mall in Egypt. Currently in its design phase, the 160,000m2 Mall of Egypt located in Cairo will be open to tender from November this year, developer Majid Al Futtaim has said. Londonbased architects RTKL is
due to finish the design by October. The project is set to be one of the biggest shopping centres in North Africa, with 350 stores, a 17-screen cinema complex and an indoor ski facility ‘Ski Egypt’ similar to that in the Mall of the Emirates in Dubai. In an interview with the daily, the mall’s develop-
ment director and MAF Properties senior vice president of development Richard Reid said: “It’s only been in the last two years that the retail market looked quite seriously at Egypt.” He added that he expected the project to employ as many as 7,000 Egyptian labourers through a local contractor, and the mall retailers themselves to hire “thousands of people”. Architectural firm BDP’s international development director and chairman of BDP MENA David Cash told Construction Week that the company has identified Egypt as an important future market.
TOP TENDERS Construction of Yanbu Power and desalination Plant Country: Saudi Arabia Closes: Sep 22, 2010 Category: Power & Water Issuer: SWCC Construction of roads in Al Shuwaikh & Al Ahmadi Country: Kuwait Closes: Sep 28, 2010 Category: Infrastructure Issuer: Central Tenders Committee Roads and infrastructure works, North Sabhan Country: Kuwait Closes: Oct 12, 2010 Category: Infrastructure Issuer: Central Tenders Committee Civil works for facilities & roads of Kuwait University Country: Kuwait Closes: Sep 28, 2010 Category: Infrastructure Issuer: Central Tenders Committee Construction of 11/132/400-kV Al Funaitees substation Country: Kuwait Closes: Oct 10, 2010 Category: Power and Water Issuer: Central Tenders Committee Construction of 38 housing units and mosque at Al-Hawiyah Country: Oman Closes: Sep 27, 2010 Category: Buildings Issuer: Ministry of Housing Construction of 33 housing units and mosque, Orab Country: Oman Closes: Sep 27, 2010 Category: Buildings Issuer: Ministry of Housing Supply of portable boring machines Country: Oman Closes: Sep 27, 2010 Category: Infrastructure Issuer: Oman Drydock Company Temporary power services, Oman Main Interconnected System Country: Oman Closes: Sep 27, 2010 Category: Power and Water Issuer: Oman Power & Water Procurement Company Installation of 11-kV overhead lines on wooden poles Country: UAE Closes: Sept 30, 2010 Category: Power and Water Issuer: DEWA SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 5
INTELLIGENCE For up-to-the-minute tenders log on to constructionweekonline.com
TOP TENDERS Supply of pulse type self cleaning inlet air filters Country: UAE Closes: Sep 30, 2010 Category: Power and Water Issuer: Dubai Electricity and Water Authority (DEWA) Maintenance and operating services for Sultan Qaboos Sports Complex Country: Oman Closes: Oct 11, 2010 Category: Buildings Issuer: Ministry of Sports Affairs Electrification distribution works to feed Flem village Country: Oman Closes: Oct 11, 2010 Category: Power & Water Issuer: SAOC Depa provided the fit-out for the Burj Khalifa, the tallest tower in the world.
Depa ups Design Mott MacDonald Studio stake to 90% progresses on Arzanah Dubai-based interiors contractor Depa Ltd has more than tripled its stake in the Singaporean firm Design Studio Furniture Manufacturer Ltd for AED295 million. Depa has increased its original shareholding bought in 2006 from 24.7% to 90.5%. The acquisition values Design Studio at AED449 million, a statement said. Depa CEO Mohannad Sweid said the acquisition was part of the company’s longterm diversification plan, which includes further inroads into southeast Asia. Design Studio is a product and fit-out interiors specialist company, active principally in Southeast Asian markets. In 2008, Depa and Design Studio launched DDS Contracts & Interior Solutions Pte Ltd, with Depa holding 55%.
Mott MacDonald is progressing with an US$18 million project from the Zakum Development Company (Zadco) Abu Dhabi to replace diesel gensets on Arzanah Island. Phase one will see the installation of two new diesel gensets with 13.8 kV and 60 Hz terminal voltage inside a custom-designed engine room, with Mott MacDonald providing design and engineering workas well as cost consultancy. Part of Zadco’s Satah oil field off Abu Dhabi’s coast, Arzanah Island has water injection facilities as well as utility and accommodation loads, and requires 3.5 MW to 4 MW of power. As natural gas is not available on the island, power turbines are operated on diesel.
Supply and installation of 2x20 MVAR capacitor banks Country: Oman Closes: Oct 11, 2010 Category: Power and Water Issuer: SAOC Proposed offices building at Bausher Airport Heights Country: Oman Closes: Oct 11, 2010 Category: Buildings Issuer: SAOC Construction of 30 Housing Units at Dibba Country: Oman Closes: Oct 11, 2010 Category: Buildings Issuer: Ministry of Housing Rehabilitation of Boiler (A) at Aziziah Plant Country: Saudi Arabia Closes: Sep 26, 2010 Category: Power & Water Issuer: SWCC Vocational Association Building at Airport Heights Country: Oman Closes: Sep 27, 2010 Category: Buildings Issuer: Ministry of Social Development
MATERIALS PRICE CHECK
$3.27
$748.67
$3.81
$32.67
$4.36
$72.15
$98
$721.45
$14.97
$580
$10.88
Alum. profiles
Beech wood
Cement
FF plywood
Glass
MDF
Ready mix
Red meranti
Scfldi planks
Steel
Steel props
Per tonne
Per piece
Per tonne
Per piece
Per kg
3
Per m
Per bag
6 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
Per sheet
Per m
2
3
Per m
3
Per m
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BEWEGUNG MIT SYSTEM
FINANCE STOCK MARKETS
NMDC up as contractor peers slip National Marine Dredging Company was the sole rising stock among contractors during August as thinner summer trading volumes saw investors turn away from project-based companies. The Dubai-listed company saw its share price rise 8.5% from AED7.83 at the start of the month to AED8.5 by 25th August. The company has posted promising financial results this summer that include an increase in contract value of more than AED400 million for the six months of 2010. Arabtec Holdings slipped from AED1.75 to AED1.67 between 1st and 29th of August. Makkah Construction & Development Company lost almost SR3 on the Tadawul in Riyadh over the same period. Mohammad Al Mojil Group, the oil and gas project specialist, also saw its share price shed more than SR2 to close at SR15.75 on 29th August.
National Marine Dredging Company secured more than AED400 million in contracts in six months. Picture illustration only.
In fair waters National Marine buoyant after solid half year; Tadawul rebounds after late August dip. National Marine Dredging Company’s share price performance this year (AED)
The Tadawul All-Share Index
63.50 63.50 10.00 9.50
62.50
9.00
62.00
8.50
61.50
8.00
61.00
7.50
60.50
7.00
60.00
Jan
Feb Mar
Apr
May
Jun
Jul
Jul 7 Jul 14 Jul 21 Jul 31 Aug 8 Aug 15 Aug 23
Expert Views Industries Qatar It’s one of the Gulf’s biggest companies – but is its stock heading for growth?
Industries Qatar has a market capitalisation of almost QR56 billion and is one of the region’s biggest steel producers along with its other major lines in fertilisers, petrochemicals and additives. Revenue for the first six months was almost QR1 billion higher than the equivalent period in 2009, though net profits were at similar levels. Its share price so far this year looks a little like a roller coaster, peaking at QR119 on 13th April before a dramatic slump to QR95 on 25th May. Last week it was simmering around the QR100 mark, and its gradual growth in the last quarter – and strong fun-
8 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
damentals - may be the reason why analysts have been looking on the stock favourably. On 5th August, Egypt-based Ahmed Shams El Din of EFG Hermes recommended the stock be bought, expecting a target price of QR115. Sriharsha Pappu of HSBC Bank Middle East in Dubai decided to stay neutral a few days later. But Ankit Gupta at Bahrain-based Securities & Investments Company declared a ‘buy’ on the company on 11th August, posting a target price of QR129. Digvijay Singh at Credit Suisse labeled it ‘outperform’ on 20th August, though Scott Darling at Nomura advised a reduced position.
VERDICT
BUY: The company has had a steadier 12 months, and most analysts recommend it.
FINANCE
Numbers game:
Deal in pipeline:
45.5%
1.2
Increase in output of Emirates Steel in H1 compared with 2009
TEN BIGGEST RISERS
Market capitalisation of Saudi Steel Pipe (Saudi riyal billions)
60
19.5%
Price fall (US$) per metric tonne of Turkish rebar in a week ($580,000)
Fall in Tadawul All Share Building/ Construction index since 1st May
Turkey undercuts Qatar for steel price
Saudi Steel Pipe signs deal with TSM Tech
Steel producers in Qatar are being edged out by Turkey in their price competitiveness, according to statistics. Data gathered by Statistics Centre – Abu Dhabi, which collects data across many industries as well as economic surveys, has found the Eastern European state undercutting rivals in Qatar since the beginning of this year. The average price per tonne of 10-25mm steel bars from Turkey in July stood at AED2,183, the same as the UAE, compared to AED2,400 in Qatar. Turkish high-tensile steel was AED2,208 compared to the UAE’s AED2,216 and Qatar’s AED2,267. Steel bars reached as low as AED2,001.3 from Turkey in February against AED2,007.5 in the UAE and AED2,012 from Qatar.
Saudi Steel Pipe Company, the Dammambased manufacturer of welded pipes, is to start a new titanium and steel company with TSM Tech Company, a South Korean firm. Saudi Steel Pipe will hold a 70% stake in the venture, it said last week. Production will come from a plant that will start in 2012. The 30-year-old company is one of the leading manufacturers for steel pipes in the Kingdom for the construction sector, as well as servces to the oil and gas industry, and it is now a year since the company first listed on the Tadawul after launching an IPO for the equivalent of 31.4% of the company between June and July 2009. The stock has declined around SR2 since the beginning of this quarter.
Union Cement Co: Specialities Gro.: Nat Marine Dredging: Fujairah Buildings: Mabanee Co. SAKC: RAK Co. White Cement: ` Salbookh Trading: Kuwait Co. for Portland: Abu Dhabi Nat Co.: National Ranges:
+7.09% +7.02% +6.12% +5.95% +5.7% +4.76% +3.48% +2.49% +2.38% +2.26%
TEN BIGGEST FALLERS Kuwait Buildings: United Projects: National Cement Co.: Al Jouf Cement: SIDC: Saudi Ceramic Co: Kuwait Cement Co: Construction Materials: Southern Province: Nass Corp BSC:
-20.14% -11.13% -4.8% -4.69% -4.14% -3.55% -3.07% -2.94% -2.93% -2.89%
SECTOR INDICES: Banking: -2.02 Insurance: -8.72 Fin & Inv : -19.56 Real Est & Constr: -17.58 Transportation: +2.59 Utilities: -3.60 Materials : 0.00 Consumer Staples : 0.00 Telecoms : 0.00
-0.24% -0.30% -1.09% -0.63% +0.56% -0.56% 0.00% 0.00% 0.00%
(Data accurate as of close 29th August 2010)
Update 10 latest industrial project updates PROJECT TITLE
STATUS
VALUE / VALUE RANGE (US$)
OIL TERMINAL EXPANSION - FUJAIRAH, UAE
Construction
100,000,000
NEW STEEL PLANT AT THE DUBAI INDUSTRIAL CITY (DI)
Construction
100,000,000
YANBU REFINERY PROJECT
Construction
1,000,000,000
PTA PLANT, YANBU COMPLEX
Tender
N/A
CONSTRUCTION OF NEW ACID GAS SEPARATION UNIT – KUWAIT
Construction
405,000,000
GAS RECOVERY SYSTEM (UNIT: 105) AT MINA AL-AHMADEI REFINERY
Construction
31,000,000
BOROUGE - ETHANE CRACKER, ABU DHABI
Construction
1,075,000,000
BOROUGE 3 - UTILITIES & OFF-SITE FACILITIES
Construction
935,000,000
BOROUGE 3 - LDPE UNIT
Construction
400,000,000
BOROUGE 3 - FOUR BORSTAR UNITS
Construction
1,255,000,000
SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 9
ONLINE Getty Images
For breaking news, analysis, interviews, tenders and projects, log on to constructionweekonline.com
MOST POPULAR
1 2 3 4 5
Mumbai’s 117-storey tower divides opinion Al Jaber gets US$300m for Shah Gas project Nakheel announces payment of AED2.5bn to creditors Moonlighting workers risking their lives for cash Bauer completes piling for Louvre Abu Dhabi
IN PICTURES
The new mosque in the eastern French city of Strasbourg has been progressing steadily since 2004.
New French mosque finally draws close to completion After the first stone was laid in 2004, construction of the new mosque of the eastern French city of Strasbourg has been progressing steadily, and is finally drawing close to completion. The building, which was designed by Italian architect Paolo Portoghesi, who also designed the Rome Mosque, is being constructed to replace the existing structure ‘The Strasbourg Mosque’, known by the French as La Grande Mosque de Strasbourg. Dating back to 1982, the old mosque currently occupies a converted foie gras factory in the Impasse du Mai in the centre of Strasbourg, near the law-courts. In its place, the new mosque, which has undergone a series of construction delays, partly due to litigation between contractors and city officials who prevented overseas funding of the project, is to occupy 5,000m2, with a 28-metre-high minaret. Other designers originally in the running for the project included Zaha Hadid, who came up with a more futuristic proposal for the building.
SPOT POLL How has the last year affected wages at your company?
36.6% 29.3%
24.4%
9.8%
We’ve had to cut staff and wages to remain buoyant.
We’ve had a slight increase this year.
We’ve had a good increase in salaries this year.
The company has launched a pay freeze.
10 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
Sheikh Zayed Road library Cheungvogl Architects have designed a library to commemorate UAE founder Sheikh Zayed for Dubai’s main throughfare, Sheikh Zayed Road.
LATEST FEATURES
Green Games on red light Preparations for the Delhi 2010 Commonwealth Games have been rocked by allegations of corruption. Signing of the summer CW interviews AECOM and Davis Langdon about the companies’ merger. Raising the roof The new terminal building in Abu Dhabi is progressing well.
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ROUND UP
LABOUR
Skilled-trades shortage could stymie global growth Skilled-trades positions such as electricians and plumbers are among the hardest to fill in the world, according to the latest research from Manpower Inc. of the US, which surveyed 35,000 employers across 36 countries and territories. In a new ‘World of Work Insight Paper’ entitled ‘Strategic Migration – a Short-Term Solution to the Skilled Trades Shortage,’ Manpower warns that as the global economy recovers, it may be necessary to implement strategic migration policies in order to create a mobile workforce and plug the gap of skilled workers. The lack of skilled blue-collar workers could impede the progress of infrastructure projects and inhibit national growth – such as transportation in India and power in Brazil, for example. It is a problem that national governments must address in the long-term to foster economic health and fuel business growth, it
says. In the meantime, increasing the mobility of these workers can help ease the talent shortage. “As the global recovery gathers pace, cultivating future talent and alleviating the shortage of skilled workers is becoming vital to ensure economic growth,” said Manpower Inc. chairman and CEO Jeffery Joerres. “With unemployment high around the world, migration is an emotive subject, but strategic migration will be necessary to create a global workforce and alleviate the current shortage,” he added. “Countries should be developing policies which facilitate positive migration to fuel economic growth through providing skilled workers where they are needed, rather than creating barriers to immigration.” Shortages of skilled workers are acute in many of the world’s biggest economies, including the US, Germany, France, Italy, Canada and Brazil.
Skilled tradesmen are a valuable resource, say researchers.
In Quotes “The heads of Davis “With weeks to go before Langdon and AECOM are the Games, this is a massive talking about opportunities distraction. We need and we can everyone focused support them on delivering the for growth in Games.” a way that is MIKE HOOPER, Commonwealth sustainable.” KEVIN SIMS, Davis Langdon Middle East head, on the company’s merger with AECOM.
12 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
Games Federation chief executive, in New Delhi’s countdown to the 2010 Games in early October.
“I will stand with you until the oil is cleaned up, polluters are held accountable, communities are made whole, and this region is back on its feet.” US president BARACK OBAMA on the recent troubles faced by its southern state residents.
ROUND UP
Around the GCC 3 4 2
“The Kingdom’s museum and antiquities sector has made remarkable achievements in recent years.” PRINCE SULTAN BIN SALMAN, SCTA chairman on the construction and renovation of the Saudi Arabia’s museums.
5
1
1. UAE
4. BAHRAIN
The number of GCC hotel projects falls from April-June
Two new parks forJid Ali district
The number of hotels in the pipeline for construction across the MENA region fell by 2,600 rooms from April to June according to a report released by Al Taameer Real Estate Investment this week. Currently, just 455 properties totaling 126,310 rooms are due to be developed through North Africa and the Middle East, reflecting a significant drop in the numbers of people requiring hotel accommodation. According to the report: “The MENA region has been witnessing a continued capacity addition for the past 18 months and is fast outpacing the demand.”
Residents in Bahrain’s Jid Ali district are to get two new public parks. The parks will be the first of their kind in the country, with the introduction of new conceptual modern designs unmatched by any other public park, a council spokesman said.
2. KSA
3. KUWAIT
5. QATAR
Firms turn to illegal workers
Grand Real Estate Firms opt to hire GM resigns gear in downturn
Saudi contractors are hiring extra workers illegally, in a bid to avoid being fined for missing construction deadlines, according to reports. Around US $80bn-worth of projects are underway in the Kingdom, according to Business Monitor International’s Key Project Database, and this has put pressure on contractors to meet deadlines. As a result, contractors have begun hiring extra workers illegally in order to avoid fines as a result of delays.
The general manager of Kuwaiti developer Grand Real Estate has resigned, a note to the Dubai stock exchange has revealed. The company said that Hussain Ali Zaman is to step down with effect from 1st December. Grand Real Estate is a Kuwaiti developer and manager of high-end and luxury buildings. This includes the construction of tourism and leisure facilities, hotel marketing and other services, property management and government projects.
Qatari heavy plant specialists United Equipment Group says it has seen a marked increase in the number of firms opting to hire equipment rather than buy it. UEG, Qatar’s sole Liebherr tower crane dealer, keeps a stock of around 40 new cranes on its books, but the hire fleet of 30 additional cranes is what has kept the company vibrant during the global economic downturn. The company says the boom-days of the past are clearly over.
SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 13
ROUND UP
Saudi to spend $39bn on sustainability Saudi Arabia will spend US$ 39billion (SR150 billion) on construction of “smart buildings” over the next eight years to promote long-term sustainability in the country. Studies show that cooling, heating and lighting systems used by smart buildings can save 30% on energy consumption, cut down 50% of water consumption and minimise up to 90% of building waste. The Saudi Build 2010 and Saudi Stone-Tech trade shows are expected to provide contractors, real estate developers and building owners with direct access to a range of smart building ideas from hundreds of companies from Europe, Africa, the Middle East and Asia. “Building owners are increasingly becoming interested in making their facilities more energy efficient to save money and decrease operating costs,” said the Saudi Build project manager, Shahid Bhatti. The two events will be held at the Riyadh International Convention and Exhibition Centre from 18th-21st October.
PICTURE PERFECT
A BUCKET-WHEEL EXCAVATOR removes the first layer of soil for the expansion of the nearby Welzow open-pit lignite coal mine in Drebkau, Germany. The area of northern Saxony and southern Brandenburg is scarred with active and former mines, and a large-scale project is underway to flood the massive pits and convert them into lakes for tourism.
PROJECT
Mumbai’s 117-storey tower divides opinion Mumbai is divided over plans for a 450m tower in the city’s downtown residential hub. Developer Lodha says that the 117-storey World One tower, due to cost around US$450million, will become a landmark for the booming Indian city. Flats in the luxury residential tower will start at 47.5 million rupees. “It took seven islands to create Mumbai, now one icon will define it,” the company claimed in its promotional material. Others are less convinced. Vishaan Chakrabarti, head of the
real estate development program at Columbia University told the New York Times that Mumbai needs infrastructure and planning as well as bold projects. “Icons alone don’t make a city,” Chakrabarti said. “You really need the platform that major urban centres like New York, London, Singapore and Hong Kong have, in addition to great architecture.”
FINANCE
Nakheel starts paying creditors Government-backed developer of the Palm Jumeirah, Nakheel, announced earlier this week that it has paid AED2.5 billion of the AED4 billion owed to trade creditors, and of the AED91 billion owed in total. The firm’s chairman Ali Lootah said that 80% of its trade creditors had agreed to the payment terms proposed in March to pay back 40% of its debts in cash and 60% in sukuk. As yet, another 15% of trade creditors must agree to the terms in order for Nakheel to pay 60% back in Islamic bonds,
In Numbers
700
Value in US$ millions of the counterfeit parts trade in the UAE.
14 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
30
Days left until New Delhi throws its doors open to the 2010 Commonwealth Games.
11
Museums in Saudi Arabia under development as part of a push to preserve the Kingdom’s past.
ROUND UP
though the developer made clear that it had no plans to review its original proposals. “The offer proposed to bank creditors is final and isn’t being re-visited or revised,” Lootah told Al Khaleej, adding that on the whole, his firm had had a “positive reception and general satisfaction” from banks and creditors. As well as trying to restructure its debt, Nakheel is also in the process of appointing consultants to assess and advise on its current financial situation and commitments.
PROJECTS
Affordable housing will rely on PPPs Public-private partnerships (PPPs) will be the norm for forthcoming affordable and social housing projects in the GCC, according to industry experts. The Standard Chartered Bank’s head of commercial real estate in the Middle East, Fergal Harris, said there is, and would continue to be, a move towards PPPs as a means of ensuring quality building on government-led housing initiatives. At least two housing projects planned for Bahrain,
2
which have been launched to cater for the growing population and increasing demand for affordable housing, are currently looking at PPPs with a view to guaranteeing efficient programme management. BUSINESS
Saudi market tempts UK giant Carillion British construction firm Carillion is considering a future entry into the lucrative Saudi market, although its plans are still at an initial stage. John Denning, Carillion’s director of group corporate affairs, said: “We are at the feasibility study stage, and we haven’t got as far thinking about a potential partner yet.” He added: “It is probably a year or two away, because you need to tread very carefully when entering any new market. But we are in the process of looking at Saudi, and of course one would eventually need a partner to operate in the country.” Denning said that his firm had noticed Saudi Arabia’s massive infrastructure funding, such as the $385 billion budget announced last week.
Number of weeks in which traffic was stuck on a Chinese freeway last month.
2200
BUSINESS
Al Habtoor’s Voyer: Civil to dominate Al Habtoor Leighton is looking to increase its projects in civil engineering to 70% of its total workload, according to one of the firm’s executives. Laurie Voyer, managing director at the Dubai-based contractor, told CW: “We’re established here in the market for general buildings though there is also scope to develop our name in civil engineering, as there might be more jobs in this field than in buildings. In future years I’d say we might be perhaps 70% to 30% for civil jobs rather than buildings.”
PROJECTS
Mott MacDonald to engineer India metro Mott MacDonald has been appointed detailed civil and structural design engineer for 10 elevated metro stations in Chennai in the state of Tamil Nadu by Consolidated Construction Company Ltd. India’s fastest-growing economic region, Chennai has the country’s highest reliance on public transport. The proposed high-capacity, high-frequency metro will not only be a cheaper mode of
Number of welds inspected by robot X-ray machines in a new Nigerian gas pipeline.
transport, but also provide a safer, more reliable and better customer service. The Tamil Nadu government is investing US$3.1billion into the Chennai Metro Rail Project, one of the largest projects underway in the region.
PROJECTS
Mourjan Marinas in Lusail City project Mourjan Marinas IGY will undertake the design, construction and operation of all marinas in the Lusail City’s development in Qatar. Master planning for the 35km2 Lusail City development, north of capital Doha, has been completed and it is envisaged the area will be home to 200,000 people. It is also destined to be a martime hub, with a number of marinas targeted at different clientele – including private, business and community marinas. In addition, 1,500 berths are planned for the development. The first phase of the project is expected to be completed by January 2011 and will include waterfront dining and shopping. Other phases will include yacht clubs and shipyards.
3.9
Billions of US$ set aside by Saudi power authorities for three major projects in the Kingdom.
SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 15
COMMENT
BEN ROBERTS
Taking stock Full working days await – how will your performance so far influence the rest of the year?
I
t is tempting to speculate how companies have used the relatively quiet period during Ramadan. It is probably the case that it will be determined by how well your company might have performed so far this year. Are you looking to cut losses or invest in greater work capacity; maintain the business you have or look again at new markets? Half-year financial statements across the construction industry can be deceptive in how you view companies in the mid-to-long term. Profits can either indicate the fruits of well-timed business expansions or, if you are a material supplier, higher production capacity. Or they could be the result of one-off events, such as a sale of assets. Losses could either see you at the mercy of declining demand – again, particularly for material suppliers – or a temporary dip while awaiting the delayed proceeds of a number of astute moves. Aldar Properties might be a good example of the latter. Total revenues for the first six months of this year fell by more than half compared to the same period last year, and investment property gains were hit by fair value accounting, but it has secured more than AED1.567 billion of additional funding. Sales fell, but the AED695 million it did make “will be recognised in future periods”, the company states tantalisingly. Cement & Gypsum Products in Oman also indicated that the company’s OR300 million net losses for the six months were also due to a kind of limbo between old projects and new. In truth this reminds me of the euphemism people give to 16 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
avoid saying they’re unemployed – instead, they are “between jobs”. It’s a tough market for the grey stuff, however: even if sales increased, prices sank. One analyst told ConstructionWeek that the boom for cement in Oman – where some companies imported to meet demand during 2007-2008 to be subsidised this year by the government – is “over”. Even in Saudi Arabia, big projects have not stopped market saturation due to so much of cement remaining within its borders – as attested by the “lower sale incentives” highlighted by Southern Province Cement in its statement, and the SR283 million-worth of bags it didn’t shift compared to last year. The contractor that has most caught the eye is National Marine Dredging Company. This could be because news surrounding ports has been all over the media this summer, topped by the thorough coverage in this week’s issue. With ongoing updates about airport expansions, there’s something warm and familiar about big projects like these. On the other hand, the numbers are big: NMDC’s contract revenue increased from AED532.2 million to AED950 million comparing the first six months of this year to those of 2009, with gross profits up more than AED100 million. No doubt this will be a company looking to ‘expand’ rather than simply ‘maintain’ itself. More so than ever, the difference between winners and losers will be wide. As work soon returns to the standard extra hours, how will you be using them?
Accounted for: financial statements can indicate many things.
Losses could either see you at the mercy of declining demand, or a temporary dip while awaiting delayed proceeds
COMMENT
CAROL PRINCE Switching on Carol Prince explains how LEDs let us keep the lights on for longer and reduce environmental damage.
T
HE NEED TO SWITCH TO SUSTAIN-
ABLE energy solutions is more
important than ever in the region, as demand frequently outstrips supply. Lighting represents 22% of electricity usage in the Middle East – a much higher statistic than anywhere else in the world. If GCC consumers switch the lights in their homes to more efficient solutions, this will save up to US$400 million and 5.1 megatonnes in carbon dioxide emissions annually. Briefly, Light Emitting Diodes (LEDs) are the efficient lighting solution for today’s energy issues. The future of lighting will soon see a widespread adoption of this solution. LEDs are available as small solid light bulbs or in cluster form with diffuser lenses, which are ideal for the home. These cluster beams can use as many as 180 bulbs per cluster and the light is spread evenly. A recent additions to the market are LEDs that can be dimmed to the zero position and emit no energy, unlike their traditional counterpart that still emits energy loss even at zero. At present, the drawback to switching to LED is the initial cost, but the efficiency and cost effectiveness of LED lighting systems will drive demand for more affordable LED lights. Further, there are still tremendous financial and energy savings to be achieved. The operational life of white LED lamps is 50,000 hours. This is more than 10 years of continuous operation. The long operational
18 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
life of an LED lamp is a stark contrast to the average life of an incandescent bulb, which is approximately 5,000 hours. The long life span of the LED has naturally a direct impact on maintenance requirement. The true expense of incandescent bulbs is in the cost, labour and time needed to replace them. These are important factors when considering lighting options for an office, as maintenance costs to replace bulbs can be enormous, and can be virtually eliminated with the LED option. The key to switching to LED lighting is reducing power consumption. With correct design, an LED circuit will realise approximately 80% efficiency, meaning 80% of the electrical energy is converted to light energy. The remaining 20% is lost through heat. Incandescent lamps operate at about 20% efficiency with a staggering 80% lost as heat. Furthermore, LEDs do not cause heat build-up, producing only 3.4 British Thermal Units (btu) per hour, compared to up to 88btus for incandescent. Comparing LEDs and incandescents financially, a 100 Watt incandescent is used for 12 months, with electrical cost at 33fils/ kilowatt per hour, at a total cost of AED290. The same example for LED with 80% efficiency being used, the electricity cost would be AED44 per 12 months – a saving of AED246 over the 12 months. The true savings are actually much higher, when you take into account that traditional
lamps need to be replaced more frequently, usually within a year, and this involves man-power and maintenance costs. Also, some areas will remain unlit if traditional lamps lose their power, due to contractual obligations. Many buildings do not allow repairs to be carried out when public areas are open, so maintenance must be carried out within set periods and limits. RWN Trading recently conducted research on lighting for a carpark that had 900 incandescent four-foot tubes on for 24 hours. Most last one year and some last no more than six months. When the company conducted the survey, 30% of the lamps had blown and had yet to be changed. The results showed very clearly the huge savings by swapping from the standard 40-watt lamp to an 18-watt LED. Facilities managers need to look at the bigger picture when analysing the true cost of energy saving with LEDs. The obvious figures start with the lights themselves, but further savings can be made in cooling expenses because LEDs generate less heat, which naturally leads to less power needed. Companies have a responsibility to reduce their energy consumption and carbon footprint. Swapping from traditional incandescent to LEDs can save up to 80% of your light energy costs. Carol Prince is marketing director of RWN Trading.
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COMMENT
JAY PALMOS Keep up-to-date with delays MEP contractors suffer disproportionately more from claims of delay than other construction professionals as a result of the economic crisis, argues Hill International's Dr Jay Palmos.
T
HE GROWTH OF DUBAI IN THE LAST decade has been unprecedented. However, the economic crisis has resulted in a decrease in jobs and, consequently, a slowdown in the number of people immigrating to the emirate. But the unprecedented construction has not slowed. Last month, Deutsche Bank estimated that up to 30,000 new units will enter the Dubai residential market this year. A UBS study predicts rental prices could decline by as much as 30% during the financial year 2010 due to overcapacity. These reports paint a bleak picture for developments currently under construction. Developers know that to increase the chance of renting space successfully they must enter the market as early as possible. Due to the immense pressure to complete projects, developers are reticent to grant time extensions and continue to rely on strict liquidated damages provisions to force contractors into timely completion. Of all the participants on a project, MEP contractors are most often blamed for project delay. The most common cause of blame stems from the fact that the MEP contractor relies heavily on the performance of others for its success, including scenarios where: 1. The MEP contractor is selected late in the nomination process, thereby reducing its overall time of performance (this issue is often compounded by
20 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
unrealistic programme requirements); 2. Late access to site or critical parts of site such as the roof level (due to design change or construction delays); 3. The MEP scope is the technical heart of any project, and therefore it is linked to many other disciplines requiring long co-ordination and/or approval periods for submittals; 4. Due to the ubiquitous nature of MEP work, installation must be co-ordinated expertly to reduce congestion between subcontractors of different disciplines. No doubt, MEP contractors suffer disproportionately more from a substandard project manager; 5. Finally, even small dollar value MEP scope variations can have an enormous impact on completion if it affects a critical area of the scope. For example, an upgraded chiller system can impact the electrical requirements and ducting throughout the site – with the necessary utility co-ordination. Delays have been reported as the most common and costly problem encountered on construction projects (Const Mgmt and Economics 1996). In normal economic conditions, contractors are compensated for delay caused by others through a time extension. However, in today’s market, it is increasingly difficult to obtain such an extension. The most recent Middle
Eastern academic research (Eng, Const & Architectural Mgmt Vol 16, No. 1, 2009) listed reasons where failure to provide adequate evaluations led to delay claims as: lack of awareness by site staff to detect a delay; insufficient skilled personnel for detecting a claim; and inadequate contract knowledge by site staff. This research is particularly concerning for MEP contractors because most general contractors and developers are unfamiliar with the technical nuances of MEP work. It is often extremely difficult to convince general contractors of entitlement to an EOT. To this end, MEP contractors must support their prime contractor by providing clear claims which demonstrate entitlement. The conclusion of the research, particularly in light of the squeeze on developer’s profit margins created by the global financial crisis, is clear: protect your interests by having personnel specially trained in delay identification and contract interpretation available to you. Early identification and prevention is the key to avoiding unnecessary costs. The survival of many contractors will depend upon the timing and total costs associated with their present contracts. Dr Palmos, an experienced lead expert witness in delay litigation, is an engineer and licensed attorney, as well as a university lecturer.
LETTERS
RE: OCTOBER CONTRACT AWARD FOR BAHRAIN HOUSING PROJECT It appears to being considered on BOOT type and is an interesting incursion into the housing sector. It will be interesting to read more details of this project particularly with regards to the project financing aspects. LIAQAT HAYAT
RE: BAUER COMPLETES PILING FOR LOUVRE ABU DHABI
RE: Mumbai's 117-storey tower divides opinion It will be interesting to see how the construction material for this 117-storey tower will reach the construction site, bearing in mind all the chaos in and around the city, especially in the morning and during the evening hours. At the moment, Mumbai cannot really afford to have any more towers, given its brittle infrastructure. For this reason, the government should focus on improving the infrastructure of the city before it develops any more of these iconic towers. Currently there are more potholes on the road than the population in Mumbai. The fastest car on the road does not go above 15kmh during peak hours, and this tower will only increase the traffic in and around the location and make congestion worse. Please save Mumbai from collapsing. NARENDRA SINGH VERMA
Can anybody explain how people will exit the building in the case of a fire? We have already seen on TV how on 26 November when the Taj was burning, there was hardly any pressure from fire hoses. It is important for people to know how this will be taken care of. In an emergency, it will be extremely difficult to reach a hospital.
Can anybody throw light on these concerns? SURESH
RE: NAKHEEL TO RESTART WORK
don't seem very bothered. Please think of investors' money and restart these projects. DEBAPRIYA
ON SIX PROJECTS
I am tired with Nakheel's pace at Jumeirah Park and Jumeirah Village. Whilst these projects remain half done, owners are paying bank loans, and Nakheel
22 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
We are happy to hear the good news. Dubai is making me sleepy with these crises. Nakheel's repayments will help attract contractors and investors to Dubai again. JAVED
I do hope that the Piling Contractors Land Surveyor made the necessary adjustment for Scale Factor whilst setting out the piles. This is a very common error prevalent in the UAE which usually becomes a costly one later on in the project. MIKE SILVESTER
RE: INDIAN STEEL MAGNATE NAMED BRITAIN'S RICHEST MAN Mr Mittal, it is great to hear the news of you being the richest man in Britain. Congratulations! May you grow more and achieve more in the future and see more Indians follow in your footsteps. Keep up the good spirit. ZAKIR HUSSAIN
RE: PUSHING CONSTRUCTION'S BUTTONS
I somewhat agree with Schwarz, but I go back to the subject regarding reusing the wastage and recyclable items. Right now it is going to cost more, but we as professionals have to view the matters in the long run and with regards for the future. M A HUSSAIN
To submit a letter, write to editor@ constructionweekonline.com or by post: Construction Week, PO Box 500024, Dubai, UAE. Please provide your full name and address. Letters may be edited for space and style. Submission constitutes permission to use. You can also log in to www. ConstructionWeekOnline.com to join the conversation.
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ANALYSIS ZIAD MAKHZOUMI: Arabtec’s chief financial officer says management needs to be more dynamic.
Money talks For the first in a three-part series looking at whether or not contractors are prepared for a possible industry resurgence, two leading finance officers give their views on the cashflow situation. By Elizabeth Broomhall.
N
ine months into 2010, and there is a sense in parts of the region that the industry may be through the worst of the economic downturn. New markets have been a huge focus for most companies, with more Dubai-based construction firms looking across the GCC for opportunities. But for contractors to win new business, it is not only important that the projects are available, but that the contractors themselves have the necessary funding to bid for them. Given today’s highly competitive market, which includes an influx of international players, they are seemingly under more pressure than ever to ensure the appropriate funds are immediately accessible. “The key to taking advantage of the opportunities which the GCC countries offer the industry is to be suitably positioned to seize the opportunity,” explains Arabtec’s chief financial officer, Ziad Makhzoumi, who is working hard to ensure his company stays at the forefront of new and existing GCC markets by maintaining strong control of cashflow. 24 CONSTRUCTION WEEK SEPTEMBER 4–10, 2010
“Working capital is rarely a top priority for operating managers, but at times like these, it should be a high priority on the corporate agenda.” ALEC’s financial director Greg Walsh agrees. “There’s a saying in the construction industry. ‘If you win a tender, you’ve made a mistake or forgotten to price something correctly!’ Clearly, remaining competitive in today’s market is no mean feat considering the portion of provisional sums that make up any tender. It’s getting to the stage now where tenders are won based on who is the bravest and how good your last contract was,” he says. Challenging times Certainly one of the biggest symptoms of the global financial crisis within the construction industry has been a difficulty to manage cashflow in the wake of a non- and late-payment period. As cashstrapped developers struggled to stay afloat, payments to contractors either slowed down or stopped completely in some quarters, causing some contractors to walk off-site. After months of speculation about whether or not struggling contractors
“Even as funding opportunities begin to re-emerge, it will still be essential to maintain financial strength and independence, and to remain in tight control of your company’s finances.”
$680m
Amount Nakheel has paid to its trade creditors so far.
$2.7tn
Total value of projects still to be awarded in the Middle East region.
$76bn
Value of delayed or cancelled projects in the UAE by February last year.
ANALYSIS For up-to-the-minute analysis log on to constructionweekonline.com
Access to finance Ziad Makhzoumi on the role of financial institutions: “In any capital markets, the equity investors and financial institutions play a significant role in providing investment funding and working capital for supporting businesses and stimulating the economy. Our region particularly is less riskaverse to private equity investment than other regions in North America, Europe or even Asia, which highlights the important role of the financial institutions. “Statistics show that in the Middle East, most companies’ borrowing is short term; this is in part a corporate culture matter, for we do not like to borrow, but more recently, a banking risk strategy. Banks should fund businesses on a medium- to long-term basis and regulations should be in place for the central banks to allow other banks to carry loans on their books. “Banks should also take a longer term view on the economy, backed by regulations which will help them provide necessary funding without increasing the risks on their balance sheets.”
would ever receive payment, and in turn, what would happen to these delayed and abandoned projects, some positive steps towards resolving the payment issues began to occur towards the end of the second quarter of 2010. The question being asked today is: does this mean that contractors now have enough capital to compete for new projects in the event of an upturn? Have the last six months helped them to access the appropriate funds to facilitate their movement into new markets, which for some is critical for their survival? “From my point of view,” says Walsh, “the UAE construction market is facing very challenging times in 2010 compared with 2009. As construction projects generally span more than a 12-month
period, most of 2009 was spent completing projects that were already in the contractors’ order books, which gave some stability to the industry. Now, many of these projects are completed and handed over.” Makhzoumi concurs that the construction industry is not out of the woods yet, but attributes the problems more to a lack of payment resolutions. “In Dubai, although Nakheel has come up with a solution and has started payment, other developers have not sorted their cash situation and have therefore not started making substantial payments yet,” he says. Exacerbating problems, are the current payment terms being negotiated with clients and the availability of funding from the region’s financial institutions. The fact
that pricing tends to be agreed and finalised at the end of a project, for example, continues to create difficulties for contractors who have borne the brunt of initial project costs. “This again has an impact on cashflow as the work is not certified along with the original contract value in spite of it being done,” says Makhzoumi. “Over the last few months, this has meant that many contractors have essentially funded these variations, which in some cases have been significant.” “Also in the last nine months we have witnessed clients asking to re-price contracts for projects that have not yet commenced but are planned to go ahead,” he adds. Limited access to finance meanwhile SEPTEMBER 4–10, 2010 CONSTRUCTION WEEK 25
ANALYSIS
Slow payments have had a significant affect on cashflow.
Before the financial crisis, there were many more commercial high rises and real estate towers being constructed in Dubai.
is, according to Walsh, adding to the mounting pressure on contractors and making it difficult for them to compete with global firms that have the advantage of being international. “When it comes to facilities from financial institutions, there is either nothing on offer or rates that are unaffordable, especially for the second tier contractor,” he says. “In my personal opinion, the targets and tight timeframes the central bank has set have resulted in the majority of institutions changing their business models, with some opting to stay clear of the construction industry.” These problems in mind, both experts believe that only the bigger contractors are really prepared to take on new projects. “Contractors that are under-capitalised, have restricted bank facilities and outstanding receivables are stuck and will suffer most, because they do not have the money to expand into new markets or fund new projects,” Makhzoumi explains. “On the other hand, companies that can survive this deep recession will not have a problem raising funding when there is an upturn. That said, initially, the cost of funding will be high, and they will need to manage their cash aggressively.” Similarly, but without claiming to know for sure how the industry is coping currently due to a lack of listed companies and financial reporting, Walsh believes that
the coming months and years will be a test for the Middle East building sector. “The drastic reduction of liquidity across the construction industry has put huge strain on the supply chain and this is going to be a real litmus test during any future upturn or sudden shift in the market. The major contractors will manage to ride out the storm, especially those that are diversified, but a major portion may not survive.”
26 CONSTRUCTION WEEK SEPTEMBER 4–10, 2010
Moving forward With many new projects and government investment schemes this year, from Saudi Arabia and Azerbaijan to north African states such as Egypt and Libya, 2010 is no time for contractors to give up. Irrespective of being the largest construction contractor in the UAE, Arabtec is also going through some challenging times. The company’s most recent financial results for Q2 2010 for example, showed a 23% fall in after-tax profits from AED393.3 million for the same quarter last year to AED301.7 million in 2010. That said, the company continues to surge ahead, committed both to diversifying its markets and taking a somewhat strategic approach to cash management. Likewise, Walsh explains that ALEC is focusing on new sectors, and on reinforcing win-win relationships with stakeholders, suppliers and subcontractors, as well as financial institutions.
“I believe we face a recession which is expected to be severe and prolonged, combined with exceptional stress in the financial system,” says Makhzoumi. “Even as funding opportunities begin to re-emerge, it will be essential to maintain financial strength and independence, and to keep tight control of finances.” Among his many tips for struggling companies, this year, Makhzoumi advises that all contractors make it their focus to understand how refinancing needs to evolve, and that they develop contingency plans to prepare for future funding gaps. He also suggests that firms manage their company receivables effectively so as to limit expensive and increasingly risky trade credit, and implement strict spending controls internally with a view to improving their financial strength during rocky economic times. He maintains that there needs to be a shift to a more dynamic management approach in a more complex and unpredictable environment. “This should include restructuring balance sheets, business models and overall business strategies. At the same time, it is important to remember that the mid- and long-term implications of these measures need to be evaluated, especially because the current climate offers the chance to pursue capital investment opportunities at a lower than normal cost.”
FACE TO FACE
28 CONSTRUCTION WEEK JUNE 5–11, 2010
FACE TO FACE
A CENTURY OF CONSULTANCY For more than 30 years in its one hundred-year history, EC Harris has been a massive player in the Middle East construction industry. In an exclusive interview with CW, regional leader John Williams explains how the consultancy is evolving in a fast-changing business climate. By Elizabeth Broomhall
I
t’s been 100 years since EC Harris was founded and, having spread its wings across a number of regions and markets, the built asset consultancy now regards the Middle East as one of its most valuable business hubs. But like most other construction firms, the company was not so lucky that it managed to come away from the global economic recession unscathed. After experiencing a substantial fall in new business, it was forced to make some difficult decisions and was compelled to diversify, both in terms of geography and sector. The result was a re-defined growth plan, being driven forward by the firm’s key executives today. The man behind EC Harris Middle East, John Willams, is in some ways what you would expect of a regional managing director. Positive, knowledgeable and forward-thinking, while slightly cautious about giving away too much. On the other hand, he is rather surprising, almost shy and relaxed. Hence why, when he is asked about how the company has fared during 2010, he gives what seems like a very honest answer. “I think most people would agree that it’s been a really tough year, but there are some signs of recovery,” he says optimistically. “We’ve had a good couple of months in terms of new project wins, and we see the market picking up towards the end of 2010.” For EC Harris, the downturn wasn’t as much about losing customers as it was about losing a market. According to Williams, the company’s focus had been on the commercial property market in the UAE – this being among the hardest hit by the declining financial situation. “Previously, we were heavily orientated towards the commercial property sector because the market pulled us that
way. It was difficult to focus on much else because that’s where the investment was. Then when the recession hit, consultancies like ours had to look at their client bases. The fact that projects were stopped in Dubai generally, obviously, affected everyone, and it influenced decision-making everywhere.” Luckily, Williams explains, EC Harris had already begun to diversify its markets, putting it in a good position to make the quick changes that became critical to every business’ survival. “I would say we probably weren’t hit quite as hard as other firms because we had diversified already in terms of sectors and geographies. So work in Saudi, for example, helped us, and fortunately we had invested in building some infrastructure in the oil and gas sector. But we did have to make some changes very quickly and it wasn’t easy. We’re still operating very much in Dubai, but obviously the commercial market there has completely changed.” As a result, he says, EC Harris Middle East has worked exceptionally hard as a branch for the last 18 months to build a strong client base while broadening its capabilities in education, health, oil and gas and transportation sectors, as well as remaining in touch with its commercial property business. Evidently, most companies that previously had a focus in the UAE or commercial property market have a similar story. What separates them today, however, is how they perceive the evolution of the market, and ultimately, their level of commitment to the UAE as a business hub from 2011. “EC Harris has been in Abu Dhabi for 30 years, although we’ve been working in the region for about 50 years. So we are very committed to the region, which I think is important at the moment. SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 29
FACE TO FACE
EC Harris is providing commercial management services to Aldar Properties PJSC on the prestigious Al Gurm Residential Development on Abu Dhabi’s coastline.
You do hear of some people that have been opportunist, who’ve packed up and left now and just saw this as somewhere to make hay.” Certainly there are companies that don’t feel it is important to stay in the Middle East, or the UAE. So why is it so critical for EC Harris? According to Williams, there is a lot more to come from both. “I’ve been on the same rollercoaster as many other people in the region. Whilst the market has undergone a big change, it is still the case that some of the world’s largest projects are in the Middle East, and some of the world’s most experienced capabilities continue to be needed here. Dubai particularly is an international financial centre, so whilst it’s been through a difficult time, as an international financial centre it will continue to attract large investments in the future.”
Another advantage of staying put, he explains, is the fact that businesses are more attractive to both potential clients and employees if they have a long-term vision. “If, when you talk to clients about their issues and needs, you can make clear that you’ll be here for the long term, I think it helps. I think people are attracted to a business that is talking about a sustainable future, and that recognises the Middle East as one of the regions of growth in the world.” He continues: “There’s also a good employee proposition. Our projects are pushing us further, so we’re now working in a lot more new places and I think that gives a good employee message. There are plenty of opportunities for people to work on a major project; for example, somewhere like Al Raha beach where we’ve had quite a large team.
“Inevitably, the people that work on the projects will take that experience with them, so it’s great for their CVs.” Of course, Williams agrees that not every company in the UAE is in a position to commit to the GCC. Many firms have left due to financial difficulties, rather than out of choice. Perhaps being an international firm gives EC Harris a strong advantage. “Yes, I would say the fact that we had an ability to diversify; and the fact that we had offices in other parts of the world which were supportive to the Middle East branch meant we were in a much better position than a lot of smaller companies. Some of our people moved into other parts of the business elsewhere, and actually, being international meant we continued to get international clients in Dubai during the recession time-frame through our
EC HARRIS HAS BEEN IN THE UAE FOR 30 YEARS• THE FIRM HAS 17 DISCIPLINES 30 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
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“When the recession hit, it affected everyone. I’ve been on the same rollercoaster as many other people in the region.” international connections,” he says, adding, “It must have been pretty tough for a lot of smaller companies.” Indeed, one of the reasons the company wins some of the work it does in the region, according to Williams, is simply because it is international. “I think people do look for the covenant of a large company, but I think the bigger advantage of being international in the Middle East is the knowledge we get from the rest of our business. If we’re building a major stadium here, for example, or a major residential scheme or a major hospital, we have data from all around the world as to what the efficiency of all those buildings should look like.” Even for international firms, Williams makes clear that some of the recession’s demons were still unavoidable. Developers for example, did not discriminate between small and large, local or global companies when it came to payment problems, and EC Harris was among a number of other large consultants and contractors, on the receiving end. This year, however, he maintains that things are looking up in that department. “In some cases we have been paid, in some cases there are ongoing discussions. But generally the positive message coming from each situation we’re in is that we’re discussing things with people in a positive way to resolve things. The dialogue is progressing and there is movement. I think that’s been a major change in this area over the last six to nine months.” In the interests of looking ahead, Williams is particularly keen to stress
John Williams believes the construction market is changing post-recession, with more developers becoming asset owners.
how EC Harris is focusing on further diversification, in terms of geography and sector, services and offerings. According to the MD, this is due to a significant change in the way the industry is operating, including a new approach to development. “In today’s market, developers and investors are realising that they can get value from their portfolios. Usually in a
development market, developers just build buildings and sell them, but in a market like the one we’re in today, developers have to keep their options open, because they may not be able to sell their assets at the end of construction. Leasing is therefore becoming more and more critical in providing a source of income, and all of a sudden, through that market change, we’re seeing
EC HARRIS’ CURRENT PROJECTS: Al Raha Beach, Abu Dhabi Central Market, Abu Dhabi Landmark Tower, Corniche, Abu Dhabi Mirdif City Centre, Dubai Al Wadha City Mall Development, Abu Dhabi Aldar HQ Khalidya Palace Atlantis Hotel Ibis and Novotel, Dubai Pullman Hotel, Dubai JAFZA Development Qatar Financial Centre EC Harris has worked on Central Market in Abu Dhabi.
EC HARRIS HAS 46 OFFICES IN 24 COUNTRIES EMPLOYING MORE THAN 3,000 PEOPLE SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 31
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people modify their whole business model to become asset owners.” In response to this new demand, he explains that EC Harris’ core business today involves advising clients on how to make the most of their built assets, though he maintains that the company still does a substantial amount of work in what it is famous for, namely project management, risk management, commercial management and general consultancy services. “What we’re trying to do is look at how we can get stakeholders better results by helping them deliver projects quicker, cheaper, faster and better. We’ve been quite bold in this built asset consultancy statement, because we can see the value of the service.” He goes on to explain how, in addition to changes in developer priorities, the cost of construction post-recession has also had a significant impact on EC Harris’ ability to provide these services. “The price of construction has come right down, and whilst there is an opportunity for clients to take advantage of that, it becomes a real challenge to buy the best contract in a market which is quite cut-throat, and then to get the best performance on it. The client has to make sure that the way that they’re procuring a property, the way they’re selecting the contractor, the way the project is defined, briefed and delivered is in a very certain way. Because if someone is charging a low price, there is more chance they’re going to try and recover money somewhere later on. In this sense, we expect the market for construction claims to rise.” Interestingly, this new ability within the firm also presents business opportunities as developers look to resume construction on delayed or abandoned projects. Only recently, industry experts came together to discuss the commercial viability of restarting construction on a ‘ghost building’ or ‘skeleton structure’ as more and more developers and contractors look to finish them. Bearing in mind EC Harris’ ability to advise clients on maximising the value of their built assets, executives are confident the company’s services can be of use.
EC Harris also worked on the Mirdif City Centre project as a quantity surveyor.
“We are actually talking to a lot of people who are making investment decisions like that at the moment, because it’s a very real issue,” says Williams. He explains how, from a commercial point of view, restarting an old project is far less straightforward than it appears. Not only are developers faced with the challenge of trying to get potentially unpaid contractors back on board to carry out work on the project, but in some cases, the structures themselves may be extremely inefficient. “This market is looking at getting as much value as it can out of its assets, which means looking at the commercial viability of the product today – so, if there is a market for the building as it was originally designed and intended – as well as the cost to complete, the outstanding contractor debts, the quality of the structure, the fabric of the building and the cost of any remedial works required.” “In a nutshell, we can help companies with the risk management process when they’re taking over a project, and our view is that we will really start to see some movement in this market towards the end of this year.”
In truth, Williams says, it is opportunities such as these which have made the post-recession market so valuable to his company. He believes there is room for more facilities management consultancy work at the very beginning of a project, again in response to a growing trend of long-term asset-owning, rather
“Whilst the market has obviously undergone a big change, it is still the case that some of the world’s largest projects are in the Middle East, and some of the world’s most experienced capabilities are still needed here.”
EC HARRIS HAS 4 OFFICES IN THE GCC, IN DOHA, ABU DHABI, DUBAI AND DAMMAM 32 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
FACE TO FACE For up-to-the-minute analysis log on to constructionweekonline.com
“Contractors are going to become strategically important as more and more models for delivery will have them at the helm.”
Williams says the UAE is still an important business hub.
than simply building and selling. He is additionally confident that, hand in hand with these new business models, there will be a renewed focus on quality, and inevitably, a new role for contractors.
“In order to make the most of your built assets you need to be working with the contractors as a team, and there’s huge value in companies like EC Harris getting involved with the people who build the buildings as well as the clients and developers, to make sure that we produce something together that’s a success,” he says. “So I absolutely see collaborative working with contractors as a progression within the industry which we want to be part of. I can see that contractors are going to become strategically important in the future as more and more models for delivery will have them at the helm.”
THE DRIVING FORCE BEHIND EC HARRIS MIDDLE EAST: JOHN WILLIAMS John Williams is a partner at EC Harris, and the Middle East regional leader. He has worked in a wide variety of sectors including a number of commercial and major infrastructure projects, and has had a key role in the firm’s growth strategy and in maintaining a positive company reputation. Having worked for EC Harris for over 20 years, Williams has been responsible for various commercial, leisure, infrastructure and industrial schemes. Today, he is driving forward EC Harris’ goals in the Middle East, leading over 320 experts operating in Abu Dhabi, Dubai, Doha and Dammam. Before his venture into the Middle East, Williams was in charge of EC Harris’ BAA commission as their framework partner under the overall long-term partnering agreement with BAA at Heathrow Terminal 5, Stansted and Gatwick Airports in London. Here he led the EC Harris team in delivering the successful commercial outcome on T5 and was subsequently asked by BAA to lead their Step Change Programme to improve project performance across their portfolio of capital expenditure. In addition, Williams is a certified value management practitioner from The Institute of Value Management. He regularly facilitates strategic studies on major programmes of works and capital projects, providing an integrated value and risk approach to maximise clients’ return on investment and expenditure.
The company was key in the development of the headquarters of Aldar Properties PJSC.
THE FIRM IS CURRENTLY HANDLING MORE THAN 13 PROJECTS ACROSS THE REGION SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 33
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Harbouring opportunities Progressing well into Phase 1, the colossal Khalifa Port and Industrial Zone project is set to the change the face of Abu Dhabi’s economy, and the construction sector is urged to prepare for billions of dollars worth of contract opportunities. By Elizabeth Broomhall
A
GCC’S BIGGEST DEVELOPMENTS of the year, the multi-billion dollar Khalifa Port and Industrial Zone (KPIZ) project is one that no contractor can afford to ignore. Covering a total area of 420km2, it is four times the size of Abu Dhabi island, two-thirds the size of Singapore and 25% of the land mass of Greater London. With as much as $8.5 billion in construction projects already committed, and another $18.5 billion yet to be awarded for Phase 1 alone, the opportunities for contractors and investors are immense. S ONE OF THE
34 CONSTRUCTION WEEK SEPTEMBER 4–10, 2010
ON S SIT ITE TE ON SITE SITE
“ are currently in the “We process of procuring the contracts for the primary road, infrastructure and utilities works in Area A.” – Jurjen Groen, project manager for Khalifa Port and Industrial Zone.
SEPTEMBER 4–10, 2010 CONSTRUCTION WEEK 35
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THE FIRST ‘FINGER’ OF THE KHALIFA PORT The majority of work on the port has been completed.
But before hearing about the project’s unique characteristics and contract opportunities, not to mention the records broken and construction milestones achieved during development so far, attendees at this month’s Abu Dhabi Ports Press Conference were keen to know why such an expensive project was necessary. Whilst the property slowdown in the UAE has created an excess of general cargo that would normally be exported, according to the audience, there is also a perfectly decent, main port in downtown Abu Dhabi already. According to developer Abu Dhabi Ports Company (ADPC), the main reason for the project was to diversify both the Abu Dhabi and UAE economies, with a mega-scale industrial zone reflecting the Abu Dhabi 2030 economic vision by bringing a wealth of new business and manufacturing opportunities to the emirate. In this sense, the port is set to perform a secondary role to the industrial zone, facilitating its operation by allowing manufacturers access to seawater cooling and supplies by boat. “Abu Dhabi Ports Company plays a fundamental part in the diversification of the UAE’s economy,” says ADPC’s new CEO Tony Douglas. “The Khalifa Port and Industrial Zone will be particularly important in presenting a breadth of opportunities in line with the Abu Dhabi 2030 strategy.” Separately, company executives were also keen to stress an imminent need to increase the capacity of Abu Dhabi ports in preparation 36 CONSTRUCTION WEEK SEPTEMBER 4–10, 2010
OFFSHORE PORT AREA: The reclaimed offshore area, which is linked to the mainland by the causeway, is 2.7km2, the size of 370 football pitches.
“We’re looking for companies who can act as delivery partners. Others talk bluntly about contractors, but we’re looking for people who will make a very formal commitment.” – Abu Dhabi Ports Company CEO Tony Douglas.
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for an extra 2.6 million tonnes of general cargo expected to hit UAE shores in 2011. While the existing port Mina Zayed has sufficed up until now, executives from Abu Dhabi Terminals made clear that it had a rather limited capacity today considering the huge influx of incoming cargo that would be witnessed in the coming years. This being the case, conference attendees were eager to understand why the existing port could not just be expanded. Douglas was quick to respond: “Mina Zayed is the main downtown port and principal port of Abu Dhabi, about 3km away from Emirates Palace. Obviously when it was built in the late 60s, the head of Abu Dhabi island was absolutely a logical place to put a port, but decades later, it’s a different story. Today it is the most populated part of Abu Dhabi, which causes problems when the road network gets constrained with a flow of wagons bringing out containers and bulks. “Equally, this is a prime time real estate area now given its proximity to Reem Island, Saadiyat Island and the downtown business district of Abu Dhabi. At some stage, it will need to be redeveloped given its strategic location and value,” he added. By contrast, the new port is situated between Abu Dhabi and Dubai, as well as two major airports, Jebel Ali International Airport and
Abu Dhabi Airport. Set to provide a gateway for UAE imports and exports, it will initially have a capacity of 2 million TEUs and 9 million tonnes of general cargo compared with 650,000 and 7.5 million at Mina Zayed respectively. By 2030, the aim is to have increased capacity to a massive 15 million TEUs and 35 million tonnes of general cargo. To compete at a global level, the port will also be connected to the mainland via a series of highways, roads and utility distribution networks, as well as a nationwide freight railway line, making it the first port in the UAE to have heavy rail connectivity. In addition, and unlike some other ports, the Khalifa port will not receive container ships and bulk cargos exclusively, but any kind of vessels, including military and cruise ships. However, a change of port facilities is not an easy task, and to ensure a smooth transition of port services, ADPC executives plan to gradually phase Mina Zayed out while phasing Khalifa Port in. Bearing in mind the sheer size of the project, one of the key challenges for developers throughout will be programme management. According to the ADPC, it is essential with any mega project to make certain that construction work is carried out in the right order and to schedule, and that there is clear accountability for delivery of each set SEPTEMBER 4–10, 2010 CONSTRUCTION WEEK 37
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“In 2011, we will see an additional 2.6 million tonnes of general cargo hitting our shores.” – Abu Dhabi Terminals CEO Julian Skyrme
of works. With this in mind, managers have so far split the project into Phases 1 and 2, as well as port and industrial zone, port onshore and offshore areas, industrial zone Areas A and B and a number of industrial clusters within each industrial zone Area. In line with the existing schedule, Phase 1 of the project, due to be completed by 2012, is well underway, with the majority of construction works focused on the port side. Completed works To date, the majority of dredging and reclamation work for stage 1 of the offshore port island, which includes the first ‘finger’ of the port, the approach channel and main causeway linking the onshore and offshore port areas, 38 CONSTRUCTION WEEK SEPTEMBER 4–10, 2010
has been completed. Along the causeway, a 60-80m-deep quay wall requiring 28,000 blocks has been constructed, together with a 3m capping beam to hold it in place and contain the utilities cables needed to power cranes and docked ships. This first finger, which extends 4.5km off-shore and expects to receive vessels by the end of the year, will be replicated another four times out to sea as the port progresses through its five stages of construction. Also near-completion are the two identical sets of seawater cooling intake/outfall pipework required both for EMAL (currently constructing the world’s largest single-site aluminium smelter in the area) and for the rest of the industrial zone. This, as well as a
420km2 28,000 246km 40m m3
Total area of entire KPIZ development
Number of blocks in the quay wall
Length of pipework laid on the project
Amount of earth moved from Area B-A
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1.7km-long canal ranging between 45m and 80m wide between the onshore and offshore areas containing a basin of water protected from the tide and currents, will facilitate the sea-water cooling process required by the likes of glass and aluminium manufacturers. Meanwhile, the partly constructed EMAL smelter, which will produce up to 1.4 million tonnes of aluminium per year when complete, is constructed as far as Phase 1, together with a vacuum suction and conveyor belt system to aid the transportation of alumina and coke supplies from incoming vessels to the main facility. Perhaps some the most critical port elements already constructed include the environmental breakwater that extends
around the perimeter of the port and out into the shipping canal, and the bridges connecting the onshore and offshore port areas. While the bridges hold the record for being the longest and third longest in the whole of the UAE, according to Douglas, the 17km sea wall, costing US$240 million (AED880 million), is significant in “protecting the largest coral reef and seagrass meadows in the UAE” and in demonstrating “the manner in which environmental challenges have been embraced in the Khalifa Port project”. Project managers say that it will also protect the reef from spills and currents that occur during construction and reclamation of the port island.
Ongoing work While most project elements already completed are ports-focused, the main construction work taking place today is related to the industrial zone. This follows the assignment of two major earthworks contracts as far back as 2008 to Al Jaber Transport and General Contracting, and Ghantoot Transport and General Contracting Establishment, requiring the contractors to move 40 million m3 of sand from Area B to Area A to raise the ground level in area A by 2.5m above mean sea level. Scheduled for completion within 36 months of the contracts being awarded, and marking the start of construction in the industrial zone, the works are now steadily progressing, with 1,500 truck movements per day, the equivalent of 1.2 million m3 of sand each month. “The main activity in terms of construction is the mass land filling work in the industrial zone,” says ADPC project manager Jurjen Groen. “They’re moving the land from Area B, where there is a big surplus of sand, to Area A, where the ground level needs to be higher because of its proximity to the sea. The other reason for raising the area was because some of it was actually lower than the design ground level based on a stone surface analysis.” Other contracts already awarded, in line with the project schedule, are associated with the port. According to Douglas, this was not because the port was a priority, but rather, because it was the first stage of development. “Most of the contracts we have awarded already are pretty much exclusively linked to the port,” he says. “These are the biggies, the ones in excess of a billion dirhams. That said, the port, for all intents and purposes, is actually one of the smaller elements of the project – the development being an industrial zone with a port rather than a port with an industrial zone. But it’s the first part of the job.” Other contracts already awarded include those for the construction of onshore and offshore port facilities, and for the construction, testing and commissioning of the port’s power supply. Probably the furthest ahead is the construction of onshore port facilities, which was awarded to Al Habtoor Leighton Group last year. One of the main things the firm was assigned to was the construction of 47 official buildings, the largest of which is the central facilities building – over 300m long and five storeys high . In addition, the company was also required to manage the associated infrastructure works for the area, including a series of road networks, bridges, utility installations and landscaping. The works are steadily progressing towards completion in 2011. SEPTEMBER 4–10, 2010 CONSTRUCTION WEEK 39
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The remaining two contracts on the other hand, were not awarded until this year, hence, construction is still in its early stages. In March, Larsen and Toubro began works for the design, construction, testing and commissioning of an electrical, medium-voltage power supply for Phase 1A of the port. Here, the company’s primary role was to install a 33kV power cable network and three primary substations to provide the main power supply for the entire Phase 1A of the port, in addition to the construction of civil buildings with utilities such as air conditioning, fire protection and lighting systems. In July, Ed Zublin AG and Al Jaber Transport and General Contracting were assigned to design, construct, fit-out, test and commission the offshore port’s civil and structural building works, providing the necessary infrastructure to support the commencement of port operations in 2012. Among the works required of the contractors was the construction of 23 buildings and associated structures, including the six-storey Terminal Operations Building, over 1,000m of additional quay wall and associ40 CONSTRUCTION WEEK SEPTEMBER 4–10, 2010
ated marine fenders and bollards. This was in addition to a 5.4km dual carriageway linking the offshore port to the mainland, as well as associated service roads, street lighting and two helipads. In the future, Zublin and Al Jaber will also be responsible for implementing site-wide utilities in the area, including electrical, drainage, sewerage, potable water and telecoms. Outstanding contracts With AED18.5 billion-worth of contracts yet to be awarded for Phase 1 alone, the KPIZ project certainly offers attractive new business prospects to qualified contractors. According to Groen, there are three new contracts on the cusp of being awarded for the north, central and south areas of Area A within the industrial zone. “We are currently in the process of procuring the contracts for the primary road, infrastructure and utilities works in Area A,” he says. “So that basically involves work on the roads, utilities, sewage, seawater cooling, and telecoms
systems in the primary corridors. We have divided the area into three parts and will be awarding three separate packages, although h contracts will ll b l generall in terms off the be ffairly the work involved.” Though keeping quiet about the total value of the project, Douglas is also keen to stress that there is “a lot more to come” for those with high health and safety standards and a strong sense of corporate social responsibility. “We’re looking for world class practice as opposed to regional practice when it comes to safety management,” he explains. “A formal part of our evaluation is to look at the manner in which contractors demonstrate their corporate social responsibility and how that reflects in the way they operate.” He adds: “We’re also looking for companies who can act as delivery partners. Others talk bluntly about contractors, but we’re looking for people who will make a very formal commitment to participating in this vital piece of infrastructure for Abu Dhabi.” As well as hosting the World Ports and Trade Summit in March 2011, the developer has promised to provide more information about contract opportunities and the programme of works at a press conference in November. The Summit in March will take place at the Abu Dhabi Exhibition Centre (ADEC) with a view to unveiling new projects and giving further explanations as to the investment and development opportunities.
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ADPC HEADQUARTERS Operations are currently being led from the temporary ADPC headquarters on site.
KPIZ PHASE 1: OUTSTANDING CONTRACTS Industrial Zone
Port
General/other
Area A infrastructure North
Outstanding industrial zone seawater cooling intake / outfall pipework – deferred
Security installations
Area A infrastructure Central
Advanced piling for offshore terminal area
Construction
Area A infrastructure South Area A ME&S infrastructure Area A secondary infrastructure Design services Design for IZ secondary infrastructure
None
Framework design services
None
Security services
Marine design validation of KPMC works
None
Technical services None Professional services None General/other services None
None
General construction works (pack 1) General construction works (pack 2) General construction works (pack 3) General construction works (pack 4)
SEPTEMBER 4–10, 2010 CONSTRUCTION WEEK 41
TOP 10 PORT PROJECTS
Top 10 Port Projects Port projects within the GCC are big business, and CW has listed 10 of the most interesting contracts underway AL DUQM PORT AND DRYDOCK Oman’s move to improve its transport hubs is impressive, and none more so than the coastal town of Al Duqm where the port is currently undergoing a massive construction project to not only transform the port, but to also build a world-class, region rivalling dry-dock for ultra-large LPG tankers. Khatib & Alami Consolidated Engineering Company was charged with the feasibility study for the port project, while a consortium of three companies (Jan De Nul, CCC and STFA Marine Construction Company) was awarded the engineering, procurement and construction project in 2007. It’s a huge project: the contract called for the construction of the entire port complex, including the breakwaters and quay walls and the dredging of the access channel and harbour basin. The Oman Drydock project is being handled by a joint venture between Daewoo Shipbuilding and Marine Engineering and the government.The $800 million worldclass ship repair facility is scheduled to be operational by March 2011 and will have the capacity to handle anything up to 600,000-tonne oil and gas supertankers. When fully on track, the Duqm Drydock will generate an anticipated $210 million in annual revenue and employ 3,500 people by 2020. Location: Al Duqm, Oman Project cost: $1.25bn Project type: Construction Scope of works: New port, breakwater and drydock Client: Ministry of Transport and Communication Main contractor: Jan De Nul, CCC and STFA Marine Construction (port), Daewoo Engineering and Contracting, and Galfar Engineering and Contracting (dry dock) Completion due: Q2 2012
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KHALIFA PORT Built in five phases over a 20-year period, Abu Dhabi’s Khalifa Port is the largest port development for the UAE. Aligned with the new 420km2 industrial zone, logistics, commercial, educational, and residential special economic and free zones, Khalifa Port’s future is rosy. At the moment, Abu Dhabi’s main port, Mina Zayed, has 21 berths with 143km2 of covered warehousing and 20,000 tonnes of cold storage facilities. The current port offers little room for expansion, so the new Khalifa Port, situated at AlTaweelah north of the city, will take over once completed. Transfer of Mina Zayed’s operation is expected to take place at the end of 2012, while the phased project continues. By 2030 the port will have 7.4km of quay for 22 container berths, 12.6km of quay for 63 general cargo and RO-RO berths, and 2.4km of quay for six dry bulk berths. This will accommodate 15 million TEU containerised cargo, 16 million tonnes of general and RO-RO cargo, and 25 million tonnes of dry bulk annually. Initially, however, Khalifa Port will handle two million TEU (twenty foot equivalent units) and nine million tons of general cargo. International Bechtel Company Limited (IBCLTD) was appointed as programme managers. Bechtel’s primary responsibility is for the management and co-ordination of the master planning, design and construction of the port and associated infrastructure. Location: Abu Dhabi Project cost: Not stated, but includes $1.5bn (dredging and reclamation); $380m (port and onshore facilities). Project type: Major port development Scope of works: Construction of port and industrial zone Client: Abu Dhabi Ports Company Completion due: Phase 1, 2012; total completion, Q1 2030
TOP 10 PORT PROJECTS
BOUBYAN ISLAND, KUWAIT In the pipeline for quite some time, Kuwait’s Boubyan Island is one of the latest ports to appoint a major contractor to complete its works. The idea is to return Kuwait to its former glory as a regional shipping hub, and for Boubyan Island to act as a gateway to the Gulf state. The $1.1billion development contract was signed by Hyundai Engineering and Construction Company and local firm the Kharafi Group in July this year to design and build the port. The plan calls for 16 berths to be designed and an initial four berths to be up and running by 2015, while the staged development could see as many as 60 berths in operation on the island. Dredging works are going to be a considerable part of the project. Depth at the basins of the port are projected at 16.5 metres, and navigation channels will be 14.5m deep. The first phase of work is estimated to cost $410m and also includes the construction of a 30.30km two-way, six-lane road and foundation for 24km multitrack railways, which include a 1.42km road bridge and a 4.245km railway bridge across Subiya Straits, and the sub-works for soil foundation treatment below the roadbed. China Harbour Engineering Company and two local companies (GDC and SAC) have formed a JV for the initial contracts. Location: Boubyan Island, Kuwait Project cost: $410m (Phase 1 only) Project type: Island port development Scope of works: Harbour dredging and initial design of 16 berths Main contractor: Hyundai Engineering and the Kharafi Group (port) Completion due: December 2015
SOHAR INDUSTRIAL PORT Industry drives port expansion and a US$1.35 billion project at the Port of Sohar has helped drive investment in to the northern Omani region. The Port of Sohar underwent a major redevelopment in the early 2000s and late last year announced that it had signed three contracts for the financing and construction of a 1,380-metre long deep water jetty and port designed to cater for ships with drafts of up to 25 million. Work on the new $1.4bn iron ore pelletising plant and distribution centre began last March by Brazilian mining conglomerate Vale. Van Oord, famous for its work on the Palm islands and The World in Dubai, will carry out dredging duties. A 50/50 joint venture between the Italian company SAIPEM, and AFCONS from India, will construct the jetty. Location: Sohar, Oman Project cost: $1.35bn Project type: Jetty construction and dredging works Scope of works: 1380m jetty construction; harbour dredging to 25m Main contractor: SAIPEM and AFCONS (jetty), Van Oord (dredging) Completion due: Q1 2011
JEDDAH ISLAMIC PORT, RED SEA GATEWAY TERMINAL Increased port traffic and extra tonnage means that the new terminal and three berths with a combined capacity of 1.5 TEUs and 400km2 storage area has been a welcome relief for the busy Saudi port. Jeddah is the biggest container port on KSA’s west coast, and pressure on the facility increases every year. Around 73% of all shipping containers sent to the kingdom are processed at Jeddah – and the port has seen a 20% increase in total tonnage processed through the facility for the first six months of 2010. The expansion project began in 2008 soon after China Harbour had been awarded the contract for civil works in late 2007. Halcrow was project consultant and Shanghai Zhenhua Port Machinery Company was awarded the equipment supplying contract. The first phase of the project opened in December 2009, and the terminal is due for completion later this year. Six tandem-lift, Super Post-Panamax, 85tonne ship-to-shore cranes, manufactured by ZPMC were commissioned earlier this year and join the 26 RTG Yard Cranes already at the port. Port authorities plan to build a fourth terminal at the site, increasing capacity by almost 60%. Location: Jeddah, Saudi Arabia Project cost: $510m Project type: Construction/expansion Scope of works: Terminal, 1.5m TEU storage Client: Saudi Trade and Export Development Main contractor: China Harbour Completion due: 2010
SEPTEMBER 4–10, 2010 CONSTRUCTION WEEK 43
TOP 10 PORT PROJECTS
RAS LAFFAN PORT Ras Laffan’s goals are fairly simple. As Qatar seeks to become one of the world’s leading exporters of Liquefied Natural Gas (LNG) by 2012, Ras Laffan – situated 80km north of the capital Doha, and close to the North Field Gas Reservoir – wants to become the world’s leading port for LNG. It’s no mean feat. The port covers an area of 51km2 and substantially increases the amount of LPG the country will be able to export in future. It includes five new LNG berths, 10 liquid product and liquid petroleum gas (LPG) berths, four small tanker berths, navy/coastguard and tug berths, container export berths plus onshore infrastructure. The berths are designed to enable simultaneous berthing, mooring and loading of two vessels from 20,000 to 300,000 tonnes. The development also includes a comprehensive dry dock and ship repair operation which was built by Daewoo E&C. Qatar Petroleum (QP) funded the land reclamation and construction of the project. Location: Qatar Project cost: $1.7bn Project type: Port expansion Scope of works: Major LNG port expansion project Client: Qatar Petroleum Main contractor: CCC/Six Construction Completion due: Q4 2010
NEW DOHA PORT Doha’s new port is one of the largest and newest projects of its type in the GCC. It’s intended that the new 20km2 port, to be constructed in Economic Zone 3, Al Wakra, will transform Doha’s shipping industry. It will include five general cargo terminals and berths, four container terminals and berths and a roll-on/ roll-off berth, plus berthing for tug and pilot boats. The project will begin in 2011 with the first phase operational in 2014. By then, the port will have a capacity of two million TEU per year – increasing considerably once the project is fully implemented in 2023. AECOM was awarded a six-year, $149.3 million contract to provide program management services to the project in 2008. Location: Qatar Project cost: $7bn Project type: Construction of 20km2 port complex Scope of works: Construction of new port Client: Doha port authority Completion due: 2014 (Phase 1), 2023 (complete)
44 CONSTRUCTION WEEK SEPTEMBER 4–10, 2010
FUJAIRAH OIL TERMINAL The UAE’s fifth largest emirate, Fujairah’s strategic location on the coast of Oman at the entrance to the Persian Gulf makes it a perfect spot for shipping operations. Though the emirate isn’t huge, expansion of the port has been required to meet demand placed on the facility as a bunkering centre and regional trading hub. An additional 600,000 cubic metres of storage has been allocated, expanding total storage capacity at the port to 2.1 million cubic metres when the project is completed in 2012. The project includes 20 new tanks (ranging between 20,000 to 40,000m3), one new berth for ships up to 110,000 tonnes, another for vessels up to 60,000 tonnes, and six loading arms – three each for white and black goods. Location: Fujairah, UAE Project cost: $110m Project type: Construction, engineering Scope of works: Expansion of cargo terminal Client: Vopak Horizon Fujairah Completion due: Q1 2012
TOP 10 PORT PROJECTS
PORT OF SALALAH EXPANSION Sea freight through the Omani port of Salalah has almost tripled in the last decade which has prompted several port expansion projects over recent years. The latest additions to the port, simply known as Terminal Two, will add three more berths to the existing six and 1,350 metres of quay wall, boosting the port’s capacity by three million TEU by 2012. Terminal Two will handle general container freight, with the first berth, Berth 7 scheduled for completion during the first quarter of 2011. Berths 8 and 9 will follow in 2012. The expansion project also calls for the construction of a new breakwater, a new liquids jetty and the related facilities. Bids have just closed for the work, and the port authority expects to announce contract winners soon. Location: Salalah, Oman Project cost: $500m Project type: General cargo terminal Scope of works: Expansion of container terminal Client: Transport and Communications Ministry Main contractor: TBA Completion due: End 2012
DEVELOPMENT OF AL-RUWAIS PORT Located about 120km north of Doha, Al Ruwais Port is designed to accommodate dhows, coastal trading vessels and a roll-on/roll-off passenger/car ferry, centring on general cargo, fruit and vegetables, livestock and building materials. It may not be the largest port development underway in the region, but it’s no less important to the local economy. The port currently caters for over 100 vessels, including fishing boats, customs and Ports General Authority (CPGA), Ministry of Interior and small leisure boats, and it will remain open while the new port is developed. The work includes dredging of the 3km channel to five metres, while the port basin will be dredged to seven metres and the marina and fishing harbour to 2.5 metres. Around 2.8 million cubic metres of mud, silt and sand will be removed during the process. It also includes the construction of block work quay walls, fenders, navigation aids, utilities and port furniture, floating pontoons, slipways, fuel storage tank and dispensers, and block paving. There are also provisions for roads, sewerage, water and drainage works in the contract. The main construction contract was awarded to Consolidated Engineering Construction Company in May. Location: Qatar Project cost: $215m Project type: Port development Scope of works: Marine facilities, infrastructure Client: Public Works Authority Main contractor: Consolidated Engineering Construction Co. Completion due: Q1 2013
SEPTEMBER 4–10, 2010 CONSTRUCTION WEEK 45
SCAFFOLDING AND SAFETY
Structured products Quality equipment and early training are the core principles to reduce scaffold-based injury, say suppliers. By Ben Roberts
T
HE
EQUIPMENT
AND
SAFETY
standards for building at height have been a discussion point this summer following a spate of accidents. Three on-site deaths linked to the collapse of scaffolding in Sharjah caught the attention of national media, while the deaths of four workers at the Ansar Mall when their maintenance cradle collapsed was attributed to the fact that they were not wearing safety harnesses. Scaffolding work is perhaps the most precarious element of construction, with workers occasionally hundreds of feet off the ground on temporary structures. Industry initiatives to improve the awareness of safety at height have led to a healthy debate as to where the main responsibility lies, along with discussions about the origin of safety rules: industry-wide generic legislation against management-focused schemes. At ConstructionWeek’s ‘Building at Height… Safely’ conference in Dubai in May, panelists concluded that a balance needed to be struck between generic guidelines and those directly implemented by a project’s management. Mark Warrington, of the Al Ain Municipality for Atkins, said: “To answer the question as to whether it needs to be prescriptive or implemented from a man46 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
agement perspective, the answer is both. There have to be guidelines and I think it has to be tailored to the region.” Basic scaffolding comprises galvanised steel (or aluminium) vertical ‘standards’ and horizontal ledgers. There are also ‘transoms’, which rest across the parallel ledgers so that the walkway resembles a ladder laid flat (before the timber boards are placed on top). The whole structure rests on a square base plate to spread the load. Scaffolding firms constantly need to promote safety standards due to these inherent dangers. Mizra Nadeem Baig, general manager at Ajman-based KHK Scaffolding & Formwork, explains that the scaffolding needed when pouring concrete for slabs and beams within each floor is designed by the company for the client and checked during operation. “At the start we ask for the structural drawings from the contractors, and we design the scaffolding needed for the building,” he says. “We’ll design the layout and once that is complete the engineers can enter and train those on site.” When this is fixed the contractor will work on the rebar for the beams and all preparatory work. Then, before the concrete is poured, the KHK engineer will go back onto the site to check that the scaffolding was
“A good contractor will appoint a safety officer who they will consult with. A bad contractor will tell him: 'don't make life difficult for us'.”
SCAFFOLDING AND SAFETY
Scaffolding is central to the safe construction of most major building projects.
constructed according to the design. “This includes checking stability and making sure all the links of all the different parts are secure, the drophead and wedges are secure,” he adds. “After that we will award a certificate, and that is presented by the company to the Dubai Municipality.” This certificate is vital as proof that all relevant safety standards have been met. KHK sells finished aluminium and steel scaffolding products and has a galvanising plant to be able to also sell component parts. Its aluminium towers – mobile, lightweight structures that do not attach to buildings – are sold directly to customers. Steel parts such as pipes are sold to other suppliers that target specialist areas such as offshore work
or shipbuilding. Other steel products – such as K-Stage scaffolding, a modular system that fixes the horizontals ledgers and transoms by wedge fixings – are sold directly to contractors. Nadeem says that sales of aluminium scaffolding have decreased greatly since the economic slowdown as it can be “four or five times” the price of steel, often around AED10,000 per tonne. However, cutting costs can also result in contractors purchasing low quality scaffolding that will ultimately infringe on safety. “Some contractors will buy cheap scaffolding that has a lower quality, such as that the thickness of the pipes is not 3.25mm but 2mm,” he says. “Contractors look only at
the fixed price and think a pipe is a pipe [like any other].” Beyond ensuring high quality from the metal materials, scaffolding suppliers must also comply with the specifications of the industry into which they are selling their product, as each differs. One key example is scaffolding for oil and gas projects. Mohammed Azazi, general manager of Kuwait-based Almen, which produces scaffolding for work on oil refineries, said: “There is a very big difference between working on refineries and other buildings. On refineries you are working by the standards of the oil sector. This relates to all things, falling down, the stability of scaffolding. Refineries are different and require SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 47
SCAFFOLDING AND SAFETY
It seems safety isn't so much a priority in other regions, but industry experts want the GCC to take a lead in scaffolding safety.
a different and special design for a spherical tank, or a reactor.” Madhu K, Almen’s project manager, says there is a thorough procedure for installation and maintenance. “The scaffolding pipes, base plates screw jacks, scaffolding planks and clamps and all other materials should be inspected and approved before use,” he says. “The scaffolding should be built on firm floor and base plates should be used to transfer the load uniformly to the earth.’ Red and green tags are also mandatory, he adds: red tags show the scaffolding is under construction; green tags authorise the people to work on it. “The scaffolding structure will be re-inspected once in seven days and tags system will be followed,” he explains. “The scaffolders will be provided with double latch hooks with safety harness for hooking purpose, leather pouch to keep the ratchet spanner and other basic personal protective equipments to be provided and used.” He points out that in normal building 48 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
person who they have trained up and will consult with along the way. The bad contractor will simply appoint a person and say: ‘you’re in charge of health and safety but don’t make our life difficult’.” He adds that it is everyone’s responsibility to ensure safety for a site, and approves of initiatives such as a suggestion box, allowing employees to communicate safety issues on site, in exchange for a reward.
Mark Warrington: tailored regional guidelines are needed.
work, these procedures are not mandatory. Peter Neville, head of HSE at Halcrow and Sharjah spokesperson for BuildSafe UAE, says the safety ‘culture’ in any contractor should be emphasised. “The contractor is responsible for daily safety and there are two ways of doing health and safety,” he says. “The good contractor will appoint a safety
Scaffold board standards BS 2482 states that scaffolding boards of two thicknesses can be used, according to how the timbers are supported. Thinner timbers of 38mm can be used if they are supported at 1.2-1.5m centres, but wider gaps (up to 2.5m) must be spanned by boards no thinner than 63mm. The boards must be 225mm wide and can be selected by visual or machine strength grading. The standard does not cover laminated or finger-jointed scaffold boards.
PROJECT UPDATE ON SITE CW reviews a collection of its most recent site and plant visits to keep you up to date with project progress
WANT TO UPDATE YOUR PROJECT'S PROGRESS, OR HAVE IT INCLUDED HERE? Email: stuart.matthews@itp.com
ABU DHABI AIRPORT TERMINAL BUILDING Location Abu Dhabi Visited July 2010
85m AED value of MEP contract awarded to DSI
AMERICAN SCHOOL OF DUBAI Location Al Barsha Visited July 2010
SOWWAH ISLAND Location Abu Dhabi Visited June 2010
50 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
The new VIP terminal, being built in Abu Dhabi , is part of the 'Presidential Flight unit of Abu Dhabi Airport. It consists of a large main room and a domed tower in the corner. The 400 tonne roof structure has been prefabricated, and is set to be raised from the ground and placed into position using a sequence of eight hydraulic jacks. The structure is currently sitting on temporary I-beam piers about a metre off deck.
The American School of Dubai is a fast-track project being carried out by Al Ahmadiah Aktor. The anticipated opening date of the new campus is 14 September, to coincide with the new academic year. The design of the new campus has incorporated the latest sustainable trends to conserve energy. Construction teams include DG Jones & Partners as projects managers and RMJM architects.
Sowwah Island, in Abu Dhabi, is being developed by Mubadala to be the new central business district of the UAE's capital. Sowwah Square is the most advanced of the island's developments so far and will be home to a new stock exchange as well as four business towers. Right next door is the Cleveland Clinic, along with the near by Rosewood Hotel. Work on a Four Seasons hotel is expected to start soon.
PROJECTS
ELITE TOWERS Location Dubai Visited July 2010
5.1m Kg of steel used so far in zone four
DUBAI LAGOON Location Dubai Visited June 2010
RUFI TWIN TOWERS Location Dubai Visited June 2010
148 Townhouses in Al Muneera
AL MUNEERA Location Abu Dhabi Visited June 2010
When complete Elite Residence will be a towering 91 storeys, standing 380m high and holding a total of 697 residential units. With around 20 floors still to be cast, there is plenty left to do. The current scheduled completion date is around October 2011, and to meet this, main contractor Arabian Construction Company will have to keep the pace up. Coordination between ACC and its sub contractors is seen as critical.
After a slow and troubled start, Dubai Lagoon is a project getting back on track. Three main contractors – Belhasa Contracting and engineering, Bin Sabt Building Contracting and Commodore Contracting – are working across four zones within the development. Buildings in zone one, where eight residential towers in zone one will provide 442 apartments, are due for completion around the end of 2010.
The Rufi Twin Towers project involves the construction of two towers with G+18 floors, in Dubai Sports City. The towers will be joined at roof level by a distinctive sky bridge. Emirates Belbadi Contracting is the main contractor. The company has worked to make sure the project makes steady progress and has agreed a year-long extension with its client, to accommodate a slow down on the job.
Al Muneera is being developed by Aldar as part of the expansive Al Raha Beach project in Abu Dhabi. The projects is made up of two distinct areas, with an island and mainland divided by a canal. A total of 16 residential towers are under construction, along with an office tower, 11 villas and 148 townhouses. Al Futtaim Carillion is the main contractor, with Drake & Scull providing MEP works.
SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 51
PROJECTS
DUBAI PEARL Location Dubai Visited June 2010
KING ABDULLAH FINANCIAL DISTRICT Location Riyadh Visited June 2010
7000t Daily production capacity
CONSTRUCTION AND DEMOLITION WASTE RECYCLING PLANT IN AL DHAFRA Location Abu Dhabi Visited May 2010
SAUDI BINLADIN GROUP FOR INDUSTRIAL PRECAST Location Jeddah Visited May 2010
52 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
With four 73-storey towers planned, the Dubai Pearl project is a massive undertaking that has taken several years and some false starts, to finally get a solid start. Piling was completed in 2009 along with the raft pouring. The towers are just starting to grow, with a 600strong work force moving from building to building, as each one progresses at a similar pace. The project is aiming for LEED Gold certification.
The King Abdullah Financial District is one of the most challenging and intricate projects currently under development in Saudi Arabia. A total of 77 buildings are expected to be built in six zones across the entire site. Saudi Bin Laden Group is building four of the first 10 towers as part of the initial construction packages. The company is targeting Leed ratings for the buildings when complete.
Concrete waste, from construction and demolition projects, now has an alternative place to go, other than straight to landfill. The recently opened recycling facility in Al Dhafra, on the outskirts of Abu Dhabi, is crushing waste concrete into aggregate for use in road building. The plant will be able to produce up to 7000 tonnes a day, using crushers, conveyors, screens and magnets to break the raw material down to size.
The Saudi Binladin Group for Industrial Precast operates out of Jeddah, a city with a whole street full of offices for the company and on the outskirts there are enormous factories and holding yards. The plant is supplying a number of projects across the country, including the Princess Noura Bint AbdulRahman University for Women in Riyadh and the King Abdullah University for Science and Technology.
PROJECTS
36 Townhouses in the first part of the project.
AL WAHDA STREET Location Sharjah Visited May 2010
SANDOVAL GARDENS Location Dubai Visited April 2010
MIRDIF CITY CENTRE Location Dubai Visited April 2010
24
Million m2 of desert is what DIP started with
DUBAI INVESTMENTS PARK Location Dubai Visited March 2010
Central Sharjah is moving closer to a transformed road system to meet today’s traffic volume, following the latest milestone in Package 5 of the redevelopment of King Abdul Aziz Road. The latest completion of note, officially announced on 30th April, is the opening of the viaduct on the west side of Al Wahda Street. The viaduct crosses King Abdul Aziz Road at a 90 degree angle, itself a major project.
Bavaria Gulf’s flagship Sandoval Gardens project has been an interesting mix of German and Arab expertise, and its townhouses are near to completion. The 36 townhouses are the first part of an AED260 million twin-development of the overall Sandoval Gardens. All townhouses conform to TUeV, a standard of quality that is a common benchmark, which means all construction and finishing is assessed by a third-party.
UAE-based Alec was awarded the main contract to build the US $816 million Mirdif City Centre in September 2007, with construction getting under way almost immediately. Developed by Majid Al Futtaim Properties, more than 16000 jobs were created at the peak of the design and build stage. The team behind the mall are hoping for a Leed Gold rating, to reflect the work they did to make the building sustainable.
In 1997, way before the construction boom really took off, Dubai Investments’ management took it upon themselves to lay foundations across 24 million m2 of desert and start building a mixed-use city from scratch. In March, the developer announced the launch of the final phase of development, which is set to become a hub for logistics services spread across 500,000m2. Construction was due to start in May.
SEPTEMBER 4-10, 2010 CONSTRUCTION WEEK 53
APPOINTMENTS Shuffle Brokerage ďŹ rm Landmark Properhristiane ties last month appointed Christiane operty Murray (right) as head of property management. With previouss lays positions at Lufthansa, Barclays Capital and Spectrum Real Estate Management, Murrayy brings with her 12 years of experience in the Middle East. In her new role, she will be responsible for advising Landmark Properties clients on best practice and standards rew lated to projects in both new and existing developments.
Mubadala Developm Development’s property director, Canadian lawyer Joh John Thomas, announced his resignation, with effect from the end of August. He joined Mubadala in 2008 and oversaw the rrollout of projects like the new cen central business district on Sowwah Island and the red redevelopment of Mina Zayed waterfront. Thomas says he will return to Can Canada to spend more time with his family and pursue other ot interests. He has been succeeded succee in the interim by tthe th e head of Mubadala M Real Estate and Hospitality Hospitali Peter Wilding.
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projects seem to have sprung up across the region. I hear the piling work for the Louvre Abu Dhabi has just been finished on Saadiyat Island with the Guggenheim just beginning. Then there are the five museums coming up in Saudi Arabia. Probably costly jobs given all the marble needed for these kinds of building, no doubt imported from Italy or somewhere like that. But I suppose I’m most interested in the bit between design and construction. Do you just copy the original layout in structure from the Louvre and Guggenheim in Europe, or come up with a Middle East version? Me, I think it’s enough of an art getting everyone involved in a project on the same page. One site was actually losing cash just because we had a lot of hired heavy machinery sitting round longer than we needed. Not a massive amount overall, but who is not counting their pennies these days?
Nurturing talent This week I was at a social function and got talking to
a car designer, and how he sees the role of the graduates in the company as vital to keeping the brand fresh. I’d assumed that he’d save the plum jobs for himself and lock graduates into the more mundane tasks of designing wheels, switches and that sort of thing. “Oh no. I get them to design the car itself – the exterior, the look. They’re the ones with the fresh ideas, why would I want to squash that creativity?” he said. He saw his job as a conduit between their creativity and the realities of putting the car in to production and the company’s bottom line. “Designing the exterior is the easy bit. Transforming that idea into reality, that’s where the challenge of true design comes in,” he said. It got me thinking about the parallels with the construction industry, and whether architects in the Middle East were as open to new and engaging ideas from graduates as this car designer obviously was. Really the principles of nurturing talent remain the
56 CONSTRUCTION WEEK SEPTEMBER 4-10, 2010
Hats off: are architects getting the most out of their graduate workers?
same. Certainly the architects I’ve worked with are a talented bunch, but I wonder if they’re missing a trick with their graduate staff. Can sustainability be sustained? Thirty years ago, building green or ‘sustainably’ was unheard of here in the UAE. During the construction boom, the concept was definitely around, but only in the last few years has it really been a hot topic on site. Funnily enough, the guys and I got into a debate about it the other day. Some of them think it’s going to take a long
time before buildings here are really green. They say it’s pretty unlikely there’ll be much in the way of new builds, particularly in Dubai, and for that reason, we might not see much ‘sustainable construction’ for a while. Some of the others said we will, but it’ll just be more retrofitting – though they weren’t sure how popular this was with the tenants. I’m not so sure, but if I had to guess, I’d say there’s going to be a lot more retrofitting, particularly in Dubai and Abu Dhabi where there are more offices than workers. Time will tell.
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