Inside Knowledge: Client Briefing
Roll call: who you need to know n Mark Allan, chief executive officer of Unite Group Unite Group is one of the biggest private developers of student accommodation in the UK. The group is headed by chief executive officer Mark Allan, who also develops the group’s growth strategy. The company develops, builds and manages both off-campus accommodation and on-campus student housing, which it has earmarked as a future growth area for construction. The firm houses almost 40,000 students in 120 properties across the UK.
n Peter Cochrane, project director at Birmingham City University Having already embarked on the first phase of its new city centre campus development, Birmingham City University is likely to be a significant source of work for contractors as its plan for expansion progresses over the next few years. Willmott Dixon was chosen last month to deliver the first phase of the project, worth £61 million. The scheme represents one part of the university’s £180m investment plan. Mr Cochrane is overseeing the progression of the new campus development.
n Professor Iwan Davies, pro vice-chancellor of Swansea University Swansea University is continuing its evaluation of received pre-qualification questionnaire bids for its Bay Science and Innovation campus project, after the deadline to submit prequalification questionnaires closed last month. The university’s advisory team expects to conclude and advise bidders in the near future. Professor Davies is overseeing the campus development, which is set to cover 69 acres of former BP land and is expected to become one of Europe’s largest centres for science and technology research.
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Uni market still open to all Contractors focused on “Although it’s a value for money can downturn, it’s still prosper despite cuts a steady market and an open field”
universities michael lane
mark cleverly, ec harris
As is the case with so many clients, universities are facing a great deal of uncertainty, with their funding system having undergone a radical overhaul. Until recently their capital budgets were boosted by government grants, but that funding has been pulled and universities will largely have to rely on higher tuition fees to expand and maintain their estates. “The government is about to withdraw teaching block grants and that block funding is going to be replaced by [higher] fees and student loans,” explains EC Harris partner for higher education Mark Cleverly. “With the higher fee levels there’s no real confidence about whether student numbers will go up or down.” Mr Cleverly says that combined university capital expenditure is forecast to fall for the next three
years, but that need not mean a lack of work for contractors. “Capital expenditure over the last decade has been at record levels but [universities] will still need to invest in estates. “Contractors will continue to find universities attractive. Although it’s a downturn, it’s relative. It’s a steady market and an open field because of the absence of a national framework.” Mr Cleverly says there is a major opportunity for contractors, particularly those who are new to the sector, to build relationships with universities to help them get value for money. “[Universities] are under quite a lot of financial pressure so a contractor needs to be aware of that financial position,” he says. “There’s opportunity emerging for that middle bandwidth of
contractor because I think they can be competitive, as universities are businesses operating on small margins focused on value for money and price.” He says there is already evidence of contractors who specialise in value for money solutions such as off site and timber-frame builds coming into the market. Mr Cleverly warns that the market could revert to highly competitive tendering if contractors do not look to work in partnership with universities. “The sector has embraced partnerships and early contractor involvement, but contractors have got to be clear with clients that they are demonstrating value, otherwise they will go back [to competitive tendering] and those hard fought gains will be lost.” One area likely to provide work despite funding concerns is student accommodation, which Mr Cleverly believes may also play a crucial part as universities battle to recruit new students. “There is a big undersupply of accommodation and I think the quality of student accommodation will be a core driver,” he says.
Contractors must adapt to succeed Interview: patrick finch
As universities face a squeeze on funding and their capital programmes change in scope, contractors will also have to adapt to keep winning work. Association of University Directors of Estates executive committee member Patrick Finch says the nature of the work on offer will be different, as universities look to improve their estates with a reduced amount of funding. “Universities are working with design teams and contractors and saying, ‘If we were expecting to spend £100m and now only have £20m, what can we do?’” he says. There will be a change but there will still be major projects that
“Firms that understand the sector and what it’s facing are likely to be successful” universities want to progress.” Mr Finch says the type of work is likely to shift to refurb and improvement of existing assets and this might not suit the major project-oriented contractors that traditionally work in the sector. “There have been a lot of big ticket projects and that has tended to focus on the major contractors.
“The issue is whether they’re geared up for maintenance work. “They will need the ability to take on different, complex projects on existing buildings.And they will need the ability to manage important projects on a live site.” Mr Finch says sustainability will be a “huge issue” and any universities seeking government funding will face tough criteria in terms of BREEAM ratings and carbon targets. “We have seen significant reduction in both government funding and in charity funding for research. Contractors that really understand the sector and what it’s facing are likely to be the most successful,” he says. www.cnplus.co.uk
Top 10 university clients in 2011 Client
University of Oxford
University College London
University of Liverpool
University of Greenwich
University of Southampton
Birmingham City University
Robert Gordon University
University of Cambridge
University of Reading
Top 10 pre-tender university projects Project
Civic Quarter redevelopment*
Leeds Met University
Value (£m) 300
New Glasgow city centre campus
University of Strathclyde
New Belfast campus
University of Ulster
Student accomodation development University of Leicester
New Humanities Centre*
University of Oxford
New Edgbaston Campus
University of Birmingham
Boldrewood Campus redevelopment University of Southampton
Frenchay Campus redvelopment
University of West of England
Birley Fields Campus Plan
Manchester Met University
Arup Building refurbishment
University of Cambridge
* project currently on hold
university project starts on site (£m) 600 500 400 300 200 100 0
As is often the case when it comes to universities, Oxford tops the table of clients in the sector, having let more than £120 millionworth of work in 2011 so far. The schemes it has procured this year include the £78m restoration of its New Bodleian Library, awarded to Mace. This is also the largest single contract let by any university this year, followed by the University of Greenwich’s £76m campus development, won by Osborne. The new campus will feature a series of BREEAM Excellent rated multi-storey buildings, which will house the school of architecture. Other major contracts awarded in 2011 include University College London’s £45m Sainsbury Wellcome Centre, Robert Gordon University’s £45m new campus in Aberdeen and the first phase of Birmingham City University’s new campus worth £61m. The University of Liverpool has also been active, having embarked on the first phases of a £600m redevelopment masterplan. According to figures from construction intelligence unit Glenigan, the value of project starts has risen in the first half of 2011 – £380m in total – after falling away in the latter half of 2010. “Clearly there must be a lot of uncertainty given the new student fee structure, but in the longer term we expect to see confidence return once the fee system is up and running,” says Glenigan economics director Allan Wilén. “It should put universities on a more secure financial footing and less dependent on government funding,” he adds.
university news in brief
Student digs shortage
The University of Cambridge is seeking a project manager for the £35 million refurbishment of its Arup Building. The building has a gross internal area of around 15,000 sq m. Two of its occupants, the Department of Materials Science and Metallurgy and the University Computer Service, will relocate to a new premises in 2013.
Leicester University has commissioned Terry Farrell and Partners to create a development plan that could potentially see accommodation for 20,000 additional students built on campus. The architect and urban design firm will produce a masterplan in an aim to improve its campus sustainability.
Student accommodation is running well below what is required in London, despite a 90 per cent rise in construction in the past year, according to consultant Drivers Jonas Deloitte. It estimates there to be £165m-worth of construction work in London that has planning consent and that is expected to start on site next year.
Unis repair to cut costs and carbon When working in higher education, timing is everything. Contractors are working to a tight build schedules and any repair work should ideally be carried out between terms when students are away on holiday. Specialist finishing contractor Plastic Surgeon says it can help contractors deliver projects on time and budget by repairing instead of replacing items in higher education buildings and accommodations. “Cosmetic repairs can provide a high-quality finish to minor defects that occur in the build programme and through natural wear and tear in student accommodation,” says Plastic Surgeon MD Rob Mouser. “It removes the costly process of ordering, requires fewer tradespeople onsite and helps main contractors control their maintenance budgets.” The company has worked with student accommodation providers such as Unite to carry out quick repairs on student flats before the start of a new term, and was recently onsite at the University of Exeter repairing accidental damage to powder-coated aluminium panels, filling holes in stone flags where feature lights had to be repositioned, and repairing interior wood grain doors that had been damaged by passing trades and materials. Sustainability also is a major concern for universities, making cosmetic repairs more desirable than replacements. “Cosmetic repairs cut environmental waste, saving tonnes from landfill each year, and help reduce the overall carbon footprint of a project,” says Mr Mouser. Plastic Surgeon says its cosmetic repairs saved 1,750 tonnes from landfill last year. For more information, visit www.plastic-surgeon.co.uk or email firstname.lastname@example.org
Produced in collaboration with Plastic Surgeon
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