The Building Economist - June 2017 - The Resilience Issue

THE RESILIENCE ISSUE

FEATURING RESILIENCE OUR ROLE AS BUILT

ENVIRONMENT PROFESSIONALS

BANGKOK RESILIENT CITY SPOTLIGHT

LEGAL CASE NOTES SUSTAINABLE AUSTRALIA JUNE 2017

AUSTRALIAN INSTITUTE OF QUANTITY SURVEYORS

AUSTRALIAN INSTITUTE OF QUANTITY SURVEYORS

AIQS Academy Certificate Available Now Save $1,500!

The AIQS Academy The AIQS Academy is an on demand, online training portal available for all Quantity Surveying professionals. This platform provides further CPD options to AIQS Members or Non-Members and can be accessed from a location of your choice. Each topic takes approximately two hours, but completion can be at your own pace and work around your busy schedule.

AIQS Academy Certificate Available Now Save $1,500!

The topics available have been individually reviewed and assessed at the highest standard expected by the AIQS for continuing professional development. The AIQS Education Committee will regularly review and update the offerings of the Academy, to ensure a wide ranging and relevant topics. The Academy can be used for your organisational training, enhancing the professional skills of your Quantity Surveyors.

The AIQ Meet AIQS Membership Entry Requirements The Academy can be used as a pathway to AIQS Membership by ensuring you have the necessary skills required to meet the Institute’s academic entry requirements.

Applicants seeking Institute Membership with a partially qualifying degree (Pathway 2), will be able to meet the academic entry requirements by completing the 100 Academy topics available.

Participants who complete 100 topics will also receive the AIQS Academy Certificate.

Continuing Professional Development The Academy can help you identify knowledge gaps, learn new or upgrade existing skills, as well as provide upskilling opportunities for your project team.

The AIQS Academy is an on demand Surveying professionals. This pla The Academy provides continuing professional development Membersforor Non-Members and can b (CPD) opportunities AIQS Members and Non-Members. topic takes approximately two hour Undertaking CPD ensures your skills remain current and relevant in addition to ensuring you fulfill your requirements work aroun for continued membership.

The topics available have been ind standard expected by the AIQS for c www.aiqsacademy.com.au Education Committee will regul

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WELL

BUILDING STANDARD

Just when you thought that the property industry couldn’t come up with a new building rating system… welcome to the WELL building standard.

Noted as the first human health and wellness building standard, but what does it mean to a Quantity Surveyor?

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HYPE OR LASTING?

The ability of the city to respond to and recover from climate impacts is essential for life. A resilient city makes it possible to be temporarily flooded, hot, or on fire, while retaining the capability for people to live their urban lives.

RESILIENT CITY SPOTLIGHT

When we talk about resilience, we mean urban resilience. Resilience is about surviving and thriving, regardless of the challenge. It is the capacity of individuals, communities, institutions, businesses, and systems within a city to survive, adapt, and grow no matter what kinds of chronic stresses and acute shocks they experience. - Chief Resilience Officer of Bangkok, Dr. Supachai Tantikom

Managing Editor Stephanie Ifill Graphic Designer Guilherme Santos CEO Grant Warner

As a practitioner, sustainable development is a term you are likely to have some familiarity with, but what about ‘resilience’ and ‘resilience issues?’ This term is likely to be less familiar to you. What does it mean in the context of the built environment in general, and; for quantity surveyors in particular?

02 35 04 43 REGULARS 07 46 JUN 2017 CONTENTS

BANGKOK

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RESILIENCE OUR ROLE AS BUILT ENVIRONMENT PROFESSIONALS

Editorial Contributions The Australian Institute of Quantity Surveying encourages readers to submit their articles relating to quantity surveying, the built environment and associated industries including; construction economics, cost estimating, cost planning, contract administration, project engineering and the macroenvironment.

T: +61 (02) 8234 4009 E: marketing@aiqs.com.au

FROM THE CEO

LEGAL CASE NOTES

SNAP SHOT

EVENTS & SOCIAL

VIEW POINT HINDSIGHT

BUILDING COST INDEX AVAILABLE IN PRINT ONLY

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Disclaimer The Institute does not take any responsibility for the opinions express by any third parties involved in the development of the Building Economist Magazine.

Advertising To advertise in the Building Economist, contact AIQS Marketing & Communications for more information on available opportunities.

Marketing & Communications T: +61 (02) 8234 4009 E: marketing@aiqs.com.au W: www.aiqs.com.au

THE BUILDING ECONOMIST - JUNE 2017 - 1

FROM THE CEO

IS 'RESILIENT' THE NEW 'GREEN'?

Resilience, in relation to the built environment, is a term which has come into common usage over the past two years. The City Resilience Framework is a unique framework developed by Arup with support from the Rockefeller Foundation. In that framework, City Resilience is described as the capacity of cities to function, so that the people living and working in cities – particularly the poor and vulnerable, survive and thrive no matter what stresses or shocks they encounter.

More recently this has been elaborated on through the 100 Resilient Cities (100RC) initiative, as the capacity for individuals, communities, institutions, businesses, and systems within an urban environment to survive, adapt, and grow no matter what kinds of chronic stress and acute shocks it experiences.

The framework provides a mechanism to understand the complexity of cities and the drivers that contribute to their resilience. Looking at these drivers can help cities to assess the extent of their resilience, to identify critical areas of weakness, and to identify actions and programs to improve the city’s resilience.

So what does this mean for those engaged in the development of the urban environment, in particular the quantity surveying / cost planning professions? How does the profession contribute toward ensuring that our cities, particularly infrastructure and public transport networks, and emergency services infrastructure, are resilient?

Perhaps the most significant resilience issue for the quantity surveying profession relates to infrastructure development including emergency services, health infrastructure and public transport.

In recent years we have witnessed a number of acute stresses including earthquakes, tsunamis, flooding and bushfires around the globe which have directly impacted urban environments.

Quantity Surveyors are ideally positioned, through the provision of lifecycle costing, to assist clients (principally governments) in determining the level of sustainability and resilience measures required for potential Chronic Stress and Acute Shock events.

This raises a myriad of questions, to

which I have found no ready documented answer at this stage.

Given the apparent increase in both the number, and severity of adverse weather events, will this require the Quantity Surveyor (in consultation with other relevant experts) to be able identify the impact of 1 in 500 or 1 in 1,000 year events and advise on resilience capacity?

Have governments identified capacity requirements to ensure an effective resilience strategy? If so, how will this impact the financial viability of construction projects?

How much capacity needs to be built into infrastructure assets to ensure they can cope with current and future potential chronic and acute stresses, and is this capacity being constantly reviewed to ensure suitability? For example, will our health infrastructure cope with a natural disaster?

Australian governments have budgeted to spend in excess of $120b on infrastructure projects over the ten-year period from 2013-14. It is evident, that following years of under-investment, we are playing catch-up with infrastructure development, particularly across Sydney and Melbourne.

Currently in New South Wales alone there are at least 23 new Health Infrastructure assets under development. This raises questions surrounding, how we ascertain the level of resilience and capacity built into those projects, the period of time are they designed to cover, and whether this will deliver infrastructure that can withstand all potential urban stresses and shocks?

In attempting to mitigate the impact of chronic stress and acute shock events, the Victorian Government established a Critical Infrastructure Resilience Strategy (September 2016) incorporating a Critical Infrastructure Model, designed to identify

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“IN RECENT YEARS WE HAVE WITNESSED A NUMBER OF ACUTE STRESSES INCLUDING EARTHQUAKES, TSUNAMIS, FLOODING AND BUSHFIRES AROUND THE GLOBE WHICH HAVE DIRECTLY IMPACTED URBAN ENVIRONMENTS.” critical infrastructure components in case of urban stress and shocks.

At the same time, the City of Sydney undertook a preliminary resilience assessment, the purpose of which was to; •

Provide a summary of the state of resilience in Sydney today

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Describe the work done to date to understand Sydney’s key future challenges and opportunities

•

Identify emerging themes for building resilience to guide the development of a Resilience Strategy for Sydney

Evidently there is significantly more work to do in establishing resilience strategies for Australian cities, and we as a profession should be actively engaged in the development and delivery of those strategies.

Grant Warner

CEO The Australian Institute of Quantity Surveyors

SNAPSHOT INDUSTRY NEWS

ARE WE BUILDING A SUSTAINABLE FUTURE FOR WEST AUSTRALIA? “While WA has some of the fastest growing areas in Australia, there is an urgent need for a clear long-term plan to manage this growth,” says the GBCA’s Senior Manager – Government & Industry, Jonathan Cartledge.

“Perth’s population is expected to double in size over the next 15 years, but without a fully-funded plan, people can expect the same traffic gridlock and diminishing quality of life already experienced by citizens in cities along the east coast.

“The cost of housing continues to be a challenge in WA, in spite of recent price falls.

“The latest Demographia Housing Affordability, which surveyed 406 global housing markets, found Perth has the dubious distinction of being in the top 20

least affordable major housing markets in the world. The average house in Perth now costs 6.1 times the average annual salary.

“WA is changing – and it is undeniably experiencing some growing pains. Perth’s CBD currently has its highest office vacancy rate since 1992, for example.

“We are working with all political parties to encourage policies that support longterm integrated planning and sustainable development across WA,” Cartledge says.

The GBCA has five policy priorities for government action. These are: •

Achieving more productive, liveable, sustainable and healthy cities

•

Securing more resilient communities

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•

Delivering a low-carbon, highperforming built environment

•

Raising minimum standards through the National Construction Code and

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Facilitating sustainable utility infrastructure.

“The West Coast has nearly 140 Green Star-rated projects – including public buildings, shopping and distribution centres, apartments, offices, universities and large-scale communities.

“The Metropolitan Redevelopment Authority requires Green Star certification as a condition of development approval, and 5 Star Green Star minimums have been mandated for all buildings at the Elizabeth Quay development on the Perth waterfront.

This will help future-proof development at Elizabeth Quay.

“West Australia’s Landcorp was a sponsor of the Green Star – Communities rating tool and is creating new communities and infill developments that will be future proofed for generations to come.

“But we need more than a building-bybuilding or project-by-project approach.

We know WA is going to continue to grow. We need a comprehensive plan for this growth – one which protects the natural environment, which supports liveable communities and which drives economic growth."

SNAPSHOT INDUSTRY NEWS

THE GREEN STAR – COMMUNITIES GUIDE

THE GREEN BUILDING COUNCIL OF AUSTRALIA (GBCA) HAS REVISED ITS GUIDE TO HELP LOCAL GOVERNMENTS AROUND THE COUNTRY PLAN AND DELIVER HEALTHY, RESILIENT AND POSITIVE COMMUNITIES. The Green Star – Communities Guide for Local Government can help councils tackle local challenges, deliver and communicate better outcomes and multiply the value of their investments.

“Communities want leadership on a range of issues from affordable housing to climate resilience, and from social inclusion to infrastructure planning. This guide can help local governments respond to these

challenges and communicate the benefits of their actions back to their communities.” says the GBCA’s Chief Executive Officer, Romilly Madew.

Since the GBCA launched Green Star – Communities in 2012, 26 projects have been certified, and a further 24 are registered for certification. These projects range in size from small urban regeneration sites to large-scale greenfield developments that

will be home to 50,000 people.

Among the projects certified are Renewal SA’s Tonsley in Adelaide, a former manufacturing park that has been transformed into a centre for innovation and new high-value industries, and Alkimos Beach, north of Perth, a partnership between Lendlease and Landcorp which boasts Australia’s first community battery storage trial.

INDIA’S FIRST COMPREHENSIVE URBAN RESILIENCE STRATEGY “Our community’s resilience rests on our people and our ability to live well in good times and bounce back stronger than ever from the inevitable hard times. The Resilience Strategy articulates solutions that make our city more resilient not only to physical challenges, such as floods and aging infrastructure, but also to social challenges, such as cohesion and urban health.” Said Hon. Mayor Ashmitaben Shiroya

•

Connectivity and mobility services and regulation: seeks to make it safe and easy to get around the city

•

Affordable housing: assess the city’s housing needs and better align housing supply to match the needs of the city

The Surat Resilience Strategy is organized around seven key pillars and contains 20 goals and 63 actionable initiatives to build resilience in the city:

•

•

Water availability and quality: improving the city’s water supply using innovative technology as well as green and blue infrastructure Dominant sectors of employment and economic development: eases over-reliance on dominant industries and encourages balanced growth and entrepreneurialism

•

Ecosystem and environmental regulation: lays the framework for a clean and green Surat prepared to face the challenges of climate change

•

Social cohesion: encourages social integration, civic engagement and city pride

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Upscaling of health: explores ways to improve the health of the city and its citizens

The full Surat Resilience Strategy is available for download here: www.100resilientcities.org/Surat

LIVING VS FAKE GREENWALLS There is no doubt that the popularity of greenwalls has significantly grown over the past few years. However, Mark Paul, horticulturist and Australian greenwall pioneer warns the hidden dangers of going fake versus living.

Mark Paul, founder of The Greenwall Company says, “Although the aesthetic of a fake greenwall can be appealing and the faux plant choice has expanded over the years, there are a number of things to

consider.

“Aside from the lack of health benefits, they are a fire hazard due to the chemicals they are treated with and the dust they collect.

The same dust can cause an increase in allergies, especially when placed in closed office spaces. After a number of media reported “greenwall fires”, all in fake greenwalls, many commercial property managers have banned them and had existing ones removed,” said Mark.

THE BUILDING ECONOMIST - JUNE 2017 - 5

SNAPSHOT AIQS NEWS

AIQS ACADEMY TOPIC SPOTLIGHT: COST MANAGEMENT & MONITORING PROCEDURES This topic will explain how delivery of a project on time and within budget is a key performance indicator of successful capital investment and project development. Time and cost management issues are central to good project management and neither should be considered in isolation.

This topic is divided into six sections that cover the following areas: 1.

Understand the need for cost management planning

2. Appreciate why some cost management plans fail

3. Identify the key components of a cost management plan 4. Be able to prepare a generic cost management plan in the context of a project's life cycle 5. Customise the generic cost management plan to suit specific Client/project requirements 6. Monitor the cost management plan during project delivery and identify if corrective actions are required Visit https://www.aiqsacademy.com/ AIQS/cost-management-monitoringprocedures to purchase this topic.

2017 SCHOLARSHIPS APPLICATIONS ARE NOW OPEN! AIQS offers a number of scholarships each year for Year 12 students who qualify for entry into a Quantity Surveying, Construction Economics, Construction Management (Economics) or other appropriate course at an AIQS accredited university in Australia.

The scholarship is to the total value of AU$3,000. This includes: • AU$2,000 cash (there are no restrictions on its use); and,

Entries close Friday 1 September 2017. For further information, including application forms visit www.aiqs.com.au

• AIQS published text books and manuals to the value of AU$1,000.

IMPLICATIONS OF 2017-18 BUDGET MEASURES AFFECTING TAX DEPRECIATION Following from the Federal Treasurer’s budget announcements on 9 May, AIQS has made submissions to the Commonwealth Government, including the Treasurer, highlighting the impact this will have on not only property investors and the rental market, but also those quantity surveyors who derive an income from providing Tax Depreciation services.

The Institute supports the intention of removing depreciation of plant

and equipment items in residential properties which have already been fully depreciated in accordance with the Australian Tax Office’s list of effective lives for plant and equipment.

However, the AIQS has raised concerns surrounding the proposed budget measures limiting plant and equipment deductions to outlays actually incurred by residential property investors, while at the same time removing the ability

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for subsequent investors to claim deductions for the remaining effective life of those assets which have not been fully depreciated.

The AIQS has proposed that it work with the Commonwealth Treasury Department to develop clear and concise guidelines and standards surrounding the application of tax deductions for plant and equipment.

SNAPSHOT AIQS NEWS

HAVE YOU TAKEN UP THE CERTIFIED QUANTITY SURVEYOR DESIGNATION?

CERTIFIED QUANTITY SURVEYOR (CQS) IS AN ADDITIONAL DESIGNATION TO A CORPORATE MEMBER’S GRADE. IT REPRESENTS THE HIGHEST LEVEL OF EXPERTISE WITHIN THE PROFESSION. Since its inception, a large number of our most senior Members and Fellows have applied and been awarded the CQS designation.

CQS is awarded to members who consistently build on their existing professional quantity surveying skills and will have achieved the requisite level of robust education, knowledge and experience to provide exemplary service and advice to clients. A Certified Quantity Surveyor is able to provide the ultimate solutions in identifying and minimising risks associated with time, cost, quality, environment and safety.

The CQS designation brings with it the recognition that you as a Quantity Surveyor have attained a significant level of professional experience and expertise that has been benchmarked across the industry, are committed to the provision of excellence in service, recognise the

importance of continuing professional development and adherence to the AIQS Code of Professional Conduct.

AIQS is marketing CQS to all levels of Government (Cth, State/Territory, Local), financial institutions, insurance companies, corporate Australia and the public, as the mark of ultimate expertise that should be engaged for the provision of quantity surveying services and consultancy advice on all construction projects.

AIQS LIBRARY

AVAILABLE FOR MEMBERS

Application for Certified Quantity Surveyor (CQS) designation are available to existing Corporate Members and new Member Grade applicants.

For further information, including eligibility visit www.aiqs.com.au (log-in required).

DID YOU KNOW THE AIQS HAS A LIBRARY OF QUANTITY SURVEYING AND OTHER RELEVANT SUBJECT TITLES? Available at the Head Office in Sydney, members can access these titles for private reading and study.

For the list of avaliable titles or should you wish to donate titles to the library, please email education@aiqs.com.au

THE BUILDING ECONOMIST - JUNE 2017 - 7

VIEWPOINT

THE BENEFIT OF

HINDSIGHT Mark Quinn FAIQS, Cost Management Associate Director AECOM

THE BLACK SWAN THEORY IS A METAPHOR THAT DESCRIBES AN EVENT THAT COMES AS A SURPRISE, HAS A MAJOR EFFECT, AND IS OFTEN INAPPROPRIATELY RATIONALISED AFTER THE FACT WITH THE BENEFIT OF HINDSIGHT. THE TERM IS BASED ON AN ANCIENT SAYING WHICH PRESUMED BLACK SWANS DID NOT EXIST, BUT THE SAYING WAS REWRITTEN AFTER BLACK SWANS WERE DISCOVERED IN THE WILD.

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Resilience was explained to me by the sustainability team at AECOM as just that. It was in a session where we were looking for ways to assist our clients in planning for future events, regardless of what they may be, to plan for resilience as part of an overall strategy.

flooding. These readily accepted projections can be brought into the design process early and inform siting, design, services and materials selection.

Allowance can be made for these by either developing resilient assets or allowing to manage the consequence.

I have been a Quantity Surveyor for over 30 years and like valuers and accountants, we tend to forecast based on the known. We use history as a marker for the future. Although in the past I have been able to assist various clients in capital planning, this challenge to define resilience brings together a lot more of what Quantity Surveyors are well placed to deliver. In doing so we need maintain a logic that is aided by collaboration with our industry partners whilst applying our core skills and processes in more innovative ways.

However the range of disruptive events is increasing: global economic downturns can have profound local impacts, terrorist attacks have become a more constant part of our evening news, and governments, faced with an ever increasing share of the cost of damage are moving towards a resilience frame.

This recognises that underlying stresses – such as climate change, social cohesion and economic opportunity – all impact on a city, and its community and economy’s ability to function during disruption, regardless of the cause.

Like resilience, the built environment is a very broad term. Both can be focused on a single building or asset, yet both need to consider the range of broader dependencies and responsibility to their surroundings and local / broader community.

Therefore, in the design, delivery, operation and maintenance of assets we are increasingly considering these connections – the flows of energy, water, people, that the asset needs to function, and the ‘downstream’ services that the asset provides. We need to develop rationale behind the costs associated with change and consequence, so that we can consider a broader context when decisions are made about how we plan and deliver assets.

It is difficult to forecast the unpredictability of the future, to measure resilience and sustainability, however sustainability itself is a steady state that only changes as the world around it continues to change.

CSIRO projections for various climate regions across Australia are readily available for temperature, rainfall, wind and other variables affecting communities through extreme heat, hot spells, flooding and fire as extreme weather and cyclonic events increase and sea level rise contributes to coastal

‘…THE RANGE OF DISRUPTIVE EVENTS IS INCREASING: GLOBAL ECONOMIC DOWNTURNS CAN HAVE PROFOUND LOCAL IMPACTS, TERRORIST ATTACKS HAVE BECOME A MORE CONSTANT PART OF OUR EVENING NEWS, AND GOVERNMENTS, FACED WITH AN EVER INCREASING SHARE OF THE COST OF DAMAGE ARE MOVING TOWARDS A RESILIENCE FRAME.’

When the AIQS produced the cost control manual for sustainability with the assistance of Sustainability Victoria, it focused on the low hanging fruit, passive design and generally bringing awareness to the profession. It used our own elemental framework as the driving tool. On the whole this approach has not changed however with most of the

THE BUILDING ECONOMIST - JUNE 2017 - 9

‘QUANTITY SURVEYORS CAN PLAY A KEY ROLE IN HOW CITIES ARE DEVELOPED, HOW PRECINCTS AND ENVIRONMENTS ARE PLANNED TO PROMOTE SAFE AND SUSTAINABLE LIFESTYLES WHERE COMMUNITIES PROSPER.’

low hanging fruit now picked, or made obsolete through regulatory change and low energy design becoming business as usual, passive design and reliance on infrastructure will become the focus.

Going forward more importance is now being given to how assets will operate in extreme conditions and how assets can be adapted with the foresight required to enable a resilient built environment.

To be part of this future, Quantity Surveyors and Cost Managers need to align themselves and learn from other industry professionals about how this change can be enabled, managed and accounted for with existing, new and complementary assets.

Increasingly our work extends beyond the traditional built environment stakeholders so that the design solution contributes to broader societal benefits – flood mitigation works can no longer divide communities, must provide amenity and support urban cooling. Our analysis can assist built environment professionals to assess options and to justify investment in broader outcomes.

The need for collaboration has become increasingly obvious to me since working at AECOM where I have the pleasure of working on city shaping projects with highly skilled engineers and advisors on all aspects of the design, planning and operation of the built environment.

Quantity Surveyors can play a key role in how cities are developed, how precincts and environments are planned

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to promote safe and sustainable lifestyles where communities prosper. The costs / benefit associated with changing yields on commercial developments need to be factored in future development decisions.

Our analysis may assist in showing that allowances for contributions to precinct development may prove in the future not to be a burden but rather a necessity to ensure demand and commercial viability or how the cost of technology is likely to diminish but reliance on it in managing security and privacy is likely to play an important role in delivering resilient cities.

Despite the unpredictability of climate change or “black swan events” there is enough evidence to suggest where we live today is not the same as yesterday and unlikely to be the same tomorrow.

When we think about the future, and strive for safe functioning of assets and infrastructure, we are getting much better in accounting for climate events.

This is a fascinating area and one that needs consideration as we reposition how we consider our assets. A cost consultant is more than a trusted advisor; they bring essential parts of the toolkit, and are a key contributor to the governance arrangements that enable the building of resilience and sustainability to be achieved.

SHARE YOUR POINT OF VIEW! Email marketing@aiqs.com.au

REPORT

FORECAST DOUBLE-DIP DOWNTURN FOR

BUILDING AND CONSTRUCTION Australian Construction Industry Forum (ACIF)

THE LATEST INDUSTRY FORECASTS RELEASED BY AUSTRALIAN CONSTRUCTION INDUSTRY FORUM (ACIF) SHOW THAT THE BUILDING AND CONSTRUCTION INDUSTRY IS MOVING QUICKLY THROUGH TWO PEAKS IN ACTIVITY WITH A LESS FEVERED, DOUBLE-DIP DOWNTURN COMING. THE ACIF FORECASTS FOR MAY 2017 DOCUMENT THE STEEP DECLINE IN ENGINEERING CONSTRUCTION, INCLUDING MINING-RELATED CONSTRUCTION, PLUS ROADS, RAIL AND OTHER LARGE INFRASTRUCTURE. THIS SECTOR IS COMING OFF A RECORD-BREAKING PEAK DRIVEN BY THE MINING DEVELOPMENT BOOM AND WILL NOW TAKE SECOND POSITION BEHIND RESIDENTIAL BUILDING. RESIDENTIAL BUILDING IS IN THE MIDDLE OF ITS OWN BOOM. THIS HAS PUSHED GROWTH BEYOND THE HOUSING FUNDAMENTALS AND A DOWNTURN IS ON ITS WAY.

The Australian construction market is rolling through multiple business cycles of boom and bust, due to a changing macroeconomic environment which has altered and exacerbated the domestic

cycle in the residential building sector.

Head Forecaster for ACIF, Kerry Barwise, has summarised the key issues for each sector plus the major economic factors driving the change in the property market.

Members of AIQS enjoy free access to the ACIF Forecasts Dashboard. Login to the AIQS website and subscribe to gain access to the ACIF Forecasts Dashboard, and to receive a copy of the Australian Construction Market Report. To find out more, login to the AIQS website.

THE BUILDING ECONOMIST - JUNE 2017 - 11

ECONOMIC DEVELOPMENTS ARE AT THE HEART OF THE BUSINESS CYCLES The end of the mining investment boom continues to be a drag on economic growth, which is tracking below the longer-term average.

The much awaited strengthening in non-mining business investment remains elusive.

Dwelling investment has provided one of the few sources of growth in activity and employment over recent years.

Growth in employment, despite relatively low levels of growth in GDP, has been sufficient to wind back the rate of unemployment to under 6%.

This gradual decline in unemployment may have faltered recently and high rates of part time employment points to significant underemployment and spare capacity in the labour market.

Reflecting low inflation, sluggish growth and evidence of spare capacity the cash rate of interest has been set to 1.5%, an historic low point. This has supported modest growth in non-mining business investment and household consumption. Traces of

accommodative monetary policy are most apparent in surging dwelling investment and somewhat alarming increases in house prices, especially in Sydney and Melbourne. There is also concern about increased household debt and risks to the banking system and future growth.

Increases in official interest rates should not be on the table until there is evidence of a significant improvement in employment growth, higher income growth and a clear prospect of higher inflation.

Firmer prudential supervision is targeting the emerging risks in mortgage lending, sharply restricting credit growth and raising interest rates for investors and developers. There are indications that these measures have already taken some of the pressure out of rising house prices and they are adding to expectations of a downturn in investment in new housing, especially development of apartments in inner city areas.

ENGINEERING CONSTRUCTION HAS BEEN DOWNGRADED The ongoing decline in Engineering Construction has been extended and deepened in the May 2017 ACIF forecasts. Work done is projected to fall by 14.5% in 2016-17 to $81 billion.

Overall, a fall of 45% is expected from the peak in Engineering Construction activity in 2012-13 to the expected trough in 2017-18.

Earlier ACIF Forecasts had pointed to plans to increase infrastructure spending and these are now flowing through into actual construction work (especially in Roads and Telecommunications).

The ACIF forecasting team is still

assessing recent announcements in the Australian Government’s Budget 2017 that foreshadows a $75 billion investment in infrastructure across Australia and in most key categories of infrastructure over the next 10 years.

Many of the larger commitments relate to projects that are already in the ACIF Major Projects database.

The May 2017 ACIF Forecasts reflect the view that additional commitment to infrastructure investment in the medium term will play a useful role in putting a halt to the current downslide in Engineering Construction and stabilising activity at around $80 billion into the medium to longer term.

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REPORT

NON-RESIDENTIAL BUILDING DISAPPOINTS This category of building fell by 0.8% last year, shedding $276 million in work done.

Non-Residential Building is a mixed bag with increases in subsectors being less common than dips. The May 2017 revisions have downgraded the outlook for Education, Health and Aged Care and Industrial. This largely dominates upgrades in activities such as Accommodation, and Retail/Wholesale Trade and results in a net decline in Non-Residential Building activity in the next two years.

THE CYCLE OF BOOM-AND-BUST DEEPENS IN RESIDENTIAL BUILDING A boom in Residential Building resulted in growth of 10.5% in 2015-16 lifting the value of work done to $95 billion.

Leading indicators show that growth has peaked, particularly in New Other Residential (that is, flats, apartments and townhouses).

A raft of policy measures have been implemented to reduce demand for housing, including closer supervision of foreign buyers and more stringent prudential supervision on mortgage lending which has already raised interest rates for investors and reduced house prices in key markets.

Growth in Residential Building at large is projected to fall to 4% this year (2016-17) and then activity will contract by a total of 16% over the 3 years to 2018-19.

The Australian Government’s 2017 Budget provided many measures designed to tackle problems with housing affordability.

These will take some time to flow through to actual Residential Building activity and it is likely that they will provide a lift in supply and assist in funding demand for more affordable housing from 2017-18, just when the Residential Building activity would otherwise be entering its expected downturn in earnest. It is too early to say in this set of ACIF Forecasts how much this will change the projections.

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THE STATES ARE RIDING THE CYCLES HARDEST Queensland and Western Australia, traditionally viewed as the mining states, experienced extraordinary growth in construction activity in the years up to 2013-14 and they surged ahead to overtake every other state.

Construction activity in these 2 states accounted for over half of the total at the time. Huge mining and supporting export infrastructure projects have been completed and construction activity in these states is now in a steep decline.

Meanwhile, construction activity in New South Wales and Victoria faltered in 2013-14 and then began to see more rapid growth as Residential Building built up steam. These states are predicted to enjoy continued increases in construction activity this year and next as the housing boom finally reaches its own peak. They too will experience the downside of a boom when the predicted decline in Residential Building works through the construction pipeline.

TOTAL CONSTRUCTION AND CYCLES The outlook for the Australian construction market as a whole seems to be underlining the well worn cliché that “what goes up must come down”.

The value of aggregate construction work done peaked at $248 billion in 2013-14 reflecting the influence of the investment phase in the mining boom.

The synchronised double dip due to the bust in mining and housing booms will push the value of work done in aggregate construction down to $194 billion by 2019-20.

Construction employment will inevitably have to ride the cycles Employment in building and construction rose to a little above 1

million persons in 2013-14 as mining related construction activity peaked.

It has been a source of surprise in some quarters that employment did not fall away following the end of the investment phase in the mining boom. It seems that the Residential Building boom has been sufficient to sustain and actually increase employment in construction activity, which has continued to grow to around 1.1 million jobs last year (2015-16).

The end of the Residential Building boom is forecast to occur as the Engineering Construction activity troughs. It is this “double dip” in construction activity that will drive employment numbers down to 956,000 by 2020-21.

For more information on the ACIF Forecasts November 2016, visit http://www.acif.com.au. ACIF Forecasts are available in two formats: Australian Construction Market Report, which has detailed expert commentary, data and charts; or the ACIF Customised Forecasts Dashboard, where you can create your own query on work demand, construction costs, labour requirements and over 5,500 Major Projects from Cordell Information.

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Integration with estimating tools

INSIGHT

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Resilience What it means and our role as built environment professionals ASSOCIATE PROFESSOR SARA WILKINSON

UNIVERSITY OF TECHNOLOGY SYDNEY

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INSIGHT

AS A PRACTITIONER, SUSTAINABLE DEVELOPMENT IS A TERM YOU ARE LIKELY TO HAVE SOME FAMILIARITY WITH, BUT WHAT ABOUT ‘RESILIENCE’ AND ‘RESILIENCE ISSUES?’ THIS TERM IS LIKELY TO BE LESS FAMILIAR TO YOU. WHAT DOES IT MEAN IN THE CONTEXT OF THE BUILT ENVIRONMENT IN GENERAL, AND FOR QUANTITY SURVEYORS IN PARTICULAR?

T

his article explains the term and what it means, giving examples of interpretations in Sydney and Melbourne and how it manifests in the built form there. Resilience issues in other international cities are also highlighted, so that you can compare Australian issues to some extent. The article describes the differences between chronic and acute resilience issues and how they manifest themselves in the built form here. Finally it highlights how consideration of resilience might affect the way you advise clients about their buildings to make them more resilient for the future.

WHY WE NEED RESILIENCE The 2015 global population of 7.3 billion is predicted to reach 8.5 billion in 2030 and 9.7 billion in 2050. More people surviving to reproductive age, changes in fertility rates, increasing urbanisation and accelerating migration drive this growth. These trends have far-reaching implications for future generations.

In the largest wave of urban growth in history, over half the world’s population now live in towns and cities, by 2050 around 66% of global population will be urbanised. Whilst urbanisation may usher in an era of well-being, resource efficiency and economic growth, cities house high concentrations of poverty and inequality. So our cities will grow, mostly faster than ever before.

We need planning and governance to deliver transition from all levels, scales and type of development from building to city scale, ensuring infrastructure can support growing populations and changing land uses.

With adaptation of existing areas to accommodate more people, and as predominant land uses undergo change, we need to consider optimum levels of

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sustainable development that includes, at the building level, different types and degrees of new development, adaptation and adaptive reuse.

CITY CHALLENGES Many cities are setting up task forces and developing resilience plans. New York published its strategy in 2013. Melbourne was among the first wave of 32 cities to join the 100 Resilient Cities (100RC) network and published its resilience strategy in May 2016. Established by the Rockefeller Foundation, the 100RC assists cities to meet the physical, social and economic challenges now and in future, and supports the adoption and incorporation of acute and chronic manifestations of resilience.

Acute, or shock events, include bushfire, cyclones and floods. Chronic stresses undermine and weaken the fabric of a city on a day-to-day or cyclical basis, such as high levels of unemployment; inefficient public transport systems; and chronic shortages of water and food. In addressing shocks and stresses, a city becomes more able to respond to adverse events, and more able to deliver basic functions in good and bad times, to all populations.

Table 1 illustrates a selection of cities in four continents in developed and developing countries to show the challenges, similarities and differences that exist. Issues range from social to environmental and economic, some are chronic and others acute. The built environment, in its new and existing buildings affects these circumstances.

Different solutions suit different cities and different locations, and have different degrees of importance.

Table 1. Resilience challenges faced in selected cities

TABLE 1. RESILIENCE CHALLENGES FACED IN SELECTED CITIES City

Resilience Challenges (100 Resilient Cities)

Sydney, Australia

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

Ageing infrastructure Heat wave Infrastructure failure Lack of affordable housing Overtaxed/ under developed/unreliable transportation system Rapid growth Rising sea level and coastal erosion Social inequity Terrorism Wildfires

Rotterdam, Netherlands

11.

12.

13.

14.

15.

16.

Coastal flooding Drought Hazardous materials accident Heat wave Rainfall flooding Refugees

Chennai, India

17.

18.

19.

20.

21.

22.

23.

24.

25.

Aging infrastructure Economic inequality Economic shifts Hurricane, typhoon, cyclone Infrastructure failure Overpopulation Pollution or environmental degradation Pronounced poverty Tropical storms

New York, USA

26.

27.

28.

29.

Heat wave Overtaxed/under developed/unreliable transportation system Rising sea level and coastal erosion Tropical storms

FIGURE 1 RESILIENCE SCALES Resilience scales 1.

2.

3.

4.

5.

6.

7.

Building District (Precint) City Metropolitan area Country Region/continent (ie Europe, Asia) Worldwide

Building

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INSIGHT

RESILIENCE SCALES Resilience scales refer to different levels, from global to building level (see figure 1). It is a useful way to understand how measures taken at building level impact at global level. After building scale, there is suburb and then precinct scale. The city scale follows, at which policy is made and executed and governance applied.

After this is metropolitan scale (areas immediately around a city). The national scale is next, and here national policy and governance decisions are made and executed. Then comes the regional scale, such as Europe, where some collective decision-making may be exercised. The final scale is global.

Figure 1 Resilience Scales

TYPES OF RESILIENCE Whilst the concept of urban resilience is used in policy and academic discourses, it is not so well known at practitioner level. The theory of resilience explains complex socio-ecological systems and their sustainable management, by which we mean; cities and buildings. Resilience offers a framework for dealing with future uncertainties. It is perceived as positive, action to make us less vulnerable to climate change, natural disasters and/or man-made disasters such as economic downturns. Urban areas of over 50,000 people, account for 71% of global carbon emissions yet cover only 3% of the area. In accommodating growth and expansion, cities and their buildings need resilience. Resilience comes from the Latin word ‘resilio’, meaning ‘to bounce back’, in the 19th century however, the term evolved to embrace the notion of adversity. Resilience has five attributes; (1) Equilibrium versus non-equilibrium,

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(2) Positive versus negative notions of resilience, (3) Mechanisms of system change, (4) Adaptation versus general adaptability and (5) Timescales of action.

The 100RC defines urban resilience as ‘the capacity of individuals, institutions, businesses and systems within a city to adapt, survive and thrive no matter what kind of chronic stresses and acute shocks they experience’. Urban resilience is dynamic and ever changing. Cities and their hinterlands are highly interdependent with delineation of boundaries problematic, as some systems extend beyond the physical city limits for example; water or food supply systems.

EQUILIBRIUM Equilibrium can be single state, multiple-state and dynamic nonequilibrium. Single state equilibrium is the ability to return to a previous state post disturbance and prevails in disaster management, where buildings are reinstated post flooding. Multiple-state equilibrium acknowledges that there can be numerous states of equilibrium. It is recognised that systems exist in a state of dynamic non-equilibrium, that is no constant state can exist and there is a continuous flux and change and lead to the rejection of the notion of resilience as ‘bouncing back’.

Here systems are ‘safe to fail’ rather than fail-safe, and acknowledge post disturbance, cities and their buildings, may not return to a previous state.

Further return to ‘normal’ may neither be desirable nor appropriate, as the original state was vulnerable. Some

advocate for a co-ordinated proactive approach to risk mitigation and adaptation within the urban planning and built environment context.

POSITIVE VERSUS NEGATIVE PERCEPTIONS In 25 definitions, resilience was positive and where systems with resilience were held to be able to maintain basic functions, to prosper and to improve. Others question that existing states may not be desirable, such as areas with poor quality, inadequate housing. Hence the debate extends posing questions; resilience ‘for whom’ and ‘to what?’ Power inequalities also determine whose agenda prevails.

"THE VALUE OF RESILIENCE PLAYS RIGHT INTO THE HANDS OF A QUANTITY SURVEYORS’ LIFE CYCLE COSTING SKILLSET." COMMENTATOR ANDREW DOHERTY, AAIQS SENIOR ASSOCIATE AT ADVISIAN

MECHANISM OF CHANGE The three mechanisms of change to resilience are ‘persistence’; where efforts are made to return or maintain the built environment and its systems in an existing state. For example, after a cyclone, buildings are reinstated.

Building adaptation is an example of persistence. The second mechanism, ‘transitional’ implies some adaptation to a new state or incremental change, for example, adaptive reuse from a former land use, such as warehousing, to a new land use of residential as an area transitions post industrialisation.

The most extensive degree of change is ‘transformative’. An example where areas are completely transformed is Barangaroo in Sydney.

ADAPTATION Adaptation refers to the differences between high adaptability compared

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INSIGHT

to generic adaptability. Too much emphasis on specified resilience undermines system flexibility and ability to adapt to unexpected threats. Others perceive adaptability as synonymous with adaptive capacity and note the importance of maintaining general resilience to unforeseen threats in addition to specified resilience to known risks.

An example, here might be a known risk of rainfall flooding affecting a city, and taking measures in the design, construction and adaptation of buildings to reduce risks of water damage arising and ensuring faster recovery. Sydney is predicted to get more intense rainfall as a result of climate changes so adapting designs now will make buildings more resilient.

Equally, adopting flexible design and construction in buildings might accommodate a greater variety of alternate uses over time, thereby having adaptive capacity. The UK Tower of London is a building with high adaptive capacity; in 900 years it has functioned as a home, prison, barracks, armoury and now, museum and tourist attraction. Warehouses are another example of a design with good adaptive capacity, used as hotels, residential buildings, art galleries and retail centres.

TIMESCALE Some perceive immediacy and rapid recovery as essential; however it depends on whether the focus is on rapid onset events such as storms and floods, or more long-term gradual states such as changing climate. The measurement of timeframes is unclear and can be hours, months or years.

So reinstatement of energy supply following a storm would be delivered

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within hours, whereas reinstatement of flood-damaged buildings might take months.

Then there is the question of reinstatement being a return to the ‘prior state’, or an improved and different state that would be more resilient to the same event. Urban transformation requires setting long-term goals at city/state level, however flexibility is a pre-requisite to adapt to changes that occur, otherwise unintended adverse consequences may result. Although these issues are dealt with at city/state level, it is at building level where many interventions and adaptations occur and that is where professional practitioners are vital, catalysts of change.

THE FIVE W’S OF RESILIENCE IN BUILDINGS So resilience is complex, with multiple attributes and levels of interpretation. It is vital to consider questions of; who, what, when, where and why? When considering resilience, ‘who’ is determining what is desirable for an urban system, whose resilience is prioritised and who is included or excluded from the urban systems? In respect of ‘what’, what should the system be resilient to, what networks /sectors are included in the urban system, and is the focus on generic or specific resilience? On the question of ‘when’, is the focus on rapid or slow onset disturbances, on short or long term resilience, and finally, is it on the resilience of current, or future, generations? The fourth W covers ‘where’; in respect of the boundaries of the urban system, and whether resilience of some areas prioritised over others, and whether building resilience in some areas affects the resilience of other areas.

TABLE 2 SYDNEY AND MELBOURNE RESILIENCE ISSUES AND RELEVANT QUANTITY SURVEYOR SERVICES Sydney and Melbourne Resilience Issues

Services Quantity Surveyors can offer to mitigate / address these issues in the built environment / buildings

1. Ageing infrastructure

»» Life Cycle Costing »» Forecast for maintenance or replacement, with an understanding of what may be required to future proof

2. Heat wave

»» Cost benefit analysis on urban heat island mitigations »» Evaluation of design options passive and active. This may include infrastructure and city assets in extreme events or may also include the changing of design parameters to overcome differing climatic conditions

3. Infrastructure failure

»» Quantum expert in claim and dispute settlement »» Insurance / cost assessment – see also 1 above

4. Lack of affordable housing

»» Cost model pre-fabricated housing »» Evaluate programs and initiatives to develop or fund housing alternatives

5. Overtaxed/ under developed/unreliable transportation system

»» Analyse procurement to determine if inefficiencies can be improved to release more capEX »» Forecast for maintenance or replacement / evaluate funding / evaluate options innovative or BAU / work in association with transport modellers

6. Rapid growth

»» Work in association with city planners and engineers. Evaluate costs associated with the impacts of planning

7. Rising sea level and coastal erosion

»» Add carbon to cost plans so that both carbon and cost of designs can be evaluated to determine a projects comparative effect on climate change. »» Insurance assessments / disaster recovery assessments. Provide cost forecasting coastal infrastructure upgrade or coastal village relocations

8. Social inequity

»» Insurance assessments / disaster recovery assessments. Provide cost forecasting coastal infrastructure upgrade or coastal village relocations

9. Terrorism

»» Feasibility cost plans including CPTED knowledge gained from CPD and project experience »» Costs associated with mitigation of attacks, blast proofing, security, Emergency Services and disaster recovery

10. Wildfires

»» Managing costs associated with new codes

11. Rainfall flooding

»» Feasibility cost plans including storm water knowledge gained from CPD and project experience »» Insurance assessments / disaster recovery assessments / coastal infrastructure upgrade or relocations

12. Rising sea level and coastal erosion

»» Add carbon to cost plans so that both carbon and cost of designs can be evaluated to determine a projects comparative effect on climate change

13. Coastal flooding

»» Feasibility cost plans including storm water knowledge gained from CPD and project experience »» Insurance assessments / disaster recovery assessments / coastal infrastructure upgrade or relocations

14. Declining or ageing population

»» Contribute VM input into Lean construction that requires a smaller labour force to undertake projects »» Direct assets in relation to housing

15. Disease outbreak

»» By costing / budgeting how quarantine is managed through cities. Cost associated with rapid resourcing and or manufacture of distribution of drugs and programs

16. Drought

»» Add carbon to cost plans so that both carbon and cost of designs can be evaluated to determine a projects comparative effect on climate change »» Costs associated in managing and or construction of water assets – cost benefit analysis and future proofing

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INSIGHT

"OUR ROLE IS IN UNDERSTANDING WHAT ISSUES SUSTAINABLE DEVELOPMENT AND RESILIENCE PRESENT FOR OUR CLIENTS AND THE WIDER COMMUNITY. ALSO IN ARTICULATING HOW THESE CAN BE UNDERSTOOD BETTER OR PROVIDED FOR WHEN CONSIDERING THE MANAGEMENT OR DEVELOPMENT OF BUILT ASSETS. TO ACHIEVE THIS WE NEED TO COLLABORATE WITH OTHER INDUSTRY PROFESSIONALS AND STAKEHOLDERS AND UNDERSTAND WHAT THEIR DRIVERS / INHIBITORS ARE FEEDING BACK IN TERMS OF COST AND RISK, CAPITAL OR OTHERWISE. " COMMENTATOR MARK QUINN, FAIQS COST MANAGEMENT ASSOCIATE DIRECTOR AT AECOM

Finally there are issues of ‘why’; what is the goal, what are underlying motivations and is the focus on process or outcome?

term maintenance costs is a skill that is of increasing value to an increasingly mature marketplace.

In a ‘built-in’ resilience environment, the quality of a built environment’s capability (in physical, institutional, economic and social terms) to keep adapting to existing and emergent threats; thus it's focus is coping with dynamic changes. If we interpret disasters as natural, this stance absolves policy makers and stakeholders from blame, however this is changing as many government stakeholders are making and publishing resilience plans.

There are no right or easy answers to these questions, however it is imperative that we are cognisant of and debate them, as we try to build resilient cities and buildings.

AECOM Quantity Surveyor Mark Quinn, specialises in infrastructure, asset strategy, risk evaluation, useful life analysis, depreciation and sustainability years takes the view that most of the services will be associated with providing cost forecasts presented so as to articulate cost benefit at a point in time.

These costs may be associated with a single asset, precinct design or city design. Table 2 summarises the resilience issues faced in Sydney and Melbourne and, given the depth and breath of knowledge professional Quantity Surveyors have, there is a clear need for the professional services Quantity Surveyors can provide for clients.

WHAT ADVICE QSs CAN GIVE TO CLIENTS According to Andrew Doherty, a Quantity Surveyor with over 23 years’ experience in commercial management, contract administration & cost planning on major construction & infrastructure projects across Australia, a Quantity Surveyor’s primary role is to be value managers.

As the commercial adviser on a project or program, the Quantity Surveyor can help clients determine the levels of sustainability and resilience measures required.

For a commercial client, the value will generally be cost driven, but for public clients, improving the amenity, or at least creating a perception of improving the amenity of their citizens may be of greater value than the degree of capital expenditure. The value of resilience plays right into the hands of a Quantity Surveyors’ Life Cycle Costing skillset.

Being able to demonstrate the impact of an initial spend for resilience on long-

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Table 2 Sydney and Melbourne resilience issues and relevant Quantity Surveyor services.

IN SUMMARY Resilience is going to become a growing consideration for many of our clients to protect people and investments in our built environment. We need to ensure resilience is taught in our education system and CPD is offered to existing members. When advising clients we need to take a long-term view and a broad perspective. Do we consider specifications to withstand future weather events or, with reinstatement is the preferred option a different specification to future proof the building?

For Sydney and Melbourne based practitioners we need to consider how buildings and the built environment will be affected by heatwaves, rainfall flooding, ageing infrastructure, housing affordability, rising sea levels and so on.

We should be proactive, with our lifecycle costing skillset and understanding of value management, Quantity Surveyors are in a strong position to lead in resilience advice.

Some content for this article is taken from my forthcoming book; Wilkinson, S. & Remoy, H. 2017. 'Building Resilience in Urban Settlements through sustainable change of use'. WileyBlackwell. ISBN 978-1-119-23142-4. To be published in late 2017.

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RESILIENT CITY SPOTLIGHT

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BANGKOK

Thailand’s capital city, home to 10 million residents within 1,500 square kilometers

WHEN WE TALK ABOUT RESILIENCE, WE MEAN URBAN RESILIENCE. RESILIENCE IS ABOUT SURVIVING AND THRIVING, REGARDLESS OF THE CHALLENGE. IT IS THE CAPACITY OF INDIVIDUALS, COMMUNITIES, INSTITUTIONS, BUSINESSES, AND SYSTEMS WITHIN A CITY TO SURVIVE, ADAPT, AND GROW NO MATTER WHAT KINDS OF CHRONIC STRESSES AND ACUTE SHOCKS THEY EXPERIENCE DR. SUPACHAI TANTIKOM CHIEF RESILIENCE OFFICER CITY OF BANGKOK

DR. SUPACHAI TANTIKOM IS THE CHIEF RESILIENCE OFFICE FOR THE CITY OF BANGKOK, WORKING UNDER 100 RESILIENT CITIES TO DEVELOP A RESILIENT STRATEGY FOR BANGKOK CITY. PREVIOUSLY, HE WAS AN ADVISER TO THE GOVERNOR OF BANGKOK FOR 6 YEARS, WHERE HE WAS RESPONSIBLE FOR INFRASTRUCTURE DEVELOPMENTS, CLIMATE CHANGE, SUSTAINABILITY DEVELOPMENT, GREEN GROWTH AND RESILIENCE.

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SHOCKS AND STRESSES AGEING INFRASTRUCTURE COASTAL FLOODING DROUGHT OVERTAXED/ UNDER DEVELOPED/ UNRELIABLE TRANSPORTATION SYSTEM POLLUTION OR ENVIRONMENTAL DEGRADATION POOR TRANSPORTATION SYSTEM RAINFALL FLOODING RIOT OR CIVIL UNREST

Bangkok is situated on the lower basin, on flat land at the mount of the Chao Phraya River whose catchment area is about one third of Thailand’s area or approximately 160.000 square kilometres.

Since the climate of Thailand is under the influence of monsoon winds of seasonal character, especially the southwest monsoon which starts in May till October, causing abundant rain over the country.

The utmost resilience challenge for Bangkok is flood risk.

Since flooding is a natural phenomenon in the river basin, Bangkok experienced several floods in 1917, 1942, 1975, 1977 1978, 1980, 1983, 1995 and 2011. In fact, Bangkok is well equipped with flood protection infrastructures which are: •

77 km long flood protection dikes along the Chao Phraya River, Khlong Bangkok Noi and Khlong Mahasawad

•

7 giant tunnels with total capacity of 155.5 cms

•

158 pumping stations with total capacity of 1,638 cms

•

1,682 canals with a total length of 2,604 km

•

6,188 km public drainage pipe

•

25 retention areas with total volume of 12.88 million cm

•

Flood control centre

But the 2011 floods were historically devastating for Bangkok and its surrounding areas causing damage of about USD 46.5 billion. Among the complex causes of the flood were the natural effects of extreme monsoon rainfall and the low capacity of upstream

rivers, but also changes to land use and water management including urbanisation of the flood zone, diversion of water through certain channels, dam height and lack of proper maintenance of water structure.

After the 2011 flood, the city came up with a mitigation plan to increase the efficiency of flood protection systems by raising the height of the dikes, improving the drainage capacity of main canals, constructing 3 more giant drainage tunnels with total capacity of 180 cms, developing retention pond, and improving the forecast and warning system of the flood control centre.

THE NEED There is a need to understand Bangkok’s current and future flood risk and the current and future gap between existing flood prevention infrastructure and future protection requirements and to explore more holistic flood plain management, rather than localised flood infrastructure solutions such as drainage upgrades and retaining walls.

In addition, climate change is expected to have significant impacts on sea levels, average seasonal rainfall and the intensity and frequency of extreme rainfall events. The current criteria used in the design of infrastructure will need to be assessed to ensure that it accommodates these projected changes.

The structural integrity of existing infrastructure could also be affected.

Existing drainage systems are likely to be under-designed in the future and this will need re-evaluation and assessment, which will require further investment.

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RESILIENT CITY SPOTLIGHT

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BANGKOKS THREE STRATEGIC ACTIONS BREAKING THE CYCLE Increasing urbanisation has created a INCREASING QUALITY OF LIFE busy and stressful lifestyle, congested REDUCING RISK AND INCREASING streets and poor water and air quality.

ADAPTATION Our natural environment and the health of residents has suffered with everDRIVING A STRONG AND expanding development. Such challenges COMPETITIVE ECONOMY will only be compounded by climate change, which will bring increasing uncertainty and unplanned interruption to our city. With more people than ever before living in, and engaging with our city, it is a critical time for us to break the cycle of reacting to problems and set out on a more deliberate course to ensure that our city is resilient.

"IT IS A CRITICAL TIME FOR US TO BREAK THE CYCLE OF REACTING TO PROBLEMS AND SET OUT ON A MORE DELIBERATE COURSE TO ENSURE THAT OUR CITY IS RESILIENT"

The three strategic action areas in Bangkok Resilient Strategy will work alongside the city’s investments to upgrade and transform city systems to ensure that Bangkok is a safe, liveable, and sustainable city for all by increasing quality of life, reducing risk and increasing adaptation and driving a strong and competitive economy. This will not only allow the city to fulfil its functions as envisaged for the future, but also reduce the impacts of shocks and stresses, ensuring that all city residents will be able to share and enjoy the development gains accumulating over time without serious interruption.

To explore the full Bangkok’s resilience strategy please visit http://www.100resilientcities.org/strategies/city/bangkok

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INSIGHT

THE RESILIENT CITY:

HYPE OR LASTING? Professor Rob Roggema, University of Technology Sydney AFTER SUSTAINABILITY, THE NEW WAVE OF ‘GREENISM’ IS RESILIENCE, AN OPINION ONE COULD EASILY PICK UP IN ANY CONVERSATION ABOUT THE FUTURE OF THE BUILT ENVIRONMENT. ASSUMING IT WILL DISAPPEAR, OR AT ITS BEST BECOMES A HOLLOW CONCEPT. HOWEVER, THERE ARE MANY REASONS TO EMBRACE THE CONCEPT AND APPLY IT TO CITY BUILDING. IN CURRENT TIMES THE WORLD HAS TO DEAL WITH HUGE UNCERTAINTIES, AND CITIES EVEN MORE SO. AT THE SAME TIME HUMANS ARE DEPLETING EARTH’S RESOURCES AT AN INCREASING RATE. THIS PLACES SOCIETIES AT RISK AND RESILIENCE OF URBAN SYSTEMS IS MORE NECESSARY THAN EVER.

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THE CITY NEEDS IT Current urban areas are under an increasing threat of disturbing events.

The most cited is undoubtedly climate change, but other impacts such as migration, loss of biodiversity or water scarcity, are evenly important. The ability of the city to respond to and recover from climate impacts, such as floods, cyclones, heat or bushfires, is essential for life. Humans, and ecosystems cannot live under a permanence of these impacts, so the city has to release them.

A resilient city makes it possible to be temporarily flooded, hot, or on fire, while retaining the capability for people to live their urban lives.

THE CITY HAS IT One of the interesting capabilities of cities is they have the ability to transform and self-organise under changing conditions. Processes such as gentrification or changing uses are all possible within the built environment.

Old and depleted neighbourhoods can suddenly be rediscovered as the hottest places in town. A resilient city offers the context for many different uses and groups of people. The potential of reuse of spaces and buildings is large and allows the city for a continuous transformation. This way the city is able to adapt to any future demands, no matter what these comprehend.

Besides the physical indestructability the city is also the result of fixed processes and procedures. Regulations around land-ownership, the planning culture and the price of land often determine the outcome, no matter whether these are desirable or not. These fixed processes and environments make it hard to deal with uncertainties.

THE CITY IS VULNERABLE Since 2007 the majority of the world's population lives in cities. The majority of the urban agglomerations are located at or close to the coast. With climate change, the rising sea level and the increase of heavy storms and cyclones, the threat increases. The increased threat and increased number of people in these areas leads to a double higher vulnerability. A resilient city mitigates this higher vulnerability, for instance by locating the majority of the inhabitants in places that are not sensitive to these impacts. A master plan is required for this to allocate people to the least vulnerable places.

THE RESILIENT CITY There are many reasons for creating a resilient city. In order to become more resilient the city should perform several qualities (Vitale and Gardner, 2017).

•

The reflective city accepts the inherent and ever-increasing uncertainty and change in today’s world.

•

The robust city includes wellconceived, constructed and managed physical assets.

•

The redundant city has purposely created spare capacity within systems to accommodate disruption.

•

The flexible city can change, evolve and adapt in response to changing circumstances.

THE CITY IS RESISTANT On the other hand the city can be characterised and is developed as a result of long enduring mechanisms.

These mechanisms are persistent and they often determine the outcome in terms of urban patterns and the shape of the built area. This results in infrastructure and buildings that are located at a very fixed position and difficult to move. Once investments have been put in, these elements will stay.

“CURRENT URBAN AREAS ARE UNDER AN INCREASING THREAT OF DISTURBING EVENTS. THE MOST CITED IS UNDOUBTEDLY CLIMATE CHANGE, BUT OTHER IMPACTS SUCH AS MIGRATION, LOSS OF BIODIVERSITY OR WATER SCARCITY, ARE EVENLY IMPORTANT.” •

In the resourceful city people and institutions are able to rapidly find different ways to meet their needs during an event.

•

In the inclusive city broad consultation and engagement of communities, including the most vulnerable groups, occurs.

•

In the integrated city systems are aligned to promote consistency in decision-making and to ensure that all investments are mutually supportive to a common outcome.

Creating a resilient city is already a significant task and requires a fundamental different design approach to urban development, the question remains whether this is enough to truly create a city that can deal with unprecedented uncertainty, so-called deep uncertainty.

The core problem here is that it is never clear what the risk is until a disturbance happens. In this type of situation creating a resilient urban environment might not be enough, as it is unknown for what the city needs to be resilient.

The concept of anti-fragility could be a way to provide a city that is ready for unprecedented impacts. Anti-fragility

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“ANTI-FRAGILITY IMPLIES THAT A SYSTEM BECOMES STRONGER UNDER THREAT…”

implies that a system becomes stronger under threat (Taleb, 2012). In an urban context this could mean that a city can be constructed, which increases its qualities when impacted. For instance, the water of a potential flood can be used to store it in places where it does no harm and create an urban environment that is ecological valuable, is a cooling factor in the city and adds visual quality.

The resilient city is not a self-evident result of current urban practice. At the same time the resilient city is a wellestablished phenomenon, both in theory

and practice. The risk of becoming a hype or a hollow phrase seems to be low. However, with the economic driving forces in the delivery of the city, resiliency remains a vulnerable concept. The application of the six principles mentioned in this article could help to make resiliency inclusive of the designs for our future city. This is should be undisputed because the future wellbeing depends on the way our cities are designed now. Without resilience disturbances take over and annihilate the happiness of all urban citizens.

STRATEGY FOR DESIGN The design of a resilient city should therefore be based on the following principles: 1.

Close cycles at the lowest possible scale. When the cycles of water, energy and materials are closed no waste streams are produced and the city is clean and has an efficient urban metabolism. The circularity provides abundant opportunities to create economic benefits.

2. Create spaces for the unknown. When redundancy becomes a standard part in urban design, the city has the flexibility to ‘host’ unprecedented events. If, for instance a cyclone hits the city there is space to store the accompanying water temporarily.

3. Design anti-fragile spaces. Using this new concept to design places that improve the quality in the city when an event occurs.

4.

Let people own their environment. When residents are part of the design process, they will create ownership over the changes and invest in their environment. Once residents own their environment they will make sure it is maintained well. The design charrette is a wonderful design method to develop designs in an inclusive way.

5. Use the landscape as the basis for urbanism. Landscape systems, such as the water system, ecology and soil, create the conditions for urban occupancy. The values in the landscape then will determine the type of urban development. This is contrary to the current situation where the urban development dictates the landscape, e.g. overthrows the existing landscape values to create ordinary residential areas.

6. Create innovative designs. The current conventions need to be broken if a resilient city is to be developed. The existing procedures need to be bypassed using creative design approaches. For the development of regional plans, metropolitan spatial visions, district plans and neighbourhood designs a sabbatical detour can provide the space to think differently and the time to come up with alternative design propositions. Elements of a sabbatical detour are design competitions, an idea-generating charrettes, designers in resident, exhibitions and many other activities.

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LEGAL CASE NOTES

THE INTEGRAL SOCIAL ROLE OF THE QUANTITY SURVEYOR IN SUSTAINABLE AUSTRALIA SUSTAINABLE DEVELOPMENT IS A CONCEPT WHICH HAS OF LATE BEEN CRITICAL IN VARIOUS AUSTRALIAN COURT CASES AND ONE WHICH DESERVES THE ATTENTION PROVIDED

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A GLOBAL PERSPECTIVE The Common Future Report published in 1987 by the World Commission on Environment and Development (otherwise known as the Brundtland Commission) describes sustainable development to be “development that meets the needs of the present without compromising the future of generations to meet their own needs.”

Quantity Surveyors play an integral part in ensuring ongoing sustainable development in Australia. Their influence cannot be understated in prompting others in the building and construction industry to consider sustainability in their development projects.

Some contributions Quantity Surveyors make to ensure their role as environment stakeholders towards the promotion of sustainability and management of ongoing resilience issues within our cities include: •

Ensuring any list of materials provided to a builder or developer consists of largely sustainable materials

•

Respecting and manage the expectations of individuals

•

Considering the re-use existing buildings in fundamental design stages of a project and consider the prospect of future re-use at the initial stages of a build from new project

•

Ensuring designs are considered to ensure wastage is minimal

•

Aiming to minimise energy exerted throughout the construction process, including in the materials selected and the design of the building

Professors Sharmin Khan and Anwar Hussian published the ‘The Ten Commandments to Manage Sustainable Development’ and presented it at the ‘International Conference on Emerging

Trends in Engineering, Technology, Science and Management on 12 April 2017’. The Article identifies ten areas of construction management that assists Quantity Surveyors in their role towards achieving sustainable development namely:

1.

Integration & Coordination

2. Construction Driven Schedules 3. Simplification of Design & Standardisation of elements 4.

Accessibility to site

5. Adverse weather conditions 6. Technical specifications & availability of resources 7.

Encouragement to innovation

8. Regular review meetings 9.

Recording of lessons learned

10. Recycling & Waste Management Quantity Surveyors may further look to their triple bottom line of their business being the social, financial and environmental implications in order to evaluate their success and to grow their position in their valuable social role within society and the wider building construction industry.

A NATIONAL PERSPECTIVE The Commonwealth Government enacted the Environment Protection and Biodiversity Conservation Act 1999 (Cth) which provides at Section 3(b) the following objective: To promote ecologically sustainable development through the conservation and ecologically sustainable use of natural resources

LEGAL CASE NOTES

The importance of sustainable development should not be overlooked and the cases below provide an insight into the increasing relevance of sustainable development and the recognition of the same in our Australian Courts system.

CARSTENS V PITTWATER COUNCIL [1999] NSWLEC 249; (1999) 111 LGERA 1 In Carstens v Pittwater Council [1999] NSWLEC 249; (1999) 111 LGERA 1 (Carstens) the applicant appealed to a judge of the Land and Environment Court in respect of a decision not to approve a development application for a ‘dwelling house and associated works’. This case considered brings into light whether or not the approval of the certain development application would present a significant impact upon a threatened species or population or an endangered ecological community and if so, whether or not they should be approved.

Lloyd J held (at 74) in this case that: “it is not an irrelevant consideration for the decision-maker to take into account a matter relating to the objects of the Act. One of those objects is to encourage ecologically sustainable development (s 5(a)(vii)). Moreover, one of the considerations expressly mentioned in s 79C(1) is “(e) the public interest”. In my opinion it is in the public interest, in determining a development application, to give effect to the objects of the Act. For these reasons I do not accept the submission that the Commissioner erred in holding that the principles of ESD must be a factor in the consideration of a combined development application and construction certificate”.

The comments were made by Lloyd J when determining whether or not the

Commissioner whom made the decision erred in law by holding that section 79C(1) of the Environmental Planning and Assessment Act 1979 (NSW) and the principle of ecologically sustainable development therein were not relevant to his consideration of the development application.

BGP PROPERTIES PTY LTD V LAKE MACQUARIE CITY COUNCIL [2004] NSWLEC 399; (2004) 138 LGERA 237

“DEVELOPMENT THAT MEETS THE NEEDS OF THE PRESENT WITHOUT COMPROMISING THE FUTURE OF GENERATIONS TO MEET THEIR OWN NEEDS.”

In BGP Properties Pty Ltd v Lake Macquarie City Council [2004] NSWLEC 399; (2004) 138 LGERA 237 (BGP Properties), the New South Wales Land and Environment Court decided what regard, if any, should a consent authority, pursuant to Section 4 of the Environmental Planning and Assessment Act 1979 (NSW), give to the principles of ecologically sustainable development.

In this case, the applicant appealed to the Court in respect of a refusal of an application made by the local council to subdivide land owned by the applicant into 48 lots. The applicant’s intention was to use the lots for industrial land and storage upon approval of the application, however, the land was found to home a threatened ecological community and further a threatened species of plant.

When considering the concept of the precautionary principle at 110, McClellan CJ referred to Talbot J’s views in Nicholls v Director-General of National Parks and Wildlife & Ors (1994) 84 LGERA 397, whereby Talbot J was “apprehensive about the role of the precautionary principle in environmental decisions…describing it as being “framed appropriately for the purpose of a political aspiration.’

The Precautionary Principle has been defined in, amongst others, section 6(2) (a) of the Protection of the Environment

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Administration Act 1991 (NSW). The act provides the following:“If there are threats of serious or irreversible environmental damage, lack of full scientific certainty should not be used as a reason for postponing measures to prevent environmental degradation.”

Despite Talbot J’s interpretation, McClellan CJ held at 113 - 114 the following in respect of ecologically sustainable development and its various application in various circumstances: “S 79C(1)(e) of the EP&A obliges the decision maker to have regard to the principles of ecologically sustainable development in cases where issues relevant to those principles arise. This will have the consequence that, amongst other matters, consideration must be given to matters of inter-generational equity, conservation of biological diversity and ecological integrity.

Furthermore, where there is a lack of scientific certainty, the precautionary principle must be utilised. … this will mean that the decision-maker must approach the matter with caution but will also require the decision-maker to avoid, where practicable, serious or irreversible damage to the environment.

Consideration of these principles does not preclude a decision to approve an application in any cases where the overall benefits of the project outweigh the likely environmental harm. However, care needs to be taken to determine whether appropriate and adequate measures have been incorporated into such a project to confine any likely harm to the environment”.

At the conclusion of the matter, the Court applied to approach as provided

by McClellan CJ. The Court held that the refusal of the development application had been justified when consideration was provided to the possible impacts upon the threatened ecological community and further a threatened species of plant.

The case of Walker v Minister for Planning (27 November 2007) [2007] NSWLEC 741; 157 LGERA 124 reinforced those principles of which were held in BGP Properties and at 67 Biscoe J provided the following: Both the Intergovernmental Agreement and the National Strategy acknowledge that while the Australian Local Government Association endorsed the ESD policy and promised that it would do all within its power to ensure

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“ IT IS CLEAR THAT THE LEGISLATURE AND THE JUDICIARY VALUE THE IMPORTANCE OF SUSTAINABLE DEVELOPMENT AND IS A CONCEPT OF WHICH PLACES OBLIGATIONS UPON THOSE IN THE BUILDING INDUSTRY. ”

compliance, it could not bind local government authorities to observe its terms. Nevertheless, it has been held by this Court that a proper exercise of the powers of local government authorities would mean that they (and the Court on a merits appeal) would apply the ESD policy unless there were cogent reasons to depart from it: BGP Properties Pty Ltd v Lake Macquarie City Council (2004) 138 LGERA 237 at [93] per McClellan CJ

practices are maintained is fundamental in helping to promote sustainability within the building and construction industry.

Legal case notes has been brought to you

by Doyles Construction Lawyers. For further information or if you have any questions in relation to this article please visit www.doylesconstructionlawyers.com or contact doyles@doylesconstructionlawyers. com

As we begin to understand the importance and practicalities of sustainable development within society, it is clear that the legislature and the judiciary value the importance of sustainable development and is a concept of which places obligations upon those in the building industry. The role of the Quantity Surveyor in ensuring sustainable development

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WELLNESS

WELL BUILDING STANDARD WHAT DOES IT MEAN TO A QUANTITY SURVEYOR? JUST WHEN YOU THOUGHT THAT THE PROPERTY INDUSTRY COULDN’T COME UP WITH A NEW BUILDING RATING SYSTEM… WELCOME TO THE WELL BUILDING STANDARD.

PRATIK SHAH, SENIOR SUSTAINABILITY ADVISORP WT PARTNERSHIP

Its creators are quick to say that it is not a rating system but rather a ‘nutrition label’ for buildings and fit-outs. Semantics aside, WELL is certainly the first human health and wellness building standard, and it has been a long time coming. Indeed, it has been informed by over seven years of evidencebased medical and scientific research, and developed by professionals from the prestigious Mayo Clinic and the Cleveland Clinic from America.

WELL’s heavy focus on human health and wellness sets it apart from other environmental rating systems such as Green Star, LEED, Living Building Challenge, etc.

WHY WELL? Human-beings spend a huge amount of their time indoors. It may come as a surprise but 90 per cent of the cost associated with a new building actually relates to occupant costs. WELL focuses on people and health-centric design, consequently delivering savings in personnel costs. WELL innovates and transforms the way humans interact with buildings; providing the opportunity to reposition old building assets and providing healthy returns for the tenants.

What sets WELL apart is the performance verification component, which requires a compulsory on-site testing component as well as an on-going maintenance requirements for each project before a rating is awarded.

Whilst WELL can work as a standalone system, it complements and works seamlessly with Green Star, LEED and Living Building Challenge, to name a few.

International WELL Building Institute

(IWBI) have collaborated and released Crosswalk documents identifying synergies respectively with Green Star, LEED, Living Building Challenge, etc.

This is a clear signal that WELL is seen by other building rating systems as complementary, rather than a competition.

WELL CONCEPTS, FEATURES AND PARTS WELL comprises seven key Concepts (or Categories): Air, Water, Nourishment, Light, Fitness, Comfort and Mind. Each of these Concepts are further broken down into Features, which in turn have Parts.

For a project to achieve a particular Feature, all applicable Parts must be met.

The Concepts of Nourishment, Fitness and Mind differentiates WELL from other green building rating systems.

In Nourishment, WELL limits the presence of unhealthy foods and strives to encourage a better food culture; the Fitness Concept encourages the

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integration of exercise and fitness into everyday life; and the Mind concept addresses the optimisation of cognitive and emotional health through design, technology and treatment strategies.

A good example of these three Concepts at work is WELL’s implication on Fitout: some of the fitout initiatives prohibit trans-fat, a ban on high sugar content drinks, i.e. prohibition on soft drink vending machines, a provision of fruits and vegetables, activity incentives for staff e.g. bicycle or gym subsidy, sit to stand desks (minimum 30%) and higher acoustics (e.g. conference rooms with a maximum noise criteria of NC30).

WELL Features are of two types: Preconditions and Optimisations. The Preconditions are the compulsory Features of the WELL Building Standard.

For all project types, all applicable Preconditions are required in order to achieve any rating. The Optimisation Features are optional enhancements for the project to achieve a higher rating.

WELL FOR...

CORE & SHELL WELL Certification is available for Core and Shell building projects seeking to implement fundamental features into the entire base building for the benefit of future tenants. The Core and Shell project type addresses the building structure, window locations and glazing, building proportions, heating, cooling and ventilation systems, and water quality. This project type also encourages consideration of the site in relation to amenities and opportunities for wellness.

Core and Shell is appropriate for projects in which up to 25 per cent of

the project area is fully controlled by the building owner (i.e. 75 per cent or more of the project space is occupied by one or more tenants). Independent of the portion of the building controlled by the owner, 100 per cent of the building core and shell and all portions of the interior buildout or managed by the project owner are included in the project scope for design and operations.

There are 26 Precondition Features and 28 Optimisation Features for a Core and Shell project type.

25% of the project area is fully controlled by the building owner 75% or more of the project space is occupied by one or more tenants

NEW & EXISTING BUILDINGS Entire buildings present opportunities for implementation of the greatest number of WELL features. This project type applies to new and existing buildings and addresses the full scope of project design and construction, in addition to aspects of building operations. It is relevant for buildings where a minimum of 90 per cent of the total floor area is occupied by the building owner and is operated by the same management (i.e. up to 10 per cent of the building may be occupied by a different tenant or operated by different management). For instance, a large

office building may rent out the ground floor for retail or restaurant purposes; in these cases, the non-office area would not be subject to requirements of the WELL Building Standard or used in area calculations.

When a project achieves all applicable Precondition Features, in accordance with the rating type, a WELL Certified Silver Rating is achieved. A Gold Rating requires the project to achieve at least 40% of the applicable Optimisation Features, and at

least 80% of the Optimisation Features are required for a Platinum Rating.

Certification has a life of 3 years, after which the project must be recertified.

A WELL Certification for a Core and Shell project type does not have an expiry, i.e. it lasts the life of the building. However, for a fitout, or a whole building, the WELL

If the project is pursuing a Green Star rating in addition to a WELL rating, there are a number of Green Star credits that will be satisfied either fully or partially

There are 41 Precondition Features and 59 Optimisation Features for a New and Existing Building project type.

90% of total floor area is occupied by the building owner and is operated by the same management 10% of the building may be occupied by a different tenant or operated by different management

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NEW AND EXISTING INTERIORS Workplace fitout projects that occupy a part of a building, or those that occupy an entire existing building not undergoing major renovation, can pursue WELL for New and Existing Interiors rating. Pursuing a WELL New and Existing Interiors in a WELL Core and Shell certified base building makes the certification for the fitout easier, given that many of the base building initiatives satisfy WELL requirements for the fitout. That said, WELL Certification for tenants is also possible in building that are not WELL Certified.

There are 36 Precondition Features and 62 Optimisation Features for a New and Existing Interior project type.

by respective WELL credits (and vice versa). Green Building Council of Australia (GBCA) and International WELL Building Institute (IWBI) have released a Crosswalk document identifying the synergies between each rating system and how projects can achieve both rating whilst minimising the documentation requirements. If well-managed, the project could achieve both the ratings at a relatively lower cost.

THINGS TO CONSIDER AS A QUANTITY SURVEYOR

Whilst it is possible for a tenant to choose a non-WELL Certified building and pursue WELL Tenancy rating, this can prove to be very challenging. A number of the prerequisites are achieved by simply choosing a WELL Certified building; these include VOC Reduction, Fundamental Water Quality, Electric Glare Control, Thermal Comfort, etc. to name a few. As an estimate, over 50% of the Preconditions are achieved by the tenant, by simply choosing a WELL Core and Shell certified base building.

In addition to the above mentioned, WELL has several pilot versions such as educational facilities, retail spaces, commercial kitchens, restaurants and multi-unit residential buildings. Recently, WELL has announced its availability for all types of projects, through its ‘all projects in’ pathway, which essentially enables all project types to pursue a WELL rating.

The first and the foremost thing to consider is the WELL project typology, i.e. Core and Shell, New and Existing Buildings and New and Existing Interiors.

In particular, the variation in the definition of a Core and Shell building as compared to base building in Australia. The ‘Base Building’ in Australia is more than ‘Core and Shell’ in America. In America, the services in ‘Core and Shell’ buildings are generally terminated at the core. i.e. the net lettable area (NLA) is really a shell – power, lights, communications, mechanical ductwork, etc. do not extend into the NLA and the floor covering and ceiling grid and tiles are not provided.

Therefore, some elements of the ‘New and Existing Building’ typology will cross over to the ‘Core and Shell’ in Australia.

This could have an impact on cost.

There are other cost implications,

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25% of the project area is fully controlled by the building owner 75% or more of the project space is occupied by one or more tenants

which you need to be mindful of, including – Registration fees, Feature implementation costs and Consultant and Contractor costs.

The registration fees are the fees payable to the International WELL Building Institute (IWBI) and comprise registration, certification and performance verification fees. These fees are charged based on the floor area of the project.

Depending upon the target rating, the project could have an uplift in costs for implementing the requirements of WELL Features. Whilst a recent update in WELL promises to minimise the cost impact on the project by up to 50% (and beyond), there will still be some cost uplift (e.g. a fitout project will need to consider the cost of installation of Circadian Lighting, which is not a business-as-usual approach). These costs will vary with the Optimisations pursued by the project as well as the gap between the current

SOCIALS

“WELL INNOVATES AND TRANSFORMS THE WAY HUMANS INTERACT WITH BUILDINGS; PROVIDING THE OPPORTUNITY TO REPOSITION OLD BUILDING ASSETS AND PROVIDING HEALTHY RETURNS FOR THE TENANTS.”

design and the WELL targets.

Lastly, there is an uplift in the consultant costs, which is a result of the additional time and resource required to assist the project with their WELL rating.

Allowance should also be made for WELL Accredited Professional consultancy fees (appointing a WELL AP will award the project 1 Innovation Point). In addition, certain Features in WELL will have an impact on the main contractor’s obligations and site works (e.g. requirement to separately store absorptive materials on site; and, significant amount of air flush-out post completion, etc.), there may be an uplift in the prelims cost by the contractor, which should be considered.

For more information on WELL please visit https://www.wellcertified.com/

ACT SOCIAL: TEN PIN BOWLING

Canberra, ACT 25th May 2017

4th ANNUALUAE – INDOOR CRICKET TOURNAMENT - 2017 Dubai, UAE 26th May 2017

The UAE Division of the International Chapter once again organised a successful Indoor Cricket Tournament for the fourth consecutive year in the UAE on 26th May 2017. The tournament was hosted in the Insportz Indoor Stadium, Dubai, United Arab Emirates.

13 teams participated, viz: Danway, Dubai Properties, Fighters, Hard Hitters, Hiru, Nakheel, Nabi Ezzam Associates, RICS, Rigga Boys Cricket Club, Sinha Cricket Club, SLQS-UAE, X'Treme Boys and AIQS the hosting team.

The Social and Sports Sub-Committee headed by Ajith Kingsley organized the whole event with the support of Committee members of the AIQS-UAE Division.

Rigga Boys won the Trophy, while Hiru and Dubai Properties won the Shield and the Plate respectively.

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NSW CPD: 2017 ECONOMIC OUTLOOK Sydney, NSW 9th March 2017 Harley Dale, Chief Economist Housing Industry Association presented the 2017 Economic Outlook.

This breakfast seminar offered key insights into the forces affecting the Australian economy, with particular focus on the construction industry at large.

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Congratulations, Hugh Parlane, FAIQS, on receiving the NSW AIQS Chapter President’s award for his amazing contribution and overall advocacy of AIQS and the QS profession.

If you have held or attended an AIQS event in your area and want to be featured in the Social Pages please send the event details and photographs to marketing@aiqs.com.au

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BCI

BUILDING COST INDEX THE BUILDING COST INDEX IS PUBLISHED IN THE PRINT VERSION OF THE BUILDING ECONOMIST. IT CONTAINS DATA THAT CAN BE USED AS A PREDICTOR FOR THE ESTIMATED TIMES FOR DESIGN AND CONSTRUCTION AND INCLUDES A SUMMARY OF THE PAST, PRESENT AND ESTIMATED FUTURE CONSTRUCTION COSTS. 46 - JUNE 2017 - THE BUILDING ECONOMIST

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