Big Project ME August 2019

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THE BUSINESS OF CONSTRUCTION

Building on Values

BIG PROJECT ME MEETS WITH ENG HAMAD AL AMERI, TO DISCUSS THE TEN-YEAR JOURNEY OF TROJAN HOLDING

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1

CONTENTS

August 2019

10

20

24

30

42

48

ANALYSIS

FEATURES

INSIGHT

08

24

38

Comments

42

Case study

46

Tenders

48

Progress report

The briefing

Figureheads of construction offer their thoughts on the market forces shaping the industry

12

The big picture

Providing a wrap-up of the biggest local, regional and international construction news stories

16

Market report

20

News analysis

ProTenders predicts that Saudi Arabia will continue to lead the GCC construction sector in Q3 of this year

Angitha Pradeep breaks down Mace’s market view for H1 2019 to analyse how increased oil prices are boosting MENA construction

In profile Eng Hamad Al Ameri

Big Project ME speaks to Eng Hamad Al Ameri, managing director of Trojan Holding, about how the group has remained committed to its core values despite a decade of exponential growth

30

Site visit Palm Tower

Big Project ME visits the Palm Tower, a $326.6m mixed-use project developed

by Nakheel which is set to become the focal point of The Palm Jumeirah

The industry’s brightest minds share their thoughts on a variety of topics and issues impacting the construction industry

ABB explains how it deployed a wireless network to secure DTE Energy’s smart grid infrastructure and applications

Big Project ME, in association with ProTenders, provides the biggest tenders for the month of August 2019

Bahrain’s Edamah reports that 60% of work is complete on Sa’ada West, a mixed-use waterfront project on the Muharraq coast

MEConstructionNews.com | August 2019

2

WELCOME

Introduction

Let’s be honest... we need to talk

T

ransparency and honesty are two universal values that should be considered mandatory in any business environment, yet in the regional construction industry, you’ll often hear professionals lament about a lack of clarity in their dealings. Whether it’s in their contracts or in their day-today operations, all too often organisations and individuals within the construction industry prefer to keep their cards close to their chest and obfuscate their dealings, so long as it suits their own interests.

Doing business this way can never have long-term benefits. It’s to the industry’s credit that it is belatedly realising this and is pushing for change to happen sooner, rather than later.

To this end, it’s good to see that a local, Emirati-owned company is taking the initiative to lead the way. During my talk with Eng Hamad Al Ameri, managing director of Trojan Holding, this was a key

August 2019 | MEConstructionNews.com

point that he kept returning to – with the company celebrating its tenth anniversary this year, he insists that one of the key factors in its success has been a commitment to being above board in all its dealings.

Not only does he hold his employees accountable to this standard, he also ensures that he himself meets it as well, no matter who or what he’s dealing with.

Given the challenges the construction industry is facing in 2019, this sort of attitude should be applauded and welcomed. We are only going to be able to overcome the issues we face if we all work together and talk to each other in an open and honest way, whether we’re a contractor, consultant or client.

Once we start doing that, I’m sure we’ll find that a lot of the obstacles that we encounter presently will soon start to fade away. It will also allow us to work together, for each other, rather than in the silos that we often find ourselves in.

Gavin Davids

GROUP EDITOR gavin.davids@cpitrademedia.com @MECN_Gavin MEConstructionNews me-construction-news

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4

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THE BUSINESS OF CONSTRUCTION

Group MANAGING DIRECTOR Raz Islam raz.islam@cpitrademedia.com EDITORIAL DIRECTOR Vijaya Cherian vijaya.cherian@cpitrademedia.com

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Building on Values

BIG PROJECT ME MEETS WITH ENG HAMAD AL AMERI, TO DISCUSS THE TEN-YEAR JOURNEY OF TROJAN HOLDING ON THE COVER

Big Project ME talks to Eng Hamad Al Ameri about how Trojan Holding has built on its values over the last decade in the UAE construction market

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Photography PHOTOGRAPHER Maksym Poriechkin maksym.poriechkin@cpitrademedia.com

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August 2019 | MEConstructionNews.com

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6

ONLINE

MOST POPULAR

READERS’ COMMENTS

FEATURED

CONSTRUCTION

EXPO 2020 DUBAI MARKS UK BECOMING AN INDEPENDENT TRADING NATION, SAYS MINISTER

‘We have the firepower to build Saudi’s future,’ Red Sea Project chief tells MECN

CONSTRUCTION

Aldar Properties wins multiple AUH contracts

Feature: How the Coca-Cola Arena was delivered ahead of schedule

CONSULTANT

EllisDon wins Canada Pavilion contract for Expo 2020 Dubai

CONSTRUCTION

Al Bawani wins $89m commercial tower project from Asharqia Chamber

CONSULTANT

Saipem wins $3.5bn worth of contracts in Saudi Arabia August 2019 | MEConstructionNews.com

Opinion: It’s time to change AI’s bad rep

I truly hope I am not the only person to read this story (Expo 2020 Dubai marks UK becoming an independent trading nation, says minister) and pick up on the intrinsic ludicrousness of this soundbite from Dr Liam Fox. The UK has been an independent nation since its formation in 1707 (thank you, Google) and even managed to survive its assimilation (ahem) into the EEC and later the European Union. Whether the UK leaves later this year or not, its independent nation status is assured.

What is not a given is whether construction companies – and those on the supply chain – are helped to compete on the world stage. For years, we’ve seen them on the sidelines at trade events in the Middle East while other nations such as France, Italy and Germany have had the full backing of their governments. Expo 2020 Dubai is an opportunity to celebrate UK industry – I hope their government gets behind them with clout rather than churning out a few choice words.

Name withheld by request

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THE BRIEFING

New developments

Dubai real estate market reaches ‘attractive levels of affordability’ in H1 2019

UNITED ARAB EMIRATES

Bayut report finds a perceivable shift in interest towards competitively priced areas for UAE renters August 2019 | MEConstructionNews.com

D

ubai’s real estate market has reached attractive levels of affordability in the first half of 2019, a report from Bayut, a UAE real estate portal, has found. Based on a comparison of prices between H2 2018 and H1 2019, there has been a perceivable shift in interest towards competitively priced areas when it comes to renting, while historically more expensive

areas for investments have become more affordable, the report says.

“As we move into the second half of 2019, the property prices in Dubai continue to be attractive for both tenants and investors,” Bayut says in the report, adding that price trends for H1 2019 reveal that apartments in Dubai have largely witnessed minimal decreases of 4-8% for both sales and renewals. According to the data, Dubai Marina is the most popular

33% increase in

real estate transactions compared to last year

9

Attractive prices Property prices in Dubai continue to be attractive for both tenants and investors in the second half of 2019.

Investment talks Announcements about permanent residency and long-term visas have prompted increased talk about property investment.

area for buying apartments in Dubai.

Prospective tenants turn to Al Nahda as the first choice for renting flats, with Marina a close second. The report adds that the consumer-driven market has created an environment conducive to lucrative property deals, which end users appear to be capitalising on. This is in line with a recent Dubai Land Department report revealing that real estate transactions in Dubai are up 33% compared to the same period last year.

Communities such as Al Nahda, Mirdif, Bur Dubai and International City dominate the rental market, while Palm Jumeirah, Arabian Ranches, Dubai Marina and Downtown take the lead for sales. In terms of ROI, the suburban community of International City is the most attractive, with impressive rental yields of up to 9.7%, said the report. Up-scale communities such as Dubai Marina and Downtown Dubai show price declines over the 8% mark, offering investors a chance to invest in luxury at lucrative rates.

These figures can be credited to numerous launches of upcoming projects in both areas. For apartment rentals, the most significant price decreases are for one-bedroom units in Dubailand and twobedroom flats in Dubai Sports City, at 9.1% and 8.1% respectively.

For villas, the Palm Jumeirah is the most popular among buyers, while Mirdif had the most searches among renters, states the Bayut report.

For villa sales, the only mentionworthy declines that investors should take note of are for certain units in Dubailand and Mudon.

“Most parts of Dubailand, including Mudon, have had a significant number of handovers in the last year, so we can expect prices to fluctuate and go up or down depending on the type of projects being delivered. More luxury deliveries can see prices go up, while reasonably priced units could bring down the overall average of these new communities,” the report adds.

As for rental villas, the largest decreases are seen for units in Umm Suqeim. With regard to ROI, apart from International City, which offers the highest ROI of 9.7% for apartments,

It’s natural for every market to go through fluctuations but if end users capitalise on resources, such as our market trends data, they will be better equipped to make more informed investment decisions” The Springs also offers 6.3% ROI for investors looking to buy villas.

“The first six months of 2019 have been dynamic for the overall Dubai market. Prices have continued to drop in key areas, but there are more discussions concerning property investments in the region as a result of the permanent residency and long-term visa announcements,” says Haider Ali Khan, Bayut CEO, about the new trends in the market.

“Dubai is also a competitive option compared to other cosmopolitan cities such as London, Shanghai, Singapore and Sydney, offering a similar standard of living at a much more affordable price point.

“This trend towards increased investor interest in the region is also reflected in DLD’s recent updates about real estate transactions going up by 33% in 2019, compared to the same period last year. It’s natural for every market to go through fluctuations but if end users capitalise on resources, such as our market trends data, they will be better equipped to make more informed investment decisions.

“Today, consumers can take advantage of the competitive prices available now and enjoy returns as the market becomes more of a seller’s market. There are some really good smart payment plans available in Dubai which are hard to find anywhere else in the world.

That, coupled with the new initiatives launched by the government in the past year, could lead to more expats considering the city as a long-term option, resulting in more investment in Dubai real estate,” he adds.

MEConstructionNews.com | August 2019

10

THE BRIEFING

Vision 2030 causing shift in focus for KSA SAUDI ARABIA

CEO of thyssenkrupp Industrial Solutions says the Kingdom is shifting its focus away from the oil sector and towards a broader industrial strategy

August 2019 | MEConstructionNews.com

V

olker Hellberg, CEO of thyssenkrupp Industrial Solutions – KSA, tells Big Project ME that the company is shifting its focus away from cement towards mining, a strong pillar of the Kingdom’s Vision 2030.

Earlier this year, Saudi Arabia announced its initiative to invest $3.8bn to enhance business opportunities in mineral exploration of gold, zinc, rare earth metals and other minerals.

The Kingdom’s objective to jump start its mining sector is part of a broader industrial strategy aimed at diversifying the economy and attracting private-sector investment.

According to this industrial strategy, Saudi Arabia plans to spend $26bn in 2019 and 2020 as part of the National Industrial Development and Logistics Realisation Programme (NIDLP), part of Vision 2030, which targets 1.6m new

Economic pillar Mining is set to be the third pillar of the Kingdom’s economy, according to Saudi Arabia’s Vision 2030.

$3.8bn investment in exploration of gold, zinc, rare earth metals and other minerals

jobs and private sector investment worth $426bn over the next decade.

“According to Saudi Arabia’s Vision 2030, mining will be the third pillar of the Kingdom’s economy. In the past, one of our biggest business was cement, but due to Vision 2030 and the capacities in the cement market, we have changed our focus to CPT [chemical and process technology] and mining,” says Hellberg in an exclusive interview.

“With regard to the Saudi Arabian market, we have a wide range of machines available, from standard machines to huge machines that we use for phosphate mining, as well as highpressure grinding rolls, with the lowest energy consumption per ton, which helps us focus on the Kingdom’s vision.”

Hellberg adds that while Saudi Arabia is focusing on mining and downstream projects, the trend in the Kingdom is to have a full range of products from the natural resource to the end product,

THE BRIEFING

because of the value it can achieve.

Instead of selling only phosphate ore, why not sell ammonia, he notes.

Out of the four pillars of thyssenkrupp Industrial Solutions, we have a separate section dedicated just for service. With this in mind, we are trying to localise our service sector and support the Kingdom’s needs”

One of the major requirements in the Kingdom at present is service, he says.

“Out of the four pillars of thyssenkrupp Industrial Solutions, we have a separate section dedicated just for service. With this in mind, we are trying to localise our service sector and support the Kingdom’s needs.”

He explains that they are looking at improving the capabilities of the local company by hiring more local talent.

“We are part of the Saudi Training Academy, where we look for firstyear university students who show potential or have special talents. The programme started two to three years back, and this year we have seven students with us for a month. The training we provide them is on the job – inside and outside Saudi Arabia.”

Saudi Arabia’s mining sector employs around 250,000 people, and the Kingdom is one of the world’s top phosphate suppliers.

Investing in people Hellberg says that thyssenkrupp Industrial Solutions will invest more in its people as it intensifies its focus on the Kingdom.

1.6m

new jobs and private sector investment worth $426bn over the next decade

11

“I think one way of improvement is that we have to invest more in people,” Hellberg continues. “Another important aspect is sustainability, not just in terms of natural resources but for machines as well. We collect data from our machines, which enable us to analyse and improve our capabilities and efficiencies of the machines, and we also share this data with the customer to enable him to improve his production and reduce energy consumption.”

Hellberg summarises that the Kingdom is spending more money in developing and enabling its own operations, as part of its long-term vision.

“Our first contract with Saudi Arabia was in 1907, when we delivered two locomotives. Since then we have had a long-term commitment with the Kingdom, and in the future we want to be not only part of the Saudi Arabian economy, but also its community,” he concludes.

MEConstructionNews.com | August 2019

12

THE BIG PICTURE

01 UNITED STATES OF AMERICA

03 SWEDEN

Google breaks ground on $591m data centre in Nevada

NCC wins contract to build 225 apartments in Sweden

Technology giant Google has broken ground on a new $591m data centre in the US state of Nevada. Expected to create new jobs in the area, the investment will help Google to better support its users and Cloud customers in Nevada. The new centre will become part of Google’s worldwide network of data centres.

Planned to be completed in 2020, the new data centre is part of Google’s $13bn expansion in 2019 in data centres and offices across the country, with major expansions in 14 states.

Construction firm NCC has been selected

by Swedish housing company Riksbyggen to build 225 apartments in Berga Park, Linköping in Sweden. Under a contract worth $30m, NCC will construct eight new blocks with a total of 182 rental units and 43 tenant-owner apartments.

The district will include studios, twoand one-bedroom apartments. The apartments will be designed to be durable and easy to maintain. Construction on the project will begin later this year and is expected to be completed in 2022.

02 ARGENTINA

Salini subsidiary wins $211m contract for Argentina water treatment project Fisia Italimpianti of the Salini Impregilo Group has acquired a contract worth $211m to build Lot 2 of the Riachuelo system in Buenos Aires, Argentina, a mega engineering and infrastructure project to reduce pollution in the Riachuelo River. The Group is already involved in Lot 3 of the Riachuelo system.

The system will treat 2,332,800m3 of waste-water a day. The World Bank is providing financial support of $1.2bn for the project, which will be completed by 2022.

04 NORWAY

06 UNITED KINGDOM

Acciona JV wins $725m Norwegian rail contract

Cardiff City Council unveils vision for $1.25bn transportation plan

A joint venture of Implenia and Acciona has been awarded a contract worth $725m to build the Sandbukta – Moss – Såstad (SMS 2A) project, a new railway line through the town of Moss in Norway. Awarded by Norwegian government agency Bane NOR, it includes the construction of a 10.3km twintrack line between Sandbukta and Såstad.

Implenia will take technical lead of the joint venture with a 55% share in the contract, worth $391m. The joint venture will soon begin planning and supplementary basic surveys, while construction work will start in October 2019 and is expected to be completed by May 2025.

August 2019 | MEConstructionNews.com

05 UNITED KINGDOM

McLaren selected as official partner to build UK Pavilion for Expo 2020 Dubai British construction firm McLaren, in partnership with marketing firm Pico, has been selected as the official construction partner by the UK Department of International Trade for the 3,417sqm two-level UK Pavilion for Expo 2020 Dubai. Planned to be built in the Expo’s Opportunity District, the pavilion was designed

by UK artist and designer Es Devlin and will be produced by Avantgarde, a global brand experience agency.

Cardiff City Councillor Huw Thomas has called for a new $1.25bn transportation plan, including a light rail/tram network connecting major population centres and new suburbs in the west to Cardiff Central, to cut congestion and improve air quality in the Welsh capital.

With direct, frequent tram connections to Cardiff Central interchange, the network will help transform the bay and link major new housing sites in northwest Cardiff with the rest of the city, a report stated.

THE BIG PICTURE

13

04 03 05

06

07

08

01

09

08 GERMANY

CyrusOne begins work on new data centre in Frankfurt 07 UNITED KINGDOM

Construction begins on $1.37bn UK culture and education powerhouse London mayor Sadiq Khan has broken ground on the $1.37bn East Bank scheme, touted as the UK’s new powerhouse of culture, education, innovation and growth.

Expected to create more than 1,500 jobs during construction phase and hundreds of apprenticeships, the project is being built at the new University College London (UCL) East and Stratford Waterfront sites at Queen Elizabeth Olympic Park.

Spread across three sites, the East Bank scheme is expected to generate $1.87bn for the local economy.

US real estate investment trust CyrusOne has broken ground on the first phase of its new data centre in Frankfurt, Germany. Said to be the company’s third in the Sossenheim district, the facility will comprise two adjoining four-storey buildings which will deliver 22MW of IT power to 11,500sqm of technical space. The facility will offer customised, secure and resilient data centre solutions to cloud providers, systems integrators and multinational corporations within a key business hub. It is planned to be completed in Q2 of 2020.

09 UGANDA

Turner & Townsend selected for 256 Bella Vista apartments in Uganda UK firm Turner & Townsend has been appointed to provide project management, contract administration and cost management services for the 336 units for the 256 Bella Vista apartments development in Uganda. The firm said that it will deliver its work over a period of three years during the project implementation phase.

The development is part of Pearl Marina, a 389-acre mixed-use development on the Garuga Peninsula on the shores of Lake Victoria near Entebbe.

MEConstructionNews.com | August 2019

14

THE BIG PICTURE

15 11 12

13 16 14 17

10 SOUTH AFRICA

12 SAUDI ARABIA

Enel begins construction on 140MW wind farm in South Africa

World’s largest entertainment city set to open in 2030

Enel Green Power has announced that it has started construction on its 140MW Garob wind farm near the town of Copperton, in South Africa’s Northern Cape province.

Enel’s fifth wind project in the country, it will involve an investment of over $224m.

The Garob wind farm, the Group’s first wind project under construction in the Northern Cape, is in an area fast becoming a renewable energy hub in South Africa due to the growing number of solar and wind farms in the region.

August 2019 | MEConstructionNews.com

11 EGYPT

Construction begins on Phase One of $4.5bn New Alamein City in Egypt Construction work has begun on Phase One of the $4.5bn New Alamein City.

The project is taking shape on the north coast of Egypt and will spread over 202m sqm. 15 towers are being built as part of Phase One of the project, while Phase Two will comprise 10 towers.

Earlier, City Edge Developments launched two projects – Mazarine and The Gate – in New Alamein City, which is expected to house over 3m people by the end of the initial development.

The Qiddiya Investment Company (QIC) has unveiled the master plan for what is set to become the world’s largest entertainment city by 2030. The plan was created in conjunction with Danish firm Bjarke Ingles Group (BIG).

Located 45km from Saudi Arabian capital Riyadh, the 334sqkm area will be an integrated destination for sports, entertainment and the arts. Its 2022 opening phase will feature Six Flags Qiddiya.

The project has been divided into five development nodes.

THE BIG PICTURE

15

14 OMAN

Omani construction contract awards to reach $12.3bn in Q3 2019 13 UNITED ARAB EMIRATES

EWEC issues tender for 2,000MW solar power project in Abu Dhabi Emirates Water and Electricity Company (EWEC) has issued a tender for the construction and development of a new 2,000MW solar photovoltaic (PV) power project in Al Dhafra, Abu Dhabi.

The 20sqkm project site will provide double the capacity of the current largest operational solar PV plant in the world.

Scheduled to start operations in Q1 of 2022, EWEC said it will take Abu Dhabi’s solar capacity to 3,200 MW with the new plant, and that successful bidders will hold a 40% equity participation in the project.

Oman’s construction market is expected to be active in the coming years and currently has $327.63bn of projects, though 27% remain on hold, a ProTenders analysis has said. The sultanate is currently focused on the implementation and completion of strategic projects such as the Al Sharqiyah Expressway, hospitals in Salalah, Khasab and Suwaiq, and new hotels.

Building master-planned projects like the $4bn Sino Oman Industrial City is also proving to be a good developmental plan, it added.

15 PAKISTAN

Mott MacDonald wins role on 1.4GW hydropower project in Pakistan Mott MacDonald has been selected as lead consultant for the 1,410MW Tarbela 5th Extension hydropower project, for Pakistan’s Water and Power Development Authority.

The project involves the construction of a new hydropower plant featuring three generating units. It also includes the construction of a new transmission line and a floating solar pilot project.

Planned to be commissioned in 2021, the project will have an annual power generation capacity of 1,810GWh.

17 CAMBODIA

Water treatment plant breaks ground in Kampot, Cambodia 16 INDIA

L&T bags EPC contract for 1.3GW Buxar thermal power project in Bihar, India 18

Larsen & Toubro’s (L&T) Power business has been awarded an engineering, procurement and construction (EPC) contract by India’s SJVN Thermal for two 660MW ultra-supercritical power plants in Buxar district in the Indian state of Bihar.

L&T will be responsible for the design, engineering, manufacture, procurement, supply, construction, erection, testing and commissioning of the 1.32GW Buxar thermal power project, on a turnkey basis, the company said in a statement.

The construction of a $10m water treatment plant in the Kampot province of Cambodia has begun. The facility, which will be able to supply up to 20,000m3 of water per day, will be operational before the year ends. The plant will also supply water to neighbouring Kep Province.

According to the Ministry of Industry and Handicrafts, the demand for water is about 310m per day, compared to only 170m3 five years ago. The government has said that it aims to provide access to clean water to everyone in the country by 2025.

18 NEW ZEALAND

Advance consortium selected for $407m New Zealand highway project The New Zealand Transport Agency has selected Advance consortium, comprising Fulton Hogan, HEB Construction, Aurecon and WSP-Opus, as the preferred alliance to deliver the $407m Te Ahu a Turanga: Manawatū Tararua Highway Project.

Advance consortium will become part of the interim project alliance, with an intention to proceed with the delivery of the design, regional consenting and construction of the project. Enabling works for the new route will commence in September 2019.

MEConstructionNews.com | August 2019

16

MARKET REPORT

Industry outlook

Saudi Arabia Q3 Construction Market Forecast

SAUDI ARABIA

ProTenders analysis finds that Kingdom will continue to lead GCC construction market with a strong pipeline of urban projects August 2019 | MEConstructionNews.com

F

or Q3 2019, Saudi Arabia will continue to lead the GCC construction market with a strong pipeline of urban projects worth over $1 trillion. Based on a recent survey by the General Authority of Statistics in Riyadh, the economy saw a slight growth by 1.6% in the first quarter of 2019, as compared to 1.3% in the same period last year. The rapid increase of projects in the kingdom will open opportunities for various jobs, from engineering to workforce and more, in the construction market.

This year, Saudi Arabia is heavily investing in urban and infrastructural projects to stimulate the economy and reduce its reliance on oil. According to ProTenders analysis, Saudi Bin Ladin Group ranks top among contractors with projects valued at $19bn, followed by Larsen & Toubro with projects worth $18.4bn.

The Kingdom’s contractor awards across the urban, infrastructure and oil & gas sectors are forecast to be $28bn for the rest of the year. The urban sector is expected to register the highest contractor awards at $11.6bn, followed by oil & gas at $9bn.

MARKET REPORT

VALUE OF PROJECTS

BY STATUS ($BN)

ONGOING PROJECTS

BY SECTOR ($BN) Planning

494.6

Infrastructure

1952.9 Total Under Construction

1156.2

UPCOMING PROJECTS

BY SECTOR ($BN)

Urban Buildings

210.3

17

Infrastructure

806.8

Urban Buildings

486.7

216.4

1156.2 Total

796.7 Total

Oil & Gas

Oil & Gas

Design

169.1

Tender

132.9

139.2

93.6

Saudi Bin Ladin Group ranks top among contractors with projects valued at $19bn, followed by Larsen & Toubro with projects worth $18.4bn�

20

20

4

10 Hanwha Engineering & Construction

Zuhair Fayez Partnership Consultants

8

Dar Al Handasah Consultants

40

Saipem S.p.A.

30

Daewoo Engineering & Construction Company

12

Larsen & Toubro

60

Saudi Bin Ladin Group

40

Saudi Arabia Ministry of Housing

16

High Commission for the Development of Arriyadh

80

Saudi Electricity Company

50

King Abdullah City of Renewable Energy

20

Saudi Aramco

100

Omrania & Associates

TOP 5 CONSULTANTS

BY VALUE ($BN)

Egis Rail

TOP 5 CONTRACTORS

BY VALUE ($BN)

Saudi Consolidated Engineering Company

TOP 5 DEVELOPERS

BY VALUE ($BN)

CONSTRUCTION CONTRACT AWARD FORECAST Q3-Q4 2019 ($BN) Urban Buildings

12.0 Oil & Gas

Infrastructure

14

12

10

8

6

4

7.0 2

Source: ProTenders

9.0

MEConstructionNews.com | August 2019

20

ANALYSIS

MENA outlook

Making headway MIDDLE EAST & NORTH AFRICA

Mace’s market view for H1 2019 analyses how increasing oil prices are strengthening the outlook for the construction sector across the MENA region August 2019 | MEConstructionNews.com

T

he MENA region is currently expanding at a moderate pace, with a significant construction project pipeline and sizeable schemes working their way through design and planning, according to a new report released by Mace, an international consultancy firm.

According to its MENA H1 2019 Market View, economic growth in the region is predicted to accelerate from 1.5% in 2019 to 3.2% in 2020, fuelled by a strong outlook for oil prices. Meanwhile, GDP growth is expected to climb to 3.2% in 2020 after being relatively low at 1.5% in 2019, despite the varying prospects of individual MENA nations.

However, a healthy project pipeline doesn’t necessarily mean a buoyant construction sector, due to the region’s predicament with rising public debt and asset price weakness in the commercial and residential sectors, the report affirms. Additionally, new projects are generally slower to commence than originally planned, with certain regions experiencing this more than others.

The report highlights that in spite of a slowdown in the pace of global economic growth, oil supply has tightened due to factors such as US sanctions on Iran and Venezuela, escalating tensions in Libya and OPEC’s decision to reduce production to a four-year low.

ANALYSIS

Oil-producing nations are striving to broaden their economic base, but oil revenue still makes a significant contribution to economic activity across MENA nations.

With oil prices recently exceeding $70 per barrel, the outlook for public sector finances has improved significantly”

5.7% The pace of growth in construction activity across MENA is forecast to slow to 5.7% by 2020

“With oil prices recently exceeding $70 per barrel, the outlook for public sector finances has improved significantly,” says Mark Taylor, MENA regional director at Mace. He explains that despite oil-producing nations striving to broaden their economic base, oil revenues still make a significant contribution to economic activity across the MENA nations: “If this boosts public sector project delivery, there is a risk that available capacity – depleted during the recent downturn – will be swiftly absorbed.”

Regardless of this potential for growth, the report notes that the volatility of oil prices creates uncertainty around projections.

In the UAE, where the oil sector

accounts for about a third of GDP, the economy grew by an estimated 1.7% in 2018, which is forecast to accelerate to 2.8% in 2019 and 3.3% in 2020, supported by an expansionary fiscal policy, according to the International Monetary Fund (IMF).

In addition, construction activity increased by 6.6% in 2018, as work progressed on projects ahead of Expo 2020 in Dubai.

Transport infrastructure has been a key growth area, and impetus from these projects is expected to drive a further year of 6% growth in construction activity in 2019 across the country.

Meanwhile, in Saudi Arabia, Vision 2030 will drive industry growth over

21

the coming years, the report states, but the speed at which the privatisation programme is delivered will influence the outlook. BMI forecasts a steady acceleration in construction sector growth over the coming years, predicted to hit 5.5% in 2019 and 7.8% in 2020, after climbing by 4.1% in 2018.

However, Mace also cites other data specialists who estimate that project awards fell by around $5bn to $21.7bn in 2018 as the government’s attention turned to reducing debt, which may make BMI’s growth projection for 2019 difficult to achieve.

The case in Oman is similar – with the government’s focus firmly on debt reduction, the near-term outlook for construction is subdued. Over the medium term, the project pipeline is expected to increase, providing a boost to the construction sector. Mace’s report says Oman’s construction sector grew by an estimated 10.4% in 2018, according to BMI, and that the pace of growth is set to accelerate to 11.5% in 2019 and 12.1% in 2020.

Projects with a total value of $177bn are planned or underway in Oman, says MEED Projects, which states that the country has planned a healthy pipeline of projects designed to support its aims for diversification away from oil.

In Saudi Arabia, the Public Investment Fund, the country’s sovereign wealth fund, manages assets with a combined value of $250bn, backing some of the country’s largest projects, the $500bn NEOM economic mega zone and the Red Sea Project.

However, Mace’s report says that even though construction costs are generally rising across the country, project-specific factors will have a bearing on the rate of increase.

“Construction cycles across MENA’s primary markets are at different stages of maturity, and procurement strategy needs to recognise this in order to secure the most economically advantageous tender prices while still being sufficient to deliver projects on budget,” confirms Paul Donaghy, head of Cost Consultancy, MENA at Mace.

“In aggressively competitive markets, the lowest tender price may not deliver the lowest out-turn MEConstructionNews.com | August 2019

22

ANALYSIS

GDP GROWTH (REAL GROWTH, % CHANGE) 2018

2019

CONSTRUCTION GROWTH (REAL GROWTH, % CHANGE)

2020

2018

6.0

12.0

5.0

10.0

4.0

8.0

3.0

6.0

2.0

4.0

1.0

2.0

MENA

UAE

Saudi Arabia

cost, so it’s important to take a balanced approach to assessment.”

Egypt’s economy is forecast to expand at a relatively rapid rate over the next two years, according to the IMF, beating the 2018 rate of 5.3% in both 2019 and 2020, driven by sustained growth in natural gas production and a recovery in tourism.

The report says delivering an ambitious renewable energy programme is a priority for the government. BMI offers a strong outlook for the construction sector as well. After climbing by 7.5% in 2018, output is forecast to rise by 10.8% in 2019 and 9.7% in 2020, as power, infrastructure and industrial projects build up a head of

August 2019 | MEConstructionNews.com

Oman

3.2% GDP

growth will be relatively weak at 1.5% in 2019, before strengthening to 3.2% in 2020

Egypt

MENA

UAE

steam. Meanwhile, schemes currently working their way through planning have an estimated value of $247bn.

Although performance in 2019 has been subdued, figures remain promising and many of the MENA nations have ambitious strategies in place to promote private sector investment and enhance existing infrastructure. Against this backdrop, a positive forecast is boosting the overall economic confidence and helping to lay the foundations for a solid performance in the construction sector, despite BMI’s prediction that the construction sector across MENA will slow from 6.4% in 2018 to 5.9% in 2019 and 5.7% in 2020.

2019

Saudi Arabia

2020

Oman

Egypt

Egypt is forecast to record the strongest economic growth in the MENA region, with GDP predicted to grow by 11.4% in 2020.

Through to 2020, construction output growth in Egypt and Oman is also expected to exceed 20%”

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24

IN PROFILE

Eng Hamad Al Ameri

Building on Values

BIG PROJECT ME SPEAKS TO ENG HAMAD AL AMERI, MANAGING DIRECTOR OF TROJAN HOLDING, ABOUT HOW THE ABU DHABI CONSTRUCTION GROUP HAS SPENT THE LAST DECADE BUILDING ITSELF UP, BASED ON THE RIGHT VALUES

August 2019 | MEConstructionNews.com

25

MEConstructionNews.com | August 2019

26

IN PROFILE

en years seems like a long time in terms of a human lifespan – one goes from a child to an adult in a decade, while around us things can change quite drastically. A decade ago, in 2009, the world was a very different place – Barack Obama was the first African American US president, Avatar was set to become the biggest movie in history, and the world’s economies were still reeling from the effects of the global financial crisis.

However, for a company, ten years is nothing more than the blink of an eye, especially in a setting as dynamic and shifting as the UAE construction market.

In order to survive such an environment, it’s essential for a company to be proactive, adaptable and adhere to a core set of values that guide its course.

I don’t just appreciate one, I appreciate the whole team. I always work with teams.

Trojan, in general, is a big family. This is what I depend on – everybody cares for the other, regardless if it’s his or her job or not” August 2019 | MEConstructionNews.com

This is what Eng Hamad Al Ameri, managing director of Trojan Holding, tells Big Project ME during an interview that celebrates the company’s tenth anniversary. Having launched the company when the local construction landscape was at its lowest ebb, the challenge for him has always been about making sure that Trojan Holding and its subsidiaries stick to the values he espouses.

“The whole idea was to found a company that is really honest, that wants to just do the right thing. I was a government employee at the time who had nothing to do with business, but the need at the time was for someone honest and transparent,” he asserts, speaking in his office at the company’s headquarters in Mafraq Industrial Area, Abu Dhabi.

Having started the group with Trojan General Contracting in 2009, Ameri has overseen its growth into a major player in the UAE construction industry, with eight subsidiaries under its umbrella.

These include National Projects and Construction LLC (NPC), Royal Advance Electromechanical Works.

Reem Emirates Aluminium & Glass Factory, Hi-Tech Concrete Products, Al Maha Modular Industries, Phoenix Timber Factory and Reem Readymix.

“We started Trojan to see what the market reaction was, and it was great. People appreciated the close contact between the leadership of the

High-profile projects Over the last decade, Trojan’s subsidiaries have been involved in a number of highprofile projects.

25,000 Total number of employees across the group

companies and the customers, the fast action and the transparency. Problems and mistakes happen, regardless of all parties, but at the time we had an aim and a goal that we wanted to be honest and transparent so that we could get the best quality on time, and with the right value for our clients,” he says.

“Price is not the only thing that matters. The history of companies tells you about their capabilities.

There are a lot of newcomers, and others going out fast as well [in this industry]. You have to be careful. Not everybody can do what they present.

Our market is so open, everybody can work in it. You can come from anywhere, start your company and begin work directly. It always has to depend on how much your company has done, to see how much it can do in the future. More than presentations, or the technical capabilities of the people who present them, financial statements are one of the most important things for companies. I have learned that we have to look at financial statements more and more [closely].

“We created our own subsidiaries because we didn’t want to be let down again and again by companies when they have problems. That’s why we’ve created subsidiaries who work in construction, only to support us,” Ameri says, providing an illustrative insight into his philosophy and vision for the company.

IN PROFILE

27

The history of companies tells you about their capabilities.

There are a lot of newcomers, and others going out fast as well [in this industry]. You have to be careful. Not everybody can do what they present” Having been the first employee, Ameri has seen his staff grow to more than 25,000 employees across the group over the last decade.

Despite the huge number of people working under him, he insists that he views everyone in the company as part of one big family, with systems in place across the board to keep everyone on the right track.

“We created our own processes and procedures which keep everyone on track, on the right career path, in the right positions, with the right communication with the right parties.

When I started this company, I began by choosing people who were going

$354m

Total contract value of the Water’s Edge project

Core values No matter the size or scale of the project, Ameri insists that the company keep to its core values of honesty and transparency.

to be focal points, the cornerstones [of the company]. Thanks to God, I have chosen correctly, and I have been successful and lucky with a lot of them.

“I don’t just appreciate one, I appreciate the whole team. I always work with teams. Trojan, in general, is a big family. This is what I depend on – everybody cares for the other, regardless if it’s his or her job or not. I think that’s what has kept us strong.”

As part of the company’s culture, Ameri explains that there is an opendoor policy in place throughout the organisation, with all employees free to share their ideas or communicate their problems to management,

whether to him directly or to other senior figures. This approach also extends to how clients are treated, he says. “I communicate with clients myself. Even if the clients are communicating with the managers, they can come to me as well. It’s open communication for everybody, with no problems. If you have an idea, put it forward. We have systems in place for suggestions, regardless if they are workers, helpers or even the GMs. It’s all going to be evaluated, looked at and responded to with open communication. This is what we do.”

As part of his efforts to foster a collaborative culture throughout the

Trojan’s largest projects to date WATER’S EDGE Located in Yas Island, Abu Dhabi with a total contract value of $353.9 million EMIRATI HOUSING DEVELOPMENT 3,000 villas in Jebel Hafeet, Al Ain (contract value not shared) EMIRATI HOUSING DEVELOPMENT 2,000 villas in Ain Al Faydha, Al Ain (contract value not shared) THE PALM TOWER Located in Palm Jumeirah Island, Dubai with a total contract value of $222.9 million MEConstructionNews.com | August 2019

28

IN PROFILE

I hope that one day people are going to say that this company has been built on a very strong base, with a really loyal team that has built up the company and represented the industry and the UAE all over the world” organisation, Ameri says that Trojan’s management is looking to implement systems that will allow them to evaluate operations and productivity through tangible measures and numbers.

“We put in place measurable KPIs for every position in this organisation, and the system shows us every month what the results are. Without technology, we wouldn’t have all the reports needed to evaluate people, to evaluate jobs and to do all the things that need to be done,” he explains, adding that the considerable investment into a wide range of technology – from robotics to software, new manufacturing materials and new techniques and methodologies

August 2019 | MEConstructionNews.com

– has all been done with an emphasis on improving performance and efficiencies.

In 2018, Ameri told Big Project ME that he was keen for Trojan to expand into new territories and sectors, having successfully established itself as a major player in the UAE construction market. Having mentioned that Saudi Arabia was a major market for the company, he now provides updates on progress in the Kingdom.

“We started in Saudi Arabia with one of our subsidiaries – Hi-Tech Concrete Products, which delivers complete precast solutions and projects. We have got a project already and work has started. Recently, one of our other

2020

Trojan is targeting Saudi Arabia in 2020

Open market The UAE’s open and competitive market has prepared Trojan for any challenge it may encounter abroad.

subsidiaries – Reem Emirates Glass & Aluminium Factory – has got two projects in KSA as well. So I think that it’s time for Trojan to jump in. We are targeting that market in 2020.”

He adds that the company is keeping its eye open for other potential markets as well – such as Belarus, where Trojan Holding has registered and set up shop with the target of going fully operational by the end of this year, or early next year.

Even though he is keen to take Trojan Holding to a truly international level, Ameri asserts that the company will not be deviating from the values and principles that have served it so well over the last decade.

“I’ll tell you something. I believe that what works in the UAE can work anywhere, because it’s such an open market and we face a lot of challenges.

A lot of countries haven’t reached that level of systematic process yet. We know how things can run, from an asystematic system to a systematic system.

“The second thing is that when we expand, we depend on UAE investors who are investing all over the world. We know them, having worked with them in the UAE, so we can go and support them there. We have the chemistry between us, and we can go together and invest and work together. From there, we can then expand into that country.

“Or with a new country like Saudi Arabia, for example, we start by putting our subsidiaries first.

If that is successful, then we can go in ourselves and start investing in there,” he explains, adding that this process ensures that the transparency and honesty that he so values continue to be maintained.

“I hope that one day people are going to say that this company has been built on a very strong base, with a really loyal team that has built up the company and represented the industry and the UAE all over the world, with the right image that everybody can see. I hope that we have built the right basis for this company to continue in the future, with the right values of transparency and fairness to everybody who works in this organisation and who work with it,” he concludes.

29

Trojan Holding: Key milestones 2000: Al Maha Modular Industries opens its doors and commences operations in Abu Dhabi.

Downtown is completed, the company’s first high-rise tower in Abu Dhabi and a sign of things to come.

2003: NPC launches in the UAE market and begins construction on its first project.

2009: TGC launches in the UAE market and begins construction on its first project.

2004: Both Royal Advance Electromechanical Works and Phoenix Timber Factory open in Abu Dhabi, ensuring the future of reliable MEP and joinery works for the emirate.

2006: Reem Emirates Glass and Aluminium Factory and Hitech Concrete and Blockworks Factory are founded. This ushers in a new age for quality products in Abu Dhabi.

2007: The 30 MGD SWRO plant is completed, showing both local and international markets NPC’s incredible capacity for development.

2008: The 23-floor Vision

large-scale developments.

2012: Trojan Holding is created with the mission to consolidate the strengths of the various companies and bring them under the guidance of one holding company.

2014: Nation Towers is completed and becomes the jewel in the Trojan Holding crown.

2019: 2019 will see the completion of the enormous villa development at Jebel Hafeet.

2011: A new standard of luxury living is introduced in Abu Dhabi with the launch of Highland Resort Villas. The project immediately becomes the benchmark for other

2013: The multi-purpose Marina Square development is finished on Reem Island and launched in the market, becoming an instant and massive sales success story.

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MEConstructionNews.com | August 2019

30

August 2019 | MEConstructionNews.com

SITE VISIT

31

Palm Tower DEVELOPER: Nakheel MAIN CONTRACTOR: Trojan General Contracting LLC CONSULTANT: RSP Architects, Planners & Engineers (PTE) Ltd TOTAL PROJECT VALUE: $326.6m TOTAL BUILT-UP AREA (TOWER): 109,808sqm OPENING DATE: 2020

Heart of the Palm

BIG PROJECT ME VISITS NAKHEEL’S PALM TOWER, A $326.6M MIXED-USE DEVELOPMENT THAT WILL BECOME THE FOCAL POINT FOR THE PALM JUMEIRAH MEConstructionNews.com | August 2019

32

SITE VISIT

Palm Tower: Project Stakeholders

DEVELOPER: Nakheel isitors and travellers to Dubai often make a beeline to the Palm Jumeirah, home to some of the city’s finest and most extravagant hotels, including the world-famous Atlantis The Palm Hotel and other internationally recognised hospitality giants. Guests can enjoy their breaks in luxury and style, indulging themselves in the best Dubai has to offer. In addition to the plethora of hotels on the Palm, there are several nightspots and restaurants, making it an attractive destination for both residents and visitors.

However, while the Palm has seen several developments launched along the Crescent and on its fronds, the main trunk of the mega development has only seen major developments in recent years, spurred on by master developer Nakheel launching several high-profile projects along its length.

These include The Pointe, Nakheel Mall

August 2019 | MEConstructionNews.com

CONSULTANT: RSP Architects, Planners & Engineers (PTE) Ltd MAIN CONTRACTOR: Trojan General Contracting LLC

and the eye-catching Palm Tower, a 52-storey hotel and residential complex that will, along with Nakheel Mall, soon become the hub for the Palm Jumeirah.

Situated at the centre of the trunk, the project was visited by Big Project ME in the wake of a recent announcement by the developer that construction is nearing completion.

Comprising 432 luxury residences and a five-star 290-room hotel with a range of dining and leisure facilities, the project is set to become a magnet for both residents and tours.

Among the attractions are a rooftop infinity pool, restaurant and viewing deck, the developer says. Luxury hotel

Central hub The 52-storey Palm Tower will connect to Nakheel Mall and will have access points to several key attractions on the Palm Jumeirah.

240M total height of Palm Tower

MEP WORKS: National Projects and Construction LLC INTERIOR DESIGN FOR HOTEL ROOMS: Romeo Interior Factory LLC INTERIOR DESIGN FOR PUBLIC AREAS: Bond Interiors INTERIOR DESIGN FOR APARTMENTS: STC OMAN LLC AV/IT/SECURITY: Honeywell International Middle East Ltd HOTEL KITCHEN AND LAUNDRY: Chef First Equipment Trading LLC ALUMINIUM FAÇADE WORKS: Reem Emirates Aluminium

33

St Regis Dubai – The Palm will occupy the first 18 floors of the building, and the Palm Tower residences will comprise fully furnished studio apartments along with one-, two- and three-bedroom apartments that will offer views of the Palm Jumeirah, the Arabian Gulf and the Dubai skyline.

Furthermore, the tower will have direct access to Nakheel Mall, also currently under construction and scheduled to be opened shortly. It will also offer direct access – via bridges and walkways – to Palm Jumeirah’s beach clubs, including Nakheel’s own Club Vista Mare and Palm West Beach projects.

View from the top The top of the tower will feature an observatory that will offer 360-degree views of the Palm Jumeirah and the Dubai skyline.

1,500 total workers currently on-site

According to the developer, structural work on the tower and the rooftop swimming pool has been completed.

Perched 210m above the ground and covering 775sqm, the infinity pool on the 50th floor of the Palm Tower will be one of the highest in the world, holding 930,000 litres of water. It will border four sides of the building and feature panoramic views across the Palm Jumeirah and the Arabian Gulf.

Above the pool will be a podium housing a speciality restaurant on the 51st floor, while the 52nd floor will house a 240m-high public viewing deck. Named the View at the Palm, the observation deck sits on top of the tower

and will be accessible from Nakheel Mall. It will feature an interactive museum which the developer says will tell the story behind the making of the man-made island, as well as a VIP lounge and areas for private events, and will have its own elevator access.

Designed by Gensler, the steel structure for the observation deck is currently being constructed. A fit-out contract for the project has been awarded and construction is expected to be completed this year.

For the tower, which has a total project value of $326.6m, glass façade work is currently in progress, with approximately 60% completed. Internal

The Palm Tower is a lifestyle project and that is what Dubai wants today; the views are naturally going to be waterfront and that is a unique opportunity we have. It’s important to emphasise that this tower is an iconic address” MEConstructionNews.com | August 2019

34

PROJECT PROFILE

fit-out is also underway in public areas, hotel guest rooms, hotel kitchen areas and apartments, Nakheel says. For the residential apartments, fit-out work is scheduled to be completed by 2020.

However, despite the progress made to date, the Palm Tower has presented Nakheel and its main contractor, Trojan General Contracting, with several challenges during the construction process, the developer points out.

“Constructing a 240m tower in an area with limited space [is a challenge].

There are also large numbers of workers on-site – currently 1,500 – who are working in a high-rise environment and are close to a road where there

We also ensured that residents and other stakeholders were kept informed of the project’s progress and of any inconveniences – such as temporary road diversions – during the construction process” August 2019 | MEConstructionNews.com

is constant traffic. Furthermore, there are currently two tower cranes in operation on the project; at the peak of construction, there were three tower cranes being used.

“Windy conditions caused by The Palm’s seafront location meant that there can be big challenges when it comes to lifting materials. Careful considerations have to be given to the crane angles,” the developer says, highlighting some of the major issues the project team faces. “[In order to mitigate the dangers of working at height], edge protection and security nets on all floors have been installed to prevent the potential challenge of falling objects,” it continues.

Safety requirements Trojan General Contracting set out specific safety requirements for the project, and had five safety advisors on hand at all times.

1,100 tonnes of steel in roof structure

In addition, Nakheel says the health and safety team from Trojan General Contracting has a strong presence on-site, with five safety advisors on hand to ensure that all protocols and procedures are followed closely.

“There are specific safety requirements set out by Trakhees for high-rise buildings. These are all being followed on this project. There are also specific health and safety procedures in place for all visitors and workers on the site. Since construction began, there have been zero lost-time injuries,” the developer asserts, adding that there are strong procedures in place to monitor noise levels and waste removal.

SITE VISIT

Palm Tower: Project Statistics

TOTAL PROJECT VALUE: $326.6m TOTAL BUA OF THE TOWER: 109,808sqm TOTAL AMOUNT OF CONCRETE POURED: 60,000m3 STEEL REINFORCEMENT: 12,000t STEEL IN ROOF STRUCTURE: 1,100t GLASS FAÇADE: 45,000sqm with 2,000t of glass ROOFTOP POOL AREA: 775sqm WATER IN ROOFTOP INFINITY POOL: 930,000l CONCRETE: 77,600m3 LUXURY RESIDENCES: 432 VIEWS FROM ROOFTOP INFINITY POOL: 360-degree SHOPS IN NAKHEEL MALL, DIRECTLY CONNECTED TO THE PALM TOWER: 350

Given that the project is in such a congested area, another major focus for the project team was ensuring minimal disruption to residents and businesses. To this end, Nakheel says it was keen to work with all stakeholders.

“As with all of our projects, processes are in place to ensure that coordination between contractors and authorities is as effective as possible. We utilised the latest technology approved by the relevant Dubai authorities in the construction of the Palm Tower [to ensure the efficiency and pace of operations].

“We also ensured that residents and other stakeholders were kept informed of the project’s progress and of any inconveniences – such as temporary road diversions – during the construction process. Night shift work has also been minimised and limited to cleaning and housekeeping, so as not to disturb the surrounding properties and areas,” it adds.

With anticipation for the project growing, Nakheel is keen to emphasise the impact the project is predicted to have on not just the Palm Jumeirah but on Dubai as a whole, with Aqil Kazim, chief commercial officer at Nakheel, highlighting that the project is a reflection of what the market desires.

“The Palm Tower is a lifestyle project and that is what Dubai wants today; the views are naturally going to be waterfront and that is a unique

Keeping quiet Nakheel says night work on the tower was limited to cleaning and housekeeping, so as not to disturb the surrounding properties and areas.

432 luxury

residences in Palm Tower

35

opportunity we have. It’s important to emphasise that this tower is an iconic address on the island, with a five-star hotel, residential apartments, access to the $330m Nakheel Mall and the beach, all connected by the Palm Monorail,” he says, adding that access to the tower and mall is from multiple points.

“There are also five vehicle accesses and three pedestrian entrances, separate to the monorail which is itself connected to the Dubai Tram, which in turn is linked to the Dubai Metro,” he concludes, emphasising the scale of the project and how connected the island is to the rest of Dubai, thus ensuring that it really is the heart of the Palm.

HEIGHT OF TOWER CRANES USED IN CONSTRUCTION: 300m SEATS IN ROOFTOP RESTAURANT: 300 ROOMS AND SUITES IN ST REGIS HOTEL: 289 HEIGHT OF VIEWING DECK AT THE TOP OF THE TOWER: 240m HEIGHT OF ROOFTOP INFINITY POOL: 210m STOREYS HIGH: 52

MEConstructionNews.com | August 2019

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37

ADVERTORIAL

Infrastructure

Peak infrastructure, or new dawn for private sector investment?

MIDDLE EAST

Tim Armsby, partner at Pinsent Masons, examines the landscape for public-private partnerships in the GCC region

T

here has been a lot of discussion in the last couple of years as to whether we have reached a peak in infrastructure spend in certain GCC economies. Certainly, deflated oil prices have until recently had a lag effect in most economies, and in those exposed to real estate, demand has slowed significantly.

Most contractors are faced with increased competition and lower margins in an environment where there is a history of late or non-payment. In traditional procurement projects, we are witnessing increasingly innovative approaches with contractors bringing finance solutions in terms of both debt and equity.

Despite the slowdown in some sectors of the economy, most

Gulf countries are now seeking large-scale investment in all areas of infrastructure. Increasingly they are looking to the private sector, often on a public-private partnership (PPP) basis. While the immediate pipeline is dominated by utility schemes, there are signs that we may be approaching a new era in the use of PPP in the delivery of infrastructure.

Since the relative rebound of oil prices in 2018, many Gulf governments have been pumping funds back into their economies, particularly in the energy, infrastructure and technology sectors. However, budgets are still constrained. Driven by visions for economic and social development, Gulf countries have renewed their interest in PPP, and many are implementing regulatory and legislative frameworks to support these schemes.

If one considers the change over the last five years, the difference is dramatic and difficult to ignore.

Even as recently as 2015, Kuwait was the only country in the GCC with a PPP law (originally issued in 2008 and replaced in 2014).

Notably, Kuwait has struggled to close PPPs and to date only one project has reached commercial operation. Kuwait is now in the process of amending its law to reinvigorate interest and has

new projects under tender or in preparation in the housing, entertainment, power, water and transportation sectors.

In the UAE, Dubai issued a PPP law in 2015 and the first project under that law has already closed (Dubai Courts). In an effort to remobilise private investment in large infrastructure projects, the Department of Finance allocated $272.2m for PPP projects in July 2019. In Abu Dhabi, a PPP law came into force in January 2019.

It aims to bolster foreign direct investment and enhance private

Given recent legislative developments, there are now genuine reasons for optimism”

sector participation in sectors such as education, healthcare, transportation and housing.

The long-awaited Omani PPP law came into force in July 2019, and a programme of projects has been announced. The much-welcomed law will sit alongside a new privatisation law and will encourage rapid progress and investment in various infrastructure projects.

Saudi Arabia published a draft private sector participation (PSP) Law in July 2018, and it is in the final stages of the legislative approval process. Interim legislation has been issued and a National Centre of Privatisation has been established to regulate and enable the Kingdom’s privatisation and PPP programme.

As part of Saudi Arabia’s Vision 2030, it plans to raise $200bn through privatisation efforts, and the PSP law will surely focus on delivering this. Projects in key sectors are already under tender.

The improvements in the regulatory framework across the GCC are a welcome development in terms of bolstering interest in PPP projects and attracting foreign investment into the Gulf. It should be noted that issuance of a PPP law does not necessarily lead to the successful closing of projects, but coupled with other legislative changes, there has never been a time for greater optimism.

MEConstructionNews.com | August 2019

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COMMENT

Industry insight

ANILESH KUMAR LEVTECH CONSULTING

Why Beethoven is an inspiration for construction

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he instantly memorable drama with which Ludwig van Beethoven’s 5th Symphony announces itself to the listener transcends time. One doesn’t even have to be much of a classical music fanatic to be familiar with that iconic introduction. Sports motivational videos, movie soundtracks and countless more have used the motif as shorthand for ‘this is dramatic’, so deeply is it engraved in public consciousness.

The 5th symphony used doubled winds and brass, which was unprecedented at the time.

It paired flutes, oboes, clarinets, bassoons, horns and trumpets, resulting in a much larger orchestra than musicians were accustomed to as a norm. So why did this substantially expanded ensemble not fall apart in a mess of cacophony, despite an unfamiliar format? Meticulously notated sheet music – essentially a few dots and squiggles on a piece of paper, which was the appropriate ‘technology’ of the time – ensured each musician knew the what, when and how of their contribution, and the grand masterpiece was executed flawlessly. Such is the power of being able to bring all individual components and elements together in one unified endeavour.

The complex intricacies that make up a construction project have always been an obvious candidate for the influence of technology. Once a laggard in adopting enabling digital platforms, the construction industry is now making up for lost time in dramatic fashion. As we enter an age of unparalleled high-value mega projects – to rebuild developed nations and rapidly ramp up infrastructure in developing ones – 5D BIM is taking centre stage as the definitive technique to solve the biggest challenges in any project.

August 2019 | MEConstructionNews.com

Smart cities, digital transformation and cognitive technologies are coming to the fore, empowering enablers of the world of tomorrow and playing a crucial role in unlocking exponential growth in the construction industry.

Governments in the Middle East are already in the throes of a proactive diversification towards a post-oil economy, and some of this enthusiastic momentum seems to have been harnessed by an emphasis on digital technologies. As one of the region’s most significant industrial sectors after oil & gas, the real estate and construction industry is a prime candidate for the influence of these innovations.

With the Middle East’s emphasis on empowerment through technology gaining ground with each passing day, the region’s dynamic and ambitious construction sector is likely to emerge as a global trendsetter in the digitisation of the industry.

A POTENT NEW SOLUTION APPEARS MTWO, a 5D BIM enterprise cloud solution created by RIB Software SE of Stuttgart, is fast gaining a reputation as an industry-leading platform in addressing the needs of a new, digitally empowered construction sector. A combination of RIB’s flagship product iTWO 4.0 and Microsoft Azure, MTWO delivers a state-of-the-art enterprise solution for the construction industry, unlocking efficiency across various business functions and redefining resource utilisation. The great strength of the MTWO solution stems from its integration with 3D modelling and its complete set of modules providing a unified platform for the construction industry value chain and strong estimation and scheduling modules, thereby providing a comprehensive platform to drive integrated processes and manage enterprise data.

Accessible through an intuitive user interface and compatible with all connected devices, MTWO helps organisations make the leap from big data to smart data. With its enterprise-wide, global-scale multi-project management capability, and its multilanguage, multi-currency capability, MTWO provides a unified platform that is truly comprehensive, integrated and scalable.

In November 2018, MTWO’s AI engine McTWO – dubbed the world’s first artificial intelligence engineer – made its debut at the 6th iTWO World Conference in Guangzhou, China. A significant enhancement to the

original software, it will enable some of the most up-to-date AI and machine learning capabilities for the construction industry, including chatbots to facilitate collaborations between on-site teams, the use of mixed reality for on-site engineering activities, and many other path-breaking industry applications.

SO WHERE IS ALL THIS LEADING US NEXT? Imagine granular detail across subcontractors, suppliers and stakeholders, and the resulting streamlined view compounded by uniform reporting, standardised estimation and process optimisation through a common data platform and integrated business functions. Now add an empowering layer of AI and machine learning, which retains insights from all previous projects and continually refines them to benefit all future ones, in an iterative process that makes the operation smarter with each passing day. What might such an operation be able to achieve? What level of productivity and performance can it reasonably aspire to?

As dramatic as it sounds, this truly is the dawn of an era in which construction ecosystems will redefine their capabilities and powers.

Anilesh Kumar is the CEO of Levtech Consulting.

SUHAIL ARFATH AUTODESK

Delivering more, with less, and better

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he Middle East has been on a building binge for over a decade now, and programmes like Expo 2020 in the UAE and cross-border city Neom in Saudi Arabia have been key drivers. According to recent government data, in 2018 alone 3,566 buildings were constructed in Abu Dhabi, an average of 297.1 per month and 9.7 a day.

COMMENT

Over the last few years the construction industry has witnessed a dramatic increase in technology investments, with a large portion towards digitisation of processes and workflows” To add to this, the long-term visions for each of these countries, such as UAE Vision 2030 and Saudi Vision 2030, promise even more growth, demand and exciting times ahead. The UAE construction market alone is worth over $1 trillion, out of which approximately $400bn worth of projects is currently under construction.

Historically, the construction industry has been focused on reacting to issues, because there hasn’t been an easy way to visualise leading indicators of risk. With the sheer volume of construction projects in size, complexity and tight deadlines over the coming years, teams are constantly challenged to discover ways to innovate to reduce cost, deliver quality on time and minimise risk.

The rising demand and high levels of risk involved in construction projects are not changing; what we can change is how we deal with it to deliver more, with less, and better.

Over the last few years, the construction industry has witnessed a dramatic increase in technology investment, with a large portion going towards digitisation of processes and workflows. Building information modelling (BIM) alone has transformed the way infrastructure assets like buildings, roads, and bridges are planned, designed and constructed.

This digitisation of processes and increased use of mobile devices has triggered an explosion of data, with no easy way to benefit from it. The fact remains, the industry is still extremely high-risk and teams are besieged to make the shift from reactive to proactive to predictive.

In fact, according to FMI, 95% of data captured goes unused in the engineering and construction industry. This is where machine learning and artificial intelligence play a significant role, predicting daily project

risks and bringing them to the attention of the right person at the right time.

With access to this enormous pool of data, machine learning and AI-based applications bring game-changing benefits to construction teams and projects.

Imagine a smart assistant that can analyse this enormous pool of project data and alert you about the top 10 critical things that need your attention today. Machine learning enables that smart assistant, helping teams identify the critical risk factors that need immediate attention from a construction safety and quality perspective.

Using AI, it is possible to automatically assess risk associated with issues. The algorithms can understand and predict complex things, like whether an issue will cause potential water infiltration if not addressed. The system makes use of the observations of quality managers across projects when they monitor their projects.

The good news is that pioneers like BAM Ireland, a large general contractor and civil engineering firm based in Ireland, are leading the way. BAM Ireland began using Autodesk’s machine learning and AI-based applications to capture data and manage construction work on all levels, starting with Museum of the Future in Dubai and seven courthouse projects, under a publicprivate partnership, across Ireland. The software went beyond showing BAM Ireland the existence of mere inconsistencies, also showing why they occurred in the first place.

BAM Ireland achieved a 20% improvement in quality and safety on-site, with the added capacity to make better decisions supported by the solutions. Management now has an easily accessible, cross-project dashboard that improves oversight across multiple complex projects. With this level of oversight, BAM is able to break down traditional construction data silos to automatically identify and understand high-risk items.

Case studies like BAM Ireland demonstrate how machine learning and AI can play a significant role in helping predict, prevent and manage risk, by providing personalised visibility into daily priorities, an instant snapshot of individual project health, and insights into company-wide performance.

Suhail Arfath is head of Autodesk Consulting’s Middle East operations.

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ANASTASIYA GOLOVATENKO SHERPA COMMUNICATIONS

The power of effective communication in construction

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he construction market is a key driver of the UAE economy, but has recently come under substantial pressure due to the prolonged slump in oil prices.

Despite the prevailing climate, the construction industry remains resilient and the outlook for the sector remains cautiously optimistic.

Effective communication, therefore, forms an integral component and requires a significant level of attention and organisation in order for businesses in this sector to be successful.

A Research and Market report notes that residential construction was the largest market in the UAE construction industry during the 2014-18 period, accounting for 33.1% of the industry’s total value in 2018. Moreover, the market is expected to retain its position in the next five years, due to government efforts to balance housing demand and supply through the construction of housing units. With day-today business operations becoming even more tedious, and revenues and profitability at risk, it is easy for business owners to lose sight of other important aspects of the business, such as marketing and strategic communications.

TIP #1 – DEFINE A CONSTRUCTIVE THOUGHT LEADERSHIP STRATEGY An effective thought leadership strategy can deliver the right content to decision-makers.

To be able to stand out in an oversaturated property market, it is important for businesses in this industry to showcase their expertise and leadership through the production of best-in-class content on relevant topics.

Outbound marketing such as TV commercials and large billboards used to be the most effective MEConstructionNews.com | August 2019

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COMMENT

channel for advertising. The paradigm has now changed, with thought leadership and content marketing attracting investors more organically.

Quality content has the potential to help construction industry marketers cost-effectively drive ROI. The key to attracting the right clientele is providing thought leadership content that places the audience at the centre of the platform.

Engaging with like-minded professionals and investors on oniline platforms provides an additional opportunity for business owners to inspire and connect with others. Topics can range from white papers and opinionated pieces on the cutting edge of construction technology, to the advancement of 3D modelling and virtual reality.

TIP #2 – BUILD RELATIONSHIPS VIA PUBLIC SPEAKING The construction industry is rapidly changing to meet the expectations of the built environment.

Trade shows, conferences and events can help generate new sales leads, deepen connections with existing contacts and glean more information across developing markets. The industrial, commercial and real estate sectors have a lot to gain by networking and relationshipbuilding at the mid-levels of their organisations.

The quality of stakeholder relationships will depend on the quality of the communication involved. It is important to establish the right standards, processes and outreach to the right stakeholders and partners on business services, agreements and new offers.

Winning industry awards, or even being a finalist, can offer a magnitude of benefits.

Building and construction awards add prestige, improve market visibility and differentiate organisations from the competition.

Business awards can also help generate additional sales and help motivate staff.

TIP #3 – RE-ARCHITECT BRAND POSITION TO MAINTAIN STRONG PERCEPTION A jack of all trades is master of none. Many companies in the construction and property industry don’t realise just how much this pertains not just to prospective employees or subcontractors, but also to them.

Effective brand communication employs both creativity and strategy to build and maintain strong perceptions that can increase an organisation’s bottom line. An effective and targeted brand positioning strategy includes a strong media relations campaign, a sound digital strategy, and event and content marketing to bring on board new investors and partners, as well as strengthen employee relations.

August 2019 | MEConstructionNews.com

Clear communication is essential if appropriate messages are to reach the target audience. Multi-faceted communication across internal and external channels on projects can bring on board new investors or improve relations with current ones. Becoming an expert can provide credibility and produce greater profit margins, while positioning a business across a niche service can attract the right investors.

TIP #4– BUILD ONLINE AND OFFLINE AWARENESS TO CREATE INTEREST The construction business is without doubt an offline business; however, a majority of investors, architects, developers and construction workers continue to spend a significant number of hours on social sites and on the internet, making it mandatory for businesses to market online.

Aside from a construction company’s brand, a business website should be responsive, adaptable and searchable across a wide range of devices including mobile, tablet and desktop.

More than half of the UAE’s population access the internet via mobile devices, making it imperative for websites to be mobile-optimised.

Marketing in the construction industry can be a challenge; however, if properly executed, it can build a positive reputation within the industry, attract key prospects and contribute to overall business objectives and lead conversions.

Anastasiya Golovatenko is an account director at Sherpa Communications.

ANDREW SKUDDER CCS

Behind the curve

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ith the Middle East construction sector under growing pressure as a result of a tightening economy, construction companies should be looking at ways to streamline their business processes, improve cash flow management and tighten risk management. Those that sharpen internal

processes and systems today will be best positioned for an upswing in government and private sector investment in the years to come.

The sector faces numerous challenges – challenging economic growth, shrinking margins, skill shortages, rising resource and labour costs – which means it’s under pressure to start innovating.

INVESTMENT IN TECH IS BEHIND THE CURVE The challenges the industry faces are compounded by the fact that many construction groups have not digitised operations such as cost-consulting. This means they lack visibility into – and control over – the many variables, changes, people and equipment involved in any construction project.

Middle Eastern construction companies should be looking for ways to use technology to drive higher productivity, achieve cost savings and improve project management, to weather a tumultuous time for the industry. However, the lean years of late have seen IT spending in the construction industry stagnate, despite the accelerating pace of innovation around the world.

For example, adoption of wearables, 3D printing, driverless heavy vehicles, drones and building information modelling is rising in the global construction sector. To take full advantage of these advanced technologies, many local construction companies will first need to modernise their core back-office systems.

They should be looking to tried and tested solutions for estimating, project control, enterprise accounting and operational costing. These solutions will enable them to drive down the cost of maintaining legacy applications, help them to become more agile and give them clearer real-time visibility into business performance.

BREAKING DOWN SILOS Construction performance and progress cannot be monitored on financial data alone; engineering information is just as critical. Engineering control includes generating and managing allowable and actual quantities of resources, wastages, manhours of labour, production of equipment and time for construction activities.

Without digitisation, an organisation has no clear indication of the status of a contract, because it doesn’t have real-time visibility into these factors. Today’s business solutions can break down the silos, enabling estimators and accountants to produce real-

COMMENT

time reporting and yet continue to work in the language that is meaningful to them.

Integrated back-office systems spanning procurement, project control, cost estimation, subcontractor management and accounting give construction companies one source and view of the truth, enabling them to manage an entire project with real-time visibility into costs and performance.

Using this data can help construction firms make better strategic and operational decisions. Data-driven insights can enable them to better manage cashflow and project risks, so they can better predict and mitigate payment delays, rising costs and other challenges. It can also help companies to drive higher levels of profitability through better project planning.

BUILDING A FOUNDATION FOR THE FUTURE Looking to the future, a robust business solution is also a foundation upon which construction companies can layer drones, robots, Internet of Things (IoT) sensors, artificial intelligence (AI) and other advanced digital technologies. Such solutions enable construction companies to manage and analyse big data produced by sensors, devices and workers so they can drive productivity and innovation – AI, for example, can help them rapidly process the data to find key insights.

Construction companies should embrace digital transformation to drive higher productivity, improve efficiency and gain a competitive advantage. Transforming their core business with a proven solution will help them prepare for the future, with a possibility that infrastructure spending will show signs of life again in the near future. Now is the time to lay the foundation for the next wave of growth.

Andrew Skudder is the CEO of CCS.

Middle Eastern construction companies should be looking for ways to use technology to drive higher productivity, achieve cost savings and improve project management, to weather a tumultuous time for the industry”

MARK FARLEY WSP

Is a zero-carbon city a reality?

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hat is a zero-carbon city, you ask? At its core, for a city to achieve zero-carbon status, it must cause no net release of carbon dioxide into the atmosphere.

So for all the carbon dioxide a city creates day to day, it must also be creating the same amount of clean air to cancel it out. The smartest way to do this is to ensure a city is releasing as little carbon dioxide as possible through the introduction of sustainable buildings, infrastructure, commercial space and vehicles.

The Abu Dhabi Masdar City project is an excellent example of how a zero-carbon city might look in the Middle East. Although not totally zero-carbon, it has been designed and built with the purpose of having a carbon output as low as possible while still attracting residents and visitors. All the buildings in the city are built at the perfect angle to generate the most shade throughout the day; there are advanced materials in all structures that allow buildings to breathe and control temperature; and the city prioritises walking and cycling over public electric transport.

Masdar City has retail, office space and dining facilities all designed to consume 40% less energy and water than an average city, and plans to grow one neighbourhood at a time, adding schools, parks and housing for up to 90,000 people.

Energy consumption is unavoidable, and with technology becoming more prevalent in our lives, that won’t be changing anytime soon.

With the level of comfort we all insist on, it is difficult to avoid a carbon footprint; unlimited clean warm water, 20+ electrical items in the average home and access to any food we want, regardless of where in the world it is, will continue to add to the release of carbon dioxide that we pump into the atmosphere each year.

A switch to automated vehicles and a fully automated road network feels like a good start

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in achieving a decrease in carbon emissions; after all, cars currently produce an average of 4.75 metric tons of carbon dioxide emissions per passenger. However, we will still need to power automated vehicles and the satellites that keep them on course, and this power comes at a cost.

Currently, 92% of the global population lives with unhealthy air and cities are increasingly having to think of innovative solutions to disappearing green space – such as introducing roof gardens, plant-filled buses and grasslined cycle paths – but what more can we do?

After all, our need for green will not change.

Not only is it an effective natural tool to fight pollution and reduce the effect of carbon on our planet, it is also good for our communities.

Green space draws us in, inspires us, fosters productivity and encourages social contact; with loneliness predicted to be the next big killer, this is more vital now than ever.

HOW CAN WE PLAN FOR FUTURE GENERATIONS? We can encourage developers to use smart grids, or at least make buildings easy to retrofit with smart grids. We can encourage the use of advanced materials, which currently tend to get left behind in favour of the traditional and trusted concrete. We can ensure our roads can adapt and facilitate automated vehicle hosting systems. We also really need to consider how we can satisfy the need for green space, offer access to local produce and encourage our communities to use more sustainable public transport systems whenever possible.

IS A ZERO-CARBON CITY ACHIEVABLE? Currently, no. If we expect to have the same standard of living that we currently do in our cities, then we can’t expect to be zerocarbon. Perhaps if we forgo tropical fruit and veg, personal transport and half of our technology it could be possible, but hope is not lost. Climate change is climbing higher on the global news agenda with each passing day, and sustainable solutions have increased tenfold in recent years – a trend that will only continue. It isn’t unrealistic to think that one day we will get there, but we need to start planning for that now and discover how best we can balance our expectations for comfort and advancement with the need for clean air, green spaces and a sense of community.

Mark Farley is director of Building Services at WSP. More thought leadership content from WSP in the Middle East can be found on www.wsp-anticipate.com.

MEConstructionNews.com | August 2019

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CASE STUDY

Smart technology

Reliable wireless networks for smart grids AMERICA

This case study shows how DTE Energy used a wireless network deployed by ABB to secure its smart grid infrastructure and applications August 2019 | MEConstructionNews.com

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n 2010, DTE Energy, the energy provider to 2.2 million customers in southeastern Michigan, received a US Department of Energy Smart Grid Investment Grant to help fund 50% of its $168m SmartCurrents programme. The programme aimed to modernise DTE’s electric grid, improve distribution system reliability and efficiency, and empower electric customers with more information about their power usage.

The utility selected solutions from ABB and Itron to advance the initiative, and by 2012 DTE had installed 725,000 of Itron’s smart meters and a complementary network communications architecture from ABB’s wireless unit, covering approximately one third of DTE’s customers – resulting in almost $1m in savings from significant efficiencies, including almost 80,000 fewer truck deployments and a smart meter daily read of 99%. Simple manual meter read errors were now eliminated with the automated remote daily read feature.

PROJECT EXPANSION Due to the programme’s initial success, DTE continued smart grid deployment over the next four years, expanding the roll-out to include wireless connectivity to more than 70 electric distribution substations and the largest solar power generation station in Michigan.

The expanded smart meter capabilities enable DTE to provide, among other things, automated meter connect/ disconnect of 3,000-5,000 meters per day. Additionally, DTE implemented advanced distribution applications and the ABB Ability Network Manager Supervisory Control and Data Acquisition (SCADA) platform, with the goals of reducing outage time and better managing distribution power flow and peak power.

The final phase of the distribution automation efforts across DTE’s coverage area – 3.2m meters in 7,600 square miles – was completed at the end of 2016. Notably, the DTE deployment of ABB’s wireless technology is the largest wireless mesh network in the world.

Key project details facing ABB and DTE Energy PUTTING THE NETWORK TO THE TEST In March 2017, the effectiveness of the distribution automation (DA) efforts was tested when a storm with 70mph winds left nearly 800,000 customers without power – more outages than any other time in DTE’s history. By design, the self-healing wireless mesh technology embedded in the communication network was able to work around downed lines and poles to continually read meters and provide additional data essential in pinpointing outages, making field deployment far more efficient than in previous years.

To determine restoration progress and how many customers remained without power, the electric advanced metering infrastructure (AMI) meters were automatically queried by the system four times a day, providing frequent customer power status updates. These AMI data points were used to analyse, update and refine outage management system (OMS) data to automatically update the OMS-fed outage maps, prioritise restoration activities and align resources.

This reduced average restoration time by an estimated one to two days.

In fact, power was restored to 90% of customers within four days of the storm, exceeding DTE’s response goals and earning the utility neutral to positive comments in mass media and on social media. Moreover, after the windstorm, a cold front moved into the service area and the utility was able to use AMI technology to determine whether self-identified critical medical care customers and those on the senior rate had power. If not, DTE employees performed a ‘well visit’ check and provided information about nearby warming centres. Hundreds of these visits were performed during the course of the storm.

APPLICATIONS: AMI, DA, substation automation, outage management

PROJECT LOCATION: 7,600 square miles in Detroit, Michigan and surrounding areas

Put to the test The network was put to the test in March 2017 following a heavy storm that left 800,000 customers without power.

Deployment issues Early on in the programme, the team was challenged by dense urban geography, with limited access to poles.

$1M savings

from significant efficiencies

PROJECT SCOPE: 3.6m G&E meters, 3,000 primary DA devices, 500 automated switches, 70 electric distribution substations, and Michigan’s largest solar power generation station

OVERCOMING CHALLENGES While the newly installed smart grid technologies have resulted in many benefits, deploying the new devices and systems has not been without challenges.

Early in the programme, the team was challenged by dense urban geography with limited access to poles, due primarily to underground rather than overhead electric distribution construction.

DTE engineers were able to initiate design innovations using available facilities or partnered facilities to help remedy the issues.

Also, DTE’s service territory has a dense tree canopy that negatively impacted RF signal propagation. The combination of using the ABB products’ multiple frequency bands, alternating network device installation periodically on different sides of the street, and using traffic intersections for device

CASE STUDY

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placement created reliable successful communication in these areas.

A further early design challenge was the placement of the network device in the exact location as engineered, rather than possibly a few poles away in the general area. Installation triage crews used washable paint to pre-mark the poles chosen by engineering, which reduced line crew installation time and improved the accuracy of field placement.

DTE and ABB worked together on product enhancements, such as the addition of GPS to devices to increase the accuracy of device placement, as well as signal theft or other issues if the devices begin to travel within an area without a corresponding issued work package.

Like most other utilities, DTE initially underestimated the volume of data generated by the new technologies and its impact on information technology (IT) needs. By 2012, DTE had partially addressed the challenge by adding to DTE’s IT system capacity. In addition, DTE worked with its vendors to improve the speed and performance of their products, such as through a new bus architecture.

How to achieve proper system integration was another IT-related challenge that entailed trade-offs for the utility. DTE decided against comprehensive system integration, keeping the various systems separate in an effort to be able to isolate changes to one part of the system without affecting other affiliated applications.

A PRIVATE NETWORK TO ENABLE THE FUTURE Also in 2017, DTE started the process of moving away from 3G cellular and toward a wholly owned private network in support of a smarter grid strategy for the next five years, anticipating the installation of thousands of smart grid devices.

Over the course of the SmartCurrents programme roll-out, the benefits to DTE and its customers have been evident.

MEConstructionNews.com | August 2019

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INDUSTRY FOCUS

HVAC

Energy efficiency in HVAC systems MIDDLE EAST

Angitha Pradeep speaks to James Lee, LG Electronics’ MEA president, about smart HVAC solutions

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n the Middle East and Africa (MEA), where temperatures reach as high as 50°C, the key to smart energy management is in heating, ventilation and air conditioning (HVAC) solutions.

With this in mind, Big Project ME speaks to James Lee, president of LG Electronics MEA, about the requirement of increasing investment in sustainable energy infrastructure in the MEA region.

What does the future of HVAC look like locally?

The GCC is rapidly evolving in terms of demand for sustainable

HVAC solutions. We are seeing an increasing shift towards a more environmentally friendly mindset, not only in terms of HVAC solutions, but also across our wider business portfolio.

GCC customers are also very keen to experience a highly connected and digital world, embracing more Internet of Things (IoT) technology, which is why we have started implementing more smart technology integration into our HVAC solutions to meet this demand.

How have client requirements changed over the years?

Customers are increasingly looking for energy-efficient, cost-effective and sustainable solutions, in line with the local government agenda. Meanwhile, companies are increasingly investing in research and development as well. LG is particularly focused on ensuring its products have better energy ratings. Moreover, customers are also interested in choosing a provider based on

August 2019 | MEConstructionNews.com

the degree of after-sales service support and maintenance offered, while smart technology is also an important feature people look for now – whether that is smart thermostats, or mobile applications and web-based software to help with maintenance scheduling.

GCC customers are very keen to experience a highly connected and digital world”

How can HVAC systems help contribute to the overall green rating of a building?

Green ratings of a building depend on many factors like sustainable sites, water efficiency, energy and atmosphere, material and resources, indoor environment quality, innovative design solution and regional priorities. LEED consultants always look for total energy modelling for the whole building, where HVAC systems play a critical role.

Implementing inverter technology with a high seasonal energy efficiency ratio (SEER), and maintaining IAQ (indoor air quality) using an efficient FAHU (fresh air handling unit) in tandem with a VRF outdoor unit, can help gain more green points.

Regional standards such as ASHRAE also have a positive impact towards climate change, and we encourage the optimisation of performances through high SEER product innovation, which substantially reduces the energy cost of the project.

Our leading construction platform offers a range of solutions to suit your business needs.

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Bid on Tenders

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TENDERS

Middle East tenders UAE INFRASTRUCTURE

Sharjah Sea Water Reverse Osmosis Plant BUDGET $360 million TERRITORY UAE CLIENT SEWA DESCRIPTION The project’s scope of work involves the construction of a seawater reverse osmosis plant. The facility will have a capacity of 60 million imperial gallons a day (MIGD).

PROJECT PERIOD 2018 - 2022 RESIDENTIAL

Azizi Victoria (Phase 2)

– Concourse 1 & West Terminal Substructure Works BUDGET $2.8 billion TERRITORY UAE CLIENT DAEP DESCRIPTION The project’s scope of work involves the construction of foundations, basement walls, columns, basement slabs and top slabs for the 2.7km Concourse 1, West Terminal building, short-term car park and staff car park located at Al Maktoum International Airport in Dubai South, Dubai.

PROJECT PERIOD 2015 - 2022

SAUDI ARABIA INFRASTRUCTURE

Red Sea Village Development Marine Works BUDGET $50 million TERRITORY Saudi Arabia

BUDGET $205 million TERRITORY UAE CLIENT Azizi Developments DESCRIPTION The project’s scope of work consists of 16 residential buildings located at Mohammed Bin Rashid Al Maktoum City District 7, Dubai. The project includes the construction of 2,000 residential apartments, parking facilities and other associated facilities.

PROJECT PERIOD 2018 - 2021 AVIATION

Al Maktoum International Airport Expansion

August 2019 | MEConstructionNews.com

Facilities Renovation BUDGET $11 million TERRITORY Saudi Arabia CLIENT Ministry of Finance Saudi Arabia DESCRIPTION The scope of work involves the rehabilitation, restoration and modification of air force command facilities in Riyadh, Saudi Arabia.

PROJECT PERIOD 2018 - 2022 CLIENT Al Inma Al Thuraya Real Estate Company DESCRIPTION The project involves marine works for Red Sea Village in Jeddah, Makkah Province, Saudi Arabia. The project will include edge protection, beaches 1 to 4, a vertical wall breakwater at the entrance to the main marina, and construction of storm water outfalls, installation and commissioning of navigational aids.

PROJECT PERIOD 2018 - 2022 AVIATION

Air Force Command

RETAIL

City Centre Ishbiliyah BUDGET $1 billion TERRITORY Saudi Arabia CLIENT Al Futtaim Group Real Estate DESCRIPTION The project consists of an enabling work of a new shopping mall. The project includes 250 stores, a 9,000sqm Carrefour hypermarket, a food court and a Magic Planet amusement arcade.

PROJECT PERIOD 2015 - 2022

KUWAIT OIL & GAS

South & East Kuwait LP Compressor & Turbine Upgrade BUDGET $201 million TERRITORY Kuwait CLIENT KOC DESCRIPTION The scope of work involves the upgrade of the LP compressor and turbine at Booster Station BS140 in Al Ahmadi, Kuwait.

PROJECT PERIOD 2017 - 2020 INDUSTRIAL

Al Jahra Central

TENDERS

Workshops & Piping Yards

TERRITORY Bahrain CLIENT BAPCO DESCRIPTION The project’s scope of work involves the replacement of 3 gas turbo generators at BAPCO Refinery in Sitra, Bahrain.

PROJECT PERIOD 2017 - 2022

BUDGET $63M TERRITORY Kuwait CLIENT KOC DESCRIPTION The scope of work involves the construction and maintenance of central workshops and piping yards in Al Jahra, North Kuwait.

PROJECT PERIOD 2017 - 2022

HOSPITALITY

The Address Hotel & Residences at Marassi Al Bahrain

ENERGY

Dabdaba Photovoltaic Power Plant BUDGET $1.5B TERRITORY Kuwait CLIENT KNPC DESCRIPTION The project involves the construction of a 1,500MW photovoltaic solar plant at Al Shegaya Renewable Energy Park, 100km west of Kuwait City. The solar project is part of the country’s plans to produce 15% of power from renewable energy by 2030.

PROJECT PERIOD 2016 - 2021

OMAN INFRASTRUCTURE

Al Batinah Water Transmission Pipeline Maintenance Work BUDGET $100M TERRITORY Oman CLIENT Oman Public Authority for Electricity & Water DESCRIPTION The scope of work involves the maintenance of the water transmission pipelines network located at Al Batinah North, Oman.

PROJECT PERIOD 2018 - 2021

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INDUSTRIAL

Philex Pharmaceutical Complex BUDGET $370M TERRITORY Oman CLIENT AQI DESCRIPTION The project involves the construction of a pharmaceuticals and biotechnology complex located at Adhan, Salalah Free Zone (SFZ), Salalah, Dhofar Governorate, Oman. The project includes a research and development centre, a training centre and laboratories, and is expected to generate 300 job

opportunities for Omani nationals.

PROJECT PERIOD 2017 - 2022 MIXED USE

The Mount Mixed Use Complex BUDGET $320M TERRITORY Oman CLIENT Resolution Engineering Consultancy DESCRIPTION The project consists of a mixed-use complex in Muscat, Oman. The scope of work includes a 5-star hotel with 300 keys, retail shops and restaurants, 600 residential units, terraced villas and a spa.

PROJECT PERIOD 2015 - 2022

RECREATIONAL

Bahrain Expo City – Bahrain International Exhibition & Convention Centre (BIEC)

BAHRAIN OIL & GAS

BAPCO Refinery Gas Turbo Generators Replacement BUDGET $51M

BUDGET $275M TERRITORY Bahrain CLIENT Eagle Hills Diyar Al Muharraq DESCRIPTION The project consists of a hotel and serviced residence building in Marassi Al Bahrain in Manama, Bahrain.

The new five-star hotel will feature 110 rooms and 17 suites and other amenities such as a raised roof garden, swimming pools, a rooftop restaurant, a spa, a wellness centre and landscaped terraces.

PROJECT PERIOD 2016 - 2022

BUDGET $300M TERRITORY Bahrain CLIENT Bahrain Ministry of Works, Municipalities Affairs & Urban Planning DESCRIPTION The project consists of an exhibition centre near the F1 Circuit in Sakhir, Southern Governorate, Bahrain.

The facility will accommodate over 5,000 people.

PROJECT PERIOD 2016 - 2021

MEConstructionNews.com | August 2019

48

PROGRESS REPORT

Final update

60% of work on Sa’ada West completed – Bahrain’s Edamah Mixed-use waterfront project scheduled to be completed by September 2019

B

ahrain Real Estate Investment Company (Edamah) has said that steady progress is being made on its premium seafront development, Sa’ada West, which is located on the Muharraq coast, adjacent to the Shaikh Isa Bin Salman Causeway.

In a statement, the real estate unit of the Kingdom’s sovereign wealth fund, Mumtalakat, said that nearly 60% of the work has already been completed.

August 2019 | MEConstructionNews.com

Sa’ada is a first-of-its-kind waterfront development and has been mainly designed to cater to the needs of a diverse base of Bahraini locals and tourists, as well as serving requirements from an investor and business perspective.

The development features a variety of public facilities, including restaurants, kiosks and a promenade, along with other services which enable it to be a valueadding project to the community at large.

According to Edamah, the premium mixed-use waterfront project is being implemented in two phases. In Phase One, an 18,000sqm area has been reclaimed and prepared, and seawalls and jetties have been constructed. In Phase Two, currently underway, seven new buildings are being built, featuring a total of 45 retail and F&B units, in addition to a multi-storey carpark building.

Featuring a mix of retail and hospitality spaces, the Sa’ada West

18,000 sqm area of land reclaimed and prepared in phase one of the project

In full swing Work on the development is in full swing, with all seven buildings scheduled to be completed by September 2019.

project is envisioned as housing a promenade with family entertainment, an experience of harbour-side dining and a modern marina, hosting an array of boats.

“Phase One consists of the development of restaurants and cafés with spectacular sea-facing views and a harbour for cruise boats and other leisure facilities,” said Ali Al Rumaihi, head of corporate financing for Edamah.

“Phase Two will see the development of a centrally located multi-storey car parking building, acting as a link between the culturally rich Muharraq Souq, complete with a modern waterfront promenade and pedestrian bridge.”

Work on the development is in full swing, with all seven buildings scheduled to be completed in September, while the 200-space car park will be ready for use in November. Mohammed Jalal Contracting is undertaking the phased construction work, the developer added.

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