review AECOM Ireland Annual Review 2014
Cover image: Marker Hotel, Dublin Docklands, Dublin. Image courtesy of the Marker Hotel.
Contents Introduction 1
Industry review — bridging the transition Medium-term outlook Sector performance Tender prices and construction costs Industry issues
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Business intelligence — linking strategy to results Brendan McDonagh, National Asset Management Agency (NAMA) Frank Conlon, Industrial Development Agency (IDA) Ireland Peter Collins, Kennedy Wilson Ireland Geographies — connecting one global market Island of Ireland United Kingdom Asia focus
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Reference 32 Indicative building costs Case study: Offices, new build or refurbishment? Case study: Transportation Case Study: Data centre focus AECOM 41 AECOM Global Unite AECOM news AECOM key contacts Global services
Introduction ... positive signs for recovery?
Welcome to this year’s Annual Review. What a difference a year makes? Whilst 2013 represented another tough year in the construction industry it also marked the first year since the start of the downturn where certain sectors experienced growth and a real sense of optimism took hold. The influx of foreign direct investment continued unabated and exceeded the investment made in 2012. We saw new corporate brands enter the market and reduce the percentage of surplus office space in our cities. 2013 saw the first of the new office buildings commence construction towards the end of the year signifying the viability tipping point in the market. Keeping up with the code-names became the biggest challenge last year with loan sales portfolios and asset parcels being placed on the market at an accelerated rate during the latter half of the year. This looks likely to continue at even higher volumes during 2014 as the deleveraging continues. The emerging product on the market appears to be evenly matched with new funds entering the market providing adequate competition and avoiding overheating, although some may argue otherwise.
So, what has all this done for the construction industry itself? The new companies expanding or moving into Ireland have created fit-out work in the commercial sector which is enjoying a competitive but yet functioning part of the industry. The funds buying loan or asset portfolios, by their very nature, do not provide significant levels of new construction work but do have the effect of freeing up capital that should make its way back into the system. In contrast, the public sector continued its decline albeit at a much slower rate. Projects still continue to be difficult as we deal with the legacy of below-cost tendering. While it is still a feature of the market, we see contractors taking a more risk adverse approach and in certain cases declining to tender for public projects where the risk profile exceeds their tolerance. When the figures are tallied later this year, it is likely that 2013 will have marked the year when the industry levelled out and proved to be the turning point in the industry’s decline. We expect the market to increase by 5-7 percent in 2014 supported by the commercial and residential sector and the start of the Public Private Partnership (PPP) programme.
In this year’s Review we hear from leaders including Brendan McDonagh, CEO of Nama on their €2 billion funding for construction, Frank Conlon from the IDA on the future for 2014 and Peter Collins, Managing Director of Kennedy Wilson Europe on his view of the Irish market. We also have the usual focus on topical issues including New Build Office v Refurbishment, Data Centres, the PPP Programme and this year’s geography focus Asia. We hope you enjoy the read and look forward to working with you during 2014.
Paul Mitchell Head of Office — Ireland (AECOM Project and Cost Management) paul.mitchell@aecom.com
Introduction | 1
Industry Review
Bridging the Transition
2 | Industry Review
Marker Hotel, Dublin McCauley Daye O’Connell Architects Limited
Any recovery is starting from a very low base.
“Lies, damn lies and statistics” is a phrase often used to caution against placing too much weight in statistical data. It is a valuable reminder, not that we should ignore statistics, but of the need to set them in context before reaching conclusions. So when we look at the performance of the construction industry in Ireland 2013, we can note some interesting examples of statistical data. –
Employment in the construction industry increased by 9.5 percent from quarter one to quarter three of 2013
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Residential dwelling commencement notices in Dublin increased 95 percent in the 12 months before November 2013
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The number of Foreign Direct Investment (FDI) announcements by IDA Ireland increased by 13 percent in 2013
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The Central Statistics Office (CSO) Building & Construction Index indicated a 12 percent increase in output on an annual basis in Q2 2013
Medium-Term Outlook So, where do we stand? Last year our Annual Review focussed on illustrating the long path to recovery ahead, even with strong growth rates of 10 to 15 percent. While the statistics above seem positive, one swallow, or rumours that one might be coming, does not a summer make. Indeed, whilst we would agree with other commentators that signs are positive, we would caution against concluding that we are on the brink of a recovery, as we are nowhere near the place we were at five years ago. The reason for this caution, as a continuation of the central point of our market review last year, is that any recovery is starting from a very low base and in addition there are a number of downside risks;
Figure 1: Opposing pressures on Construction Output
– In the immediate aftermath of the anticipated exit from the bailout, government spending will continue to be scrutinised by international markets. Any divergence from the plan is therefore likely to see a rise in borrowing costs and thus the public capital programme (PCP) will, as illustrated in Budget 2014, continue to be restrained. In value terms, the budget has reduced by 2.8 percent in 2014. This will be followed by a further 2.5 percent reduction in 2015 and it will be static in 2016. When tender price inflation is considered, the volume reductions are greater. – The emergence of a two-tier residential market would indicate that, whilst there may be some high-profile pockets requiring residential development in the greater Dublin area, the over-supply in the market nationally may be a barrier to new developments.
On the flip side, the public sector capital spend — a significant element of the overall industry — in 2013 had a very modest budget.
Sustainable Demand Resource Competition Growth
Finance
Over Supply
Public Finances
Viability
Industry Industry Review Review || 3 3
annual growth of between 5 and 7 percent. We believe it is too early to say whether or not this constitutes the beginning of a sustained recovery, particularly given the very low base of today’s construction industry.
international western markets continue to maintain a weak and fragile growth outlook.
– The financial institutions’ lasting inability to extricate themselves from the personal debt hangover restricts their ability to resume normal bank lending activity.
We expect the outturn figures to confirm 2013 as the year when the construction industry stabilised, and we expect 2014 and 2015 to demonstrate the first signs of modest
– As a small open economy, we are equally exposed to any downturn as to an upturn, and the traditional
Figure 2:
Anticipate growth of between 5 and 7 percent in 2014
How long would it take to reach optimum output? €40,000m
€35,000m
Construction output *
€30,000m
+170k +145k
€25,000m
+125k +100k +85k
€20,000m
Labour figures are based on notional cumalative output
+70k +55k
Optimum construction output based on 12% of GNP
+40k +25-30k
+10k
€15,000m
+15-20k
Extra jobs
€10,000m
*Pre 2012 output
based on “The Irish * Construction Industry 2012” SCSI/DKM. Post 2012 based on hypothetical 10 percent pa growth.
€5,000m €7.75 billion
€0m
2007
2008
4 | Industry Review
2009
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One feature of recent years has been the increasing diversity of sources for public expenditure on capital projects.
Sector Performance The medium-term outlook highlighted the role of opposing pressures at a macro level being levelled against each other in the coming months and years, ultimately influencing annual trends in output. Similarly, at the sector and sub-sector levels, a series of micro level factors come into play in determining the overall outlook. Public sector Whilst public-sector capital expenditure has been in sharp decline
Figure 3:
since the downturn, this decline has been significantly less severe than in the private-sector. As a result, it now represents just over 50 percent of the overall industry output. One feature of recent years has been the increasing diversity of sources for public expenditure on capital projects. The use of public private partnerships (PPP) as a model for investment has facilitated some of the key large infrastructural projects. While the PPP programme suffered from the cancellation of a number of projects during the economic crisis, it is indeed re-emerging as a credible option and
there is a significant pipeline coming on stream over the next few years.(see Figure 3) Added to this, the selling of state assets such as the National Lottery is due to release €400 million to partially fund the National Children’s Hospital and a range of other projects announced in Budget 2014, and is likely to continue to release funds. The Government has established Irish Water with a significant planned investment programme. The National Asset Management Agency (NAMA) is also investing €2 billion up to 2016 and making a further €2 billion
PPP Projects and cashflow
4 2 1
5 6
9
7 3
1 N17 and N18 Gort to Tuam 2 N25 New Ross 3 Schools Bundle 4 4 M11 Gorey 5 Garda Stations 6 DIT/GDA Campus 7 Primary Care Centres 8 Schools Bundle 5 9 Court Houses Bubble denotes relative size of project
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€500m
Accommodation Schemes Road Schemes
€400m €300m €300m €100m €0m 2013
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Industry Review | 5
Athlone IT International Arena
of development finance available. The diversification of funding for government-backed capital investment in severely constrained financial conditions has thus been, and will continue to be, pivotal in providing a significant proportion of overall output. The breakdown of public-sector capital expenditure in Budget 2014 contains the multi-annual capital investment framework, and within this, most departmental capital spend provisions remain broadly similar to 2013. The one department that bucks the trend is the Department of Education & Skills which has seen a 30 percent increase. The roll out of the school building programme to meet the demographic demands is the driver for this, and the funding for it is due in large part to the €2.25 billion stimulus plan. This was announced by the Government in July 2012 for a range of projects up until 2017 and 2018. In contrast to this, the Department of Education & Skills’ funding for the third level sub-sector has declined by 29 percent to €34.5 million, which is particularly concerning as we need to maintain and enhance our reputation as a highly educated workforce. The Department of Health provision was kept at €397million for 2014, however, there is a concern that the ongoing budgetary difficulties in the
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health sector may result in some of these funds being diverted to fund overruns elsewhere. Residential In contrast to the public sector, residential construction has seen a reversal of its dominance in terms of overall construction output from a position where it was over €25 billion (source: DKM Annual Construction Industry Review 2009 Outlook 20102012) or 66 percent of construction output back in 2006 to circa €3.5 billion (source: Forfas Outlook and Strategic Plan, 2012) or 44 percent in 2012. This drastic decline has not significantly diminished the level of interest in the sector amongst the wider economy and certainly the differing trends in the market between the greater Dublin area and those of the other regions have been the general focus of attention. Currently, the majority of activity in the sector is in the repairs, maintenance and improvement (RMI) sub-sector. The Budget 2014 Home Renovations Initiative incentivising people to get these works done — and done by registered builders to address the shadow economy issue — should also help in maintaining this output. In terms of new units, the Department of Environment & Local Government statistics based on new
dwelling Electricity Supply Board (ESB) connections, identify the new completions in 2012 as 8,488 (the lowest since records began) and 5,682 in the first nine months of 2013. A proportion of these are likely to be units that were partially constructed in the boom and are being gradually brought back to the market by banks or receivers. This trend is likely to continue, however the quality of boom stock will be decreasing as the more marketable properties are brought forward first. Indeed, as the availability of suitable stock diminishes, or as we have seen in certain south county Dublin areas where no significant stock existed, house prices are likely to start increasing if general economic conditions continue to improve. One possible antidote to house price increases is increased supply, however, this may not be entirely straight forward from a planning perspective, and it may not be physically possible to provide the types of houses required in the areas of south Dublin that have seen an increased demand. In summary, we would expect output in the sector to increase from its current historically low base, but not to an extent that would offer a significant boost to the overall industry.
Strength & Conditioning Building, LIT Thurles, Co Tipperary. Image courtesy of BDP / Visual Lab
Private Non-Residential Unlike the other sectors of public and residential, the private nonresidential sector is an eclectic mix of sub-sectors which, whilst all sharing macroeconomic drivers, in some cases have very different micro drivers. As a result, the construction industry has experienced differing fortunes in its subsectors. Commercial office market The success of IDA Ireland in continuing to attract foreign direct investment is a significant benefit to the construction industry and in particular the commercial sub-sector. In its half year update in July 2013, 35 of the 70 announcements up to that point in the year related to companies investing in Ireland for the first time. A lot of these announcements related to the Information and Communications Technology (ICT), financial services and corporate headquarter bases amongst others. These in turn generated demand in the commercial property market and therefore the construction sector. Demand has also been bolstered by indigenous professional services companies. It is now apparent that the availability of Grade A space in the cities, above 100,000 square feet is very limited — particularly in Dublin. The viability
scales are almost at their tipping point and it is likely that we will see new builds breaking ground in 2014, with significantly more starts in 2015 once they have completed the planning process. Industrial The good news in relation to IDA Ireland announcements continues into the industrial sector. Activity is expected to continue to be strong in 2014 in the life sciences, big data and medical technologies sub-sectors. In its 2013 end-of-year statement; IDA Ireland highlights that the pharmaceutical sector is facing challenges with overcapacity globally, the expiry of patents, clinical trial failures and the fallout from mergers and aquisitions. Notwithstanding this, Ireland continues to attract new investment in the sector. In addition, Irish exports across a range of subsectors have been performing strongly, with a â‚Ź4 billion surplus in the balance of international payments in the first half of 2013. This strong export performance also stimulates construction activity through expansion and improvement works.
low. There has been some activity where a number of national brands have rolled out limited branch refits, and, where units become vacant in the stronger urban centres, new entrant fit-outs follow — this has mainly been in Dublin city centre, however. Activity in the majority of regional towns has been minimal as property and lease transaction levels are low. Tourism, sport and culture 2013 saw a strong year for tourism, with a 6 percent increase in the numbers of overseas visitors to Ireland in the first three quarters of 2013 compared with the same period in 2012. This, combined with the government decision in Budget 2014 to continue the reduced 9 percent Value Added Tax (VAT) rate and the abolition of the air travel tax, has boosted confidence in the sector. Despite many businesses continuing to suffer from financial difficulties, we would expect to see an increase in investment in 2014 as the trend in increasing transactions in the hotel sector is likely to continue.
Retail In contrast, the retail sector has continued to struggle and the level of construction activity has remained
Industry Review | 7
2013 saw tender prices continue the broad trend of circa +3% increases.
Tender Prices and Construction Costs
today we are now approximately 28 percent below 2007 prices. Inevitably, some contracting organisations did not survive this period and indeed, many are still struggling to manage the burden of Celtic Tiger activities and bad debts. Notwithstanding this, those that have survived have started to see modest tender prices, partly because tender prices were not sustainable over a lengthy period, and partly as a result of reduced capacity in the industry. Since 2011, we have seen prices increase by approximately 3 percent per annum, however, this has not been uniform across the industry by any means, with volatility across the regions, sectors and indeed between trades. 2013 saw tender prices continue the broad trend of approximately 3 percent increases. There appears
With output appearing to stabilise in 2013 and the outlook in the mediumterm being one of modest growth from a very low base, the focus of attention in the industry shifts to tender prices and construction costs. Tender prices Tender price movements in percentage terms have been less severe than those of industry output (see Figure 4) but nonetheless, the sharp decline in output since 2007 has been accompanied by tender prices dropping by approximately 36 percent to unsustainable levels in 2010. Abnormally low tenders are a regular feature before a slow recovery, and
to be a particular trend of reduced competition for public-sector tenders. Indeed, construction firms are now more selective in allocating their significantly reduced resources, strategically pricing lower on projects that they wish to target. Thus public sector tenders may see tender price increases above this level, particularly where there is a high level of mechanical and electrical services, which appear to be more acutely affected. In contrast, strong competition continues for commercial projects in the Dublin region, with medium-sized regional contractors seeking to find private work where there are greater opportunities to make a profit. We expect tender price increases in 2014 to average +3 percent, however we would note that this is an average figure and as noted
Figure 4: Percentage change in construction output and tender prices
20% Output Change 10% Tender Price Change 0%
-10%
-20%
-30%
-40%
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1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013e
Arts Millennium Building Extension, NUI Galway, Galway. Paul Tierney Photography
Industry Review | 9
Any stabilisation in the output of the industry would belie the quantum and seriousness of the issues it still faces.
above, we would anticipate that certain sectors, including the public sector and fit-out sector, and certain trades, such as Mechanical & Electrical (M&E) services, are likely to see higher levels of increase if demand levels rise.
We anticipate average construction cost increases of approximately 2 percent in 2014.
Construction costs The building and construction materials component of the Central Statistics Office (CSO) Wholesale Price Index recorded a 1.6 percent increase in the 12 months from the third quarter of 2012. Internationally there has been relative stability in material costs as international demand has been relatively muted, avoiding global shortages — particularly in materials. In addition, exchange rates with our nearest trading partner, the U.K., have seen the Euro appreciate, making imports cheaper and energy costs have declined in the same period.
Any stabilisation in the output of the industry would belie the quantum and seriousness of the issues it still faces. What is certain is that the industry is experiencing significant changes, and will continue to do so for the next few years. Summarised below are a number of the current key industry issues.
The Supreme Court ruling in May 2013, declaring the unconstitutionality of the Registered Employment Agreements (REAs), has created a level of uncertainty as to future trends in labour costs. Employment contracts existing prior to the Supreme Court ruling remain on the same terms, however, and so the labour cost base remains broadly the same. It will be important for the industry, however, that the uncertainty surrounding the continuation or not of the REAs, in some format or other, is resolved in the near future.
Industry Issues
Construction Contracts Act 2013 The Construction Contracts Bill was introduced in the Seanad by Senator Feargal Quinn in 2010 and enacted in July 2013. It is intended to formalise the mechanism for construction contract payments. At the time of writing, we are awaiting the issuing of a ministerial commencement order so that it can be applied. Application This legislation will apply to all construction contracts (subject to minimum criteria) and is not optional. All main contracts, sub-contracts and service appointments including professional services are covered. The minimum criteria excludes; – Contract values < €10,000 – Contracts for private dwellings < 200 square metres (owner occupier)
10 | Industry Review
– Contracts for supply of materials/plant It protects sub-contractors by formalising: – The periods for making payments and prior notices – The process for withholding notices where claims disputed – The process for eliminating the practice of “pay when paid” clauses Adjudication The Act also introduces adjudication for payment disputes with fast-track binding decisions (28 to 42 days) whilst being open to challenge by arbitration or court. Actions Contractors and those employing consultants will have to adopt regimes to comply with the Act such as compliant contracts, use of payment claims or withholding notices whilst ensuring that procedures are followed. Independent Certifier The Building Control (Amendment) Regulation 2013 will come into effect on 1 March 2014, imposing greater responsibilities on owners of public and private-sector property. The Regulation applies to the design and construction of works, including an extension to an existing building of larger than 40 square metres, or where a Fire Safety Certificate is required in
Phoenix Care Centre, Grangegorman, Dublin. Image courtesy of Ros Kavanagh Photography
Above and left: Arts, Humanities & Social Sciences Research Building, NUI Galway, Galway Image courtesy of Warner Corporate Photography
Industry Review | 11
Colaiste Iognaid, Galway
12 | Industry Review
An October 2012 SCSI member survey highlighted the issue of a shortage of property related graduates and an impending shortage of surveying graduates for the construction sector. accordance with the Building Control Regulation 1997 to 2013. Some of the key features of the Regulation 2013 include the following measures: – You must submit a new commencement notice with all the necessary supporting documentation to the Building Control Authority. – There are three new Certificates of Compliance to address.
to be set up in Ireland with Green REIT in July and Hibernia REIT in November. REITs have been talked about in the Irish market for some time now. We originally joined others to call on the Government to pass the REIT legislation in our 2012 Annual Review and were glad to see it passed in April of last year. The initial fundraising of the REITs is a combined €665 million and is likely to grow further in the coming years. The timing for the REITs couldn’t be better, with a lot of property coming on stream over the short term with the continued deleveraging of the Banks. The REITs are a good opportunity for individuals to invest in larger scale commercial property without significant set up costs or expertise required.
statement given immediately after the court ruling was that they would study the judgement, taking legal advice. Thus the industry is waiting to see what government proposals/legislation arise on the back of this judgement. This judgement and the fall-out from it represent a major juncture for industrial relations and labour costs in the sector. It remains to be seen whether unions and employer representative bodies will be either willing or able to put in place a replacement to the REAs.
– A Completion Certificate must be issued to the Building Control Authority and included on the Statutory Register before the works or a building can be opened, occupied or used.
Registered Employment Agreements (REA’s) As referred to earlier, in May 2013 the Supreme Court ruled that the REAs prevalent in a number of industries throughout the economy, including construction, were unconstitutional. The court said the agreements, which are founded on 1946 legislation, “passed unmistakably into the field of legislation which was the sole preserve of the Oireachtas”.
– You are obliged to notify the Building Control Authority of any changes of ownership of the works or of the persons assigned.
Prior to the Supreme Court ruling, the Government introduced an Industrial Relations 2012 Act to address some issues in the 1946 legislation, however,
Shadow Economy The Construction Industry Federation (CIF) released the results of its 2013 member survey on the shadow economy in construction in September of 2013. The results highlighted that it is a continuing problem, indicating that 64 percent of construction companies have been asked to do a job for cash outside the tax system and worryingly, if not entirely surprising, 76 percent of respondents had come across an increased number of shadow economy operations in the preceding 12 months. Apart from the obvious tax take implications, the growing presence of a shadow economy in the industry raises serious concerns in terms of other legislative requirements such as health and safety, building control, pay and conditions.
Real Estate Investment Trusts (REIT’s) 2013 saw the arrival of the first REITs
it is unclear precisely what impact the ruling will have. The government
In an apparent acknowledgement of the problem, particularly at the domestic
– You must appoint a person (“Designer”) to certify design. – You must appoint a person (“Assigned Certifier”) to inspect and certify the works. – You must appoint a person (“Builder”) to build the works.
Industry Review | 13
Resources will be required at graduate level in order to maintain a competitive and sustainable industry.
level, the Government introduced a tax-back home improvement scheme in Budget 2014 aimed at both stimulating activity in the sector and requiring contractors to be fully registered and tax compliant. Industry Capacity An October 2012 survey of Society of Chartered Surveyors Ireland (SCSI) members highlighted the issue of a shortage of property-related graduates and an impending shortage of surveying graduates for the construction sector. It may have seemed alarmist at the time, however, when we consider that it effectively takes a minimum of four years to start reversing the direction of the slow moving tanker, which the level of graduate outturn is, then we quickly realise the urgency of the call to attract new students. The potential shortages are not confined to surveying but also extend to the other constructionrelated courses, with a total of only 170 first year enrolments on construction-related level 8 courses in September 2013.
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Of course there remains capacity within the industry and there are a large number of professionals that have emigrated in the last number of years, some of which may wish to return. Resources will be required at the graduate level in order to maintain a competitive and sustainable industry however. Research Research tends to be the poor relation whenever we read about research and development or research and innovation. Indeed, in the boombust cycle that the construction sector typically follows, there is a risk that everyone is too busy during boom periods and resources are too stretched during the bust periods to undertake it. Innovation and new developments have the appropriate forward-looking perspective key to any industry growth and progression; however, it is important that we do not lose sight of the need to conduct research in order to increase our level of knowledge of the industry past and present, to identify where and how mistakes were
made in the past and importantly, to inform and provide a solid basis for the innovation and development of new and improved processes and methods of work. The recent Forfรกs report on the industry was welcomed and could potentially provide a springboard for further work. There is a need for greater collaboration between industry, academia and government in establishing and implementing an ongoing programme of research in the construction sector. This also applies, for example, to bringing back the Construction Industry Annual Review and Outlook publication which previously provided crucial data on the industry.
St James’s H and H, St James’s Hospital, Dublin . Image courtesy of Donal Murphy Photography
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Business Intelligence Linking Strategy to Results
To assist in understanding the wider economic context in which the construction industry sits and to picture some of the different perspectives, we have spoken to a number of industry leaders for their thoughts on some key questions.
16 | Business Intelligence
Arts Millennium Building Extension, NUI Galway, Galway Image courtesy of Paul Tierney Photography
“ We envisage that we will invest at least €2bn in the period to the end of 2016 .” Brendan McDonagh, CEO of NAMA
AECOM: NAMA has stated that they have €2 billion in funding available for viable construction projects. Are the right projects available for funding? Brendan: Yes, we have already approved €1 billion for projects in Ireland, €500 million of which has been drawn down and is being invested currently across a range of both commercial and residential development projects. We said in May 2012 that we envisage investing at least €2 billion in the period to the end of 2016, in addition to the €500 million already approved before May 2012. A major focus in this regard is the Dublin Docklands SDZ, which is where future FDI will be located. Specifically, we see the Docks as the next natural progression of the Irish Financial Services Centre (IFSC), and see projects such as Boland’s Mill as also being of strategic importance. New companies coming to Ireland want to locate close to the global financial services and IT companies already located here, so there is a real opportunity for Ireland to further develop this area as a global hub or cluster for the technology sector. AECOM: Is this underway or is anything restricting this? Brendan: Planning is a major focus and a major challenge. We have inherited projects with planning permissions that are not viable, either from a financial or indeed planning perspective, and projects that have no planning. Bringing projects through the planning system is therefore a major part of our work with debtors and receivers. The lack of a definitive timeline for decision points is the biggest issue for most
projects given the uncertainty around planning approvals. The current SDZ for the Docklands, for instance, will not emerge from An Bord Pleanála until mid-2014, all going well, and given the design, construction and letting phases, the first building might not be ready for occupation until 2018. This is a long time away given that the funding is available now and demand has been identified by the IDA for Grade A office accommodation in Dublin in the near term. AECOM: What other areas are of interest to NAMA? Brendan: The other area is housing. We expect, for instance, that we will fund the construction of 4,500 new residential properties, through new housing and the completion of apartments in Dublin over the next three years. We expect to invest in family homes in the areas in which our assets are located. 93 percent of our assets are located in Dublin, the neighbouring counties of Meath, Kildare and Wicklow, and the other major cities, Cork, Limerick and Galway. These are the areas where demand for new homes will be concentrated over the short - to medium-term based on the population. In terms of impediments, we don’t see land availability or funding as the issue — the main issue is sustainable, commercially viable planning being in place. Demand is and will be for owndoor, family homes — the market is making this clear — and this needs to be reflected in the planning framework. Our experience is that local authorities are very receptive to this argument Business Intelligence | 17
“ We are actively looking for viable projects to fund, but the reality is that projects are only now starting to get into this zone.”
but they too have to work within the existing planning system, within the timescales set down, for example, for revisions to development plans or the preparation of new local area plans. NAMA carried out an exercise with South Dublin County Council to assess the number of available viable planning permissions that can be pursued currently. Out of 5,000 permissions identified, 50 percent relate to NAMA and of these, only 600 are currently viable. So, as an example, if you apply a similar metric to the approximate 30,000 planning permissions that are talked about in the context of Dublin, then there are actually only between six and eight thousand viable planning permissions currently available against a backdrop of rising demand. A lot of work has to be done by all concerned to deliver projects that have a real prospect of being funded and for which there is market demand.
cap. If there are projects that can show a commercial return for us, we will fund them. Our strong cash performance since inception — we’ve generated over €15 billion since 2010 — means that we have the wherewithal to fund viable projects. I go back to planning, however: the system has to be capable of responding to market demand and, in particular, the current lead-in for decision making in planning time has to be addressed. AECOM: Will all the €2bn go to Irish projects?
AECOM: What percentage of the €2bn is still available?
Brendan: Yes, the €2 billion referenced is for Irish projects. In addition to this, we have committed funds for the workout of schemes in other jurisdictions where this makes commercial sense. For example, we have funded €120 million in Northern Ireland on schemes to date — an example being a significant investment to complete two landmark office blocks in Belfast city centre in response to demand for that additional accommodation space.
Brendan: A significant portion of the funding is still available. As pointed out, we had committed about €500 million before the announcement was made in May 2012, and since then we have committed a further €500 million to projects. We are actively looking for viable projects to fund, but the reality is that projects are only now starting to get into this zone. We expect to approve a further €1.5 billion for projects up to 2016 and this is not a
Our other main focus is London. As an example, I understand that there are 17,000 apartments currently being built in London at present and NAMA is funding 4,000 of those. What we find in London is that very substantial demand and pre-sales are commonplace, with 20 percent non-refundable deposits being paid. The cycle is such as that by 2014/15 we will be cashflow positive in London and making a strong return on our investment. This reflects the
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fact that the London market has been more profitable than the Irish market over the last couple of years and it has made sense, therefore, for us to recycle funding from completed London developments to new development and to generate cash flow that is allowing us to invest to enhance the value of our Irish assets. AECOM: NAMA has made its intentions clear in respect of providing social housing through completion of housing schemes within their control. How is this working? Brendan: NAMA has offered up 4,500 units for social housing. We are disappointed that only 2,000 of these are to be taken up by the local authorities but this reflects the various planning and housing considerations that they must consider, including the 20 percent quota that has been in place that is designed to deal with issues around the location and integration of different housing tenures. One of the major issues that this process has thrown up and which we are currently facing is the past failures of the construction industry in terms of self-regulation. This is manifesting itself in a range of building defects in completed and semi-completed stock built in 2006-2009. We are committed to remedying these latent defects within the existing stock, as we won’t have local authorities or housing associations taking on units
with these problems still present. This is a significant cost. It also raises a very serious question and a challenge for the house building sector in Ireland and for the regulation of that sector. It serves nobody well, least of all the construction industry, to have presided over poor practices and disregard for building regulations. AECOM: How many units have been provided to date? Brendan: At the end of 2013 we hope to have 600 social and affordable units completed and contracted. We will then have 1,400 units to complete in 2014-15. We are eager to move on these as quickly as possible and have been actively working with the Housing Agency and housing associations to align policy and funding to enable schemes to proceed. When one looks at the total amount of new social and affordable units delivered in 2013, the 600 units completed by NAMA constitute a significant amount. AECOM: What is the current status on the private NAMA-controlled housing stock? Brendan: Looking at the general housing stock, NAMA controls approximately 20,000 units, of which 14,000 are completed and the remaining 6,000 are at various stages of construction. A significant proportion of these properties will be completed
but there are others that will not. We are currently planning on the basis of ten housing schemes being prepared for demolition as part of Site Resolution Plans with various local authorities. In certain cases the quality of the existing build is so poor with insurmountable health and safety issues that the only option is to demolish. On one of the sites where we have already demolished a poorly constructed apartment block, it has significantly improved the conditions for existing residents and removed a liability for NAMA, so in effect it has turned out to be a positive outcome given the circumstances. When you consider that Ireland has around two million housing units, we have to conclude that the remaining 6,000 represents a relatively small percentage of the overall national housing stock. AECOM: What can the construction industry do to assist NAMA in achieving its business plan? What has worked well or otherwise to date?
Ireland would appear to be lacking in terms of innovation on projects. Building regulation is part and parcel of operating in the U.K., it is priced in. Innovations in areas such as “green living” and sustainable family living are a feature and contribute to the overall branding of housing developments and market perception of quality. This should be looked at here. We need to be in a place whereby ordinary purchasers will recommend to a friend that House builder XYZ produces “good houses” and can be trusted. This is happening on a small scale but could be significantly improved on. Overall, we look forward to a more positive interaction with the industry where we overcome the problems of the past and help rebuild the industry in the process. The construction industry is obviously very important in the context of NAMA’s work but it is also important in the context of the overall economy and employment. We should be partners and strategic allies and the days of construction short cuts are over as far as NAMA is concerned.
Brendan: In simple terms — get it right, first time, price it correctly, embrace the building standards, employ a reputable team to supervise the works and start to rebuild the reputation of the construction industry. Secondly, in comparison to NAMA construction projects in the U.K.,
Business Intelligence | 19
“ For 2014 it is important that there needs to be continuous investment in terms of infrastructure. ” Frank Conlon, Manager, Property Division, IDA Ireland AECOM: How did 2013 compare to 2012 in terms of inward investment? Frank: Our 2012 report which was published in mid 2013 would have shown 3 years of continuous growth in terms of jobs, projects approved and across nearly all our key metrics in terms of attracting Foreign Direct Investment (FDI). That strong momentum has continued into 2013 and we would expect 2013 as a whole will be a continuation of that previous good performance. AECOM: How did the investment breakdown between Dublin and the regions? Frank: Dublin would capture north of 50 - 60 percent of the announcements and that is reflective of the shift away from manufacturing as we knew it in the past, into the technology, services and office requirements. The concentration of business in Dublin has gravitated to the central business district with the likes of Facebook and Deutsche Bank to name but a few and on the southside of the city with the likes of Novartis and SSE. Outside of Dublin there have been major investments with the likes of Allergan in Westport, Analog Devices in Limerick, Ely Lilly in Cork and Paypal and ebay in Dundalk are some examples. The regional distribution where it has happened has been very
20 | Business Intelligence
strong and robust and given a very significant economic boost to the local economy. FDI footprint in other smaller towns is thinner on the ground. The spread has not been as much as IDA would like it and our objective would be to build on that in 2014. AECOM: There is a lot of discussion around the patent cliff in the pharmaceutical sector, is this a major area of concern on the radar? Frank: Certainly it would be on the IDA’s radar - FDI companies account for circa 60 - 70 percent of exports and the pharmaceutical and life sciences sectors would be a significant part of it. However, if you look at the churn in that market at the moment there are a whole new wave of companies coming into the sector – especially the bioPharma sector. Track record and reputation is key to attracting new companies in the pharmaceutical sector. AECOM: Ireland has had the tag of saints and scholars; in terms of the education sector, are we still producing the right number of graduates in the right disciplines and are there sufficient connections with industry? Frank: The educational sector produces a good supply but more importantly, a good quality of graduate. That has underpinned the thousand foreign
investment companies here today. The education system is well networked into companies with joint research projects. For example if you take NUI Galway there are a number of IDA companies engaged directly with the university in research programmes. Similarly, all of the universities have strong links with industry. The Institutes of Technology have also developed masters programmes in conjunction with companies on a phased basis to develop the particular skills they require. AECOM: What is the forecast for 2014? Where do you see the concentration in terms of geography? Frank: IDA Ireland would see further growth in the FDI sector in 2014. The international pipeline for FDI is good and we would consider Ireland’s competitiveness as being very strong and in a position to continue to attract in similar companies. For 2014, it is important that there needs to be continuous investment in terms of infrastructure. Innovation in technology and business does not stop so investment in infrastructure needs to continue in areas such as broadband, development of Strategic Development Zones (SDZ’s), water / waste water, power.
AECOM: It has been said that the main centres do not have the required office space available. Is this the case in your opinion and if so where are the deficiencies?
AECOM: In terms of the construction industry would you have any advice or concerns in terms of its capacity to meet demand whether driven by FDI or otherwise?
Frank: If you look at the dynamics of the Dublin market, there is a clear opportunity for investors to move into the 100,000 sq ft+ space provision for blue chip companies. We are fast approaching a place where we will need to see new construction. The same could be said for Cork in the past year. If you move outside of that there is demand for space in Galway and Limerick. There will also be opportunities for the market to provide new manufacturing space in 2014.
Frank: If you stand back and look at it from an IDA lens and what makes Ireland great, our construction skills have become a key competence. Where else in the world would you get a skill set that can handle the complexities involved in the highly regulated biopharma, pharmaceutical, data centres, and I.T. sectors? We should never underestimate the reputation that this brings to Ireland. These skill sets carried us through the Celtic Tiger and are still carrying us through today. It is a very valuable asset to Ireland to have these competencies from contractors, consultants and post construction in the FM and operations management.
For Dublin to be successful, we will need to have a critical mass of speculative stock available as well as builds based on pre-lets as a lot of technology companies need to get up and running straight away or can grow very fast – such companies cannot afford to wait 24 months to get off the ground.
Business Intelligence | 21
“ refurbishments may be the filler and start coming on stream in the next 12, 24, 36 months with the new builds lagging behind ” Peter Collins, AECOM: Kennedy Wilson was one of the first of the major investors in the Irish market. How has the market changed over this period? Peter: In terms of the Irish market when we arrived in 2011 there was very little happening. We did our first transactions in the first and second quarter of 2012 and in retrospect there was relatively little competition in the market at the time. The market has changed profoundly in two years and the main change has been a return of confidence to Ireland. More specifically the two main developments have been, firstly we have seen a lot more international investors and secondly the introduction of the REIT legislation will have a very big impact. Long term investors could probably start to say it is a well structured market with the right mix of transparency and people who will stick with the market and it is not all local capital which could be under stress. AECOM: In your view, does Ireland still represent value for money from an investor’s point of view? Where are Ireland’s so-called ‘competitors’ in this regard? Peter: The perception is that prices have risen in the last 12 months and in particular six months. It probably began to stabilise in 2012 and pick up since then. We believe there is still good value here because really what has happened
22 | Business Intelligence
is that yields have now come down. When you look at the capital cost per square foot of the basic groups you are probably edging above replacement cost but there still will be pockets of value. You have to be selective and obviously different people will have different views on where that value is. In terms of where Ireland sits compared to the competition for the available capital I think Ireland is in a good enough space. Ourselves, we have set down roots here for the long term with offices and 25 people. Clearly the more opportunistic, transitory capital may move quicker but our impression would be that they are still quite focussed on Ireland. It is much easier to do the second deal once you have done your first and the opportunistic investor may be encouraged to build a portfolio of scale now that the volume has increased and pricing is still relatively sensible. AECOM: How does Ireland compare to other European countries for doing business? Peter: Our European business is primarily in the U.K. and Ireland and certainly it is as easy doing business in Ireland as it is in the U.K., which would be seen as one of the most transparent property markets in the world. The only stumbling block was the flow of deals was slow but that is beginning to change and the volume is increasing.
AECOM: Are there any areas that the construction industry specifically should or could address? Peter: We have a number of current properties where there are opportunities to either add to or improve what we have in terms of construction and we are actively working on some of those opportunities. In many respects you are waiting for rents, there are two sides to the equation costs and rents and at the moment development of anything in terms of new build, would be very marginal. Collectively we need to figure out how we bridge that gap to the tipping point where it makes sense to press ahead. Logically the refurbishment world is going to be easier to get your head around, your planning and construction risks are significantly lower so you can see yourself getting into the refurbishments much quicker. So refurbishments may be the filler and start coming on stream in the next 12, 24, 36 months with the new builds lagging behind, that would be my own sense of how it will happen. One aspect of more from a planning perspective than construction is in relation to residential. Looking at it from a perspective of if you were to build residential for renting, which doesn’t tend to be done here, the current building regulations and codes in terms of number per cores etc don’t make for ideal residential buildings where we like to have a centralised area where people come through and disperse as opposed to apartment blocks with 25 doors and lots of cores
which makes it very expensive. So would we build for renting, ideally not with the current codes unless rents increase significantly. So perhaps this is something the planning authorities will consider when these discussions start happening again. AECOM: Outside of Dublin, how do you see the commercial and residential sectors performing over the next 3 years in cities such as Cork, Limerick & Galway? Peter: We have been very Dublin focussed, so not dissimilar to the U.K. where there is London and the rest, in Ireland there is Dublin and the rest. But you are beginning to see some comeback at an investment level in Cork. From an occupational market level whether it is offices or residential it is lagging behind a bit and will take a while longer.
Peter: I don’t think there is a shortage. But logically there will be a shortage as demand is increasing, however it is probably slightly over stated. Undoubtedly for Central Business District (CBD) Dublin there will be shortages emerging for large floor plate buildings. It is worth noting however a very high percentage of leasing in Dublin is less than 10,000 sq ft so there is not 400,000 sq ft of overseas people banging on our door saying please build us a building. AECOM: What plans, if any, do Kennedy Wilson’s have for development in Ireland in terms of new construction? Peter: We clearly have some interesting sites which were acquired as part of other acquisitions and we are actively looking at ways of adding value through getting through planning and taking them further down the track.
Where your capital is coming from overseas there is a real Dublin bias and whether that is justified, maybe not as much as it is coming across but, it is real. Ireland is still seen as a relatively high risk location compared to some of the other core locations and one has to ask the question am I going to take the next step into a town outside of Dublin or is this more suited to local capital? AECOM: A number of commentators speak about the shortage of commercial offices in the major centres, particularly Dublin. What is Kennedy Wilson’s view?
Business Intelligence | 23
Geographies Connecting one global market
24 | Geographies
Halley VI, Antartica Image Courtesy of 速jmorris
The reality is that markets are made up of a range of sectoral and regional sub-markets that can, and often do, operate at different levels.
We often hear and see it written, in a wide variety of contexts, that “a two tier market” exists. This is probably most frequent when people are engaged in the national pastime of discussing the Irish property market. With the direct connection between the construction industry and the property market, it is inevitable then that such conversations infiltrate construction sector dialogue. The reality of course is that markets are made up of a range of sector and regional sub-markets that can, and often do, operate at different levels or tiers and at varying speeds. In this regard it is important for those operating in the construction industry to understand the trends across regions and sectors and how these will influence the market. Armed with this knowledge, AECOM can see the opportunities to achieve value for money and significantly improve the chances of successful project delivery. Over the following pages we review the key trends in the construction industry across the island of Ireland. We also take a snapshot of the U.K. market and this year we have included a feature on the Asian market, a key area of potential growth. For a copy of our full Asia Construction Outlook 2013 or market reports on other regions in the global market please contact paul.mitchell@aecom.com
AECOM presence 140 countries
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$$$
Island of Ireland In output terms, the construction industry in Ireland has a number of key determinants namely: (a) general economic climate; (b) sector-specific demand; and (c) industry capacity. We are acutely aware that the general economic climate is one of fragile growth which is significantly exposed to the international trends. In addition, closer to home our exit of the bail-out in December has brought with it reasons for confidence, but it also carries with it risks. This, combined with another cost cutting budget likely in 2014, means that, notwithstanding the export sector performing strongly and boosting our balance of payments surplus, growth is likely to be constrained in 2014. As noted in our medium-term review, the commercial and industrial sectors performed strongly in 2013 and this should continue in 2014. Likewise, after a strong “Year of the Gathering,” we would anticipate investment in the tourism sector to build on 2013. These
strong-performing sectors tend to benefit some regions more than most as highlighted in the regional spotlights below. Finally, in terms of industry capacity, there is no doubt that the industry will be able to provide the resources necessary. Nevertheless, it is important to consider the medium-term needs as most organisations in the industry have downsized to meet current requirements and it is not simply a case of flicking a switch to increase resources. This must be done in a managed manner to avoid any logjams or, more likely, higher rates of tender inflation Cork and the Southern Region Education, healthcare and pharma continue to provide the backbone of construction activity in the region. In common with other regions, the school building programme has progressed in 2013 and will continue in 2014. At third level, University College
Geographies | 25
Fitout Project – Confidential – client Image courtesy of Donal Murphy Photography
Cork (UCC) is currently completing the Tyndall Institute Block B refurbishment and has completed its masterplan for the Irish Marine and Education Research Cluster (IMERC) with the first phase underway. UCC is also undertaking their masterplan for the science and innovation park.
Belfast
Galway
Limerick
Cork
Dublin
Both public and private healthcare continue to see investment. Gastroenterology services are being centralized at Mercy University Hospital (MUH), whilst Cork University Hospital (CUH) has an expansion planned to their existing magnetic resonance imaging (MRI) facilities. The Bon Secours is currently on site with a roof-top extension to their existing cath lab. At primary care level, the Health Service Executive (HSE) and UCC are at the public procurement stage for a major primary care centre on the campus at St. Mary’s Health Campus in Gurranabraher. 2014 should see the plans for the Cork Events Centre being progressed, in addition to the proposed National Food Centre. Cork continues to be a strong hub for the pharma and medical devices sectors, such as the recently completed Stryker medical devices facility in the IDA Business and Technology Park. Foreign direct investment has also led to one of the largest projects in the region in 2013 with the expansion at the Apple European headquarters. In the residential sector, Cork city is lacking a supply of good quality three
26 | Geographies
and four bedroom housing and this, in addition to NAMA and receivers starting to develop some of their more marketable sites in areas such as Bandon and Kenmare, may see an increase in residential construction activity. Limerick and the Mid-West Region 2013 has been a year of change in Limerick, with a number organisational changes coupled with the launch of key strategic plans for the future. This has led to renewed optimism for the future. Limerick City Council and Limerick County Council have merged as one entity and now also incorporate Limerick Regeneration. The launch of the “Limerick Regeneration Framework Implementation Plan” is an important milestone and will provide a roadmap for delivering the vision of safe and sustainable communities in well serviced and attractive neighbourhoods. The Limerick Institute of Technology (LIT), also launched its Campus 2030 Masterplan for its city centre and Moylish campuses. 2014 should see the first steps in the delivery of these strategic plans which, combined with Limerick being the City of Culture 2014 and the Irish Technology Leadership Group holding their annual conference in the city, should all provide a welcome boost to activity in the region. Shannon Airport also got a new lease on life by becoming independent of Dublin Airport Authority and an autonomous entity from 1 January
Project Triumph, Roseisle Distillery in Elgin, Scotland. Image courtesy of Keith Hunter Photography
2013. Combined with the abolition of the travel tax and new routes being announced by Ryanair amongst others, it is another welcome boost to the region. In terms of private investment, the redevelopment of the former Parkway Valley Centre into the Horizon Mall, with Marks & Spencer as the anchor, is a key retail development in a sector that has struggled more than most. In addition the welcome news that Regeneron Pharmaceuticals is planning to take over the 400,000 square foot former Dell facility will also provide welcome construction activity. Galway and the the Western Region There was increased activity nationally in the tourism sector in 2012 and 2013 and this has helped grow confidence. This is evidenced by a survey published in the 2013 AIB - IHF Sector Outlook Report which found that 55 percent of hotels intended to improve and grow their business over the next three years. So we would expect increased investment by hotels in the region, along with tourist attractions such as the Galway Racecourse, which continued to invest in the facilities in 2013 with enhancements to the Millennium stand and a new northern entrance building. Elsewhere, the public-sector capital programme continues to be a key contributor to the economy. National University of Ireland Galway (NUI Galway) is continuing its development programme with a new life sciences
study building on site and a new clinical and translational research facility being built in collaboration with the HSE on the University Hospital Galway (UHG) campus. The HSE has recently advertised for a new 75 bed ward block in UHG and an Endoscopy unit at Roscommon County Hospital. In common with other regions, foreign direct investment is a major driver of construction activity and the major Allergan development in Westport and the recently-commenced Hewlett Packard office development in Galway are examples of this. We welcome the IDA Ireland end-of-year statement, that they intend to start building new property capacity in regional locations, including Waterford, Athlone and Letterkenny. From a civil engineering perspective, hopes remain high that the Gort to Tuam motorway will finally commence in 2014 which would provide a welcome boost to the sector in the region. Northern Ireland Finally, after five years of contraction, then stagnation, the construction industry in Northern Ireland (NI) is starting to stabilise and indeed to tentatively grow. The general feeling within the industry is more optimistic, especially so in the last quarter of 2013. The Ulster Bank PMI indicates a recovery within private-sector investment at a level not seen since March 2004. Unemployment rates remain at, or just below, the U.K. average of 7.6 percent and it is expected
that there will be a slight inflationary pressure on construction prices as normal levels of activity resume in the market. Residential property prices in NI appear to have bottomed and indeed are rising again in the main urban conurbations around Belfast. The forward guidance from the Bank of England on likely timescales for interest rate rises has brought some certainty to the mediumterm costs of finance. A number of retail developments have been recently sold to U.K.-based property investors who consider the underdeveloped NI retail sector to be rich pickings again. Public-sector work now also appears to be moving from feasibility to shovelready projects and we hope to see some significant public-sector projects starting this year.
United Kingdom After five years, the belief appears to be that the construction sector landscape in the U.K. is offering, dare we say, green shoots. Industry surveys point to renewed optimism throughout the industry. Growth forecasts have been revised upwards for 2013 and 2014: for example, the Confederation of British Industry (CBI) forecasts growth of 1.3 percent in 2013, and a further acceleration in 2014 of 2.3 percent GDP growth. Broadly, output levels still remain below those of 2010 and 2011 Geographies Geographies | 27
28 | Geographies
1 World Trade Centre, New York, USA Image courtesy of Silverstein Properties
Serpentine Gallery Pavillon 2013, London, U.K. © Sou Fujimoto Architects, Image © 2013 Iwan Baan
(chained volume measures). Similarly, the total value of new construction output is marginally above the postcrash nadir of 2009 (current prices). Fundamentally, construction output as a proportion of GDP is at its lowest for over 50 years. Quarterly growth rates for new work rose by 3.2 percent in Q2 2013, whilst seasonally adjusted total work grew by 2 percent. Figures for Q3 2013 underscore the broader trend of volatility in output data and the differing fortunes across sectors. Therefore, assertions that balanced growth is in play are less clear. AECOM’s Tender Price Index, which measures average tender price movement for competitively tendered projects indicated prices in the Greater London area continued to edge up in Q3 2013. Whilst this recent increase underscores an improving price environment for contractors in this region, the same story may not yet be replicable across wider parts of the U.K. or sectors. Generally, price levels in the regions remain unchanged, although there are nuances depending on location and sector. ”This time it’s different” is a common industry refrain. In all probability, the pace and sustainability of any recovery will be substantially influenced by external events. Any recovery should avoid the unfavourable aspects of the years leading up to the financial crisis. Save for apparently increasing confidence levels, questions remain
Supply chain constraints have manifested themselves very quickly on the strength of emerging increases in workload, which is of some concern. Incremental rises in new orders and output could alert potential new entrants to the U.K. construction industry as a source of revenue, adding to price competition amongst contractors once more. Until stable, continuing and robust quarterly GDP growth rates are evidenced and momentum across industry sectors is clear, for now at least, it could be safer to call this a rebound for the construction industry rather than as a sustained recovery.
with respect to actual changes or improvements in the structural makeup and debt levels of the U.K. economy. These factors, amongst others, will ultimately affect overall levels of construction output. Specifically, broad-based momentum across sectors is necessary to ensure the continued well-being of the industry. So too is an alignment of the strategic goals of the U.K.’s productive capacity with a visible pipeline of construction output. This enables the construction industry to minimise cycles of boom and bust, support investment and ensure sustained contributions to U.K. GDP.
5% 24% Eastern
17%
Western Europe Europe
North America
46% Asia
2
% Middle East
4%
2
% Africa
Latin America
Figure 5: Share of construction spending by region 2020.Source: IHS Global Insight (2012)
Geographies Geographies | 29
Ithra Cultural Centre, Dhahran, Kingdom of Saudi Arabia Image courtesy of Snøhetta / MIR
Asia Focus Asia is tipped to be the world’s fastest growing region between now and 2020. Until the end of the present decade alone, the region is forecast to grow at a rate of around 7 percent a year. Accordingly, the Asian construction market is set to be one of the busiest on the planet. While Western economies have slowed, Asia has maintained growth, albeit at lower levels than in previous years. As a result, today Asia is the largest regional construction market worldwide, accounting for some 40 percent of global construction spending in 2012. Asia has become increasingly dependent on domestic demand in recent years. Burgeoning affluence and urbanization, a headline trend forecast for the region over the coming decades, will strengthen that demand going forward, further fuelling construction activity. This key trend will also steer construction in a new direction: Activity will shift away from non-residential structures and instead move towards infrastructure, and then in the longer term to residential projects. Funding models will also evolve in Asia, with growing use of private finance,
30 | Geographies
including public-private partnerships. Our review shows that China is the standout market, based on both its huge size and growth potential. The country accounts for some 41 percent of the Asia-Pacific total construction spend, with expenditure of US$1.25 trillion last year. China was also top in our research in terms of profitability expectations for firms working in the market. In terms of market size, China is followed by Japan, India, Korea and Indonesia. However, the strongest growth in construction spending will be seen in China, India, Indonesia and Vietnam. India offers a significant level of opportunity because despite having a population comparable in size to that of China, its construction sector is only about one-third the size of the Chinese market. However, with the public purse constrained, growth will depend on India’s ability to attract private finance. Indonesia emerges in our review as a particularly interesting market. Construction spending in the world’s fourth most populous country accounted for more than a quarter of the nation’s GDP in 2012 with around half of this expenditure funding infrastructure projects. Our research also found that the Indonesian capital Jakarta is viewed as the number
one city in the region for potential market growth and profitability. Interestingly, expectations for growth and profitability in Chinese cities are relatively poor. Vietnam, despite being one of the smaller construction markets in Asia, is set to see rapid growth in spending on residential, nonresidential and infrastructure projects over the next five years. In the shorter term, the property market is suffering from a downturn but this is expected to be overcome in the longer term. Although Japan is the region’s second largest market by size, the present spike in construction activity is forecast to be relatively short-lived. This is largely because much of the work is being driven by rebuilding required following the earthquake and tsunami in March 2011. Overall, the review shows that Asia’s construction market offers excellent prospects for growth and profitability over the short-, medium-, and long-term. For a copy of our full Asia Construction Outlook 2013 or market reports on other regions in the global market please contact paul.mitchell@aecom.com
Hong Kong Science Park, Phase 2.
Geographies | 31
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Reference
32 | Reference
Hermitage Centre, Dublin
Indicative building costs
â&#x201A;Ź per square metre
Healthcare Hospitals 1,800 Primary care centres 1,500 Nursing homes 1,500
2,900 1,900 2,100
Education Primary schools 930 1,200 Secondary schools 930 1,200 Third level 1,450 2,700 Commercial Offices - Shell and core (landlord fit-out) 1,400 2,000 - Owner occupied 1,600 2,600 Offices fit-out - Basic 300 600 - Medium 600 900 - High 900 1,200 - Top 1,200 1,950 Shopping centres - Shell and core 650 1,100 - Mall 1,450 2,650 - Fit-out 900 1,500 Residential Apartments 1,300 1,700 Apartments (12-16 storey) 1,600 2,100 Social housing 920 1,400 Sheltered housing 1,020 1,550 Housing (suburban housing) 900 1,200 Industrial Warehouse/factory shell 600 700 Factory (basic) 700 975 High spec factory - Shell and core 925 1,300 - Fit-out 700 1,150 Leisure Cinema 1.600 2,200 Hotels - 3/4 star 1,400 2,075 - 5 star 2,075 3,200 Swimming pool - (60% wet and 40% dry) 1,700 2,225 Car parks Surface (includes drainage and lighting) 100 Multi-storey 370 Single basement 535 Double basement 740
225 640 850 1,175
Public buildings Fire station Prison Courthouse
1,950 2,700 2,500
1,650 1,950 2,000
The figures quoted are for mid-range buildings in the Dublin area at January 2014 prices. Due to the volatile nature of the current market, it is possible that tenders will be received outside these ranges. Professional advice should be sought for specific projects. The AECOM indicative building costs should NOT be used for fire insurance valuations or for residual valuations for funding purposes. If you require a valuation for fire insurance or more specific information, please contact AECOM. When considering building costs, you should check if costs include: - Value added tax - Professional fees - Inflation - Fit-out - Landlord fit-out/landlord credits - Furniture - Planning levies, fees and charges - Demolition - Abnormal ground conditions
Reference | 33
Renault, Dublin (photo courtesy of Lafferty).
Case Study: Offices — New Build or Refurbishment?
In certain areas in Dublin city we are now at a viability tipping point. Where during 2013, the aspiration was to achieve rents in the early €30 per square foot region, we are now hearing whispers of new office deals in excess of €35 per square foot which is the trigger for new build offices in desirable locations in the city.
The next challenge for owner occupiers and developers is to design office buildings that are efficient and offer the correct value for money to balance the equation based on the available rent and yields. We are seeing somewhat of a move away from the traditional narrow floor plate and extensive glazing. The tendency now seems to
be moving to deeper floor plans with a higher ratio of solid facades with design quality being achieved through shape rather than materials. However, this does depend on whether the building is owner-occupier or speculative.
Figure 6: Creating the value gap
Common area upgrade only
Strip existing building: Fit out to Cat A standard, incl. full M&E
Full Cat A standard, plus move cores to improve efficiency
As before plus upgrade Facade
Construction cost
Rent
€/sq ft (gfa)
€180/sq ft
€30/sq ft
Potential impact of 10% increase on net lettable areas €140/sq ft
€25/sq ft
€20/sq ft €100/sq ft €15/sq ft €60/sq ft
€10/sq ft
€5/sq ft
€20/sq ft
* A detailed financial appraisal should be carried out when assessing costs of development options 34 | Reference
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C5'$%069#5'90%9&'#5'B,2-#5'$#6>'*%'90%'5/*'96'9':#92#-#6>'6#==#5<'=/#56' Add volume to foyer Moving cores Add volume to foyer ' *3%0%'.,0#5<'HIJK'63%'9&=#096#/5'*9&'6/'9$3#%:%'0%56&'#5'63%'%90->'' Upgrade common areas Restrictive floor height Widen entrance LKIM'&G'"6'0%<#/5'*%'90%'5/*' 3%90#5<'*3#&=%0&'/"'5%*'/""#$%'.%9-&'#5' Infill/reduce atria Secondary glazing Introduce natural light ' %D$%&&'/"'LKNM&G'"6'*3#$3'#&'63%'60#<<%0'"/0'5%*'2,#-.'/""#$%&'#5' Displacement systems Strengthening floors Bikes and showers ' ' .%&#092-%'-/$96#/5&'#5'63%'$#6>? Green roofs Add a floor Improve circulation Removing columns
Sustainable measures
' E3%'5%D6'$39--%5<%'"/0'/*5%0'/$$,=#%0&M.%:%-/=%0&'#&'6/'.%&#<5' Part M /""#$%'2,#-.#5<&'6396'90%'%""#$#%56'95.'/""%0'63%'$/00 %$6':9-,%'"/0' ' 4/5%>'6/'29-95$%'63%'%G,96#/5'29&%.'/5'63%'9:9#-92-%'0%56'95.' '63%' ' >#%-.&?'8%'90%'&%%#5<'&/4%*396'/"'9'4/:%'9*9>'"0/4 609.#6#/59-'5900/*'"-//0'=-96%'95.'%D6%5&#:%'<-9O#5<' 6/'.%%=%0' It is always a delicate balancing We have seen a lot of office ' "-//0=-95&'*#63'9'3#<3%0'096#/'/"'&/-#.'"9$9.%& '*#63'.%&#<5'G, 9-#6>' act between available income and return refurbishment taking place in the 2%#5<'9$3#%:%.'630/,<3'&39=%'0963%0'6395'496%0#9-&?'P/*%:%0F'63#&' on capital expenditure. As the image capital and elsewhere over the past ' shows, there are lots of areas to be few./%&'.%=%5.'/5'*3%63%0'63%'2,#-.#5<'#&'/*5%0 years. As the demand from FDI Q/$$,=#%0'/0' considered. There are very successful increases, we are now seeing landlords ' ' &=%$,-96#:%? investigate more intensive or invasive fit outs, which include the upgrade of' the facade and reorganisation of the internal layout of the building to improve efficiency.
examples of completed buildings in existence where a full overhaul has been put in place and premium rents achieved as a result, however, this obviously depends on the location of !"#$%& ' &$()&*+,&.,1&12#-&#)&(-&(&1(=>0 7& the existing building in the first place.
' Office refurbishment versus new build
â&#x20AC;&#x153;Office floor space in excess of 100,000 sq ft in short supply.... time for New Build?â&#x20AC;?
' '
There are also examples of where there has been a high level of intervention but yet the end product is sub optimal, leading to a negative experience for the tenant, which impacts future rental and more frequent exercising of break clauses.
Office refurbishment
New build
' ' ' ' ' ' Floor loading
' ' '
Facade upgrades M&E upgrades
Can be done floor by floor
' ' '
Tenant can see space first
Certification services Columns
Floor to ceiling
Faster
Riser capacity
Demolition Less Costly
Layout restrictions
Cost
Wide range in scope and specification Add floors?
Match brief
Viability Parking
Programme Required floor to ceiling heights
Insufficient rent
Flexible space
Funding
Developer Contributions
Energy efficient
Optimal grid
Choice of mechanical system
Reference | 35
Case Study Transportation: Grangegorman, M50 and Lissenhall Grangegorman Grangegorman Urban Quarter involves the development of a modern third level campus for Dublin Institute of Technology (DIT) and expanded healthcare facilities for the HSE and future commercial elements, on a 30 hectare site in Dublin’s North Inner City.
Assessment for the planning application in 2009. This involved detailed assessment of public transport in the area, analysis of traffic impacts using the RPA Local Area Model, and Mobility Management proposals to minimise car travel.
What we did. – The peer review during Masterplan development in 2008, involving detailed assessment of the impact of the proposals on the local road network and consideration of the capacity of the access proposals to cater for 25,000+ students and thousands of permanent staff.
Construction of the Site Infrastructure and Public Realm Contract is due to commence in December 2013.
– The design study of access options to the campus from Constitution Hill. This required detailed discussions with CIÉ on routes through the existing bus maintenance depots at Phibsborough and Broadstone, and liaison with the Railway Procurement Agency as the proposed Luas Broombridge tram alignment runs through the bus depots. – The preparation of a Strategic Development Zone Transportation
36 | Reference
M50 Demand Management Services Provided – Demand Management Strategy for the busiest motorway in Ireland which carries in excess of 300,000 unique vehicles on a daily basis. – Analysis of management options for the M50, both traffic control and fiscal measures, and a full economic and financial appraisal of the final Demand Management Scheme. – Included Road User Charging in the form of a multi point distance based variable toll system, Traffic Control, ITS measures and Smarter Travel Measures
– Involved teams from numerous disciplines including Transport Planning, Transport Modelling and Appraisal, Economics, Sustainable Travel, ITS and Highways all of whom were based in Ireland. Innovations – The proposed multi point tolling system would be the largest in Europe. – The system will increase daily passages by over 100% ensuring equity for all M50 users whilst reducing average toll payments. – The combination of fiscal and control measures proposed on the M50 is the first of its kind and will ensure the capacity of the M50 is protected. – Journey time reliability is maintained and safety is improved for all road users. Challenges – Tolling technology is an ever evolving industry where the efficiency, reliability and cost of collection are constantly improving.
Grangegorman Urban Quarter, Dublin. Image courtesy of Grangegorman Development Authority
– Operational aspects of Variable Speed Limits presented some challenges due to the complexity of traffic streams.
– Preparation of PromSpec’s and MOVA Data Sets – Factory Acceptance Testing (FAT) of Controllers
– Political challenges came with presenting the scheme to government stakeholders and local authorities committees.
– Site Acceptance Testing (SAT) and Site Commissioning of Signals
Client: National Roads Authority
Innovations – Unique right turn Hook Lane through a roundabout
Lissenhall Interchange Upgrade, Dublin
– Innovative Mova Controlled Hamburger Roundabout.
Services Provided Joint venture project with Roughan & O’Donovan Consulting Engineers. AECOM were responsible for the following:
– High Quality Pedestrian and Cycle Facilities at a Motorway Interchange.
M50 Motorway, Dublin
Client: National Roads Authority/ Fingal County Council
– Concept Development – Preliminary Design of Traffic Signals – Micro-simulation modelling – Traffic signal modelling and design – Detailed Design and Specification of Traffic Signals
Lissenhall Interchange Upgrade, Dublin
Reference | 37
Case Study: Data Centre Focus
The data centre industry has seen phenomenal growth over the past five years throughout Ireland and Europe. Global spending on IT is somewhere in the region of $3.7 trillion and a high proportion of this spend is on servers and storage which need housing in specialist data centre facilities. The attractive climate conditions for optimising free cooling, coupled with some of the lowest seismic activity on the planet has helped to guarantee this region as one of the main areas of choice for long term-data centre development. Demand for data centres continues to be driven by three groups of clients; owner occupiers such as banks; tenants such as internet operations who take space in collocation centres; and managed service companies who need large scale IT capability. A key
Telecity Datacentre, Dublin.
38 | Reference
challenge for data centre developers now is how to keep up with the insatiable customer demand for space and ensure that your business is ahead of the pack in securing those all important resources required to deliver on that demand, whether that be the expertise or the relevant technologies.
Design and operation considerations The key factor in data centre planning is ensuring that the reliability and availability of the engineering services is as high as possible in order to secure resilient power and IT connectivity. Other key design principles are; â&#x20AC;&#x201C; Resilience and Availability As all aspects of life become more dependent on continuous, real-time IT processing, user requirements
for guaranteed availability have increased. At one end of the scale access to health records or military security etc., whilst at the other end, most processing has less critical availability requirements and can be accommodated in centres which provide a lower level of resilience. The accepted definition of data centre availability is the Uptime Instituteâ&#x20AC;&#x2122;s four tier system. A tier 4 data centre will be 50 percent larger and three times more expensive per unit of processing space than an equivalent tier 2 data centre, thus definition of resilience requirements is critical. â&#x20AC;&#x201C; Sustainability Electricity consumption by data centres represents between 1.5 and 2 percent total global energy use. IT clients have tended to focus
Telecity Datacentre, Dublin.
their absolute requirements for performance and security, but as power costs increase the agenda is changing slowly.
feasibility study into the business case of any data centre needs to be accurate and relevant for that specific location or country.
– Flexibility and scalability Space flexibility to accommodate technology upgrades during its operational life and with scalability to accommodate sustained growth in a controlled manner without disruption to existing operations through use of a modular approach.
Choosing the right form of contract can be very important. Data centre clients needs are more attuned to collaborative contracts which are incentivised and which manage risk in an open fashion like the New Engineering Contract (NEC) family of contracts. Contractors and client team members are actively encouraged to engage in the notification process. All of this can contribute to problems being dealt with immediately which in turn brings the focus back to project delivery and the key milestones.
– Simplicity Human error during operation is a major source of downtime risk, so the use of simple solutions, albeit as part of very large systems, is the preferred lowest-risk design strategy. Project Delivery With time as the driver, keeping costs as low as possible to support business cases is crucial without compromising on technical or safety standards. Data centre clients need teams that have the proven expertise and track records in delivering programs in multiple locations concurrently using tried and tested low cost models which meet the highest standards. Cost management plays a crucial role in the data centre development process. All data centres need to be firstly commercially viable and, as such, the primary data which stems from the cost managers
Cost Model See overleaf for an indicative cost model for a data centre.
Due to the time pressures involved in data centre delivery, the program and project managers are constantly under the spotlight to make decisions and give direction immediately thus they need to be extremely proactive in their roles.
Key cost drivers Extent of technical area “white space”
Planned server density
Resilience tier rating
Power usage effectiveness (PUE)
Level of control and monitoring
Expansion strategy
Reference | 39
Cost Model Data centres have a unique set of cost drivers. Conventional measures do not apply when you have a building with occupancy levels 100 times lower than a conventional office and cooling loads 10 times higher.
Below, we set out a cost model based on a tier3, two storey 4,500 square metre warehouse-style development designed to manage power loads of up to 1,500W/square metres. The scheme comprises of two Cat A technical areas
(20kW per rack) of 1,350 square metres each, 950 square metres of Cat B support spaces and 850 square metres internal plant area.
The Euro/Metre Squared rate in the cost breakdown is based on the technical area of 2,700 square metres, not the gross floor area of 4,500 square metres. Element
Substructures Piled foundations
€ €/m2 %
1,559,759
Element
€ €/m2 %
577.69
4.9%
Drainage and refuse disposal Above ground drainage
External walls 690,693 255.81 Kingspan panels, windows,louvres, internal blockwork & metsec
2.2%
Protective installation 793,795 294.00 2.5% Leak detection, lightning protection, earthing & bonding, water mist installation to plant room
Internal walls 339,759 125.84 Blockwork walls, stud partitioning, column casing, cubicles
1.1%
Comms installation 737,349 273.09 2.3% L1 fire & smoke detection, high sensitivity smoke detection, access control, cctv, pa, data to offices
Floors In-situ reinforced concrete with high floor loadings
90.36
0.8%
Mechanical installation 5,714,802 2,116.59 17.9% cooling towers, chillers, pipework, energy management systems, water installation, builders work testing & commissioning
Frame 1,176,675 435.81 Reinforced concrete frame. Some structural steel elements
3.7%
Transport installation Goods lift, passenger lift, 2 no. sissors lifts
Stairs 74,096 Steel stair with concrete infill threads, steel balustrades
27.44
0.2%
Electrical installation 14,592,771 5,404.73 45.7% HV & LV switchgear, distribution, containment panels, standby generator, static UPS, PFUs, lighting
Roof Kalzip standing seam roof
208,735
77.31
0.7%
Sanitary fittings Kalzip standing seam roof
10,663
3.95
0.0%
Internal doors and screens Beech veneered solid core doors, screens and ironmomgery
91,566
33.91
0.3%
Fittings and furniture Reception desk and furniture
15,060
5.58
0.0%
Internal wall finishes Wall sealant to plant room, painting and tiling
87,349
32.35
0.3%
External works Security fence, barriers and landscaping
538,554
199.46
1.7%
Floor finishes 850 high Kingspan raised access floor to technical area
451,627
167.27
1.4%
Preliminaries 4,164,606 1,542.45 13.0% Site supervision, staff, plant, equipment, overheads
Ceiling finishes Suspended tile grid ceiling
132,590
49.11
0.4%
Total Building Cost (excluding VAT)
243,976
Exclusions VAT, Professional fees, Equipment/loose furniture, contingency, inflation, client direct costs and abnormals.
Action
Assumptions Constructed in one phase, competitively tendered and contractor to have full access to the site.
40 | Reference
11,449
292,771
4.24
108.43
0.0%
0.9%
31,928,643 11,825 100%
Eoin Dunphy, AECOM Engineering Cost Management Services and extract from AECOM Building Magazine article 22 Nov 2013
AECOM
Fitout Project – Confidential – client Image courtesy of Donal Murphy Photography
AECOM | 41
AECOM: Global Unite
AECOM has developed Global Unite, our internal international benchmarking and project performance indicator database. The data that we have gathered from our involvement in over 10,000 projects greatly assists us when benchmarking project costs and establishing a project cost plan. In this era of data, we are facing a growing number of requests that require solutions that are evidencebased, data-backed, and rapidly delivered. Instead of relying on locally stored and constrained sources of cost and benchmarking data, our cost managers can now access a vast and growing pool of data generated from real projects which they can then apply on new projects. We can now instantly analyse parameters that define how effective or efficient a building is (or is not) against local or global standards for all buildings types. Global Unite provides the following benefits to projects: – It gives our clients unparalleled access to quality global and local knowledge that adds value to their project. – Through direct comparison of our clients’ project with global data, we can show clients what best practice is and how their project compares.
42 | AECOM
– It gives us the ability to collect and share project performance data from across the whole of AECOM globally. – It gathers the wealth of untapped data that we generate as we do our daily quantity surveying/ cost consultancy work within our individual geographies. – It takes knowledge from our cost planning and measurement systems and applies data mapping rules to manage differences in geographic definitions; and, –
It captures data at source and allows us to deliver local and global knowledge in a consistent and managed way through a variety of different routes.
We draw on our personal experiences and the benchmarking data to generate an initial view of the likely project cost and update the cost plan moving through the design stages. Building on the available design information through close liaison with the design and client teams, and supplemented by the provision of allowances for potential site or project specific items, it allows the cost plan to accurately reflect project requirements.
Davis Langdon News
AECOMâ&#x20AC;&#x2122;s global capabilities: Architecture Building Engineering Construction Services Design + Planning Economics Energy Environment Government Mining Oil + Gas Program, Cost, Consultancy Program Management Transportation Water With approximately 45,000 employees around the world, AECOM serves clients in more than 140 countries.
AECOM | 43
AECOM News
Congratulations to Michael Webb, our former Managing Partner, who was recently conferred with an honorary doctorate degree by Dublin Institute of Technology (DIT) in recognition of his outstanding professional achievements and his contribution to civic society.
Michael McGovern
Claire Culleton
44 | Industry Review
In a career spanning almost 50 years, Michael is a leader in industry (most notably showing a commitment to developing the profession of quantity surveyor), is widely respected for his contribution to the field of built environment and has made a significant impact to society through his life-long commitment to civic engagement. This has included working with the Scout Association of Ireland, the National Youth Council and the Church of Ireland amongst other organisations. We were very pleased to welcome back Claire Culleton who has spent the last three years in the London office working on large commercial and retail projects. Claire has been with AECOM for over 10 years and previously worked on Terminal 2 in Dublin Airport and in our Cork office. Claire returns to the Dublin office as an Associate and leads our Banking and Due Diligence service and large commercial projects.
We are delighted to announce that Michael McGovern, who has been working with AECOM for the past 6 years has been made an Associate. Michael, who is based in the Dublin office, has a wealth of experience in the Public sector and is currently working on some the largest healthcare projects in the country. During our Annual Away Day, Carl O’Grady of Go Explore on Clare Island set us a challenge of creating something ‘interesting’ when we reached the peak of the island – here’s what the winning team came up with.... we’re still trying to figure it out! Local celebratory events were held across Ireland and the U.K. to mark the rebranding of the company and a successful 2013. AECOM have currently over 300 people in Ireland working in Cost & Project Management, Engineering and D&B services. Everyone must have been greatly shocked and saddened at the loss of life and destruction in the Philippines as a result of the typhoon in November 2013. As part of our contribution to assist in the relief and re-building effort required, which undoubtedly will be great, AECOM has made a donation of circa $250,000 for relief in the grief stricken region.
Top: Michael Webb (Right) being presented with his Doctorate by the President of DIT, Professor Brian Norton. Above left: Sam McDowell (AECOM Belfast) and John O’Regan (AECOM Galway) cutting the AECOM cake to celebrate the rebranding of the company. Above right: AECOM staff at the Annual Away Day on Clare Island. Left: The Philippines after November’s devastating typhoon.
Industry Review | 45
AECOM: Key contacts Dublin
Galway
Paul Mitchell Director, Head of Office, Ireland paul.mitchell@aecom.com + 353 1 432 0460
John O’Regan Director john.o’regan@aecom.com + 353 91 530199
Anthony McDermott Director anthony.mcdermott@aecom.com + 353 1 432 0481
Gregory Flynn Regional Director gregory.flynn@aecom.com + 353 1 4320498
Tomás Kelly Regional Director tomas.kelly@aecom.com + 353 91 530199
Jason Hobson-Shaw Regional Director jason.hobson-shaw@aecom.com + 353 1 432 0434
Eoin Dunphy Associate Eoin.dunphy@aecom.com + 353 1 432 0404 Mark Smith Associate mark.smith@aecom.com + 353 1 432 0438
John Lombard Associate john.lombard@aecom.com + 353 1 4320413
Cork Stuart Griffin Associate stuart.griffin@aecom.com + 353 21 436 5006
Glenn Hanna Senior Surveyor glenn.hanna@aecom.com + 353 21 436 5006
Declan Hegarty Associate declan.hegarty@aecom.com + 353 1 432 0465 Belfast Belfas Michael McGovern Associate michael.mcgovern@aecom.com + 353 1 432 0442 Claire Culleton Associate claire.culleton@aecom.com + 353 1 432 0478
Limerick Andrew Thompson Associate andrew.thompson@aecom.com + 353 61 318870
Belfast Jody Wilkinson Senior Surveyor jody.wilkinson@aecom.com + 44 28 9060 7200
46 | AECOM
AECOM Belfast Office (T: 44 28 9060 7200)
AECOM Grand Canal Office (T: 353 1 238 3100) Cormac O’Brien District Manager Transportation cormac.obrien@aecom.com
Matt Lyons Regional Director Building Engineering matt.lyons@aecom.com
Sam McDowell Director Building Engineering sam.mcdowell@aecom.co
Andy Patterson Director D, P & E andy.patterson@aecom.com
Colin Acton Regional Director Transportation Colin.acton@aecom.com
Eoin O’Mahony Associate Director Transportation eoin.o’mahony@aecom.com
Clare Anderson Regional Director Transportation clare.anderson@aecom.com
Julie McDowell Regional Director Environment julie.mcdowell@aecom.com
John Finnegan Regional Director Transportation & Economics John.finnegan2@aecom.com
Joseph Seymour Regional Director Transportation Joseph.seymour@aecom.com
David McCune Regional Director Water david.mccune@aecom.com
Jimmy McMullan Regional Director Building Engineering james.mcmullan@aecom.com
Stephen Reid Associate Director Transportation Stephen.reid@aecom.com
Elaine Brick Associate Director Transportation Elaine.brick@aecom.com
David Swann Regional Director Building Engineering david.swann@aecom.com
Tim Robinson Regional Director Transportation tim.robinson@aecom.com
AECOM | 47
Global services
Verification Services
Asset Management
Building Surveying
Spec & Design Management
Business Consulting
Property Consulting
Certification Services
Cost Management
Project Consulting
Program, Cost, Consultancy Global Services
Programme & Project Management
Development Management
Engineering PMPC Services
P3 Advisory
Master Planning/ Urban Planning
Facilities Management
Legal Support
Health & Safety Services
Funder Advisory Services
Fiscal Incentives
AECOM | 48
About AECOM
Key AECOM offices in Ireland
AECOM is a global provider of professional technical and management support services to a broad range of markets, including transportation, facilities, environmental, energy, water and government. With approximately 45,000 employees around the world, AECOM is a leader in all of the key markets that it serves. AECOM provides a blend of global reach, local knowledge, innovation and technical excellence in delivering solutions that create, enhance and sustain the world’s built, natural and social environments. A Fortune 500 company, AECOM serves clients in more than 140 countries and has revenue in excess of $8 billion.
Dublin Office Programme Cost Consultancy 24 Lower Hatch Street Dublin 2 T: 353 1 676 3671 F: 353 1 676 3672 E: paul.mitchell@aecom.com
More information on AECOM and its services can be found at www.aecom.com. Follow AECOM on Twitter at @AECOM
Engineering Ground Floor, Grand Canal House Upper Grand Canal Street Dublin 4 T: 353 1 238 3100 E: cormac.obrien@aecom.com Galway Office Heritage Hall Kirwan’s Lane Galway T: 353 91 530 199 F: 353 91 530 198 E: john.o’regan@aecom.com Limerick Office Mezzanine Suite Riverpoint Lower Mallow Street Limerick T: 353 61 318 870 F: 353 61 318 871 E: andrew.thompson@aecom.com
Program, Cost, Consultancy www.aecom.com
Belfast Office AECOM Ltd. 9th Floor The Clarence West Building 2 Clarence Street West Belfast, BT2 7GP, Northern Ireland T: 44 28 9060 7200
Design and production: DCH Partners
Cork Office Douglas Business Centre Carrigaline Road Douglas Cork T: 353 21 436 5006 F: 353 21 436 5160 E: stuart.griffin@aecom.com