INFRA MENA 6

PUSHING THE BOUNDARIES Al Habtoor Leighton CEO Laurie Voyer on expanding beyond the UAE

BAY OF PLENTY Inside Bahrain Bay with Chief Executive Bob Vincent www.menainfra.com • Q3 2010

A FAREWELL TO ARMS As Iraq swaps combat for construction, what challenges does the country face in its rebuilding process?

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16/09/2010 13:47

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FROM THE EDITOR

5

UNTAPPED POTENTIAL

As Iraq swaps Humvees for JCBs, can the country’s rebuilding process provide a much-needed boost to the regional construction industry?

I

raq is increasingly waking up to new sounds in the morning: amid the continuing crackle of gunfi re and exploding IEDs, the nation’s long-suffering inhabitants are now just as likely to be woken by the drone of jackhammers and earthmoving equipment as the country’s rebuilding process begins in earnest following the withdrawal of US combat troops at the end of August. Across the country, scaffolding is springing up over the bullet-marked walls and workers are swarming over construction sites as Iraq embarks on its return to some semblance of normality.

And as the massive recovery effort picks up momentum, foreign firms stand ready to take up the challenge.

Oil money from rising production is powering growth, and now that the government has awarded oil-field contracts worth billions of dollars to BP, ExxonMobil, China National Petroleum and others, foreign clients are looking for help in financing everything from pipelines to power grids to workers’ camps. And in addition, pent-up demand for housing and better infrastructure is also proving a big draw for international fi rms. Indeed, for all its security issues and political infighting, Iraq remains an economic powerhouse waiting to be tapped – and the government’s decision to kick-start a US$186 billion development plan, announced back in July, is welcome news for a region that is looking for new ways to massage an economy that has collectively struggled in the wake of the global fi nancial crisis.

The Iraqi government’s aim from the plan is to achieve an average annual economic growth of 9.38 percent, develop its sagging infrastructure, reduce regional differences, provide 3.5 million jobs and diversify the economy away from a dependence on oil and gas. Everything from ports to bridges to roads to affordable housing solutions is set for an overhaul as the country looks to stimulate growth.

It’s especially good news for regional construction and real estate companies who can bring in their much needed expertise to Iraq, and Gulf fi nanciers who are sitting on cash,

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“US$100 billion of the proposed project costs will be financed by the state budget while the remainder will be funded through local and foreign investments”

unwilling to invest in their own stock markets and property sectors. According to Abdul-Zahra Al Hindawi, spokesman for the Ministry of Planning and Development – the agency in charge of supervising the implementation of the plan – about US$100 billion of the proposed project costs will be fi nanced by the state budget while the remainder will be funded through local and foreign investments.

Th is suggests that despite its problems, Iraq may just be the place to invest in right now. It’s certainly on the radar for the big fi rms: Laurie Voyer, CEO of major UAE contractor Al Habtoor Leighton Group, tells us in an exclusive interview that the country will play an important role in its continued expansion across the region; meanwhile, regional real estate players such as Al Maabar, Bloom, National Holdings, Bonyan and Al Hanthal are all in advanced talks with the Iraqi National Investment Commission on starting projects in Iraq.

As ever with these types of developments, cooperation and collaboration will be key to their success. “The experience and technology knowhow of the international companies, plus the contacts and cultural knowledge of local partners, will provide a great formula for success,” says Namir El Akabi, CEO of domestic construction firm Almco, in our cover story.

If the Iraqi people and international fi rms can embrace this new spirit of partnership and work together, then the rewards could be rich indeed.

Ben Thompson Managing Editor

16/09/2010 10:18

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15/09/2010 09:30

36

ASK THE EXPERT

Nickel use in Middle Eastern infrastructure How does the use of nickel-containing stainless steels in architecture and construction contribute to sustainability in the Middle East? By the Nickel Institute’s Catherine Houska.

S

ustainable development is high on the agenda as construction in the Middle East emerges from the global recession and the region focuses on continued expansion after the boom years of the early 2000s. The need for longevity with service life requirements of up to 150 years, together with the area’s harsh climate, make nickel-containing stainless steels the materials of choice for both new buildings, such as Abu Dhabi’s Central Market project, and infrastructure.

Achieving long service life without replacement or significant maintenance reduces the direct costs of replacement and indirect impact associated with service disruption. It also minimises the environmental impact of raw material replacement and maintenance tasks. Stainless steel is used in applications ranging from reinforcing bar for sea walls and bridge decks, to stunning building exteriors, owing to its corrosion resistance, which has a direct effect on long-term sustainability.

Most stainless steels utilised in the Gulf are higher alloy nickel-containing austenitic and duplex stainless steels because of the aggressive environment. The nickel addition makes forming and welding the steels much easier and they also provide a broader range of texture, colour and other fi nish options that are uniform in character and striking in appearance. Due to these factors, they are increasingly being used in cutting-edge regional designs.

In some coastal regions of the Gulf, such as in the UAE, Saudi Arabia and Qatar, the potential for exposure to sandblasting from windblown sand is unremitting, making it unwise to rely on corrosion-resistant coatings. Cars can have paint stripped off them in fully-fledged sandstorms.

In many areas, there is constant particulate dust in the air that can increase corrosion rates, but buildings faced with stainless steels will always look good in the long term.

In order to obtain sustainability in design, construction and operation and to minimise negative effects on the environment, the World Green Building Council stipulates elevated rates of recycling and end-of-life recapture, durability and a positive impact on energy and water consumption. Nickel-containing stainless steels fulfi l all these criteria.

Stainless steels are 100 percent recyclable and can potentially be refurbished and reused indefi nitely. While the average recycled content is 60 percent, some producers report up to 90 percent, while 92 percent of stainless steel used in architecture and construction is recycled into new metal, rather than being sent to landfi ll.

NickelInstitute 36

Stainless steel roofi ng, sunscreens and wall panels score highly on the solar reflective index as they absorb less heat than many other construction materials, so reduce demand for energy from air-conditioning. It is also healthy, in that stainless steel does not create toxic run-off that can damage the surrounding environment or produce harmful chemical emissions when deployed inside buildings – unlike carpet and drywall – allowing a wide range of attractive interior fi nishes to be used. Stainless steel buildings require only the application of ordinary, non-environmentally damaging, household detergent or window cleaner to keep their exteriors clean.

A great deal of infrastructure continues to be erected in the Middle East, from sea walls and building foundations to bridges. Because the soil, air, water, sand and concrete in coastal areas has a very high sea salt (chloride) content, the employment of stainless steel for both reinforcing bar and other structural components can provide infrastructure capable of 100 or more years of life, as well as seismic and fire protection and security against blast impact.

Stainless steels are also important in minimising the use of precious potable water and are used extensively in desalination plants and in building systems for capturing and reusing grey (waste) water such as tanks, piping and fi ltration systems, so that wastewater can be utilised for other purposes, for example for flushing toilets and irrigating landscapes.

All in all, nickel-containing stainless steels could not be a better choice for ensuring sustainability in construction in the Middle East.

Catherine Houska, one of the world’s leading authorities on nickel-containing stainless steels in architecture, is architectural consultant to the Nickel Institute.

Further information can be obtained from the Nickel Institute, a not-forprofit organisation that represents the interests of the companies that together produce more than 90 percent of global annual nickel output on www.nickelinstitute.org.

16/09/2010 10:32

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TITAN TABLEFORM SYSTEM: The Ischebeck Titan Aluminium Scaffolding & Formwork System is a product of German Engineering and British Marketing expertise and is without question one of the most cost effective investments being made by Contractors in the Middle East today.

The system comprises just 4 main components; an aluminium leg (or prop) which is connected horizontally with aluminium ledger frames which in turn supports a 225mm deep primary beam and 150mm deep secondary beam to which plywood is fixed.

The design of the system is such that ANY application on site can be accommodated by the same components either in a traditional “fix & strike� method OR tableform solution, irrespective of slab thickness AND/OR propping heights making it a truly universal product, not withstanding that the aluminium legs can be used on their own for back propping of poured concrete slabs

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48

INDUSTRY INSIGHT

Protecting concrete joints Kryton International Inc.’s Alireza Biparva explains how to find the best waterproofing solution for the most vulnerable part of your concrete structure.

Krystol Waterstop System Slab

Detail

Krystol waterstop Grout & Treatment

Krystol waterstop Grout

J

oints play a vital role in fortifying concrete structures. But when it comes to waterproofi ng, joints represent the most vulnerable part of the structure.

Without an effective joint waterproofi ng system, it’s not a matter of if joints will leak, but when.

A construction joint, also referred to as a cold or nonworking joint, marks the spot where two sections of concrete meet. It is a pre-planned separation in the concrete that allows for limited movement caused by natural factors such as seismic activity or freeze-thaw cycles. The waterproofi ng challenge posed by these joints for contractors and engineers lies in their design itself – the physical separation between concrete slabs creates vulnerability where water ingress is likely to happen.

Leaking joints can not only result in costly repairs but, incoming water can bring contaminants into the concrete, corrode steel reinforcements, jeopardise structural safety and shorten the overall lifetime of the concrete structure.

So, protection is a must.

In the past, waterstop systems have been used to act as a physical barrier to block water penetration at joints. The most common, PVC, is a plastic strip that is put in place before the concrete is poured. Half of the PVC sheet is submerged into the joint area while the other half is secured into the formwork. The strip must be spliced correctly and rebar installed without puncturing or cutting the PVC. In addition, extreme care needs to be taken during the concrete pouring and compacting to ensure that the PVC is

KrytonInt 48

Alireza Biparva is Technical Services Rep/Concrete Specialist, Research & Development at Kryton International Inc. Ali received his M.A.Sc. in civil engineering from University of British Columbia, specialising in cement-based materials, and Bachelor Degree in Engineering from Shiraz University of Iran.

not displaced or folded. Installation is difficult and often done incorrectly, leaving joints at risk of leaking. To make matters worse, once the damage has been done, it’s virtually impossible to recognise a problem until the joint starts to leak.

Over the last 25 years, more advanced and economical waterproofi ng systems and materials for joints have been developed. These new systems are easier and more efficient to use and most importantly, give your structure longer lasting protection.

One of these systems is Kryton International Inc.’s Krystol Waterstop System. Th is revolutionary system provides both a physical and chemical barrier to water ingress. It relies on two products for guaranteed protection: Krystol Waterstop Grout, the physical barrier, and Krystol Waterstop Treatment, the chemical barrier. When mixed with water, Krystol Waterstop Grout forms a stiff putty like consistency that is molded into a triangular strip along the centre of the joint. Krystol Waterstop Treatment is then brushed on top of the grout and around the joint area. The Treatment comes in a powdered form that is mixed with water to form a slurry consistency. Once applied, active crystalline chemicals in the slurry cause microscopic crystals to grow, permanently blocking the movement of water (Fig 1). When the Treatment has hardened, you are ready to pour the remaining concrete and can do so with confidence that your joint is waterproof.

Kryton’s innovative system has been growing in popularity because it offers several fundamental advantages to traditional joint waterproofi ng methods. The Krystol Waterstop System is quick and easy to install. It does not require skilled labour and adheres extremely well to concrete surfaces. Unlike PVC waterstop treatments, Kryton’s system is not at risk of being displaced or folding during concrete pouring. Additionally, because the system uses Kryton’s proprietary integral crystalline waterproofing formula, it has the ability to self-seal small cracks that may develop over time. It is durable, long-lasting and will give you the peace of mind you need when tackling a concrete joint waterproofi ng project.

Every concrete jointing system will have its advantages and limitations. What is critical is that you take the time to consider what is appropriate for your construction project.

Look at your project timeline and budget. Th ink about how much risk of failure you are willing to take and the level of protection you need. Then make the best decision that will guarantee watertight joints for the lifetime of your concrete structure.

16/09/2010 10:29

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50

INDUSTRY INSIGHT

Using GIS to manage record growth Leaders in Persian Gulf countries are eager to modernise cities and improve residents quality of life. Massive construction programmes to implement ambitious urban development plans for the next 20 years are planned in these countries – and GIS can help, argues Chen Liang.

A

ll activities on Earth have one common component – geographic location. These geographic locations establish reliable data links to help organise and manage business data. Geographic information systems (GIS) bring together business data from different sources through a spatial component, revealing relationships and patterns. For example, with geographic locations embedded inside sewage and water pipelines, GIS users can easily locate the types and sizes of pipelines and also determine how those pipelines relate to each other geographically.

A new series of key performance indicators (KPIs) can be introduced from a spatial dimension. Space-aware KPIs complement traditional KPIs and provide more meaningful measurements for urban planning and improved quality of life. For example, gas pipelines must be a certain distance away from utility lines for safety reasons. The safety distance can be captured by a buffer radius that can be analysed with other attributes or spatial data.

GIS soft ware and web-based portals can display a large amount of heterogeneous data from multiple sources on one map. These portals can present a comprehensive view of a current situation or a future vision at a specific geographic location and allow users to perform sophisticated data searches, measurements, spatial analysis and map reporting. In addition, GIS web portals enable users to access spatial data through web browsers without any specialised GIS soft ware, therefore dramatically improving the accessibility and availability of data.

With GIS server technologies and Web 2.0, GIS web portal users can view an area at a variety of scales and perform analysis that was previously available only on desktop GIS. GIS web portals can integrate with enterprise security policies and protect sensitive data. With single sign-on and multi-level security control, a single GIS web portal can be customised to serve multiple user groups, release specific information to the public, present a sophisticated map view to internal users, or provide a reporting tool to executives. A service-oriented architecture (SOA) GIS web portal provides maximum functional extensibility and reusability and allows the web services to be directly utilised by other parties.

Because spatial components are such an important part of business data for a number of organisations, GIS teams become practical custodians of enterprise business data. For example, the Abu Dhabi Urban Planning Council (UPC) in the UAE, the agency responsible for the future

Gannet Fleming 50

Geospatial Web Portal

Chen Liang serves as a technical architect with GeoDecisions, a division of Gannett Fleming.

Since February 2009, he has been working on-site as a Senior GIS consultant at the Abu Dhabi Urban Planning Council in Abu Dhabi, applying state-of-the-art GIS technologies to support and improve the planning practice for massive development projects in Abu Dhabi and facilitating collaboration across multiple agencies.

of Abu Dhabi’s urban environment, has implemented this model to provide enterprise level GIS support and outline a strategy to integrate geospatial technologies into the UPC’s urban planning initiatives.

The UPC has employed the services of GeoDecisions, Gannett Fleming’s geospatial and information technology division. GeoDecisions is on-site at the UPC to provide enterprise-level GIS support and outline a strategy to integrate geospatial technologies into the UPC’s urban planning initiatives. Since 2009, the UPC’s GIS team has ensured data accuracy and prompt maintenance for tracking rapid change and growth by dividing data maintenance responsibilities – the spatial component for the GIS team and the attribute component for the business team. Each team is responsible for keeping data up-to-date in the geographic database. Both parties share the data maintenance load and exert their expertise on maintaining the right data components.

UPC’s GIS team successfully supports the daily business operations of more than 150 planners on more than 300 development projects and nine master plans. The team also maintains the planning database, two web portals, and a 3D visualisation system for urban planning. For its efforts, the UPC was awarded the 2010 Excellence in GIS Award at GISWORX 2010 and, along with the Abu Dhabi Systems and Information Centre, was awarded the Making a Difference Award at the 2010 ESRI International User Conference.

GeoDecisions and Esri are registered trademarks.

16/09/2010 10:27

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COVER STORY

CHANGING THE GUARD With the withdrawal of the last American combat troops, Iraq has a difďŹ cult period of rebuilding ahead as it faces up to life after occupation. Some see it as a chance for a fresh start; others, the opportunity to cause further chaos. Either way, the country is about to enter a new chapter in its long, often troubled history.

By Ben Thompson

Iraq Cover Story 54

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COVER STORY 55

A

s the holy month of Ramadan drew to a close, Iraqis had more than just fasting and prayer on their minds. In the early hours of Thursday, August 19, nearly two weeks before President Obama’s August 31 deadline for the withdrawal of all American combat troops, the 4th Stryker Brigade, 2nd Infantry Division crossed the border from Iraq into Kuwait and thus ended official US combat operations in the country.

The withdrawal provoked mixed reactions across the war-ravaged state. Prime Minster Nouri al-Maliki called the move “a basic step in restoring complete sovereignty”, and reiterated that his forces were up to the job of protecting the country in the absence of the Americans, while President Obama stressed that “the Iraqi people now have lead responsibility for the security of their country”. But on the streets of Baghdad, Basra and Iraq’s other population centres, the news was largely met with a mixture of anger and apprehension.

For while many openly opposed the huge US presence in their country and rejoiced at their exit, most also recognised that their fledgling democracy currently stands at an extremely fragile stage in its development, and that the Americans’ withdrawal leaves the country’s immediate future delicately balanced – between independent progress on the one hand, and outright anarchy on the other.

“They must secure the borders before completing their withdrawal… otherwise they will leave the country in chaos,” one concerned Baghdad resident told Reuters, and it was a view echoed across the nation. Hasnaa Ali, a Baghdad schoolteacher, agreed. “What have the Americans accomplished for this country that they can now decide to just leave?” she asked of a Time reporter. “We don’t have clean water or electricity. Prices for everything are very high. There is no security, no jobs, no housing.” Baghdad trash collector Ali Nasar typified the prevailing feeling within urban Iraq. “When the occupation forces came to Iraq, it was good they got rid of Saddam, but in fact everything got worse: security, electricity, water and garbage,” he lamented. “When they leave, nothing will be improved or returned to the way it was. No matter if the Americans are here or not, Iraq is a ruined country.”

It’s a pessimistic outlook. But like it or not, US combat troops have now left the country, leaving behind an unfinished US$53 billion rebuilding plan and some 50,000 personnel to advise and assist the local populace in its reconstruction efforts. It is time for the next phase of Iraq’s rebuilding process to begin, one led by local initiative and willpower rather than foreign military might. And slowly but surely, the green shoots of recovery have begun to take root across the country.

Opportunity knocks Namir El Akabi is just one of many Iraqi nationals returning from exile to help play a leading role in the future development of the country’s recovery. Having left Iraq at the age of 10, the London-educated 46-year-old businessman and entrepreneur returned seven years ago with a clear vision: that of helping his homeland back to prosperity. “It was always my dream to return to Iraq,” he says. “I know the potential the country has in every sector, and to be honest I saw an opportunity for huge business in Iraq.”

El Akabi formed a small construction company called Almco with just five employees, primarily to work on US-funded strategic projects geared around stabilising the country and providing essential services to both the local population and occupying troops. The business proved to be a success, and today Almco has more than 6000 Iraqis on the payroll, fulfi lling roles in infrastructure development, construction and design, supply and logistics and environmental protection. To date the company has been working extensively with the US government on contracts worth US$200 million to provide a variety of construction, renovation and demolition, design/build, and life support projects throughout Iraq as part of the overall reconstruction effort. Primarily this has involved the construction of camps to be used by the US and Iraqi forces for their operations, but it has also included work on significant infrastructure projects, too.

The Sadr City water treatment plant is just one such example. Home to two million Iraqis, the city – located just outside Baghdad – was built by Saddam Hussein as a massive urban community to house the thousands of rural Iraqis migrating to the Baghdad in search of jobs. But after decades of neglect under Saddam’s regime, even the most basic areas – including adequate potable water – were severely under-resourced. Almco was commissioned to construct a water treatment plant to help meet the needs of the

Iraq Cover Story 55

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COVER STORY

local population. Completed just over two years ago, the US$65 million water treatment plant is designed to treat and purify water from the nearby Tigris River and provide Sadr City residents with potable water. The goal of the project was to provide hook-ups to residences in 68 of the 79 city sectors, and according to the Iraqi Ministry of Water Resources, the water treatment plant is currently producing between 3200 and 4000 cubic meters of potable water per hour, which equates to 25 million gallons of water a-day. At full capacity, the plant can produce over 6000 cubic meters of water per-hour. “Th is is one of the major projects we are very proud of. It was a very technically challenging project,” says El Akabi. “Water is the essence of life, and its impact on Sadr City’s standard of living will be dramatic.”

Indeed, he believes that working on more than 50 US Army Corps of Engineers (USACE) projects has helped him and his employees develop their talents. “We learned many things ethically and technically,” he explains. “Firstly, that the truth is always the way out. Be truthful with your clients and they will understand. Then there is the technical part: how to do construction the correct way with regards to safety and the quality of materials used on-site.

We learned a lot of things working with USACE.”

Hydrocarbon footprint It’s been a successful relationship. But with this area of the business on the decline due to the pullout by the collation forces, Almco is now transferring its attention to a number of other potentially lucrative markets. For instance, the firm is working with international oil and gas companies such as ExxonMobil, BP, Schlumberger, Weatherford and Petronas on the initial stages of the IOC mobilisation into Iraqi oil fields – a business that El Akabi expects to hit the US$1 billion mark for his company in the next few years. Almco is currently constructing IOC camps and offering life support and catering services for international fi rms, while at a later stage work will include more involvement in the various engineering, procurement and construction operations as well as significant operation in building out and maintaining the extensive pipeline network that will be required.

With proven oil reserves totalling 115 billion barrels and proven gas reserves of 112 trillion cubic feet, Iraq is up alongside major producing nations like Saudi Arabia and Russia when it comes to its hydrocarbon resources. The economy is estimated to have expanded 4.2 percent last year, powered largely by oil exports; companies including London-headquartered BP Plc, Royal Dutch Shell, which is based in The Hague, and Paris-based Total SA, have signed contracts with Iraq to boost oil production after two bidding rounds for development rights last year, even in the absence of a hydrocarbons law. A third bidding round for natural-gas deposits is set for later this year.

However, unlike its rivals, Iraq’s turbulent recent history means the country is severely lacking both the money and technical resources to further develop its fields and increase its output. Furthermore, for the com-

Iraq Cover Story 56

“The security situation has improved tremendously since 2005 and 2006, but is still considered far from normal.

It is a risk that investors must balance against the lucrative returns that are possible from their planned investments in Iraq”

panies already operating in Iraq or hoping to enter the country in the future, one of the most pressing concerns is the uncertain security environment. In a recent study by the Economist Intelligence Unit, 64 percent of executives – drawn from companies currently investing in Iraq and those considering it – thought it was still too dangerous to do business in Iraq, but 55 percent said they believed the security situation for foreign executives and employees would improve over the next two years. Violence was the biggest business risk for 67 percent of respondents, followed by corruption (44 percent) and the lack of infrastructure (35 percent).

“Security is still an issue in Iraq, but not a major one for local companies,” says El Akabi, although he does concede that during the height of the insurgency his fi rm was experiencing a terrorist incident every week – either an attack on one of its convoys or at a project site, or the kidnapping of an employee. “The security situation has improved tremendously since 2005 and 2006, but is still considered far from normal. It is a risk that investors must balance against the lucrative returns that are possible from their planned investments in Iraq. The market is still virgin territory, with huge untapped resources.”

Sharjah-based container terminal operator Gulft ainer recently announced plans to pump around US$60 million into its Iraqi expansion. Given that Iraq will be dependent on foreign imports to rebuild the country, it’s a potentially rewarding opportunity, and CEO Peter Richards believes the likely benefits of his fi rm’s contract to build out the container terminal gateway at Umm Qasr, just south of Basra, far outweigh the risks. He agrees that security is an issue – but suggests that the lack of basic infrastructure is just as much of a problem. “It is a challenging place to operate; many years of war has left the country and in particular the infrastructure broken, and security is still a concern to many,” he says. “However, that just makes it even more important that we focus on getting the basic infrastructure right, as that is the very basis of a working economy and thus a country returned to prosperity.”

Obviously, security and political stability are the major obstacles at this point in time, he says, because without these it is very hard for any country to make progress. “The authorities are doing what they can to build a stable base – through, amongst other things, the contract awards and invitations to foreign companies to come and assist in the rebuilding process – while the strict focus on security, now more or less in the hands of the Iraqis themselves, has also helped,” he continues. “The situation is certainly much improved compared to just a few years ago. However, a more basic obstacle is the level from which the country has now been forced to grow. With most infrastructures basically demolished and an enormous need to rebuild, growth just cannot happen fast enough; our responsibility is to make sure that while it happens as quickly as possible, it also happens in a responsible manner.”

In fact, he believes that some of the reports coming out of Iraq are exaggerated – and that if you know how to

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COVER STORY 57

IRAQ’S BUILDING BOOM HOUSING Iraq is already faced with a housing supply shortage, and coupled with a rapidly growing population that is expected to reach 40 million by 2025, Iraq will need a considerable number of new housing units in a relatively short period of time. The Iraq Ministry of Housing and Construction estimates two million new homes are needed by 2015 with 85 percent of demand to be fulfilled by the private sector. According the Iraqi National Investment Commission, private foreign investment in Iraqi housing is expected to grow with estimated upper-range investment of US$40 billion in 2010. Partnering with local developers would enable foreigners to bypass a rather steep learning curve that is always present when entering new markets.

Moreover, the slowdown in competing markets, especially in the Gulf region, presents an excellent opportunity for foreign investors.

MATERIALS Great opportunities exist in the building materials sector as Iraq currently imports most materials used in the construction process. Today, for instance, local cement production only meets 25 percent of domestic demand. The country is in desperate need of new production plants for everything from cement to steel to aluminium, and with a major expansion of the container terminal gateway at Umm Qasr in the works – which will be able to handle larger ships and even more foreign imports – the potential for regional and international suppliers is considerable.

POWER Since 2003, Iraq’s electricity consumption has grown steadily by at least 15 percent a year – but currently, Iraq’s power system barely meets half of peak demand. To meet the growing demand and supply shortfalls, the Ministry of Electricity is undertaking one of the world’s most ambitious electricity system expansion programmes, requiring at least US$7 billion. Iraq’s Council of Representatives is currently considering a draft law to grant authority for the Ministry of Electricity to engage domestic and foreign private companies in the production of electricity.

TRANSPORT Every part of Iraq’s transport system requires investment, as accelerating demand for air, seaport, road and rail freight services puts mounting strain on existing capacity. Iraq has a network of 44,000 kilometres of roads and highways, of which 85 percent was built in the 1970s and 1980s with little to no maintenance since. Rehabilitation of the roads alone is estimated at US$1 million per kilometre, and total rehabilitation could exceed US$40 billion.

Iraq Cover Story 57

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COVER STORY

operate, you can do so safely and to the mutual benefit of both Iraqis and the companies assisting in the rebuilding.

“At all our facilities, security is paramount,” he says. “We employ security personnel and our compounds are closely guarded. But besides this, it is also a matter of staying in positive contact with the local population and not portraying yourself as the big outsider. We simply want our employees to feel safe enough to focus their attention on the real work of making the many projects come to life.”

1 million new housing units are planned for the next 3 years

Building boom There is certainly enough work to go around for those

FINDING WORK Billions of dollars have been allocated to reconstructing areas of Iraq – and the much-needed work is giving construction companies plenty of opportunities to help rebuild the country and make money while doing so.

But how can foreign firms get a foot in the door?

Be honest about your own skills and expertise. “Iraq is a very interesting market, but it is also a very challenging one,” says Gulftainer’s Peter Richards.

“Potential profits are lucrative – but the risks are equally high if you are not 100 percent on top of what you are doing.” In the words of the boy scouts, be prepared – and know your limits.

Look for a strong and reputable partner. In such a volatile market, local knowledge will be essential in circumventing unnecessary bureaucracy and avoiding troublespots. “The experience and technology knowhow of the international companies, plus the local partner’s contacts and cultural knowledge, will provide a great formula for success,” says Almco’s Namir El Akabi.

Involve the local population. Using local hires builds confidence in your firm and expands the domestic talent pool, says Richards – both critical to achieving long-term success. “Get them involved,” he says. “For their motivation, for your own security, because they still know the ins and outs of their country despite you sitting on specific knowledge or patents – and because it’s the right thing to do.”

Iraq Cover Story 58

willing to brave the volatile operating conditions. According to the EIU report, Iraq’s oil and gas reserves were the most attractive aspect of the country for investors, but after this 43 percent said construction and real estate was the most promising non-hydrocarbon sector.

Indeed, the Iraqi authorities want to build on a massive scale. Around one million new housing units are planned for the next three years – one project in Baghdad’s Sadr City slum calls for 75,000 units alone – while the National Investment Commission has put together a wish list of 750 projects that require US$600 billion worth of investment. As such, private sector investment dollars as well as expertise are greatly needed in all sectors. “With some $25 billion in housing projects, US$8 billion in transportation and US$5.5 billion in water and sewage, the government is focusing primarily on reconstruction and rehabilitation,” confi rms Fady Darwish, General Manager of IFP Iraq.

“Several new cement plants are either being revamped or erected to satisfy a growing need and many major international players are now present. Iraq consumes around 15 million tons of cement yearly, with the Iraqi ministry being the largest consumer.”

It’s good news for foreign firms. Iraq’s reconstruction has created a huge demand for both construction expertise and capital, and the Iraqi government has publicly stated its need for the participation of foreign investors to achieve its objectives. In light of this, the Iraqi Investment Law was amended in 2009 to attract both local and foreign investment into Iraq, with generous benefits including 10 years’ exemption from taxes and three years’ exemption from import fees for required equipment, the ability to repatriate profits from investment and employ foreign workers when needed, and guarantees that the government will not nationalise or confiscate investments.

“The domestic construction industry is non-existent due to the lack of transparent investment criteria and the lack of essential infrastructure such as electricity,” says El Akabi. He feels that the way to address this is through encouraging more foreign and local investments in the short-term, while in the long-term the Iraqi Treasury should set aside a large surplus from the expected growth in oil revenues over the next five years to invest in the infrastructure sector. “The most important thing is for the Iraqi government to establish industrial free-zones with complete infrastructure, along with incentives such as 10-year tax and customs exemptions for the materials that will be used in the construction industry. Also, it is vital to privatise and liberalise the industry sector in Iraq; the private sector must take the lead in order for the industry to grow rapidly.”

Almco is a good example of the new entrepreneurial spirit that is taking root: alongside its work with the US forces and the oil majors, the company has also diversified into the real estate, hospitality, retail, health and agricultural sectors to take advantage of the many opportunities on offer, through the formation of its Amwaj International investment arm. “Our scope of work is to evaluate, study and submit for potential investment opportunities in the

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CLIMATE CHANGE? Seven years after the invasion that ousted Saddam Hussein, Iraq is still waiting to revamp business laws that would help make the country more attractive to investors, according to a report from Bloomberg. “Investors still note security concerns, but now are more likely to cite regulatory hindrances and other practical barriers to doing business,” the US State Department said in its 2010 Investment Climate Statement on Iraq.

Foreign direct investment totalled US$1.1 billion in 2009, most of it in the oil industry, according to the United Nations July World Investment Report.

Neighbouring Iran, however – under a fourth set of UN sanctions – took in three times as much.

Thair Feely, Director of the government’s Baghdad Investment Commission, claims that lawmakers in the outgoing parliament weren’t able to approve 72 draft laws meant to help accelerate economic growth. Legislation awaiting approval includes a measure that would make it easier to register a company. “It can take four or five months and costs a fortune, about US$15,000 to US$20,000, compared to only US$300 in the UK,” said Feely. The World Bank estimates it takes an average of 77 days to open a business in Iraq, almost four times the average in the region.

Issues such as a cash-based banking system, corruption and limitations on land ownership have also damped investment. Iraq’s National Investment Law of 2006 bars foreigners from owning land, though it was amended in November to allow non-Iraqis to buy property for housing projects. Meanwhile, Berlinbased Transparency International placed Iraq in fourth to last place in its 2009 corruption index of 180 countries.

Nevertheless, the government has pushed through some measures to attract investors. The National Investment Law exempts foreign companies from paying taxes for 10 years and from paying import fees for three years.

But even so, Iraq needs US$400-500 billion to get things back on track, according to the Baghdad Investment Commission’s Feely. “Unfortunately, we only receive hopes and promises,” he said. “We can’t do it without foreign investment. We can’t do it on our own.”

Iraqi market through the Iraqi government,” El Akabi explains. “So far we’ve been awarded one megaproject at Baghdad Gate and one medium-sized project, a shopping mall in Palestine Street in Baghdad. Almco’s superior past performance and experience – with hundreds of recommendation and appreciation letters – played a major role in winning these tenders.”

The Baghdad Gate project is indicative of the forwardlooking nature of many of these schemes. The fi rst comprehensive real estate investment project of its kind in Baghdad, it will cover 258,000 square metres in a strategic location in the heart of the city, opposite Zawra Park, and will include commercial, residential and business units and an advanced infrastructure consisting of an electricity distribution network, a sewage network, roads and sidewalks as well as gardens and stunning natural views. “We believe the time has come to reflect the desire of the Iraqi people to overcome all obstacles and challenges, which is why we have commenced with this innovative project,” says El Akabi. “We will continue to work towards our vision of implementing investment projects that provide employment opportunities to Iraqis and respond to their various needs as a means of combating unemployment and elevat-

Iraq Cover Story 59

ing the level of basic services – which will, in turn, elevate the standards of living in iraq.”

Iraq is sitting on a proven 115 billion barrels of oil & 112 trillion cubic feet of natural gas

Local talent El Akabi’s vision highlights another key issue: that of rebuilding the Iraqi talent pool. Indeed, both Richards and El Akabi are adamant that international fi rms have a valuable role to play in assisting Iraqis to rebuild their broken economy. “We want the Iraqis to form the basis of these projects and we obviously employ a majority of locals at our facilities – but we also believe that at this point in time, the expertise and managerial skills to operate from day one simply do not exist to a large enough extent in Iraq,” says Richards. “Hopefully, in time we can help to build these skills in the locals. Domestic companies, owned by and employing Iraqis, will gradually grow out of this rebuilding process, as long as the government makes sure that the international companies are incentivised to employ locals and that the locals are encouraged to work hard and learn.

But none of this will happen overnight.”

El Akabi agrees, and sees education as a key enabler.

“We need to look hard at education as a fundamental and imperative factor that would play a major role in rebuild-

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COVER STORY

ing the nation,” he says. “Iraq has been a prison for the Iraqi people for the past 30 years; the simplest technologies – such as the internet and satellite TV – have not been available, while education has deteriorated to a very low level.” He also believes the knowledge and experience gained by expatriate Iraqis could be put to good use in the rebuilding process. “In my opinion, it is vital for Iraq’s long-term growth that Iraqis living abroad as doctors, engineers, experts and other professionals in different fields return to the country. These individuals will bring new technologies, skills and knowhow, and most importantly can share their experiences in the West with the present Iraqi workforce.”

Gavin Jones is a founding partner at Upper Quartile, a business specialising in post confl ict economic reconstruction, and he believes there is currently a severe shortage of skilled and experienced personnel and project managers capable of leading the planned expansion. He also feels that the skills shortage is currently being largely ignored and that opportunities need to be made available to Iraqis in order to get them involved. “There needs to be some form of skills development put in place, probably with Basra University or certainly one of the state-owned universities, and that should include things like English language training and technical skills,” says Jones. “But the university hasn’t really been engaged and there are no training schools. It’s quite clear that you’re going to need a very large amount of people who can work in the very short-term, and nobody has got that sorted out yet.”

“It is vital for Iraq’s long-term growth that Iraqis living abroad as doctors, engineers, experts and other professionals in different fields return to the country” Overcoming such a shortage – particularly in the oil and gas industry, which will likely provide the bulk of future funding for the reconstruction process – is key to the country’s future development; following the drawdown of American troops, the country’s rebuilding process – like its security – will be left largely under the governance of its own population. But in people like El Akabi and the countless other expatriate Iraqis returning to help Iraq back to prosperity, the future looks brighter than it has in a long time. The number of foreign firms – including many Gulf-based companies – looking to enter the market and lend their expertise is also encouraging.

In addition, of course, a considerable number of US military personnel will remain in Iraq, and their skills and knowledge will also prove invaluable to the rebuilding process. Their presence may continue even past the December 31, 2011, deadline agreed to by the two countries for a complete withdrawal; after all, troop presence – or the lack thereof – is not necessarily an indicator of success. But it does represent another milestone in Iraq’s long march back to normalcy.

Iraq Cover Story 60

“UAE companies are the top companies investing in Iraq real estate” UAE FIRMS LEAD THE WAY Negotiations between the Iraqi National Investment Commission and several UAE real estate developers to build big projects in different parts in Iraq have reached “advanced stages”, a top Iraqi official announced earlier this year.

Sami Al Araji, Chairman of the Iraqi National Investment Commission, said the projects under negotiations are worth nearly US$70 billion and that the talks will be finalised in the near future. “The two sides are serious in their desire for the talks to succeed, and things are going well,” Al Araji told Gulf News.

While some UAE companies already have a presence in Iraq’s northern region of Kurdistan, the negotiations underway are on “big projects all over Iraq, in Baghdad, in Central Iraq, and in the south,” the official explained. Projects under discussion are Al Rasheed Compound, The Banks of Karbala and The Future City, while UAE companies involved in the discussions include Al Maabar, Bloom Properties, National Holdings, Bonyan and Al Hanthal.

Abu Dhabi’s international investment company, Al Maabar, had unveiled details for a Baghdad development project located at the Al Rasheed Military Compound in October 2008. The company is backed by all four major Abu Dhabi developers – Aldar, Sorouh, Reem and Al Qudra. According to Iraqi reports, the US$20-billion development will stretch across 1250 hectares and comprise several key clusters, including residential units, a commercial district, a technology centre, a hotel and hospitality district, healthcare and educational districts, and public facilities such as mosques and gas stations.

A great section of the site will also be devoted to some of the largest entertainment centres in Baghdad.

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INDUSTRY INSIGHT

As construction slows in the MENA region, the world of fire protection continues its relentless battle to prevent the loss of life and safeguard its clients. Dean McGrail opens up on the steps being taken to do precisely that.

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alk into any office, in any building, almost anywhere in the world and within seconds you’re sure to pass one of the members of the ‘dangerred’ club sitting dormant on the wall. With their cautionary instructions and shiny exteriors, these last-resort devices have become standard in all commercial buildings over the years – and with very good reason. From fi re extinguishers to alarms, blankets to sprinklers, these modest beacons of fi re suppression have saved innumerable lives through partnering with quick-thinkers and industry experts alike. But none of this would be possible without the correct understanding of and commitment to fi re protection that has created and permeated an entire industry.

Of course, fi re is fi re no matter what context you put it in; whether it’s snowing or sweltering outside, the right conditions indoors can create a potential disaster site.

Combine that with arid conditions and world-beating skyscrapers and you’ve got the current state-of-play for the MENA region. Fortunately for all those sat blissfully unaware in their offices, the region is also host to some of the best in the industry when it comes to ‘pre-planned fi re-fighting’.

“The single biggest concern in the MENA region,” begins Dean McGrail, Operations Director of Specialist Services at WSP Fire and a big thinker in the Middle Eastern fire protection scene, “is probably the high external air pressures. That’s quite a significant impact on smoke control systems, so it removes areas where we can use natural smoke

Dean McGrail fire section 62

vents in atriums and shopping mall designs – predominantly due to the fact that the temperature of the smoke is not hot enough to get out of the vents because of the high external air temperatures, and of course stratification.”

Indeed, combined with the extreme external air temperatures is another well-known characteristic of the MENA region: skyscrapers. With the external air temperatures resulting in a subsequent movement of air down the colossal buildings, the much appreciated internal air conditioning results in a differentiation in internal and external temperatures – known as a “reverse stack effect” – both issues that are predominantly related to environments such as the UAE, for example. To put the icing on the cake, McGrail also cites the fi nal usual suspect aggravating conditions as the unavoidable levels of prevalent dust, which often clog up vents and door closers.

With such a multitude of factors affecting the arena of potential fi re, it is important to note that the inherent differences between fi re suppression and fire prevention can often be combined in what McGrail refers to as a ‘fi re safety management and maintenance plan’. “That covers everything from fire prevention, to having wardens going around and making sure there are no papers stacked against heaters or that exit doors are open.

“Likewise, if a fi re does occur, human detection is obviously the most rapid form of fi re detection you can possibly have, followed by suppression using fi re extinguishers. The human interface into all fi re safety management and prevention, detection and suppression is a key issue. If we’re looking at systems, there’s obviously smoke and heat detection.

“The human interface into all fire safety management and prevention, detection and suppression is a key issue”

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INDUSTRY INSIGHT

There are also a few more advanced systems, including aspirating smoke detectors, which use an air sampling style of smoke detection that draws smoke into a sampler and then measures quantities of smoke particulates.

“Then you have truly cutting-edge technologies such as CCTV based systems and video imaging or video smoke detection. Of course, fi re suppression sprinklers are still there; it’s an old technology, but still one of the best understood by the majority of designers. They’re very simplistic to install and maintain – and typically 98 percent effective.

However, probably the most important from my perspective is the fire safety management plans that make all of these other systems work effectively.”

With constant updates in technology and the envelope of innovation forever being pushed, both McGrail and the industry have witnessed new and intriguing technologies that protect more than just the client crop up in recent months. “Probably the biggest one that we’re seeing now,” reveals McGrail, “is a move to new gaseous suppression systems. There was obviously a lot of worry about 10 or 15 years ago to do with depletion of the ozone layer. What we’re fi nding now is that a lot of these new gaseous systems are looking at lower atmospheric lifetimes, so the time that they survive within the atmosphere is as low as reasonably possible. It’s no longer 1000 years, but as low as two years before they disappear now. I think we’ll be seeing a lot more of that in the future.”

There’s no escaping that with a difference in technology comes a change in standards. McGrail states that on his arrival to MENA six years ago, there was undoubtedly a “mismatch of codes” that was ultimately down to the designer to decide upon. Fast-forward to the present and there’s been a big push towards American standards – particularly those of the National Fire Protection Association codes (NFPA). Returning to the bread and butter of MENA architecture, skyscraper codes have also had to evolve to keep pace with fi re protection plans.

“The codes used to classify a high-rise building as anything above 23 meters, so they would treat that building the same as they would a building of 1000 meters. From a design point of view, we need to know how the building will react, so you start to look at performance based designs and that takes a view of the whole building package:

Typically fire supression sprinklers are

98% effective

how the building occupants react and how smoke is going to react in the building. Again, returning to the idea of reverse stack attack, what happens if you lose a staircase?

Well, we’re starting to see a movement towards the use of elevator evacuation in very high-rise buildings, so there are strategies being developed to make use of elevators to speed up evacuation times.”

Of course, when a fire does break out, the prevention aspect pales into insignificance, making way for the ‘passive protection’ cavalry. The aim of the game? To reduce fire damage to a building once prevention has failed.

However, with the construction industry going through a rough phase at the moment, the fi re protection industry has received somewhat of a knock-on effect, reducing the opportunities to implement new passive rationales and technologies.

“The type of work that we’re usually involved in has changed somewhat,” admits McGrail. “There’s a lot of people now looking to continue in their current buildings, so not as many are looking to move into new buildings”.

Th is has resulted in a shift ing from new technologies in sparkly new buildings, to McGrail and his team undertaking fi re safety audits and due diligence studies within existing buildings to bring them up to current standards.

“There’s still a lot of work for us out here, but the type of work that we’re doing has changed. There’s not as many of the crazy projects; the 1600 metre towers and the twisting towers and what have you. It’s a lot more standard building stock, which is obviously far more cost effective.”

Is this a taste of the future? Who knows. But according to McGrail one thing is certain, sustainability needs to be high on the agenda of fire protection and suppression.

“There are contradictions between what we’re looking at for life safety against those of sustainable design. I can see that being a big area for development in the future and it’s something that we’re looking at in within WSP as well, working with our environmental colleagues on developing environmental codes and the impact that they could have on fire protection codes. As clients become more educated – and with civil defense authorities as well – there’s a much bigger push for the fi re consultant to actually follow the design through to practical completion. That’ll become more of a regulatory requirement in the future.”

October 2009 saw several fires in Dubai, Abu Dhabi & Sharjah

Dean McGrail fire section 64

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70

Safety relieves tension Belimo’s David Stevenson explains how a simple and practical fire protection system can provide safety to your building and peace of mind for you.

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ature is just as fascinating as it is destructive. On the one hand, it gives life and heat, but on the other hand the forces it is capable of unleashing can pose both a threat to humans and cause considerable damage. Using our know-how as a leading manufacturer of electrical direct-coupled actuators and motorised valves, we have committed ourselves to providing effective personal and unit protection for more than 30 years.

Our sophisticated fail-safe solutions provide you with safety that is adapted exactly to your needs, whether for air-conditioned buildings, trains, ships or tunnels. Belimo provides responsible protection for people and tangible assets. In an emergency, effective protection against fi re and smoke saves lives and helps to minimise damage to buildings and tangible assets. As a responsible investor, planning engineer or facility manager, you should ensure that your fi re protection and smoke control dampers are motorised with the specially developed Belimo actuators that have been proven the world over. A graded product range of complete solutions is available to control and monitor the actuators.

Safety takes pressure off and Belimo provides reliable fi re and smoke protection. To prevent the spread of fi re and smoke through the ventilation ducts, motorised fi re dampers are installed in the fi re compartments. In an emergency, they close automatically and seal off the area.

Controlled by a smoke detector, they trigger early enough to prevent the transfer of cold smoke. The dampers’ remote-controlled performance check cuts the operating costs. You can shut off unused compartments at night or if the ventilation system is switched off, which enables significant energy savings.

We introduced the fi rst fi re damper actuator in 1977 and have been continually perfecting it ever since.

Belimo’s years of practical experience have enabled it to develop into a world-renowned fi re protection specialist.

Experience with fi re catastrophes has shown that smoke and toxic fumes pose the greatest threat to human safety.

Motorised smoke control dampers from Belimo used in conjunction with mechanical smoke extraction systems significantly reduce these risks. Escape and emergency routes remain smoke free, the extremely dangerous phenomenon of flash-over is prevented or delayed, and fi re fighting and rescue work is made much easier.

Mechanical smoke extraction systems with motorised smoke control dampers save lives in the event of fi re.

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David Stevenson is Managing Director of Belimo Automation FZE, Middle East. A British national working in the HVAC business for many years, he joined BELIMO Automation UK in 1998. In 2006 he relocated to Dubai as Sales Manager, Middle East for Belimo Automation FZE. In 2008 he was promoted to Managing Director.

Tested and approved actuators and flexible complete solutions from Belimo also play a key role in protecting people in buildings.

Enormously resistant, Belimo actuators for fi re and smoke protection dampers were developed specifically for these applications and satisfy the most stringent quality requirements. Their outstanding robustness and complete reliability ensure that the fi re dampers they are fitted in satisfy all standards and guidelines in this area with ease.

Fire protection actuators have to securely close the damper in an emergency and keep it closed while the fi re is burning, so there is no compromise on reliability. Th is places particular requirements on their design. Highquality steel parts, robust spring return packages, form-fit connections and special thermal tripping devices ensure zero-compromise on safety in a fi re.

Belimo’s systems are safe, thanks to simple monitoring. Graded complete solutions to control and monitor fi re dampers help to increase planning reliability during project planning while optimising investment costs. They are simple to operate, provide maximum operation and maintenance protection, are extremely flexible and offer impressive cost-effectiveness.

Belimo also offers practical, graded complete solutions to control and monitor smoke control dampers.

Because they make planning, installation and operation much easier, they contribute significantly to the acceptance of mechanical smoke extraction systems and therefore significantly improved personal protection.

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ASK THE EXPERT

Effective climate separation improves the energy efficiency of your building Biddle BV’s Rob Schomaker describes how highly efficient air curtains provided by a specialist can contribute to making your building go green.

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he worldwide awareness towards energy efficiency and the need to reduce our carbon footprint play an important role in today’s building design. But why spend millions in isolating buildings and installing high energy efficient cooling equipment while at the same time a lot of energy is lost through the open doorway? By using the Biddle technology you do not only add comfort to your building climate, but also save substantially on your energy bill and reduce the excessive investment in cooling equipment.

Biddle highly values the interest of the customer and environment by adapting its products and customer-specific advice to local conditions.

First, consider energy losses caused by convection forces. When two areas are connected by means of a door opening there usually is a temperature difference between these areas. The consequence of this ΔT is that inside and outside air start to mix; cold air moves to the warmer area via the bottom part of the opening and warm air penetrates into the building through the upper part. The energy losses caused by this effect of natural convection are often underestimated. A three by three metre door opening between a conditioned area of 20°C and an outside area of 40°C already causes a constant flow of energy of approximately 60kW. Together with this penetrating hot outside air, dust, insects, exhaust fumes and moisture from outside are also drawn into the building. The energy lost because of convection is even higher when the difference in relative humidity is taken into account. The entering latent heat including moisture requires easily five times more cooling capacity to be pumped away, meaning that the actual energy losses in this example are approximately 300kW. High-efficient ambient air curtains considerably reduce the effect of moving air. Biddle understands that effective climate separation is more than just blowing air down a doorway. It starts with understanding the effect of convection and moving air. Fast blowing, cheap, simple and turbulent air curtains, which are widely applied now in the MENA region, often bring rather more negative than positive results. The speed is very critical for the performance of an air curtain and should be fast enough to bring the flow of air down to the ground but gentle enough not to collide with the floor. Another critical aspect is the level of turbulence of the air-flow. Due to Biddle’s patented rectifier technology, a non-turbulent air-flow at low velocity can be realised, which penetrates to the floor without mixing inside and outside air. The use of the rectifier technology results in real climate separation with over 90

Biddle BV 72

percent efficiency and a comfortably cool indoor climate.

Without an air curtain, the incoming warm and humid air needs to be cooled down by the air conditioning units.

A high-efficient air curtain reduces the outflow of cold inside air to a minimum, which allows the air conditioner to operate at lower capacity. When climate separation is included in the energy calculations in an early design phase, a lower number of air conditioning units or units with lower cooling capacity need to be installed. Furthermore, an air conditioner blows out cool air only at a few spots in the room. An air curtain sucks this cool air and increases the recirculation effect, which means that large temperature differences are prevented and the comfort in the building is maintained at the desired level.

The prestigious Masdar City will be a 100 percent sustainable city in the UAE, making use of renewable energy sources and energy saving solutions. The designers of Masdar Institute of Science and Technology have understood well that an investment in real climate separation contributes substantially to their challenge to become the world’s most ambitious eco-city. Biddle air curtains have recently been delivered to be installed above the entrances of this building in order to meet their challenging demands.

We would be most pleased to advise you on how Biddle air curtains can reduce your energy bill and improve the comfort in your building.

Rob Schomaker

Rob Schomaker is Director of Biddle Export Worldwide, a leader in innovative solutions in the field of climate separation in retail, public sector, cold and chill rooms. His background is electrical/mechanical engineering and through 20 years of experience in export his main skills are building long-term relationships with his key customers.

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AFFORDABLE HOUSING

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Once a hub of luxurious and extravagant developments, the MENA region’s recovering property industry has had to turn its attention to the modest middle market. But can this under-supplied demographic bring the sector back up to the dizzy heights of the boom years? How have attitudes changed since the days of speculative mega-project development? And is affordable housing really a commercially viable alternative?

By Lucy Douglas

L

uxury is big business in the Middle East. A region renowned as a hotbed for the most extreme developments in the world, bigger, bolder, brighter and above all more expensive has become the norm here. Cash-rich young professionals operating in the lucrative industries of fossil fuels or fi nance that are prosperous in the region are a prime market for high-end retailers, hoteliers and property developers. And between the seven star hotels, labyrinth shopping malls and reclaimed, purpose-built peninsulas of ornate residences, there has been no shortage of supply for this affluent consumer demographic.

For over a decade, the Middle East’s property markets have leaned towards the more sensational. From the world’s tallest building complete with designer-brand hotel, to the world’s fi rst carbon-neutral city, to even the world’s fi rst underwater resort (although this project, the Hyrdopolis, was shelved back in 2008), the developments popular around the region were less a well-conceived residential opportunity for rapidly growing populations than an extravagant statement to the world proclaiming the region’s potential as a global economic powerhouse.

Even emerging from a tough economic downturn, a plethora of mega-projects are still under development, adding to the top-end tourist, commercial and residential space that is already abundant across the region. MEED’s Top 100 list of projects, which includes developments such as Saudi Arabia’s King Abdullah Economic City and Kuwait’s City of Silk, have a combined value of US$1.3 trillion, more than the entire combined GDP of the six GCC nations.

But with so many mixed-use, master-planned, multi-billion dollar mega-projects still springing up across the MENA region, it’s easy to forget that this standard of residential space does not necessarily reflect the means of the average resident.

Well, until now. Following the glory days of the Middle East’s construction boom, the effects of the economic downturn are still being felt throughout the region with many projects cancelled or still on hold, and those that have gone ahead uncertain as to the stability of the market onto which the properties will emerge. With many of the large-scale speculative developments that took place across the region during the last decade drawing nearer completion, only to be met with a smaller and smaller pool of potential buyers available to pick up the overwhelming supply, attention is beginning to turn away from the top-end market of luxury villas and penthouse apartments, and looking towards the more modest income markets.

“Historically,” explains William Dewsnap, the Head of Valuation in the Abu Dhabi office of property consultancy fi rm Cluttons, “developers have always thought, ‘I’m going to build the biggest and the best and only the top end stuff because that’s the most valuable and that’s what will get me the best return.’ The mid-market has largely been ignored.”

Indeed, a much-needed shift is taking place in the property markets of the Middle East. Between the ostentatious, high-profi le multi-billion dollar super-developments for the region’s most affluent residents at one end of the spectrum, and the government-funded grants and social housing schemes for the lowest-earning nationals at the other, those in the middle-income brackets across the Middle East have hitherto been left with a deficit in appropriately priced housing. And they represent a significant sector of the market. The young and well educated demographics in the GCC nations (the mean age of residents varies be-

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AFFORDABLE HOUSING

tween only 24 and 30 years old across the GCC) represent a large contingent of consumers with an income high enough to take them out of the social housing bracket, but not high enough to live in the luxury residencies that have become so commonplace in the region.

In Bahrain, explains Dewsnap’s colleague Ben Cullum, the government offers a loan of up to BD40,000 to married couples or families earning up to BD1200 a month.

“We tend to classify affordable housing as being about BD40,000 to BD80,000, which covers a large sector of the population,” he says. “In broad terms there’s very little that is on the market within that band. So there’s a disconnect between what can be afforded by local Bahraini families and what’s actually being developed, either as master planned schemes or just individual properties.”

Over in Abu Dhabi, Dewsnap agrees, highlighting that while the government has some very generous rules in place to provide a significant proportion of nationals with housing, there is massive population of residents – most notably expatriate workers across all income brackets – that cannot afford the accommodation readily available in the country.

Market opportunities And so thanks to a generation of optimistically speculated over-development, these middle-income residents are providing the next big real-estate consumer market for developers. According to management consultancy fi rm AT Kearney, the affordable housing market in the Middle East is estimated to be worth around US$125 million every year; the fi rm puts the shortage in Saudi Arabia at around 150,000 housing units annually, and in Egypt an estimated 280,000. Real estate firm Colliers stated in a recent report that the undersupply of housing in Abu Dhabi would reach 42,000 homes by 2013.

Moreover, the Urban Planning Council of Abu Dhabi is bringing rules into place to regulate the provision of affordable housing to meet the demands of this sector. “Largescale multi-residential projects of over 75,000 square metres of gross floor area (GFA) are now required to allocate at

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Multi-resident projects over

75,000m2 of GFA must allocate 20% to lower income groups

least 20 percent of the GFA to housing for lower income groups,” explains Matthew Green, the Head of Research and Consultancy for the UAE at CB Richard Ellis. “Strict guidelines will also ensure that the ‘affordable’ units have a minimum floor space, specific for each bedroom type, and strict rent ceilings in place to make certain that rates are adhered to and tenants are not exploited. Rents will then be reviewed and updated regularly to make sure that leasing rates are maintained at suitable market levels.”

But why has this market gone for so long without being tapped by developers? What has sparked the sudden interest? “During the boom times,” explains Dewsnap, “people found properties in Dubai unaffordable. They tended to migrate north; so they went from Dubai into Sharjah, and then went further north into Ajman. Now as the market has turned, you’re seeing that happening in reverse. People are moving back down south.”

Th is seems to have been a common trend; if centrally located property is too expensive, move further away. In fact, it is this issue of location that is behind the interest in reasonably priced housing in Oman. “The government has always issued one plot of land per person and so each Omani will have a plot, normally 600 square metres, to build their own house on,” explains Philip Paul, Head of Country in Oman for Cluttons. “Most of the employment is in Muscat or another major city like Sohar, whereas a lot of these plots are given out in people’s home villages and home towns. So therefore, although they might be working in Muscat, because their plot is located some distance away it doesn’t fulfi l their housing need.”

Now, however, the middle-income earners are coming back. With the recovering market shifting to establish a new equilibrium, this demographic are in a prime position to reap the benefits. The global economic downturn left large proportions of the region’s construction industry in tatters as investors pulled out and funding dried up. But the midmarket segment offers huge opportunities for developers.

And despite the timing of this focus on affordable housing in the Middle East – not to mention the current tendency to attribute any market shift to the financial crisis – experts are at pains to stress that it is not simply an after-effect of the recession. “Irrespective of what the economy’s doing, there will always be people of middle income who will need somewhere to live,” Dewsnap points out. “Obviously the numbers who fall into that mid-income bracket may fluctuate a little, but there will always be quite a substantial number of people in that sector who need property.”

In Bahrain, Cullum is more pragmatic about the situation. “Certainly people are tightening belts and probably looking to more affordable accommodation than they necessarily were thinking of two or three years ago, as job security becomes more of a concern and so on, but really the affordable housing drive – certainly in Bahrain and to some extent in Saudi Arabia – is coming from pure demographic analysis.”

Cullum reiterates the pressing reason underlying this shift in the market: that for a long time luxury developments have been in massive over supply, and fi nally the

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Dubai Marina at night, United Arab Emirates

pendulum is beginning to swing the other way. Thanks to a young population coming through, and old residential accommodation becoming obsolete, the affordable housing demographic is growing, and developers have no choice but to follow where the business goes. “Most developers wanted to produce high-end, luxury accommodation, whether that’s commercial or office or hotels,” he says. “So they’d buy a plot of land in an appropriate area and start the developments. Now, there’s a big supply of that style of property in most countries.

“At the same time, the demand is reduced for that type of property, and you end up with a situation where supply has outweighed demand in a very big way. So developers are now turning their attention to where the demand/supply imbalance is right for development. So in that sense, the developers are coming at affordable housing as a knock-on result of the recession, but in terms of the demand, it has been there for a while and is increasing as time goes on because of the demographics of the countries.”

Paul agrees, pointing out that in Oman, though the activity in the affordable housing sector is more measured, it is largely a reaction to the market situation. “I think there’s a category of middle level developers who are looking for a niche in the real estate market to make money. The government, as such, doesn’t provide housing other than very small schemes generally in the interior for rural families.

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So the talk about [affordable housing] is partly a recognition that other parts of the real estate market are saturated.

There’s oversupply issues in other sectors and given the underlying economics, you’re not going to make money from them; I think people have turned to affordable housing and are just at the stage of researching.”

Bright prospects?

“Irrespective of what the economy’s doing, there will always be people of middle income who will need somewhere to live” William Dewsnap

Though this more modest market might present an attractive opportunity for developers to stay active in the region, it is not as straightforward a transition as they might like, and certainly does not take the industry back to its hedonistic heights of 2007. The fragile nature of the market during the recovery has thrown up a minefield of challenges that developers must navigate a way through in order to have a commercially viable product.

“It certainly is noticeable that the big, mainstream developers are getting involved with these more affordable projects,” says Dewsnap. “To give an example in Abu Dhabi, the main developer in town is ALDAR, and one of their flagship schemes is Al Raha Beach, which is an enormous waterfront scheme on the road in from Dubai, approximately 12 kilometres long with 10 or 12 different phases. [They] originally planned to build it as quickly as possible, obviously to get the properties ready and on the market. That has been scaled back significantly, and you’ve now only got the first two or three phases that are well advanced.”

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Dewsnap’s is not the only such example; numerous developers across the region have tried to hedge their bets with a project currently mid-construction, diverting from original plans and making it more affordable so as to increase the chances of selling units once it is completed. In many cases this has required a massive re-design and scaling back process, so as to fit with tighter budgets.

However, in many cases no amount of re-designing can create an affordable project that covers the cost of the land it has been built on. “Land prices grew very rapidly during the boom years,” Cullum highlights, “largely on the back of speculation rather than underlying economic value. We had this situation where land was being bought and sold as a commodity in itself and values were rising because of that.” Matthew Green agrees. “The main obstacle to this type of development is really the cost of land, especially if it was purchased in 2007 or 2008 when values were hugely inflated. Many affordable housing projects have already failed to get off the ground, as the developer just can’t make the numbers work for that type of product.”

Projects that have been conceived more recently with the intention of supplying the affordable housing market are able to address these issues directly so as to maximise profits. Still, there is speculation as to how well these projects will be met once they come on the market. Dewsnap points out that these mid-market properties, in order to be affordable, will be less centrally located, often smaller, and with fi xtures and fittings of a lower specification. “That is going some way to meeting the demands of the midmarket,” he explains. “The first phases are only now just starting to be handed over, so there is admittedly a long way to go.”

Paul agrees. “A lot of land within the capital city [of Oman] is still too expensive for affordable housing, so it has to go out onto the fringes and further, and developers are still concerned that might not be acceptable to the local market.” Cullum explains how in Bahrain that fear is a reality, and represents one of the biggest challenges that developers of affordable housing face in that country. “We see a tendency for customers in the affordable housing sector to be demanding quite large properties – a villa that’s 250 or 300 square metres in size is very large, but for the local population here, it’s what’s generally expected by the upand-coming young Bahraini professional who would fit into that affordable housing bracket.” He concedes that the ball is beginning to roll in terms of a change in cultural attitudes, and the young and growing population are likely to be under pressure to move towards a more European style of apartment living. “But from a developer’s perspective,” he adds, “they don’t want to be the ones to blaze the trail just in case the pressure hasn’t melted enough, and they end up with an empty building.”

Th is cautious attitude is evident around the region when it comes to this sector. Paul explains that in Oman, developers are dipping their toes in the water of the affordable housing market, building 50 houses here or there, as opposed to diving right in. “A lot of mid-level developers are looking to initially introduce small schemes. There

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The mean age of residents varies between

24 and 30 year old across the GCC

“It certainly is noticeable that the big, mainstream developers are getting involved with these more affordable projects” William Dewsnap

have been one or two that have tried to introduce investors to really large-scale developments – master planned affordable housing with parks and mosques and some mixed-use buildings – but developers are still feeling their way.”

The uncertainty surrounding the market has fed into the funding aspect of development. Even as costs can be cut on certain aspects such as the location, size or interior decoration, developers are still fi nding funding hard to come by in the current climate. “Investors have defi nitely taken a step back and are far more cautious in terms of the investments they are willing to make,” explains Dewsnap.

“It is certainly being viewed with some interest by investors,” adds Green, “but there remain significant barriers to actually developing and delivering projects that are profitable in the current market.” Th is puts the whole market in a bit of catch-22. Finance is not only difficult for developers to come by, but also for potential buyers, a situation that in turn further dictates the need for affordable housing.

Still, the cautious attitude of investors comes with good reason. With this new sector yet to reach maturity, developers are awaiting the reaction from the market; and

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A model of ‘Reem Island’ on the opening day of the Abu Dhabi Cityscape international real estate exhibition

making the figures work on a project such as this is harder than it has ever been. Newly built affordable communities will require infrastructure development to support it, an addition that may have a crippling effect on the budget of a project. Cullum explains how many developers fi nd a project would be most profitable if it was built on a large scale, producing in the region of 500 units. If a local municipality does not take on that infrastructure, he says, then charges for its initial development and ongoing up-keep will be levied onto the residents, driving up the costs of the properties and making them no longer affordable.

Moreover, purpose-built affordable housing projects are not without competition. The massive over supply in other areas of the real estate market has led to slashed rent rates on high-end properties, meaning those in the middleincome bracket are now able to afford properties that two years ago would have been well beyond their means. “For example,” points out Dewsnap, “a one-bedroom flat in Dubai Marina – which is a top-end, waterfront development that’s very popular – that would have cost Dh150,000 a year to rent in 2008 is probably now half of that, Dh70,000 or Dh80,000. That represents really good value. So some-

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“It’s almost a case that affordable property doesn’t really exist at the moment, So the development is moving into a part of the property market that is wide open and waiting” Ben Cullum

one who has a mid-market property, which is of a lower specification, less central, with less facilities, is going to struggle to shift that property.”

While the way is fraught with challenges, and developers are cautious about the opportunities this market brings, there is no doubt that this is a demographic that needs supplying. “Affordable housing is currently a burning issue throughout the region,” reiterates Green, “especially in countries such as Egypt and Saudi Arabia, which both have very large, young populations that are growing very rapidly.”

“It’s almost a case that affordable property doesn’t really exist at the moment,” adds Cullum. “So the development is moving into a part of the property market that is wide open and waiting.” With the population in the region set to double over the next 40 years, this is not a temporary market, and Dewsnap suggests that as long as developers are shrewd about the timing of delivery of their projects onto the market, they will generate significant interest. With all this in mind, only time will tell just how far this can go to boosting the convalescent construction industry.

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MENA’S DEADLIEST THREAT? Statistically, the MENA region has the most dangerous roads in the world. Just why are the safety standards so poor in the well-developed nations of the Gulf, and how can the situation be improved? MENA Infrastructure finds out.

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ccording to the latest figures from the World Health Organisation (WHO), published at the end of 2009, the Eastern Mediterranean (including the Middle East) and Africa regions have the highest rates of road traffic injury and fatality in the world, at 32.2 deaths per 100,000 people. While this statistic may not be surprising in conjunction with the under developed nations of sub-Saharan Africa, it seems more shocking to think of the emerging economies of the Gulf in this respect. But consider this.

At the height of its boom, the Gulf’s construction industry operated largely with a “build it and they will come” approach. And certainly, as residential, office and commercial developments shot up across the region, the expatriate business community flocked in and the population bulged.

Likewise, in neighbouring Arabic states, factors such as oil wealth or tourism helped to draw in visitors. And on top of that, national populations have been, and will continue to be, growing.

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“There’s a high rate of development going on and a high rate of motorisation occurring, which is resulting in many more deaths and injuries”

And with a bigger population comes the need for more advanced infrastructure, better utilities, better amenities, better transport systems. Today, though the buildings are plentiful, many other aspects of the infrastructure are playing catch up. Avi Silverman of the FIA Foundation helps shed some light on the issue. “Really it’s not a phenomenon that’s just limited to the Middle East,” he explains. “It is something that lots of countries of low and middle income status experience: there’s a high rate of development going on and a high rate of motorisation occurring, which is resulting in many more deaths and injuries.”

Indeed, this increase in development and motorisation is perhaps more of an aggravating factor than previously accounted for. While stereotypically poor standards in road safety are found in, low and middle income countries, as Silverman says, the wealth of the GCC nations makes these statistics a little more shocking. While the GCC alone is not responsible for that record regional average (and in fact their figures fall below the 32.2 value), the individual

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rates recorded from each state are still alarmingly high for countries of such wealth and resources.

According to WHO statistics, in 2007 Saudi Arabia reported 25.7 road traffic fatalities per 100,000 of the population; the UAE recorded 24.1 per 100,000; Qatar, 23.6 per 100,000 and Oman a shocking 30.6 per 100,000. Bahrain has the lowest rate of all GCC sates with 12.1 per 100,000.

To put those figures into perspective, in the same year Canada reported 8.7 fatalities per 100,000; the UK 5.4 per 100,000 and the Netherlands just 4.8 per 100,000. Romania, a developing ‘middle income’ country with a per capita income of US$6150, about a sixth of the per capita income of the UAE and less than a tenth of that of Qatar, reported 12.6 road fatalities per 100,000 population, around half of those two affluent MENA nations.

So just why are serious road traffic injuries so rife in this region? Undoubtedly the boom in construction has had an affect, and recent years have seen a noticeable increase in the movement of traffic in and around the GCC, but should that really account for such a high rate in countries that boast wealthy governments, educated populations and quality healthcare systems?

“It isn’t just the increase in the rate of motorisation,” explains Silverman. “It’s that alongside that you’re not having proper, coherent and integrated planning in terms of road safety, to mitigate the numbers of deaths and injuries as the rates of motorisation increase. So the safety measures that are almost taken for granted in countries in Western Europe in particular, are just not there at the levels that they’re needed [in the Middle East], and the investment in road safety just isn’t there at the level that’s needed either.”

He suggests that in order to improve the situation in the region, road safety must also become a consideration at all levels, right from the initial processes of the road infrastructure development, through to actual road travel. “Improving the safety provisions that are made in the building of new roads; improving the usage of seat belts; improving the safety of vehicles with measures such as airbags, ABS, new anti-collision technologies being put into vehicles; campaigns that are put in place to increase the level of helmet wearing for most of bikes and cyclists. All these measures – including education and public campaigns and legislation for road safety – are taken together as the approach [to improve road safety]. These are the measures that are needed and that are being implemented with great effect, particularly in Western Europe, but aren’t being implemented at nearly the level that’s needed in countries in the Middle East and North Africa.”

A key element in the campaign for road safety, explains Silverman, and one that is frequently overlooked, is the condition of the roads themselves. “We’ve actually focused quite a lot on road infrastructure because it has been something of a neglected area, and the contribution that it makes to road safety needs to be emphasised a lot more than it has been. What we at the FIA Foundation are saying is that again, it’s very simple countermeasures that need to be implemented during road infrastructure building projects. When a road is initially built there needs to be

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“The World Bank and other multinational development banks that play a huge role in funding road infrastructure projects have started to put together a central facility to look at road safety”

The UAE reported a 21% drop in road traffic fatalities for the first half of 2010

Saudi Arabia reported 25.7% traffic fatalities per 100,000 people in 2007

proper provision for pavements for pedestrians and crossing points for pedestrians, provisions to separate vulnerable road users, such as cyclists, pedestrians, children or people who are using two and three wheel vehicles, from the much bigger, faster moving vehicles on the road.

“There needs to be proper crossing points near schools.

There needs to be use of roundabouts in ways to slow the traffic down at critical points, proper runoffs as well. Clear marking for traffic and clear use of safety barriers at critical points is important as well. All these measures are well known in road engineering but often they don’t get implemented where they’re needed, particularly in developing countries.”

Certainly measures are beginning to be taken across the region to combat this issue. In Bahrain plans have recently been confi rmed to install a network of traffic surveillance cameras across the island; Qatar is establishing a new research centre in conjunction with the Texas Transportation Institute in an effort to improve road safety; and the UAE reported a 21 percent drop in road traffic fatalities for the first half of 2010 compared with the same period the previous year. However there is still some way to go. “Lack of funding is a huge problem,” explains Silverman, revealing that the reports from the Commission for Global Road Safety are recommending that a portion of road infrastructure project funding be set aside for safety measures. “We have been campaigning for 10 percent. You very rarely get that level of funding put aside for safety measures. Normally it’s somewhere in the region of one percent or lower, and often it’s not actually to implement safety measures on the road itself; just a kind of token project but nothing that is actually in a systematic way going to ensure that there are correct safety measures on the roads.”

Silverman suggests that this problem can be turned around with a little help from investors. “This issue is starting to be addressed,” he reveals, “and the World Bank and the other multinational development banks that play a huge role in funding road infrastructure projects have started to put together a central facility to look at road safety and have started to devote some funding to road safety. That’s to be welcomed and it needs now to be built upon and increased.”

Still, there does seem to be some positive outlook for the future. Silverman explains that beginning next year a “Decade of Action” campaign to make the roads of the world safer will take place, during which international organisations such as FIA Foundation will be looking to establish a detailed global programme to improve the quality of road safety with an aim to reduce the number of lives that are lost on the roads every year. “Obviously, the Middle East is a region that really does have a very worrying projection in terms of the numbers of deaths and injuries that are likely to take place over the next decade, and therefore obviously has a huge part to play and we want to see Middle East North Africa region play a leading role in the Decade of Action and for road safety programmes to emerge across all countries in the region so that they, too can have proper targeted programmes to save lives and prevent injuries on their roads.”

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ASK THE EXPERT

How can transport create a lasting legacy in the Middle East?

EC Harris’ Brian Fitzpatrick and Tim Risbridger discuss how engineering the creation of new transport systems, technically and commercially, will help achieve a lasting legacy.

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he development of a modern and affordable transport system becomes increasingly important to the Middle East as they look to reduce their reliance on oil. As Eddington pointed out in a 2006 report, good transport systems attract globally mobile activity, reduce the costs of trading, increase competition, boost employment, and improve the efficiency of labour markets and of business. Good transport systems are enablers of economic prosperity.

The economic hotspots of Dubai, Abu Dhabi, Doha and Riyadh are currently isolated, in the sense that air and sea are the main means of transporting goods and people between them and the wider global marketplace. The most important legacy of a transport system in a physical sense is connectivity. The societal legacy is arguably greater social cohesion and stability, and a greater sense of identity achieved through that connectivity.

Transport systems in the West developed essentially to meet industrial or business needs at a point in time and, because they were created in isolation, they now require effort to run or to ensure connectivity to a wider network is affordable. If the essential legacy is connectivity, then optimum connectivity at the start is required, or at least a plan to achieve it.

Institutional governance and responsibility for transport and plans normally falls under a national agency with wide ranging authority. Abu Dhabi is one example of an Emirate undergoing an impressive and rapid economic and societal transformation, based upon Plan Abu Dhabi 2030, providing policy directions in a number of areas includ-

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ing the natural environment, urban design, housing and the economy. It’s an example of a unified and sustainable vision for the future but is essentially predicated on joined up and sustainable land use and transport. Accurately understanding population, economic factors and growth enables travel patterns to be modelled and understood. National guidance and governance to drive planning are pre requisites to ensuring a sustainable legacy can be created in the first place.

There is the capability to meet the engineering challenges of creating 21st century cities, but commercially engineering outcomes, to create the optimum system, is not such a mature science yet.

EC Harris has identified six factors that will help ensure that transport systems can deliver value, connectivity and the social benefits they are designed to from day one. First, truly understand the cost critical components of the system and/or schemes; accepting estimates and programmes without a clear understanding is surprisingly common in an experienced industry.

Second, benchmark estimates and programmes against worldwide reference cases. Reference case comparison is increasingly common and can often lend weight to estimates or highlight potential areas of inefficiency.

Th ird, have a accurate understanding of the impact that inflation will have over the lifetime of projects or programmes; point estimation doesn’t deal with risk allocation or inflation very well.

Fourth, understand the real costs of risk transfer. Developing the right procurement and engagement strategies with the supply chain is vital; getting this wrong can be an extremely expensive mistake.

Fift h, keep the supply chain informed and together for the duration of the programme. If a client is able to bring together an informed and capable supply chain this inspires confidence, longer term pricing and availability of resources in a competitive climate.

And fi nally, develop a safe but pragmatic and informed approach to engineering orthodoxy. Challenging the way things have always been done, and ‘old world’ standards can be a liberating process; hard shoulder running in the UK is one example where a widening orthodoxy was changed safely and efficiently.

Engineering the creation of the new transport systems, technically and commercially, will help ensure that a lasting legacy can be achieved.

Brian Fitzpatrick is Head of Highways at EC Harris, focusing on the successful planning, creation and operation of highways assets. He has worked as both client and consultant to major projects and programmes of technical activity, delivering certainty of outcome and demonstrable value for money from highways investment.

Tim Risbridger leads EC Harris’ Transportation sector in the Middle East. He is based in Abu Dhabi and has over 20 years of experience working on major infrastructure projects delivering on commercial, project controls and procurement aspects in the delivery of major investment programmes across the highway, rail, aviation and marine sectors.

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EXECUTIVE INTERVIEW

Retro-reflection and safe driving Poul Svensgaard, EVP at DELTA Light & Optics, discusses matters related to retro-reflection, road guidance measures and safe driving.

Retro-reflection is the result of the car’s headlights being returned from road markings or traffic signs. High quality road markings contain glass beads generating retro-reflection. Road signs are based on either glass beads or micro-prismatic sheeting to ensure an efficient retro-reflection level. The ultimate use of both types of traffic guidance is to ensure safe driving.

How can DELTA help improve safe driving?

PS. International standards give direction as to the performance of road markings and road signs and to the instruments being used to control retro-reflection levels. To guarantee that markings and signs meet the required performance level, it is necessary to check performance on a regular basis. Checking is carried out using retro-reflectometers made specifically for this purpose.

Since the 1980s, DELTA has developed and manufactured high quality retro-reflectometers and was the first in the world to sell this type of instrument. DELTA’s instruments are available worldwide and recognised as the leading brand; they are easy for the operator to handle and calibrate and offer accurate and reliable measurements, while recorded data are automatically stored and easily transferred to a PC using proprietary software.

In other words, DELTA offers the appropriate instruments for checking the quality of retro-reflection from road markings and road signs, helping road owners securing safe driving conditions.

How can DELTA make the work of securing safe driving conditions DELTA is involved in improving safe driving. What are you really lookeasier in the future? ing at when talking about safe driving?

PS. The short answer is by going mobile. Having focused so far on handheld Poul Svensgaard. Many parameters influence safe driving on roads. No instruments, DELTA is currently finalising the development of its first mobile doubt the ‘human factor’ is a major contributor to traffic accidents, but retro-reflectometer for road markings. Mounted on the side of a car, retroconditions on and around the road may also influence the reflection can be measured at normal driving speed and in safety level of the road. Here, traffic guidance in the form the full length and width of road markings. A new technology of road markings and road signs are very important to keep used for this instrument automatically compensates for vehicle vehicles on the road and in the correct lane in order to avoid movements, making DELTA’s LTL-M much more accurate accidents. compared to other instruments on the market. LTL-M will be An increasing number of countries collect road statisalmost as easy to operate and as accurate as DELTA’s current tics to record the number and severity of accidents. Such handheld instruments, a clear improvement compared to exdata can be used to spot sections of roads where accidents isting mobile systems. LTL-M is in its final development and tend to happen more frequently, as well as decide on meawill be launched at the beginning of 2011. surements to improve traffic guidance. The better the guidance tools perform, the less the risk of accidents happening. Poul Svensgaard is Executive How does DELTA see the future development for meaVice President of DELTA’s Light & surement of retro-reflection and other road parameters?

Optics Division, and is heading What are the most critical conditions related to safe the current MENA focus at PS. DELTA believes that the future belongs to mobile soluDELTA for its line of road safety driving? tions. Our customers are looking for a complete overview instruments. of their assets, and they want to plan maintenance based on PS. Statistics show that driving at night and in bad weather facts and not guesswork. DELTA wants to support this develconditions significantly increases the risk of road accidents, opment initially with LTL-M, and we are also looking to develop an accurate and one important parameter to improve safe driving is to ensure proper and easy to operate mobile solution for measuring retro-reflection from road retro-reflection from road markings and road signs. It is important that signs. We still need some time to work on this project, but as the leading markings and signs can been seen clearly in the distance, even under adcompany in this field we are committed to coming up with a solution. verse weather conditions.

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PROJECT FOCUS

Simply safer sign posts Craig Pyser of Frangible Safety Posts tells MENA Infrastructure how specially engineered road sign posts can help save lives.

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f your car loses control and you are heading for a large sign at speed, would you rather the sign post to be made of rigid steel or a specially designed, composite material, engineered to collapse in a safe and controlled manner on impact?

The first picture shows the devastating damage caused to a car hitting a steel post at 62 mph (100 kph). Not only is the car destroyed but the rapid deceleration causes internal trauma to the occupants, most likely leading to fatality.

In recent years while significant progress has been made in deploying passively safe sign posts in the UK, the vast majority of posts are made of steel. Many countries do not have a standardised policy to tackle the issue of the safety of roadside furniture, and like the UK, use incumbent, unforgiving materials such as steel or wood for sign posts.

Frangible Safety Posts Ltd (FSP) is a UK based company, operating in specially engineered patented composite posts, which balance the strength to hold up large signs in strong winds while collapsing if impacted by an errant vehicle in a predictable and safe manner. The key to reducing risk is to avoid the rapid deceleration of the car and avoid injuring the occupants.

The intellectual property for this product was bought from 3M earlier this year and since the purchase, FSP has expanded the range of sizes available.

The second picture shows the significant reduction in damage to a car striking the Frangible Safety Post under the same conditions. The post shears and fractures with the sign plate falling close by.

The Frangible Safety Post has been independently tested and meets the European standard EN 12767 and guidelines for passive street furniture with the 140mm post achieving the highest safety rating awarded to any product to date (100 NE:3). The standards and guidelines are aimed at making our road sides more forgiving and reduce the risk of injury for those unfortunate enough to leave the highway.

A recent report by EuroRAP highlights the next major opportunity for improving road safety lies with the road network under local government control and that they estimate the cost of car accidents to the British economy is UK£18 billion per year and the UK is seen as one of the

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safest countries for road safety in the world. Putting that in perspective, The World Health Organisation estimate that there are about 1.2 million people killed in traffic accidents every year, 10 million are people injured, costing an estimated US$520 billion.

In the same WHO report, the incidences of traffic accidents and fatalities were found to be significantly higher in the Middle East than in Europe. Our solution is to work with countries to help develop a passive safety policy and implement products such as our’s on the roadside to dramatically reduce injuries to drivers and passengers. We can supply directly to governments, provinces, councils, contractors and installers and we are happy to work on projects of all sizes from initial planning to redesigning individuals roads or junctions to be passively safe.

The Frangible Safety Post has been designed to blend in with existing street furniture maintaining the look and feel of the roadside. The post is available in a wide range of sizes (140mm, 168mm and 219mm diameter – and we can develop sizes to conform with individual countries standards), colours and fi nishes which can be matched in to the local environment, for example abrasion resistent coatings for desert environments.

Another important feature is the lightweight nature of our materials making manual handling and installation of the posts easier whilst also utilising standard fittings and techniques. Th is also reduces the energy required in manufacturing the posts, which lowers the carbon footprint.

The composite materials are durable, resistant to corrosion and can last up to three times longer than steel extending the active life span of the posts.

FSP is committed to providing safer street furniture products and making our roadsides more forgiving. Should you wish to know more please contact me and I would be delighted to meet to discuss anything in relation to this article and passive safety in general.

To view videos of the crash testing performed on our products visit: www.fsp-ltd.com Craig Pyser is the Commercial and International Director of FSP, after co-founding the business in September 2009. Pyser has worked as a Strategic Consultant at Fraserburgh Consulting focusing on Intellectual Property and was part of the team that negotiated the purchase of FSP’s IP from 3M. Previously, he was an Investment Banker at Merrill Lynch working in Singapore, Indonesia and the UK.

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CORROSION PROTECTION

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Asset preservation With corrosion prevention a major construction challenge, are we are doing everything that is needed to ensure the viability of our critical infrastructures?

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pedestrian walkway over a busy highway collapses. A water pipeline fails and floods a major road, damaging a number of homes and businesses. An aboveground storage tank collapses and releases hundreds of gallons of hazardous liquid into the environment. An F18 aircraft is landing when the front landing gear fails and the plane is lost. What is the common factor in each of these catastrophic failures? Each is due to corrosion.

It was recently determined by the World Corrosion Organisation that the annual cost of corrosion is US$2.2 trillion (between three and four percent of the gross domestic product of industrialised nations), while in the US alone the annual direct cost of corrosion in the infrastructure category is estimated at US$22.6 billion.

The science of corrosion prevention and mitigation has existed for decades, and through the efforts of NACE International – a 65-year-old organisation of 23,000 members in 110 countries based in Houston, Texas – more and more is known each year. Industry standards, training and inspection protocol offer effective solutions to owners who are demanding a longer life from their structures; indeed, according to NACE’s Chris Fowler, there is a defi ned science of corrosion that can yield predictable results to extend

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“For those in the infrastructure industry, now is the time to consider corrosion prevention, taking advantage of the available knowledge and training, we can help ensure that the assets we count on today are useful when we need them tomorrow.”

– some say indefi nitely – the life of a structure. “We must address this issue today if we want to ensure that these vital assets are available for use in the future,” he insists. “Th is is possible through the use of an effective plan and continuing commitment by all levels of management for corrosion prevention and mitigation practices.”

Fowler uses the example of oil and gas pipelines to illustrate his point. In a NACE Technology Gap Analysis released in 2008, it was estimated that the cost of replacing and maintaining pipelines is US$1.1 million per mile. But with nearly 500,000 miles of pipelines in use in the United States alone, that cost would exceed an insurmountable US$0.5 trillion. “Clearly, the world community must come to terms with corrosion while maintaining pipeline infrastructure,” he says. “Unprotected or poorly protected pipelines, whether buried in the ground, exposed to the atmosphere, or submerged in water, are susceptible to corrosion. Without proper maintenance, every pipeline system will eventually deteriorate.”

Fortunately, many of today’s corrosion problems can be addressed with current technology and with proper application of mitigation methods. “First, a new inspection regime as part of an integrity management programme will provide an opportunity to more fully understand the

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integrity of the systems and how to ensure safety,” says Fowler. “Th is often requires looking beyond the traditional mindset of fi nding and fi xing, towards a preventive maintenance approach.”

International standards also have a key role to play, for as new standards emerge, so do the tools to understand the integrity of the systems. Among the technology gaps identified in the NACE Gap Analysis were the need to understand how various factors influence corrosion and integrity, how to better detect the onset and extent of corrosion, and how to improve the overall education, training and public awareness of the influence of corrosion.

“Once standards are adopted – whether voluntarily or by mandate – the next step in the battle against corrosion is investing in a trained and qualified workforce,” explains Fowler. “The need to educate begins at the top with decision-makers such as chief financial officers, engineering vice presidents and owners, whose important decisions today play a key role in preserving the assets tomorrow.

Front-line managers and field personnel, however, all need to be involved in the process if it is to succeed.”

NACE and its members have developed training to address the issues facing the infrastructure community for those at all levels, many of which lead to world-recognised certifications. These include cathodic protection, one of the key techniques to address structural corrosion; and coatings, which most engineers believe is the number one tool to address corrosion.

Th is also highlights the vital role of research and development departments in the infrastructure industries, which will ultimately provide solutions to the next generation of corrosion-related crises. “Today, many of the corrosion problems facing the industry can be solved with current solutions and techniques, but as industry continues to push critical infrastructure beyond the original design life, more and better solutions will be needed,” says Fowler.

Public awareness is also playing an important role as governments adopt policies to preserve their infrastructures. The good news is that attitudes towards corrosion are changing, albeit slowly. For example, through legislation like the Corrosion Prevention Act pending before the US Congress and similar actions by other governments throughout the world, corrosion is beginning to win the attention of those who can affect change. For example, the Corrosion Prevention Act, once passed, will provide the energy industry in the United States with a 50 percent tax credit for corrosion work that goes above and beyond regulatory requirements. Th is is the fi rst step in encouraging industry with fi nancial incentives as they deal with the impact of corrosion. Planning today to mitigate imminent corrosion is vital for the future of critical assets, as well as the long-term health of the global economy.

“For those in the infrastructure industry, now is the time to consider corrosion prevention,” concludes Fowler.

“Taking advantage of the available knowledge and training, we can help ensure that the assets we count on today are useful when we need them tomorrow.”

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FIT FOR A KING

J

otun Paints, one of the world’s leading producers and suppliers of paints and coatings, announced this summer that it has secured a massive contract to paint the major part of the King Abdullah Financial District (KAFD), a state-of-the-art and fully self-contained centre for doing business and facilitating investment and enterprise currently under construction in Riyadh, Saudi Arabia. The high-profile undertaking, which will involve paintwork on 850,000 square metres of the financial centre, is part of the manufacturer’s aggressive growth strategy in the region.

Envisioned as part of the Kingdom’s overall economic diversification programme, KAFD is being built by Hill International – with Omrania & Associates and Gensler & Associates acting as the project consultants – and will have a total built-up area of 1.6 million square metres. With the aim to protecting the structure from the elements as well as natural wear and tear, Jotun recommended its Fenomastic range for the structure’s interiors and Jotashield for the exteriors, with solvent-free Jotafloor coatings to be used for the floors.

“The King Abdullah Financial District project stands to be one of our biggest achievements in terms of decorative projects we have undertaken in Riyadh to date, and we are very excited to complete this enormous task using our specially formulated paints and coatings,” says Kjell Gundersen, Managing Director of Jotun Saudia. “Given the important role it will play in further strengthening the Kingdom’s position as the Middle East’s financial capital, we are committed to ensuring that the paint solutions we will deliver will provide maximum protection for this important icon of the Kingdom’s economic dominance.”

Upon its completion, KAFD will house the Capital Market Authority and the Stock Exchange (Tadawul), as well as financial institutions and other service providers such as accountants, auditors, lawyers, analysts, rating agencies, consultants and IT providers. In addition, the project will also accommodate a financial academy for 5000 students, offices, hotels, shops, recreational facilities, waterways, squares, parks, sports arenas, restaurants and six mosques. A monorail system will serve as the main means of transportation within the development, while skywalk-style bridges will connect all 30 buildings within the financial district.

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EXECUTIVE INTERVIEW

Bringing your business into the new decade Contax Partners’ Filippo Fantechi tells MENA Infrastructure how the energy sector can capitalise on the opportunities in the region and ensure long-term success with a methodical business plan.

Over the past few years the Middle East energy project market has experienced unprecedented levels of award activity. Is this set to continue?

Filippo Fantechi. Between 2005 and 2008 the market saw an average annual Capex award value of just under US$70 billion. In 2009, this value increased to an unprecedented level of US$95 billion, largely driven by the region’s strategic energy production targets to ensure a solid position for the future upturns in demand, the relaxation in the contracting market after the crunch period and increased gas demand from the industrial, power and petrochemical sectors. Further to announced government investment plans, it is evident that the Middle East energy market will continue to be the land of opportunity for the coming years, with US$650-700 billion worth of projects having already been announced for award between 2010 and 2014, an 85 percent increase over the previous five year total. Around US$100bn of these new announcements have actually been made within the past few months, thus giving further encouragement that the levels of activity and opportunity will remain high within this market for the near future.

-2 Project feasibility/ conceptual design

Market itelligence data feed

-1 Project intelligence gathering

1.

Stock the pipline

Project awareness Opportunities qualified based on pre-defined criteria

Opportunities prioritised based on the right opportunity for the company at that time

2 2.

33.

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Qualify Q Prioritise P Target the right opportunities o o opportunities opportunities

Pipeline activity Source: Contax Partners

realisation. Customer orientation around these opportunities is also critiGiven this market situation and the number of opportunities that are cal. Identifying and understanding your customer’s real need and then creon the table, how can companies enhance their business development ating an aligned and differentiated value proposition that your organisation efforts to heighten their success? can uniquely deliver will stand your company in good stead. Undertaking FF. The key is to ensure that one’s business development process is robust due diligence prior and post award to ensure that your customers, contracyet flexible and effective at identifying, prioritising, tartors, suppliers and/or partners have the capability to deliver geting and securing the right opportunities. A company’s is essential to developing and maintaining your reputation long-term success strongly resides on this process. As going forward. seasoned business developers, our World Class Business Development Methodology focuses strongly on a four-step How does Contax Partners support companies with the opportunity pipeline management process; stock, qualify, development and realisation of their growth strategies prioritise and target. Proactively identifying all opportuniin the region? ties; passing them through a qualification process to assess FF. For over 25 years, the Contax Partners team has develwhether they are suitable and a good fit for the company oped deep market and sector knowledge and trusted advisor early on; and prioritising the opportunities in line with the networks that enable us to access key decision makers to test key pre-identified criteria will help one to determine the and validate our hypotheses. Coupled with this, we have detarget projects. Once this has been achieved, the develop- Based in Bahrain, Filippo Fantechi veloped our own unique proprietary database regarding the is Contax Partners’ Chief ment of a unique and compelling value proposition that can Executive Officer. He has over 15 Middle East energy projects that provide us with the ability of business development, deliver both value to the customer as well as maximise the years to produce fact based analysis, insights and advise to enable project management, sales management, establishing company’s profitability is critical. our customers to make better and more informed decisions. business operations and market Our robust business development and advisory methodstrategy experience within What would you say are the key success factors that a the Middle East, Europe and ologies, which have integrity and our customers’ needs at Russia. Fantechi has a strong company should consider when trying to identify and background in the energy, utility the core, further enable us to make the defi ned strategy a target the right opportunities? How can they ensure and construction sectors. realisation. This has enabled us to work with and support a that they are best positioned for them? large number of leading project owners, contractors, suppliFF. Continuously ‘grazing’ and collecting trusted market intelligence on ers and service providers operating across the energy value chain to enter, your opportunities, customers and competitors throughout the pre-award establish, grow and be successful in the Middle East. As testament to this, lifecycle is paramount to not only supporting you in your qualification by 2009, we had supported our customers in winning more than US$35bn process but also provides you with further reassurance that the opportuniof work and therefore we are proud to say that we are often regarded by our ties you are targeting are in fact the right ones and have a likelihood of customers as being their ‘trusted advisors’ and ‘consultants of choice’.

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MEGACITIES

Why the tale of the 21st century will be defined by the rise of the megacity.

I

f space travel had been possible 100 years ago, those early astronauts would have seen the light from 16 concentrations of a million or more people.

Today, the crew of the space shuttle can see 450 such shining cities on the globe – the economic, governmental, cultural and technological power plants of an increasingly urban age.

The pace of such development is staggering. At the turn of the last century, only 13 percent of the world’s population lived in cities; two years ago, for the fi rst time ever, more than half of us were urban metropolitans, and by 2050 that number will rise to 70 percent. We are adding the equivalent of seven New Yorks to the planet every year – putting a huge strain on the planet’s resources and infrastructures in the process. And it’s not just the number of cities that is on the rise; their size is increasing, too. Welcome to the age of the megacity.

Megacities are defi ned as urban population centres of more than 10 million inhabitants, and they are on the rise: 60 years ago there were only two, New York/Newark and Tokyo, but today there are 22 such megacities – the majority in the developing countries of Asia, Africa, and Latin America – and by 2025 there will most likely be 30 or more. As these megacities evolve, many groan under the weight of a sudden, massive and unprecedented demand for services.

The basic necessities of clean water, of sanitation systems to remove megatons of garbage and human waste, of transportation systems to shuttle millions of workers – not to mention the need for electrical networks, healthcare facilities, and policing and security – are creating one of the greatest logistical challenges ever seen in human history.

And the challenge is only going to intensify, with experts predicting the expansion and merging of already highly urbanised zones to form a number of ‘megalopolises’ – vast swathes of development such as the one made up of the Greater Boston-New York City-Philadelphia-Baltimore-Washington areas (the so-called Northeast megalopolis) with an urban population of 55 million.

Indeed, the phenomenon of endless urban sprawl could be one of the most significant developments – and problems – in the way people live and economies grow in the next 50 years, according to UN-Habitat, the agency for human settlements, in its bi-annual State of World Cities report.

On the one hand, the development of such mega-regions is generally regarded as positive, asserts the report’s co-author Eduardo Lopez Moreno.

“They [mega-regions], rather than countries, are now driving wealth,” he says.

“Research shows that the world’s largest 40 mega-regions cover only a tiny fraction of the habitable surface of our planet and are home to fewer than 18 percent of the world’s population, but account for 66 percent of all economic activity and about 85 percent of technological and scientific innovation. The top 25 cities in the world account for more than half of the world’s wealth, and the five largest cities in India and China now account for 50 percent of those countries’ wealth.”

Yet the growth of mega-regions and cities is also leading to unprecedented urban sprawl, new slums, unbalanced development and income inequalities as more and more people move to satellite or dormitory cities. “Cities like Los Angeles grew 45 percent in numbers between 1975-1990, but tripled their surface area in the same time,” says Moreno, who believes that urban sprawl is the symptom of a divided, dysfunctional city. “It is not only wasteful, it adds to transport costs, increases energy consumption, requires more resources, and causes the loss of prime farmland,” he explains. “The more unequal that cities become,

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the higher the risk that economic disparities will result in social and political tension. The likelihood of urban unrest in unequal cities is high.”

What is most shocking about the report, however, is that the US emerges as one of the most unequal of all the world’s societies, with cities such as New York, Chicago and Washington showing higher levels of inequality between the haves and have-nots than places like Brazzaville in Congo-Brazzaville, Managua in Nicaragua and Davao City in the Philippines. “The marginalisation and segregation of specific groups creates a city within a city,” says Moreno.

“The richest one percent of households now earns more than 72 times the average income of the poorest 20 percent of the population. In the ‘other America’, poor black families are clustered in ghettoes lacking access to quality education, secure tenure, lucrative work and political power.”

Infrastructure concerns Infrastructure has a key role to play in reducing these disparities, as a recent Siemens study into the challenges facing megacities as population growth continues to explode shows; 81 percent of stakeholders involved in city management cite the importance of the economy and employment in infrastructure decision-making.

In the Siemens study, transportation emerges as the top megacity infrastructure challenge by a large margin – not least because it is seen as the one infrastructure area that stakeholders believe has the biggest impact on city competitiveness. They are also highly aware of its environmental impact (for example, air pollution) and are keen to move to greener mass transit solutions. It is not surprising therefore to fi nd that transport also emerges as the top priority for investment. Stakeholders acknowledge that the four other infrastructure sectors covered by the study – water, electricity, healthcare, and safety and security – are also in need of investment, but interestingly they are less likely to see a strong link between spending in these areas and improved competitiveness, despite the fact that each has an important impact on the overall attractiveness of the city for investment.

Water infrastructure is also being pegged as a major concern for city administrations in the coming years.

Megacities around the world must fi nd ways to control runoff while providing clean water for millions of inhabitants. With the World Health Organization suggesting 1.1 billion people – or 18 percent of the world’s population – now lack access to safe drinking water, governments increasingly need the money and know-how to build massive public works.

In São Paulo, Brazil, for instance, planners are struggling to cope with a drainage system that was built when the city was a fraction of its current size. Poor maintenance has left much of it clogged, while forest and parkland have given way to haphazard housing in many areas of the world’s third-largest city. Now there are fewer green areas to soak up incessant rains. Meanwhile, Mexico City is sucking up water from natural aquifers at twice the rate they are being replenished. The result: Mexico City is

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People magnets Employment and educational opportunities are the main attraction of urban centres. But hopes for a better life are often dashed as overpopulation puts a huge strain on cities’ infrastructures and their ability to provide basic necessities – like clean water and a decent place to live. Consider: • Overall almost 180,000 people move into cities every day • Of the billion people designated very poor, over 750 million live in urban areas • 1 billion people, one-sixth of the world’s population, now live in shanty towns • The number of slum-dwellers is estimated to grow by nearly 500 million by 2020 sinking, in some areas up to 16 inches a year, threatening its entire infrastructure – including the city’s deteriorating drainage system, whose capacity has diminished by 30 percent since 1975 while the area’s population has doubled. In addition, the city, which sits at an altitude of over 7300 feet, must pump water up 3000 feet to reach residents. Last year it had to ration water after one of the worst droughts in six decades. The drainage programme includes plans for treatment plants to turn runoff into clean water for use by farmers.

New solutions for old problems The infrastructure and engineering challenges presented by the emergence of these densely populated

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BUILDING FROM THE GROUND UP With cities consuming 75 percent of our natural resources, is a blank-canvas approach to development the key to our urban future? These new city projects are being built from the ground up, and could provide a blueprint for future urban projects.

Masdar City, Abu Dhabi Touted as the world’s first zero-carbon city, Masdar will be car-free, powered by renewable energy with services digitally managed and providing real-time information. With a maximum distance of 200 metres to the nearest transport link and amenities, the compact network of streets will encourage walking and is complemented by a personalized rapid transport system. Shaded walkways and narrow streets will create a pedestrian friendly environment, while surrounding land will contain wind, photovoltaic farms, research fields and plantations, enabling the city to be entirely self-sustaining.

Dongtan, Shanghai Development plans for this ‘city within a city’ – currently being built on an island off the coast of Shanghai – call for it to be modest in size (500,000 residents) and scaled for the people who will live there, rather than for automobiles or architectural monoliths. It is also designed to be completely self-sufficient, providing its own food d and d energy. Chinese h officials hope Dongtan will offer practical lessons about pollution control and sustainability that can then be applied to Shanghai, as well as to other rapidly growing urban areas.

Treasure Island, San Francisco A masterplan developed for the proposed US$1.4-billion island by architectural and engineering services company Skidmore, Owings and Merrill details up to 8000 new homes (30 percent of which would be affordable to those on lower incomes), several solar-powered skyscrapers, an organic farm, three hotels, several shops and restaurants, a wastewater treatment plant, large-scale wind turbines for energy generation and 300 acres of recreational land. The goal is to create a sustainable, compact, mixed-use residential community that is not car-dependent.

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urban centres are significant, not least because such rapid growth is being played out in the largest and most complicated urban habitats human beings have ever lived in.

Managing such complex systems in the future is going to take a much smarter approach than the ones we are currently using.

Faced by huge pressures on public services, cities tend to emphasise direct and immediate supply-side solutions.

However, this does not always mean adding more capacity: in many cases – particularly in the highly developed megacities of the US – increasing the efficiency of existing infrastructure over building new roads, railways and hospitals can be just as effective. By contrast, although it is mentioned by a minority of the survey respondents, demand management never emerges as a priority. Demand management approaches have been advocated in a variety of areas, but even the specialists in specific infrastructure sectors do not see managing demand as the primary solution to their challenges. Yet with consumption consistently outstripping supply in many cities and infrastructure areas, there is a strong case for the wider adoption of demand management strategies on a global basis.

Many believe the answer lies in embedding more (and better) technology into the networks and systems that underpin our cities, and the effects of such an outlook are already being felt around the globe. Transportation officials in Singapore, Brisbane and Stockholm are using state-ofthe-art systems to reduce both congestion and pollution.

Public safety administrators in major cities like New York and Chicago are able not only to solve crimes and respond to emergencies, but to help prevent them. A large hospital organisation in Paris is implementing an integrated patient-care management solution to facilitate seamless communication across its business applications – enabling them to track every stage of a patient’s stay in the hospital.

While smart water management in the Paraguay-Paraná River Basin of Brazil is helping to improve water quality for São Paulo’s 17 million residents.

And of course, when urban planners can no longer fi nd the surface space to install vital infrastructure components, they go underground. And while few, if any, cities can rival New York in the density and complexity of its subterranean networks, 21st century cities are looking to take the concept to a new level. For instance, officials in Oslo, Norway, may be the next underground pioneers. In their capital, developers have created a whole sub-urban community. Troubled by the city’s hilly terrain, engineers have built all sorts of structures – such as power plants, an air-traffic-control tower, and a dairy processing operation – under the surface. As a result, some of the world’s most sophisticated air-circulation systems can be found in Oslo, as well as underground lighting that’s tweaked to mimic the movement of the sun throughout the day.

Thoreau called the city “millions of people being lonesome together”, but it needn’t be; that is where infrastructure – the underlying network of nodes and interconnections that underpin every urban centre – has a vital role to play.

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As the Middle East grows ever more arid, water professionals are finding alternative ways to supply its growing population with this vital resource.

But just how viable and sustainable are these treatments and how should water utility providers respond to the challenges posed by this issue?

F

irst, some statistics. Studies show that one unit of currency invested in a modern water system produces about 10 units of currency worth of benefits to the overall economy of a country. On the other hand, studies of developing countries that lack modern water systems generally demonstrate that the economic cost of not having such a system is around three to five percent of a nation’s entire GDP. The Middle East is home to around six percent of the world’s population, a figure that is projected to double over the next 40 years. The Middle East also holds a tiny one percent of the world’s available water supplies, with per capita water at 170 cubic metres a year, significantly beneath the 1000 cubic metres per year water poverty line. Yemen is predicted to become the fi rst country in the world to run out of water.

Water Feature 135

In the fiercely hot and densely populated desert landscapes of the MENA region, water quite literally is liquid gold. Everything from cooling systems to agriculture to healthcare is subject to the availability of water; with a significant proportion of water being used in the region for irrigation, the food output from MENA countries is suffering as a consequence. As running out altogether becomes a very real possibility, there is no denying the fact that there needs to be a change in the way water is managed.

“Utilities around the world are learning that they need to manage both the supply of water and also the consumption of water,” explains Glen Daigger, President of the International Water Association, highlighting that this is an international issue. And with the development boom and growing populations that the wealthy emerging economies

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of the Gulf have seen in recent years, a comprehensive utilities infrastructure has become a necessary consideration.

Jeanette Brown, incoming President of the Water Environment Federation, agrees. “Education can reduce water use and wastage,” she points out, highlighting a key underlying issue behind the water problems in the region.

Of course, the notion of water conservation remains fairly immature in the Gulf region, and consequently knowing how best to approach the issue is of paramount concern. Both Daigger and Brown feel that there is something to be learnt from western attitudes to water management and conservation. “It is important to look at those regions in the US that have reduced water supply such as Arizona and southern California,” explain Brown. “Both those areas have strong public education programmes on the use of water. They also promote water conservation, including irrigation practices. Some communities have upgraded their treatment plants to allow water reuse for irrigation and sanitary facilities.”

Daigger’s attitude, however, is a little more measured.

“If you look at the US and Western European experience, what happened was that standards have improved over time as the infrastructure has been put in place… What are now fairly stringent standards have become something of a barrier to making progress. So if we had to do it again, in Western Europe and the US, I believe that we would be less prescriptive in terms of our standards. And we would look for a more continuous improvement process.

“To simply impose stringent standards is probably not the best approach. A more tiered approach and a more integrated and performance-based approach would probably be more successful in the longer term and lead to better outcomes.”

In the UAE, a single litre of desalinated water costs 3.76 dirhams (US$1.02)

Cultural awareness According to Daigger, for utility and water professionals looking to manage supply and consumption of water, three key areas of concern have been highlighted. First, he says, is assisting and advising consumers on their water use, such as suggesting the most efficient practices that could be used, or recommending products on the market that allow for a more efficient use of water. These might include fi xtures such as low-flow taps or shower-heads that consume less water; or appliances such as washing machines that are more efficient in terms of both water and electricity consumption.

The second is to encourage consumers to use less water. “Th is can adversely affect their revenue,” Daigger adds, pointing out one of the numerous challenges posed by the fight to improve water efficiency. “Pricing of water becomes very important, in terms of either having a progressive charge rate for water, or being very clear that as conservation is adopted, that water rates will have to go up, as the water utility companies still need to have their costs covered.”

The third consideration, he explains, is the issue of equity, making sure that the water conservation practices and tools recommended to manage water use are available

Water Feature 136

On average, each resident of Abu Dhabi consumes 550 litres of water ever day.

The average resident of India consumes 25

to everyone. “That needs to be dealt with in terms of the pricing structure so that at least a minimum – and when I say minimum I don’t necessarily mean a low amount, but a certain amount that is deemed to be the amount a person needs to live – is either very affordable, or at some utilities, actually being provided for free.”

While Brown’s point about educating consumers as to how they can minimise their water consumption certainly rings true, this can still only go so far in improving the availability of water in a region as arid as the Middle East.

With such a major imbalance in the supply-demand ratio, the level of water available needs to improve if the problem is to be tackled. “Treatment of the waste stream [is needed] to allow for that water to be reused directly,” she explains, touching on an area that has seen significant growth in the MENA region. Indeed, today there is no shortage of water treatment facilities in the Gulf; recent reports indicate that the Gulf accounts for 41 percent of the world’s desalinated water, and projects continue to pop up across the region to further this sector. As MENA Infrastructure went to press, a contract had just been announced for the development of the Ras Al Zour water desalination plant in Saudi Arabia, projected to be the world’s biggest and to cost an estimated US$5.5 billion. Elsewhere, a desalination plant in the Al Wusta region of Oman had received some US$2.6 million in government funds.

Daigger reiterates the point. “Technologies for water treatment, water reuse in particular, are quite available and continue to improve,” he says. Significantly, these treatments are capable of making water suitable to any standard, including drinking water. “Increasingly we’re seeing the use of membrane systems because of their ability to remove particulate matter,” he explains. “In some instances, we are seeing even reverse osmosis technology, which is able to remove dissolved substances. The vast array of advanced oxidation technologies, which are able to remove dissolved organics very efficiently, coupled with biological treatment of water, are some of the technologies that are allowing us to really produce water of any quality desired from any source water.” As he talks about the various technologies available to treat water, Daigger touches on a point crucial to the development of a sustainable, longterm solution to the chronic thirst of the Middle Eastern landscape. “I try to be careful not to talk about wastewater, because we shouldn’t be talking about wasting water. We ought to be talking about recovering water, and recovering energy and nutrients from the waste stream.”

Fit for purpose “The Australians have a great phrase,” laughs Daigger.

“They talk about fit for purpose, that water should be supplied of a quantity and quality that matches the purpose, not necessarily treated to the highest level.” His point resonates as one of the paramount solutions to the MENA water supply problem. For all the benefits that a water treatment system can bring, the energy costs involved in treating water to a drinkable standard can make this an expensive and unsustainable option. However, as Daigger

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Cities of the Future

T

he next generation in wet infrastructure master planning, the Cities of the Future initiative from the IWA is designed to bring new concepts in water management to utility professionals in an urban environment, and also to unite water professionals with the other planning, designing and engineering professionals responsible for an urban environment.

“The most efficient water infrastructure is infrastructure that is built into the city, so water professionals need to be at the table as city plans are developed and city policies are developed,” explains Daigger.

Pioneering the Cities of the Future programme in the MENA region, Turkish cities Istanbul, Kayseri and Trabzon are implementing the initiatives over the next three years. Experts from Turkish universities, as well as water professionals from the IWA, will collaborate to provide models, technologies and approaches that meet the highest global standards in urban water management.

“Cities of the Future represents an acknowledgement by leaders in the water sector that the current, most predominantly used techniques for water supply, wastewater treatment and stormwater management do not reflect the growing realities of a changing global context. Human population growth, rising incomes and increased urbanisation are colliding with resource limits and global warming to create an imperative for change in both the developing and developed regions.

“Cities of the Future is about learning by doing.

Turkish and international experts will combine the facts on the ground with emerging global best practice gleaned from leading-edge projects from around the world.”

points out, the average daily consumption of potable water – water used for drinking, or in food preparation – is in the region of 10 to 20 litres a day, while the total water consumption, even in more efficient and developed countries, is somewhere around 130-150 litres a day. “I go through the numbers just to illustrate that not every drop of water needs to be of drinking quality,” he highlights.

Indeed, this point paves the way for water treatment to be a widely utilised solution to the shortage in the region.

To treat all water to the standard it would need to be in order to be consumed safely would incur significant, and largely unnecessary, costs. Brown points out the downsides. “There is significant capital and operating costs associated with treatment technologies that might not be appropriate for the region. The plants are also energy intensive.” With more and more utility and water professionals in the region, and the world over, calling for a specific approach to water treatment, it would seem that solutions are beginning to be uncovered. Daigger points out that: “If we’re treating every drop of water to the highest standard, and if we have poor quality water resources, then one can get into very expensive treatment. If we treat only water for

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Istanbul

MENA region has 6% of the world’s people, and 1% of the world’s water

potable uses to the highest standard, then the amount of energy that’s needed is going to be reduced.”

As the issue of numbers is raised, it is only natural to look then to the economic effects of water treatment systems and wet infrastructure. And undoubtedly, the 10-to-one metric that Daigger laid down poses a very real argument for investing in water infrastructure. The energy expenditure involved, both in human and industrial terms, is neither economically viable nor sustainable; and the long-term health of the population is negatively affected by the lack of a comprehensive water management system.

“People have to have water,” adds Daigger. “You have to have water to live. People who don’t have a modern system put a tremendous amount of energy either into purchasing water at a much higher price than would be provided by a modern system, or in the time taken to walk kilometres to get water.”

Ultimately he says, the problem lies in the management of water. “We have water shortages based on continuing to manage water in the way we have in the past. But it’s clear that we have approaches in which we can manage water in a much more productive fashion.”

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NEXT BIG THING

Sane in the membrane OrangeBoat’s Jantje Johnson on why specialised technical support for membrane water treatment systems is critical.

M Jantje Johnson is the founding partner of OrangeBoat – a provider of technical service for membrane based water treatment systems to membrane manufacturers, OEMs, engineering companies and end-users. She has over 25 years of experience in membranes, chemicals, system design and operation.

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embrane-based water treatment systems are increasingly favored for their efficiency and reliability, but they also introduce some unique technical challenges in management, development and installation. Appropriate expertise is at a premium and often in short supply.

Mobilising a unique blend of know-how to deliver expert membrane and application support when it is needed is critical for the successful operation of your membrane system. Where to get that expertise when you need it can be a challenge. Often companies offering a product simply want to sell you their products and are not interested in providing service or know-how to solve your problem. We provide independent technical support and advice about membrane-based water treatment systems available to engineering companies, equipment suppliers, membrane manufacturers and operators.

Membrane systems may experience performance problems that affect cost-effectiveness and reliability.

Having the expertise available to take care of operational problems is important. However, before your project begins it is important to evaluate the overall process to ensure the unit operations work well together. Optimisation starts right at the beginning of the project, in choosing the best design considerations for the job.

OrangeBoat believes there are four key factors to consider for a successful operation. These are design, execution, commissioning and training.

With regard to design, winning the project with a well thought out design is important for trouble-free operation.

Being the successful bidder is one thing; evaluation of different process schemes should include an understanding of the common pitfalls in design and operation. Understanding the impact of pre-treatment on the performance of the reverse osmosis system can provide a basis for different design options for your client.

In terms of execution, once you win the project, be sure to solicit third party advice on membrane design and operation. Eliminating defects during the execution phase can prevent costly mistakes later on.

On to the next phase, many mistakes are made during the commissioning phase of the project. Many times contractors are focused on getting pumps and valves operating and often overlook the membrane system that can lead to irreversible membrane damage. Having an advisor on site, looking after the membrane system, can save money over the long run.

And fi nally training; well-trained operators and staff can ensure a successful project during the design, execution and operation phase of your project. Keep your team up-to-date by investing in training.

While you may have membrane experts on your staff they may not be available when you need it or where you need it. Working with a specialised service provider can help you close short-term gaps in technical support and solve specific performance problems in membrane-based water treatment systems. „

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Designing sustainable sports fields – the new oasis Farzad Farshid writes: “We are the contractors for a new sports stadium and we are interested in using the latest technology to capture, store and re-use the irrigated water on the sports field and surrounding landscaped areas. We are thinking about installing underground water tanks in and around the project to harvest this water. It is very important that we deliver a sustainable solution to the Ministry of Works, so we need to know if your system will work in such a hot/arid climate?”

Humberto Urriola offers his 40 years of experience in designing sustainable sports fields and environmental solutions.

Humberto Urriola is a landscape architect and industrial designer and has over 40 years’ experience in providing environment and water management solutions. He is the inventor and creator of the Atlantis Subsurface Infiltration and Rain Harvesting Tanks, and has invented and registered over 60 patented products. He is extremely passionate about saving the planet and is the driving force behind the green city design that is becoming a reality in places like Dubai, Abu Dhabi and Doha in the Middle East.

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Humberto Urriola says: Designing sports fields in the Middle East is more than a science; it’s an art, due to the harsh environment and extreme temperatures. Atlantis has been working for the past 35 years in sports field and other environmental areas. The secret is water management and we have specialised in proven water management systems that work. Atlantis has been driving a revolution in environment and water management by providing industrial designed products that have made it possible to achieve exceptional results in a sustainable way.

The system works extremely well in either wet or arid climates due to its versatility, as it eliminates soil saturation and/or soil dryness, which are two of the greatest enemies in sports field design today. Moving water through horizontal surfaces is another difficult challenge in water management, as water needs to be managed by gravity.

From the beginning we have been dealing with two challenges in sports field design: in hot, arid countries, where water conservation and keeping things green are the primary concerns; and in wet, European countries where we are dealing with mud or clay, where the primary focus is the removal of excessive water. Both of these scenarios have been solved by Atlantis water management systems with ease. But it is also important to note that there are no two jobs alike, as the conditions from job to job differ vastly. Th is is why Atlantis gives support to designers and installers when required to overcome some of these challenges.

The Atlantis Drainage System is one such innovative solution to sports field management. The unique design of the Atlantis Drainage System creates a constant subsurface aerobic water table in suspension known as a perched water table. In dry weather, a consistent water supply is maintained below the surface. Even in a heavy storm the perch remains at a constant level below the surface. The continual water supply and beneficial subsoil ventilation of the Atlantis Sports Field Drainage System results in excellent turf colour, a healthy root system and stronger, more resilient turf overall. The Atlantis Sports Field Drainage Systems facilitates quicker wear recovery

“ But it is also important to note that there are no two jobs alike, as the conditions from job to job differ vastly” and maintains healthier turf all year by combining a highgrowth root zone environment with rapid drainage rates and increased moisture retention. Furthermore, Atlantis provides turn-key solutions to many challenges by collaborating with strategic partners that are considered the best in their respective fields. As the saying goes, “together we can achieve more” and that is certainly true when designing and offering sustainable solutions. We have said before that when you utilise integrated solutions – whether it’s for a sports field, golf course, green roof or large-scale landscaped area – Atlantis and its partners can reduce the water consumption used on-site by a staggering amount.

In addition to sustainable sports fields, Atlantis technology has been used extensively in roof gardens, green vertical walls, ecological streets and podium landscaped areas very successfully.

16/09/2010 10:14

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NEXT BIG THING

Long lasting connections – in every respect This is the philosophy behind Lenzen Hebe-und Fördertechnik GmbH, a sling and belt supplier for the construction industry that is well established in the European market and looking to break into the MENA region.

W

elcome to our world of lift ing, moving and lashing appliances.

You can use our experience, which we’ve build up over more than 20 years of service for our clients.

The company was founded in 1989 by Mr Peter Lenzen. Lenzen was a well-known name in the region. In 2004, Armin Lehmann started as the new Executive Director a new era. He initialised the expansion of activities fi rst in the whole region of Germany. Then, after only one year, Lenzen Hebe-und Fördertechnik GmbH

exported to the main European markets.

The basic component of our work is our professional competence. Armin Lehmann, now CEO, has worked in this sector for more than 30 years. He was a member of the working group “lift ing slings” in the German Standard Organisation DIN for about 10 years – experiences for your profit.

Our range of products include flat webbing belts from WLL 0.5 tons up to 48 tons (pipelineslings) and round slings from WLL 0.5 tons up to 200 tons, mainly made of polyester, but also

available in alternative materials like polyamide or polypropylene and Kevlar.

Our steel products are steel wire ropes in standard qualities according to EN-standards as well as special wire ropes from the leading brands like CASAR, DIEPA, PYTHON, TEUFELBERGER and VEROPE. We also deliver wire rope slings, mechanically or hand spliced, endless grommets and all types of ropes for crane appliances. High alloy chains grade 80 and 100 from six up to 32 milimetres in diameter will be fi nished according to your demands in our job shop in a short term.

In our stock we consistently provide a wide range of lift ing appliances like shackles, hooks, trolleys and turnbuckles. Our load handling attachments are load beams, lift ing magnets, lever and chain hoists as well as hand hydraulic pallet trucks. Especially for load beams and lift ing clamps we can offer you specialised solutions.

Our construction department enables us to simulate your application with a CAD-System in 3D. To keep your cargo on the truck you can use our cargo lashing systems like ratchet lashings or chains. Since 2008 our quality management system acc. to ISO 9001 has been certified by DEKRA. Long-lasting business relationships with long-living products, that’s what we are looking for. With our competent and efficient team we are able to grant you an excellent service for all your needs referring lift ing and moving goods.

Moving goods requires a high level of competence and safety. Lenzen Hebe-und Fördertechnik GmbH is well grounded in this field.

If you are interested in our partnership, please don’t hesitate to get in contact with us.

Armin Lehmann started his career in 1979 in a leading company of lifting devices in Germany. In 1987 he moved to a Finnish producer for lifting belts and round-slings as Sales Manager. In 1989, he went back to his former company as sales manager. He was Executive Director from 2004 until 2007, when he became CEO of Lenzen Hebe-und Fördertechnik GmbH.

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