ANALYSIS DO ASIAN CONTRACTORS CREATE FIERCE COMPETITION? N E W S • A N A LY S I S • I N T E L L I G E N C E • P R OJ E CT S • C O N T R ACT S • T E N D E R S
AN ITP BUSINESS PUBLICATION LICENSED BY DUBAI MEDIA CITY
JUNE 5–11, 2010 • ISSUE 324
CONSTRUCTIONWEEKONLINE.COM
Recycling plant Crushed concrete made road ready Page 34
Compliance costs What’s the price for W peace of mind? Page 40
Su Sustainable facility Plan to build green Pla from the outset Page 44
BUILD AND DELIVER Emaar’s Mohammed M Alabbar on successful s project p j delivery, y, business future plans expansion and fut
Allegro Larvik photo: Morten Rakke
Crafted by Nature. Refined for Living. The materials from Lundhs are some of the most durable kinds of stone in the world. As a result of this, there are very few limitations to areas of use, with respect to weatherability and wearability. It is also among the most exclusive materials in the world. Within Lundhs range of materials you can find Blue Pearl and Emerald Pearl, which is recognised worldwide.
Order our new sample book for free! Lundhs are now launching a new sample book with real natural stone samples. In this sample book you will find Lundhs range of natural stone with different surface treatment. It will be useful for architects and designers to compare materials and alternative surfaces. We would like to send this sample book free of charge to designers and architects who are interested in natural stone. Please send an e-mail to hani@lundhs.no and inform us where you want us to send the sample book.
New sample book with real natural stone samples
KITCHEN TOP - BATHROOM TILES - FLOOR TILES - BUILDING EXTERIOR - SHOP FRONTS - MONUMENTS
LUNDHS Emerald™
LUNDHS Royal Blue™
NEW OFFICE: LUNDHS Middle East Branch Att: Hani Hankir Project Development Manager Middle East
LUNDHS Silver™
LUNDHS Antique™
Airport Free Zone Building: 4 EA Office: 530 DUBAI UNITED ARAB EMIRATES
LUNDHS Marina Blue™ LUNDHS Blue™
LUNDHS Norwegian Rose™
MOBILE NO.: 00971 50 4574281
www.lundhs.no info@lundhs.no
COMMENT
CONTENTS
JUNE 5-11, 2010 • ISSUE 324
28
Mohammed Alabbar talks to Construction Week about the build up to the opening of the Armani Hotel, and the achievements of Emaar in the first half of 2010
REGULARS
10 16 18 56
WEALTH CHECK EDITOR'S LETTER GUEST COLUMN FOREMAN
ANALYSIS
24
LAND OF THE RISING SUMS CW looks at how contractors and developers from China and the Far East countries have been adding to the fierce competition in the GCC.
INTELLIGENCE
COMPLIANCE
40
THE COST OF COMPLIANCE Successful project management comes down to meeting contract without compromising quality.
SUSTAINABILITY FACE TO FACE
4
BAGHDAD AIRPORT CONTRACTS Details are yet to be clarified surrounding speculation that Baghdad’s International Airport is to gain three more terminals.
44 28
THE DREAM BUILDER In less than six months, Mohammed Alabbar has delivered two of the world's most eagerly awaited projects. How did he do it?
FACILITATING SUSTAINABILITY How involving FM firms at the start of a project is a good way to ensure sustainable systems are implemented.
FINANCE
8
DEPA SHARES ROCKET 44% Depa Interiors has seen a record rise in its share price during Q1 2010, following its announcement of a strong order book. ROUND UP
12
ON SITE
34
ON THE ROAD AGAIN A crushing plant in Abu Dhabi has placed itself at the quarry face of sustainable construction, recycling concrete into aggregate for use in road building.
UK SPENDING CUTS HIT UAE Cuts in UK public spending may impact local firms. JULY 5-11, 2010 CONSTRUCTION WEEK 1
The most important project, contract and tender information, updated every week SAUDI ARABIA BAHRAIN UNITED ARAB EMIRATES QATAR OMAN KUWAIT
Construction CONSTRUCTIONWEEKONLINE.COM
An ITP Business Publication | Licensed by Dubai Media City
WEEK
MAY 15-21, 2010 [321]
NEWS, ANALYSIS, PROJECTS, TENDERS, CLASSIFIEDS, AND JOBS IN THE MIDDLE EAST
SPECIAL ISSUE
PLUS: BIA AR AL GHCUS FO page 36
AIRPORT A-Z 50 COMPANIES CHANGING THE FACE OF GCC AIRPORTS
SAUDI ARABIA BAHRAIN UNITED ARAB EMIRATES QATAR OMAN KUWAIT
Construction An ITP Business Publication | Licensed by Dubai Media City
WEEK
CONSTRUCTIONWEEKONLINE.COM
MAY 22-28, 2010 [322]
NEWS, ANALYSIS, PROJECTS, TENDERS, CLASSIFIEDS, AND JOBS IN THE MIDDLE EAST CITY FOCU JUBAIL S page 52
INSIDE NEWS
Small companies need big company attitudes to issues of safety PAGE 9
COMMENT
SPECIAL PROGRESS REPORT
ECONOMY OF SCALE SAUDI ARABIA’S ECONOMIC CITIES COULD CHANGE THE FACE OF THE INDUSTRY. CAN THEY SUCCEED?
Saeed Alabbar on the benefits of concurrent engineering in engineer sustainable sustainab ble design PAGE 18 8
ANALYSIS
What Abu Dhabi’s new HSE regulations mean for contractors PAGE 24
SITE VISIT
Pre-cast and post tensioning works the Saudi Binladin way PAGE 35
Registered at Dubai Media City ITP Business Publishing PO Box 500024, Dubai, United Arab Emirates TEL +971 4 210 8000 FAX +971 4 210 8080 Offices in Dubai, Manama, Mumbai & London
ITP BUSINESS PUBLISHING CEO Walid Akawi MANAGING DIRECTOR Neil Davies MANAGING DIRECTOR, ITP BUSINESS Karam Awad DEPUTY MANAGING DIRECTOR Matthew Southwell EDITORIAL DIRECTOR David Ingham PUBLISHING DIRECTOR Jason Bowman EDITORIAL SENIOR GROUP EDITOR Stuart Matthews +971 4 210 8476, EMAIL stuart.matthews@itp.com SENIOR REPORTER Ben Roberts TEL +971 4 210 8318, EMAIL benjamin.roberts@itp.com SENIOR REPORTER Carlin Gerbich TEL +971 4 210 8519, EMAIL carlin.gerbich@itp.com REPORTER Elizabeth Broomhall TEL +971 4 210 8142, EMAIL elizabeth.broomhall@itp.com MEP EDITOR Gerhard Hope TEL +971 4 210 8305, EMAIL gerhard.hope@itp.com PMV EDITOR Greg Whitaker TEL +971 4 210 8150, EMAIL greg.whitaker@itp.com FM DEPUTY EDITOR Sarah Blackman TEL +971 4 210 8363, EMAIL sarah.blackman@itp.com TEL
ADVERTISING PUBLISHING DIRECTOR Jason Bowman TEL +971 4 210 8351, EMAIL jason.bowman@itp.com ADVERTISING DIRECTOR Andrew Parkes TEL +971 4 210 8570, EMAIL andrew.parkes@itp.com ONLINE SALES MANAGER Scott Woodall TEL +971 4 210 8595, EMAIL scott.woodall@itp.com BUSINESS DEVELOPMENT MANAGER (SAUDI ARABIA) Rabih Naderi TEL + 966 50 3289818, EMAIL rabih.naderi@itp.com STUDIO GROUP ART EDITORS Daniel Prescott, Phil Madge DEPUTY GROUP ART EDITOR Ochi Ogbuaku DESIGNERS Simon Cobon, Lucy McMurray, Nadia Puma, Angela Ravi DIRECTOR OF PHOTOGRAPHY Sevag Davidian SENIOR PHOTOGRAPHERS G-nie Arambulo, Efraim Evidor, Thanos Lazopoulos STAFF PHOTOGRAPHERS Isidora Bojovic, George Dipin, Lyubov Galushko, Jovana Obradovic, Ruel Pableo, Rajesh Raghav PRODUCTION & DISTRIBUTION GROUP PRODUCTION MANAGER Kyle Smith DEPUTY PRODUCTION MANAGER Matthew Grant PRODUCTION COORDINATOR Devaprakash V.A MANAGING PICTURE EDITOR Patrick Littlejohn IMAGE EDITOR Emmalyn Robles DISTRIBUTION MANAGER Karima Ashwell DISTRIBUTION EXECUTIVE Nada Al Alami CIRCULATION HEAD OF CIRCULATION & DATABASE Gaurav Gulati MARKETING HEAD OF MARKETING Daniel Fewtrell DEPUTY MARKETING MANAGER Annie Chinoy TEL +971 4 210 8353, EMAIL annie.chinoy@itp.com EVENTS & CONFERENCES PRODUCER Oscar Wendel
SAUDI ARABIA BAHRAIN UNITED ARAB EMIRATES QATAR OMAN KUWAIT
Construction An ITP Business Publication | Licensed by Dubai Media City
WEEK
CONSTRUCTIONWEEKONLINE.COM
MAY 24- JUNE 4, 2010 [323]
NEWS, ANALYSIS, PROJECTS, TENDERS, CLASSIFIEDS, AND JOBS IN THE MIDDLE EAST PRODUCT FOCUS HEATING SYSTEMS pag e 48
INSIDE
ITP GROUP CHAIRMAN Andrew Neil MANAGING DIRECTOR Robert Serafin FINANCE DIRECTOR Toby Jay Spencer-Davies BOARD OF DIRECTORS KM Jamieson, Mike Bayman, Walid Akawi, Neil Davies, Rob Corder, Mary Serafin
NEWS
Qatar has signed $576m of contracts for public works projects PAGE 9
COMMENT
Alan Millin asks: are your suppliers offloading out-of-date products? PAGE 18
SHOWCASE
The Abu Dhabi Investment Council’s green headquarters
CORPORATE WEBSITE www.itp.com CIRCULATION CUSTOMER SERVICE TEL: +971 4 210 8000 WEB www.ConstructionWeekOnline.com ITPIMAGES Certain images in this issue are available for purchase. Please contact itpimages@itp.com for further details or visit www.itpimages.com. SUBSCRIBE online at www.itp.com/subscriptions
PAGE 46
NOTICE The publishers regret that they cannot accept liability for error or omissions contained in this publication, however caused. The
SPECIAL ISSUE
GAME CHANGERS
SECTOR FOCUS
GCC power and water utilities are still playing catch-up with demand PAGE 50
THE 50 COMPANIES SHAPING THE FUTURE OF THE GULF’S CONSTRUCTION INDUSTRY
To have your copy of ConstructionWeek delivered to your doorstep, subscribe by logging into www.itp.net/subscriptions
2 CONSTRUCTION WEEK JUNE 5-11, 2010
opinions and views contained in this publication are not necessarily those of the publishers. Readers are advised to seek specialist advice before acting on information contained in this publication, which is provided for general use and may not be appropriate for the readers’ particular circumstances. The ownership of trademarks is acknowledged. No part of this publication or any part of the contents thereof may be reproduced, stored in a retrieval system or transmitted in any form without the permission of the publishers in writing. An exemption is hereby granted for extracts used for the purpose of fair review.
PRINTED BY Atlas Printing Press LLC Dubai CONTROLLED DISTRIBUTION BY Blue Truck Audited by: BPA Worldwide. Average Qualified Circulation 10,400 (July - Dec 2009)
PUBLISHED BY AND © 2010 ITP BUSINESS PUBLISHING, A DIVISION OF THE ITP PUBLISHING GROUP LTD, REGISTERED IN THE BRITISH VIRGIN ISLANDS COMPANY NUMBER 1402846
ALI AL SAADI / AFP / Getty Images
INTELLIGENCE
Baghdad's international airport is the subject of ambitious plans from Iraq's civil aviation authority, which is anticipating a significant rise in visitor numbers.
Tenders of note New Baghdad Airport contracts waiting for release from ICAA
D
etails have yet to be clarified surrounding the announcement that Baghdad’s International Airport is to be expanded by an additional three terminals. The terminals, plus a bridge, which would join three existing terminal buildings, were announced by the director general of the Iraq Civil Aviation Authority (ICAA) Adnin Blebil at a conference, hosted by Gulf-based law firm Al Tamimi. He said the ICAA was expanding to accommodate a predicted 15 million passengers a year, up from around seven million today. “I think very strongly that the scale of trading and tourism will be too high” for current resources, “and we’ll need to increase the capacity of the airports,” Blebil told delegates.
4 CONSTRUCTION WEEK JUNE 5-11, 2010
The new airport development would create 70,000 job opportunities, he estimated, and when finished will help bring in revenue of around US $2 billion. Each terminal, he added, would service around 2.5 million additional passengers. Despite continued international concern about security in the country, Blebil expects to catch the eye of a number of contractors and investors. “I think it will be very attractive for people who would like to invest in the country,” he said. “For that to work we need a masterplan,” he added, saying that it would then the project would be broken down into its constituent parts, such as the building of hotels and warehouses. By deadline this week he was unavailable to provide further details to CW. By Ben Roberts
INTELLIGENCE For upto the minute tenders log in to constructionweekonline.com
Royal commission Al Fanah towers job releases Jubail tender goes to Al Qabdha Escan Investment and Real Estate Development has announced that Al Qabdha Building Construction will be the main contractor for its latest project in Fujairah. The contract, worth AED 1.2 billion, is a huge achievement for Al Qabdha, selected for its experience and expertise in the region, as well as its ability to offer the best price for their services. The development, known as Al Fanar towers, will encompass one residential tower, one commercial tower and a shopping mall, amounting to a total built up area of 241,500m2. Scheduled for completion in 2013, it will be the first set of high rise towers in what is becoming one of the most important cities in the Middle East for its strategic location and unique characteristics.
KARIM JAAFAR /AFP/Getty Images
The Royal Commission for Jubail & Yanbu has released a tender for the construction of apartments in Jalmudah, part of Jubail Industrial City. The latest release is for phase three of the development, with the scope of work including the construction of family apartment buildings. The project covers a total of eight four-storey buildings. Additional works included in the package will cover roads, parking and grading. A series of systems to cope with the project’s water needs will also be required. This is expected to cover storm drainage, a sanitary wastewater system, distribution for drinking water, plus a system to distribute water for fire suppression. A treated sewage effluent and irrigation system is also required. The tender closes on June 22 and a tender fee of 14 000 SAR applies.
A pause for the causeway? The Qatar-Bahrain Causeway looks to be setting a record in its delayed start to construction. The US $3 billion three-lane ‘friendship bridge’ has frustrated the subcontracting market with its lack of progress.
Numerous messages that construction would start in each new quarter have defined its existence. Last year the secretary general of Qatar-Bahrain Causeway Foundation, Nayef Al Emadi, told CW that it would be slightly later in the year than January
2009. By November it was to be the first quarter 2010. Studies seem to be the reason. Christopher Welton, part of investor relations at Vinci Construction, one of five main contractors, said to CW: “We are just finalising studies for the project in line with the schedule of the Qatari and Bahraini officials. This runs through the whole aspect of the project: how long the bridge is going to be, what materials, what manpower is needed.” He denied there had been a delay as such. “I think the planning stage is according to a timetable from the officials,” he said, “I think it’s nearing its end, if our study has not been handed over already.”
TOP TENDERS Housing complex, Phase 2 Buildings Country: Saudi Arabia Closes: Jul 31, 2010 Category: Residential Building Issuer: Saline Water Conversion Corporation Construction of New Ahmadi Hospital & Residential Building Country: Kuwait Closes: Jul 27, 2010 Category: Industry Issuer: Kuwait Oil Company Construction of Royal Commission Public Housing Phase 4 Buildings Country: Saudi Arabia Closes: Jul 25, 2010 Category: Residential development Issuer: Royal Commission for Jubail & Yanbu Construction of 24 Classrooms Al Ahnaf Bin Qais Country: Oman Closes: Jul 12, 2010 Category: Educational facilities Issuer: Ministry of Education Sabah Al Salem Campus - College of Petrol and Engineering Country: Kuwait Closes: Jul 11, 2010 Category: Educational facilities Issuer: Kuwait University Construction of 6 Kindergartens Country: Kuwait Closes: Jul 6, 2010 Category: Educational facilities Issuer: Ministry of Social Affairs Duqm Hotel Country: Oman Closes: Jul 5, 2010 Category: Recreational facilities Issuer: Oman Tourism Development Construction of Telephone Exchange Buildings and Allied Services Country: Oman Closes: Jul 5, 2010 Category: Buildings Issuer: Oman Telecommunications Company Operation and Maintenance for the Royal Commission Medical Center at Yanbu Industrial City Country: Saudi Arabia Closes: Jun 27, 2010 Category: Industry Issuer: Royal Commission for Jubail and Yanbu JUNE 5-11, 2010 CONSTRUCTION WEEK 5
INTELLIGENCE
HAMAD OLAYAN / AFP / Getty Images
For upto the minute tenders log in to constructionweekonline.com
TOP TENDERS Supervision Consultancy Services for a New Independent Water and Power Project (IWPP) in Salalah Country: Oman Closes: Jul 19, 2010 Category: Power & Water Issuer: Oman Power &Water Procurement Company Upgrading of Khuwair South Substation Country: Oman Closes: Jul 19, 2010 Category: Power & Water Issuer: Muscat Electricity Distribution Co. (SAOC)
Saudi Al Fouzan, which has specialist medical experience has secured a contract for a teaching hospital in KSA.
Saudi Al Fouzan wins university hospital job Saudi Al Fouzan Trading and General Contracting has been awarded an estimated SR 500 million contract to build a university hospital in Dammam. The 400-bed capacity hospital is seen as a crucial project for the university by the government, which gives special attention and support to higher education sector. Board chairman of Al Fouzan Trading and General Contracting, Sheikh Mohammad Al Fouzan said the company had specialist experience building and designing hospitals. He said it was his firms reputation as a leading hospital-building company that led to its appointment for the project itself.
Contract opportunities to be unveiled at Cityscape Prime opportunities for contractors are to be unveiled at a three-day real estate investment and development conference in Saudi Arabia next month. Organisers of Cityscape Jeddah 2010, taking place
EPC for Upgrading Water Supply System at Kumzar Water Desalination Plant Country: Oman Closes: Jul 19, 2010 Category: Power & Water Issuer: Rural Areas Eletricity Company S.A.O.C
7-9 June, say the show will see over 100 local and international property investors and developers displaying projects related to Jeddah’s 20-year re-development programme. The programme’s initiatives will include the enhancement of the Khozama and Ruwais areas and rehabilitation of central and historic districts in Saudi Arabia’s ‘Gateway city’.
Refurbishment of Several Pumping Stations - Phase 8 Country: Qatar Closes: Jul 27, 2010 Category: Power & Water Issuer: Public Works Authority Housing Complex in Different Areas of Saudi Arabia - Phase 2 Country: Saudi Arabia Closes: Jul 31, 2010 Category: Buildings Issuer: Saline Water Conversion Corporation
Fluor Corp gets lions’ share of contracts US-based Fluor Corp and WorleyParsons have won the main US $202 million contract for Maaden’s planned Saudi-based aluminium joint-venture with Alcoa. Contracted to carry out the supervision, engineering and procurements of the complex's alumina refinery, the companies have a scheduled completion date of December 2014. In addition, Fluor Corp also won the second US $177 million contract for the engineering works, procurements and supervision of the construction of the complex's rolling mill – to be finished in the next three years.
Maintenance Services for Fire Fighting System Country: Kuwait Closes: Jul 11, 2010 Category: Infrastructure Issuer: Central Tenders Committee Dev of General Cargo and Liquid Terminal at Port of Salalah Country: Oman Closes: Jul 12, 2010 Category: Marine Issuer: Ministry of Transport and Communication
MATERIALS PRICE CHECK
$3.81
$721.45
$98
$4.36
$32.67
$748.67
$3.27
$10.88
$14.97
Aluminium
Cement
Red Meranti
Ready Mix
Glass
FF plywood
BeechWood
Al Profiles
Steel Props
Scfld Planks
MDF
per metric tonne
$820
per bag (50kg)
per tonne
per m3
per m2
per sheet
per CBM
per kg
per piece
per piece
per CBM
6 CONSTRUCTION WEEK JUNE 5-11, 2010
$72.15
Sika Solutions for FIFA World Cup
ealing of roof connection joints
Bedding and sealing of glass walls
Structural window bonding and sealing
Sealing of faรงade connection joints
Technology and Quality Sika sealing solutions for watertight movement joints, construction joints and connection joints for the Nelson Mandela Stadium, Port Elizabeth, South Africa: For stadium facades, plus joints for their terraces and floors, even in areas with high mechanical and chemical exposure, Sika provides a full range of elastic joint sealants with high movement capability and UV resistance. Sika sealants are available in many colours and have fast application characteristics and excellent adhesion to most common construction materials. This ensures watertightness and improves the climate control in the building. They seal in and around complex details and connection joints, plus help to fulfil the special architectural and aesthetic requirements of stadiums.
Sika Gulf BSC
Sika Saudi Arabia
Sika UAE
Kingdom of Bahrain Tel : +973 177 38 188 Fax : +973 177 32 476 www.sika.com.bh
Jeddah, Saudi Arabia Tel: +966 2 692 70 84 Fax: +966 2 692 12 72 www.sika.com.sa
Dubai, U.A.E Tel: +971 4 439 8200 Fax: +971 4 438 0549 www.sika.ae
Qatar, Kuwait, Oman and Yemen Contact Sika Gulf BSC (Bahrain)
FINANCE STOCK MARKETS
Depa shares rocket 44% in 5 months Depa Interiors – which fitted out the Burj Khalifa – has seen a record rise in its share price during the first half of 2010, following its announcement of strong back orders. The company revealed that 2010 has seen a 9.5% rise in its order backlog to $626 million. “We are still expecting revenues and profits within a similar range to those of 2009, although cyclicality will likely weigh revenues and earnings heavily towards the second half,” chief executive officer Mohannad Sweid said in a statement to the Nasdaq Dubai bourse last week. Projects started in early 2010 are beginning to generate revenue, it said. Depa shares are now trading at $.76, a 44% rise since the turn of the year. Last July, they had slumped to a year low of $0.45.
Depa boss Mohannad Sweid has seen his company share price shoot up this year.
Two year price analysis How Depa bucked the trend and stole a march on its rivals Share price in USD 2009
Share price in USD 2010
0.60
0.80
0.50
0.70
0.40
0.60
Jan 30
Feb 27
Mar 31
Apr 30
May 31
Jan 30
Feb 27
Mar 31
Apr 30
May 31
Expert Views Drake & Scull International PJSC (DSI) Is it a good time to invest in Drake & Scull? The experts seem to think so, with the majority recommending the shares as a buying prospect.
8 CONSTRUCTION WEEK JUNE 5-11, 2010
At first glance the shares don’t look much to write home about, sitting this week on AED 0.86. That’s not a huge rise from the 12 month low of AED 0.72 which was seen on 10 December last year, and some way off the peak of AED 1.22 achieved on 11 October last year. Indeed, so far in 2010 the price has slipped by nearly 5%. But the signs look positive. At a recent event in Abu Dhabi, chief executive Khaldoon Tabari told reporters that the company was bidding for up to 50 new contracts, and also had its eye on taking over two companies in Saudi Arabia. His plan to diversify out of the
UAE seems to be working, and the market clearly likes what it has been hearing. Of the ten analysts surveyed by Bloomberg, eight recommend a “buy”, two a “hold” and there were no “sells.” And they make some strong forecasts, with Shuaa Capital, Nomura and Credit Suisse putting a target price of AED 1.22 on the shares, with HSBC suggesting AED 1.20. Last week Prime joined the list, with a “strong buy” and AED 1.15 price target. Just last November Drake & Scull was facing uncertainty but the management is back in favour with the analysts.
THE VERDICT BUY: Drake & Scull has faced some tough times in the past year, but its expansion out of Dubai is now paying off. Experts agree this is a good buy.
FINANCE
Arabtec shares
TOP RISERS
RAK Cement shares
Fujairah Building Union Cement Co. United Projects Specialties Group Gulf Cement Co. Kuwait Gypsum Co. Raysut Cement Co. Oman Ceramic Aloula Gulf Stone
2.6 0.92
2.24
0.84
2.28 2.12
0.76
1.96
0.68
6/5
12/5
18/5
24/5
30/5
6/5
12/5
18/5
24/5
30/5
Widespread losses for firms in Q1
Cement companies lead shares slide
A significant number of construction firms in the GCC reported a loss in net profits for the first quarter of 2010 compared with the same period last year. Arabtec, the biggest construction company in the UAE, reported a fall of 17% from AED 161.2 million in 2009 down to AED 134.5 million in 2010, while Abu Dhabi-based Aldar Properties recorded a 54.3% decrease in revenue from AED 227.0 million last year to AED 496.6 million this year. Earlier this year it cancelled a planned merger with Aabar. Similarly, Saudi-based developer Jabal Omar Development Company posted a Q1 loss of SR 8.9 million (AED ) compared with a loss of SR 4.1 million (AED ) 12 months ago.
The region’s cement companies have continued to perform poorly, with many seeing their shares hit an all time low on the back of poor earnings. Last week saw huge falls of close to 10% for UAE based Sharjah Cement and RAK Cement, along with Saudi Arabia’s Arabian Cement and Saudi Cement. In April, RAK Cement reported a 90% drop in Q1 net income to just AED3.3 million, sending the shares to a four month low. By the start of last week, they had slipped another 9% to just AED 0.77. The company’s shares are now trading nearly 15% lower since the start of the year – that despite the sector showing a near 3% average rise in share price for 2010.
+5.98% +5.15% +4.69% +4.24% +4.21% +1% +0.4% 0% 0% 0%
TOP FALLERS Sharjah Cement RAK Cement Co. Mushrif Trading Arabian Cement Saudi Cement Kuwait Process Plant Salbookh Trading Arkan Building Materials National Industries Saudi Arabia Amlantit
-9.09% -10.11% -10.26% -10.27% -10.52% -10.53% -11.11% -11.40% -13.58% -14.14%
SECTOR INDICES Banking +0.64 Insurance -7.30 Fin & Inv -39.26 Real Est & Constr -46.50 Transportation -2.69 Utilities -14.43 Materials 0.00 Consumer Staples 0.00 Telecoms 0.00
+0.07% -0.24% -2.11% -1.68% -0.61% -2.25% 0.00% 0.00% 0.00%
(Data accurate as of close 31 May 2010)
Update 10 latest projects updates PROJECT TITLE
COUNTRY
VALUE / VALUE RANGE (US$)
CONSTRUCTION OF PROPOSED HEADQUARTERS BUILDING AT MOTC
Oman
6, 000, 000
HOUSING DEVELOPMENT FOR CIVIL AVIATION AFFAIRS AT SEEB - PHASE 1
Oman
15, 000, 000
UPGRADING OF BIRKAT AL MOUZ - SAYQ ROAD
Oman
30, 000, 000
TUBLI WASTEWATER TREATMENT PLANT
Bahrain
TBC
KHALIFA PORT AND INDUSTRIAL ZONE (KPIZ) IN TAWEELAH - ABU DHABI
UAE
TBC
REFURBISHMENT OF 13 SCHOOLS AROUND DOHA AND VILLAGES
Qatar
11, 000, 000
PORT OF SALALAH - EXPANSION OF THE GENERAL CARGO TERMINAL
Oman
500, 000, 000
CONSTRUCTION OF DOHA EXPRESSWAY - PACKAGE 7
Qatar
438, 000, 000
SHEIKH KHALIFA HOSPITAL
UAE
145, 000, 000
AL MAFRAQ HOSPITAL
UAE
871, 000, 000
JUNE 5-11, 2010 CONSTRUCTION WEEK 9
COMMENT
WEALTH CHECK
Sheikh Mohamed Bin Issa Al Jaber MBI International US$ 9.7 billion It’s very unlikely that you will ever see Sheikh Al Jaber in the Middle East: despite reputedly being the world’s second richest Arab, and having made billions through property development, he prefers to stay at his homes in either London, Vienna or Paris. But he has made a name for himself (and added to his fortune) by being one of the few people who two years ago correctly called the property crash just before it happened. The MBI International group of companies today holds an asset value of over US $9 billion and boasts operations in Europe, the Middle East and the US. 10 CONSTRUCTION WEEK NOVEMBER 25–31, 2010
For more interviews and insight go to constructionweekonline.com
Thermal insulation systems for the entire building envelope ECOLOGICAL: Lowest carbon footprint, LEED and ESTIDAMA credits, environmentally sound, 66% recycling glass SUSTAINABLE: Environment friendly with best cost-benefit ratio, never degrades in the long term (guaranteed) FIRESAFE: According ASTM 84/136, non combustible, no flame spread, no smoke development, European fire rate A1
N E W DO H A I N T E R N AT I O N AL AI R PO R T
• • • •
for flat roof like roof garden, terraces, parking deck for shaped roof and domes with metal or ceramic cladding for facade with ventilated cladding in stone or metal for interior application for wall and soffit
PITTSBURGH CORNING Europe (Branch Middle East) Arenco Tower, Media City, P.O. Box 213345, Dubai, UAE TEL +971 (0)4 434 7140 FAX +971 (0)4 432 7109 EMAIL info@foamglas.ae WEB www.foamglas.ae
ROUND UP
NEW PROJECT
UK spending cuts threaten UAE construction recovery Construction industry problems in the United Kingdom could increase competition for lucrative contracts in the UAE. Planned spending cuts in the UK announced recently threaten to hinder the UAE construction recovery, should they exacerbate problems already being experienced by UK-based contractors with an established presence in the Middle East. The worry is that cuts in UK public spending on large scale construction projects could have the knock-on effect of increasing competition for contracts in the UAE, as many of the large international construction firms see a fall in profits. As well as harming the long-awaited and anticipated economic recovery in the Middle East, industry experts forecast that the cuts could prolong a recession, which continues to present tough challenges for the global construction sector.
Following the Chancellor of the Exchequer’s announcement to make cuts of up to £6.2 billion, the Construction Products Association in the UK called for urgent clarification on exactly where these cuts would be made. Commenting on Mr Osborne’s announcement, the Construction Products Association’s Chief Executive Michael Ankers said: “Although it is clear that government will need to address its public borrowing, it is critical that government provides clarity on where potential spending cuts may occur and ensures that spending cuts do not occur in those areas that are key to facilitating the economic recovery, such as in transport infrastructure and energy supply.” So far, the UK Chancellor revealed that £1.7 billion of savings alone would be made from delaying and stopping contracts. But at this stage no further detailed clarification has been made on the issue.
In Quotes “I think the issue is finally a political one… A lot of LEED is given for bogus stuff, with enormous costs that don’t pay you back in your lifetime” FRANK GEHRY, world renowned architect, on what he thinks of green building initiatives and global warming.
12 CONSTRUCTION WEEK JULY 5-11 , 2010
“I am delighted to announce this new initiative which brings together three leading organisations.” ISSA AL MOHANNADI, Dohaland CEO, on the JV signed with Linc Facility Services and Masraf Al Rayan Bank FM services in Qatar and other Mena countries.
“Today the approach to projects is different. In the private sector you have to think about who you will be working with especially if they are new to you.” AHMAD MATAR, general manager of Al Arrab Electromechanical Engineering.
ROUND UP
Around the GCC 3 4
2
1
5
1. ABU DHABI, UAE
4. QATAR
Abu Dhabi hourly worker pay falls
New CEO heads up gas giant
The average wage of construction workers in Abu Dhabi declined by almost AED6 per hour in two years, as the financial crisis dealt a blow to takehome pay, according to latest figures. Data from the Statistics Centre – Abu Dhabi show that the aggregate hourly wage across the range of building site workers fell from AED18.1 to AED12.6 from April 2008 to April 2010. Surveyors and steel fixers took the biggest hits to their pockets with AED7 and AED6 per hour being trimmed from their rates hourly rates, while electricians (AED4) and helpers (AED3) also felt the pinch.
“I have heard different figures (for 2009). The good news is that it was positive 1.3% and we expect GDP growth for 2010 to be around 3%” SULTAN BIN SAEED AL-MANSOURI, UAE Economy minister on the state of the region’s finances.
Qatar has appointed a new chief executive for one of the two state-run companies that ships its gas to international markets. Sheikh Khalid bin Khalifa al-Thani replaces Faisal al-Suwaidi as the new head of Qatargas. He was previously director of Ras Laffan Industrial City.
2. SAUDI ARABIA
3. KUWAIT
5. JEDDAH
Foreigners in KSA citizenship call
World Security trains in Kuwait
Jeddah Metro launched
A group of foreigners born in Saudi Arabia have set up a website demanding citizenship or permanent residency of the kingdom. The founders of www. Mawaleed.net say that they are an “integral part of Saudi society” and deserve to be granted full citizenship. Around 23% of Saudi Arabia’s 27 millionstrong population are expatriates of one sort or another, but the children of non-Saudi parents do not automatically qualify for citizenship rights in the country.
World Security will provide specialised training to the employees of Al Raed Security Company in Kuwait. The programme will include basic security supervisor training, self defence, VIP protection and an inspector supervisor course and will be handled by training officers licensed by Dubai Police Department of Protective Systems. “It is our commitment to excellence that prompted this partnership,” said World Security CEO Mahmood Amin.
Saudi Arabia has unveiled plans for a Metro system in Jeddah, just as construction work begins on the equivalent network system in the country's capital, Riyadh. The Metro will consist of three lines: and is part of a SR21 billion (US $5.6 billion) investment programme for the city’s transport system. Other aspects of the transport improvement works include monorails, buses and trams to link the urban sprawl of Jeddah’s many residential districts.
JULY 5–11, 2010 CONSTRUCTION WEEK 13
ROUND UP
www constructionweekonline.com m
MOST POPULAR
1 2 3 4 5
Besix and Takreer win contracts in Abu Dhabi IN PICTURES: The world’s six most ugly buildings Saudi transport ministry launches Jeddah metro UK spending cuts threaten ME construction recovery Escan awards Fujairah tow ers project to Al Qabdha
IN PICTURES
Two new bridges in Dubai are part of Dubai’s largest interchange system project.
Bridge building completed Two new bridges crossing Dubai’s Sheikh Zayed Road and linking the city’s Financial Centre Road with Al Safa Road, were opened recently. As part of Dubai’s largest interchange system project, the bridges have opened up routes to the Burj Khalifa, Dubai Mall and Dubai International Finance Centre, giving Dubai traffic more access to the landmark sites than ever before. As the main contractor for the project, Italian firm Salini will be carrying out the construction works for the new intersection to replace the first junction on Sheikh Zayed Road and allow free traffic access in all directions. On completion, the development will encompass 12 new overpasses (10.5 to 32.3m width; 30 to 60m span – with a combined length 3626m) and three underpasses (cut and cover), including a tunnel to link the service road behind Mazaya Centre with the service road behind Shangri-La Hotel on Sheikh Zayed Road.
SPOT POLL Do you agree with the midday work ban?
75%
10.7% 7.1%
7.1%
It’s very important for the welfare and safety of workers
I’d rather work through the heat and finish earlier
It makes the work day far too long
14 CONSTRUCTION WEEK JULY 5-11 , 2010
It’s disruptive but I can see the value
Six of the world’s ugliest buildings This week CW takes a look at the world’s ugliest structures, including this Bangkok curiosity
LATEST FEATURES
Interview At the high end - Abboud Malak has designed some of the plushest office in Dubai Analysis Hot stuff - solar powered water heating systems Comment MEP design at tender stage: is it time for a change?
COMMENT
STUART MATTHEWS
Projects, contracts, tenders The industry just can’t hear these words enough, because they mark the start of real work
P
rojects, contracts and tenders are my three favourite construction words. Those of you who I’ve met may wince at the sound of them. If we were in a meeting, I will certainly have said them to you more than once. But there’s a reason for my belligerence on the subject. Information about projects, contracts and tenders is what Construction Week’s readers have proved they want time and time again. As I write, a story headlined Besix and Takreer win contracts in Abu Dhabi tops the ‘most popular’ list on constructionweekonline.com. On any given day, stories that reference projects, contracts and tenders will out do just about any of our many other online offerings, except perhaps for the occasional top 10. There’s no doubt that they are the three things that matter most to our readers; we and them just can’t get enough. With this in mind, we’ve made changes to Construction Week, relaunching this issue to greater reflect the three words that sum up what the industry is most keen to know more about. Our changes also reflect the evolving industry and the reach our daily news website has achieved. With more than 100 000 people – the vast majority from the GCC – using constructionweekonline.com as their source of daily regional construction news, the focus of the magazine has shifted to more analysis, more features and a greater depth of project and site coverage. We will continue to address issues that directly affect our readers, as well as look at those that have an influence on the broader industry. A
16 CONSTRUCTION WEEK JUNE 5-11, 2010
greater emphasis on the business of construction is one of the results, with the addition of a weekly financial summary to bring you a glimpse of the week’s biggest financial winners and losers. This shift can also be seen in our lead interview with Mohammed Alabbar, who heads up arguably the region’s most successful property developer and who has, in effect, been the ultimate source of more construction contracts than just about anyone else. As issues go, sustainability is always worth talking about. The biggest problem is that so few companies actually do anything other than talk. Recently though, there has been a very practical and real-world change in construction sustainability in the emirate of Abu Dhabi. The newly-operational recycling plant for construction waste, located in Al Dhafra, is proof positive that sustainable construction can be a real thing and not just confined to a developer’s brochure (see page 34). The plant has been developed to turn waste concrete into aggregate, to build the emirate’s roads. Regulations to encourage the use of the plant and its product are expected to follow shortly. Visiting the site of the plant, which is a bit like a quarry where the raw materials are delivered by the truck load, was a chance to see practical recycling in action. It’s a dusty, industrial process that has a useful output and will help the emirate improve its environmental standing. It seems likely then that you can expect to be driving on recycled roads in the coming years. If in the meantime you have news about projects, contracts or tenders, just drop us a line.
Recycling waste concrete into aggregate is a real step toward sustainable construction.
The newlyoperational recycling plant for construction waste, located in Al Dhafra, is proof positive that sustainable construction can be a real thing and not just confined to a developer’s brochure.
BI C PV os Sy t-e st f fe em c t pr ive ov id er WEIHAI CITIZEN PLAZA THE WORLD’S LARGEST AMORPHOUS-SILICON BIPV BUILDING PROJECT
Leading the way in Building Integrated Photovoltaic (BIPV) Curtain Wall Building Integrated Photovoltaic
SINGYES IS PROUD TO HAVE CONSTRUCTED ARCHITECTURAL FAÇADES FOR THE MEYDAN RACECOURSE PROJECT
Engineering Complete systems solution provider
Research & Development CRYSTALLINE PV ON FAÇADE
Photovoltaic & Multimedia technology, Energy analysis, Lighting analysis, Thermal analysis, Material analysis
Singyes is the one stop service provider in BIPV from design, fabrication, analysis to installation.
MULTI-MEDIA LED FAÇADE
Singyes Facade LLC (Dubai) Rm 110B, Al Ain Center Office Building, Al Mankhool RD, Dubai T 04-3595948 F 04-3595947
Singyes Technologies Limited (Abu Dhabi) Office No 306 3rd Floor, Injazaat Building, Mohamed Bin Zayed City, Abu Dhabi T 02-6431078
www.zhsye.com
COMMENT
PHILIP ADAMS New Dawn Philip Adams looks at what remains unsaid about recent announcements of repayments to construction contractors
I
have been in dubai more than two years now and like most UK ex-pats get frustrated by the attitude of the UK press when reporting on Dubai. Hence, the recent announcement of an injection of badly needed liquidity into the Dubai construction market filled me with a sense of satisfaction and demonstrates that perhaps things aren’t quite as bad as the hacks in the UK like to make out. However, I hope that the momentum that has been generated by these announcements is maintained and more information is soon provided with respect to the details behind the proposals, as some questions do remain. Let us analyse some of the press announcements. It has been quoted that contractors (trade creditors) will be paid 100% of ‘agreed amounts owed’. But what if, as is the norm on most construction contracts, large amounts are yet to be agreed? Will amounts not agreed be set aside to allow some cash to flow or will the agreement of these amounts impact on the initial 40% payment? In addition, might this effect the timing of the initial payments which are intended to commence in June as recently announced? It would also be a good opportunity to consider some way that the agreement of the un-agreed sums may be expedited to avoid long and costly disputes. 18 CONSTRUCTION WEEK JUNE 5-11, 2010
Furthermore, to avoid the risk of contributing to any further delay, contractors should review all un-agreed claims and ensure that they have been prepared to the required standard and include the necessary substantiation. It has been further stated that the repayments to contractors and suppliers will consist of 40% cash and 60% ‘tradable security’, with an annual return of 10%. Some commentators have stated that the contractor can take the tradable security and transfer it immediately into cash, which then gets reinvested down the contractual chain and thus provides the long awaited liquidity. This is just what the construction market needs, however, in reality, if a contractor actually did attempt to ‘transfer’ this security into cash how much cash is it likely to generate? My concern is that the current global financial conditions, plus the fall-out from the sub-prime debacle, may adversely affect the market value of these tradable securities. For the majority of contractors cash is king and therefore, most of them will be eagerly awaiting more details of this particular aspect of the proposals. The 10% return on bonds is conditional on trade creditors representing 95% of the value of all claims agreeing to the proposal. Is the reference to ‘all claims’ to include both agreed and un-agreed amounts? If
so then securing the agreement of the 95% could be a very protracted process and risks being delayed by just a few large creditors. In addition, other reports state that the commencement of payment is conditional on written approval from a bank creditors committee which represents yet another hurdle. Finally, it has also been announced that an initial US $1.5 billion will be made available to fund the completion of ‘near term’ developments ahead of a final agreement on the recapitalisation plan. Therefore, it would also be good if some clarity was provided with respect to the definition of ‘near term’. Overall the recent announcements are positive news and I genuinely hope that it does bring about the desperate needed liquidity. However, the construction market needs more flesh on the bones of the deal without which we may lose a valuable opportunity to talk Dubai up and may inadvertently give the blinkered hacks back home more ammunition for their favourite game of Dubai bashing! Philip Adams is an Associate Director at Systech in Dubai. He has provided commercial, contractual and dispute resolution advice on a range of projects. He is a member of the Royal Institution of Chartered Surveyors and a fellow at the Chartered Institute of Arbitrators.
LETTERS RE: LEED rankings 'bogus': Frank Gehry Regarding LEED certification for buildings, I feel that it should be continuously upgraded through the life span of the building, rather than just implementing it for the sake of certification. Also we need to have some local content in LEED, which is particularly suited to the GCC region. Overdesigning of MEP services needs to be curtailed, or we will end up with a white elephant as some of these services turn out to be an engineer's nightmare. Simply copying the west will not lead us to LEED. We need to do what is good for us. CLARENCE S LEWIS, VIA EMAIL
MoL: workers to beat the heat for longer this year The midday working ban is only in effect in the UAE, and it is important that we consider workers in Saudi Arabia too. Not only is the summer worse there, but the larger companies seem less bothered about the environment, health and safety; except for oil refineries. I strongly recommend that Saudi Arabian construction sites too require a midday work break (12:30pm to 3:00pm). Hopefully this will be a boost to the environment, health and safety culture in Saudi Arabia, and encourage firms to take better care of their workforce. AJU SHARFUDDIN, VIA EMAIL
RE: Nuzul labour camp offers 'better quality of life' The labour force must always be our primary concern. They deserve access to quality labour camp accommodation and good basic living provisions. Labour camp operators, engineers, architects, consultants and environmentalists must be made to cooperate and evaluate technologies, which can meet stringent requirements of LEED code, whilst at the same time provide a cost effective habitat for these hard working 20 CONSTRUCTION WEEK JUNE 5-11, 2010
people to live in. This type of technology has been available but ignored. THOMAS, VIA EMAIL
RE: Dialogue: Rahamathulla I understand that Intelex Technologies/Barik Group are doing remarkably well in the Middle East. I am sure this HSE software will definitely be a boost to health and safety in the industry. Rahmat - good to see you interviewed in CW. SHARIEF, DAMMAM
RE: LEED rankings ‘bogus’: Frank Gehry I agree with Mr. Gehry's statement. Targeting maximum LEED points, especially in GCC countries, requires more common sense. I urge those developers to be open minded when it comes to their LEED vision. Whilst I agree with the concept of the LEED system and the benefits for workers and the environment, people must realise that there is a right time and place for implementation. CONCERNED ENGINEER, DUBAI
RE: Sharjah: where rubber meets the road This is good news. Finally someone in the UAE is using recycled rubber and taking the initiative to be green! Just for the record, non bio-degradable plastic can now also be used to provide bedding for roads. A company from the city of Pune in India is already working on the same. So we all know where all those plastic bags will end up! SUNNY, VIA EMAIL
RE: Saudi transport ministry launches Jeddah metro This is good news for Saudi Arabia. Infrastructure is key for the development of a country, hence why Saudi Arabia is enhancing its infrastructure. I just hope this move will generate ample job opportunities in the country for experienced professionals, and ease the current job crisis in the Middle East. AJU SHARFUDDIN, VIA EMAIL
To submit a letter, write to editor@ constructionweekonline.com or by post: Construction Week, PO Box 500024, Dubai, UAE. Please provide your full name and address. Letters may be edited for space and style. Submission constitutes permission to use. You can also log in to www. ConstructionWeekOnline.com to join the conversation.
SALARY SURVEY
How much are you worth? Construction Week will launch its online salary survey on June 12, take part to secure your firsthand look at what your peers are being paid
T
he 2010 Construction Week Salary Survey will be launched on constructionweekonline.com on June 12. It will be used to gather anonymous salary and package details from across all professional levels of the industry, as well as ask qualitative questions about working in the industry around the Gulf. Results from the survey, which will run until September 30, will be published in October and will include detailed responses analysed by sector, country and profession. The survey will be a temperature check for the mood of the industry as a whole, revealing signs of optimism or pessimism. It will also provide demographic details of the wide range of nationalities who have brought their professional life to the Gulf and see how those may have changed in the last 12 months. A comparison with 2009’s results, where more than 1000 people responded, will reveal salary and package trends over the last 12 months and provide a window into the levels of resourcing available, in the aftermath of the industry’s consolidation. Last year’s survey was conducted during the darkest days of the recession in the Gulf, with a sense that everyone was waiting to see what would happen. The mood was quite pessimistic. Yet, despite the feeling at the time, the results showed signs of optimism. It will be a good sign if this optimism remains in place in 2010, though the nature of the survey means results will naturally lean toward those who are still employed in the 22 CONSTRUCTION WEEK JUNE 5–11, 2010
2009’s average basic salaries Respondents were given the option of selecting salary windows to identify their pay level and job titles to identify their role. All figures are in US dollars and represent basic monthly salaries across the six GCC countries.
region and thus have more reason to be optimisitic about their future in the GCC. Specialists in the field of recruitment and human resources will be consulted to verify the results and identify anomalies. As with any survey, there will always be anomalous results, but they are frequently the most interesting. They can demonstrate a gap in perception between an individual’s view and that of the wider industry. The starkest example of this in the 2009 survey was people’s expectations regarding pay rises. A staggering 61% of respondents believed they would receive a pay increase at some point within the next 12 months. The 2010 survey will reveal if these optimistic expectations were met, despite most human resources experts believing that there would be no way a broad section of the industry would be getting a pay rise. The survey can be taken at constructionweekonline.com from June 12.
All construction industry employees Midpoint: $6047 The average salary of a construction industry employee in 2009 was between $4849 and $7246 per month. Architect Midpoint: $4500 The average salary of an architect was between $3643 and $5357 per month. Civil engineer Midpoint: $3370 On average, a civil engineer earned between $2573 and $4168 per month in 2009. Construction manager Midpoint: $8750 In 2009 a construction manager earned an average of between $7079 and $10,421 per month. Cost estimator Midpoint: $3904 A figure between $3095 and $4714 was the average monthly salary of a cost estimator. Project engineer Midpoint: $4023 Project engineers earned an average salary between $3141 and $4905 per month. Remove the top 20% of results and this average dropped to between $2271 and $3771 per month, producing a midpoint of $3021.
Where else can you access over US$1.7 trillion worth of construction projects all in one place? The region’s largest annual gathering of the construction industry dedicated to plant, machinery, equipment and vehicles returns even bigger in 2010.
Why Exhibit? Position your products alongside extraordinary display of latest technologies and innovations Engage decision makers and key buyers face-to-face Associate your brand with Big 5 PMV and build credibility Meet and network with the industry’s key influencers Conduct research on your customers' profile and gain information on upcoming market trends
2009 Quick Facts In excess of over 12,000 participants from 20 countries 158 exhibitors Co-located with Big 5, an event that attracts over 58,000 trade professionals Over millions worth of deals made onsite
Contact us today to book your space For exhibition or sponsorship opportunities please contact Alexandria Robinson on: Tel: +971 4 332 9029 | Fax: +971 4 332 9648 | Email: alex@big5pmv.com Organised by:
Audited Average Circulation 10,400 copies July - Dec 2009
ANALYSIS TALL ORDER Far East construction and development firms have had to acclimatise to regional differences in the Middle East
Land of the rising sums Contractors and developers from China, Taiwan, Korea and other Far East Asian countries have been adding to the fierce competition in the Middle East. Ben Roberts reports.
T
he economic downturn and resulting pressures on the construction market have intensified competition across the supply chain. Piling contractors tell CW that they can compete with as many as 13 other providers for work on a standard building – creating little margin both in profits and chance to innovate. As if domestic competition was not intense enough, the last few years has seen significant increase in the presence and success of companies from China and surrounding countries in the Middle East. Nirvit Sharma at the New Delhi-based private research firm Grail Research, which produces insights into regions for companies looking to expand, says that
24 CONSTRUCTION WEEK JUNE 5–11, 2010
his firm has seen an increase in interest from Far East Asian and South East Asian companies to enter the region. “That’s definitely happened,” he says. “They see the Middle East as having much scope for development, and specifically for UAE. From Korea and China we have seen demand for information, although mostly from the supplier side, rather than from the contractor side.” However, contractors, engineering firms and developers from the east have also been making their presence felt, typically setting up discreet offices in Dubai or Abu Dhabi and gradually claiming more contracts. Hyundai Engineering & Contracting (HDEC), from Korea, has seen particular growth recently in its business providing
building and upgrades to roads, bridges and harbor projects among other areas of infrastructure. The construction outfit gained kudos two years ago for completing the civil works for the first stage of the Jebel Ali New Container Terminal. More recently, it partnered with HBK Contracting to build the first phase of the residential and cultural development Musheireb – also known as Dohaland – in Qatar. The win boosted the value of Hyundai’s portfolio in the region to US $4.4 billion. Perhaps most impressive is the firm’s success in Saudi Arabia, where its business includes engineering work on a power plant and Jubail industrial Harbour. It is one of a few east Asian companies to see some big business in Saudi Arabia. At
ANALYSIS For upto the minute analysis log in to constructionweekonline.com
Far East GDP China's GDP has sky-rocketed over the past decade as business throughout the region continues to improve.
Trillions of US Dollars 5 China South Korea
4
Thailand Singapore
3
2
1
2000
2005
2008
China's EU exports Statistics show just how important Europe is to the Chinese economy
Manufactured goods 14.7%
Machinery and transport equipment 46.8%
Miscellaneous manufactured articles 31.5%
the beginning of this year Daelim Industrial Company, a Taipei, Taiwan-headquartered firm, won the contract to build a lowdensity polyethelene plant in Jubail. S I Kim, general manager for the Damman office, said the construction of the plant in was ‘much higher’ than the US $300 million initially reported, though he would not be drawn for the exact figure, which could be more than double. Also in the first quarter of 2010, CTCI Corporation, another Taiwanese firm, was awarded the engineering, procurement and construction contract, in January, to build an amines plant that will produce 210,000 tonnes per year in Jubail Industrial City. China Jiangsu International Construction (CJIC), part of the outward-
looking China Jiangsu International Group, has had a presence in the UAE since 2004, though sister companies in Qatar and KSA have been active since the 1990s. Its business includes survey and design, civil, M&E installation, steel structure, finishing and decoration, fire alarm and intelligent works, though Chen Xin, commercial manager, tells CW the company has attempted to diversify in recent years. “CJIC is specialised in the building sector and the infrastructure sector; however, due to credit crunch since 2008, we are trying to diversify our scope of work, and have become involved in office fit-out works, hotel refurbishment works and public sector [projects], such as school projects and hospital projects,” he says.
Conventional trade 44%
Others 5%
Processed trade 51%
JUNE 5–11, 2010 CONSTRUCTION WEEK 25
ANALYSIS
He explains that there are a few key differences in the Middle East compared to China, particularly surrounding regulation and the supply chain. “Here, a contractor has to produce shop drawing; however, in China, shop drawings are handled by the design firms and/or consultancy firms,” he says as an example. On the supply side, he says in China it is very easy for a contractor to source the materials and procure the subcontractor and maintain the supply chain. “Trade contractors are quite motivated,” he adds. Steven Hunt, a construction lawyer in law firm Al Tamimi, has followed the recent success of East Asia companies in the region, as the firm itself has increased its advisory business to contractors. These companies are no different to others in seeing the ongoing potential of the region, he believes. “Dubai has interested everybody in the last few years, and there is now an interest in other areas, as the Dubai market has quietened,” he says. “For some of these contractors they might receive sponsorship from their government, and now they are seeing opportunities, particularly in states such as Saudi Arabia where there has been a lot of recent investment in infrastructure. “Then you have Kuwait, which to a degree is coming out of the shadow of Iraq. There’s a greater stability, and if you are one of the big [foreign] players, which already has a presence on the ground, then that gives you a good platform to expand further into the Middle East. But it’s the same as anywhere: a company has to feel culturally comfortable doing business there.” He adds that although there are a number of “green shoots”, there are trenchant differences between the GCC states to which Asian firms must acclimatise. “I guess Saudi stands out as a little bit more of a challenge. A project might be overbudgeted so there are issues for contractors getting entitlement.
Asian and Arab companies place a similar emphasis on developing long-term business relationships.
“Abu Dhabi, as a contrast, is signed up to the New York convention. But there is a challenge for international players up against local and government developers.” There are even occasional problems when it comes to joint ventures, he says, which is a prevalent business structure whereby the foreign company owns 49%. “You can see a situation where a local firm might do a deal with the government or some other entity – there’s a danger of that.” He adds, however, that underlying principles of business are the same. “Contracting is about relationships, and you have to prove yourself as a company entering the region,” he says, agreeing that there is a good match between the emphasis on long-term relationships in Arab states as with East Asian companies. Far East Asian companies have won contracts across the spectrum of construction, from mega projects to niche areas of airport infrastructure. On the one hand, there is Guangsha Middle East Construction, part of the Guangsha Holding Venture Capital Company. Last month it announced an MoU with the Meydan
“If you are one of the big [foreign] players which already has a presence on the ground, then that gives you a good platform to expand further into the Middle East." 26 CONSTRUCTION WEEK JUNE 5–11, 2010
Group to develop the first phase of the Metropolis Business Park in Meydan City. It will be repeat business for the Chinese firm, which completed the Falcon car park in the complex three years ago. On the other hand, Pteris Global, a Singaporean firm that builds baggage handling systems as well as parts of in-flight service machines, has gradually sold its services across more of the region. The firm first set up its Middle East operations in Dubai in 2003, currently trading under its original name Inter Roller. The company won its first contract upgrading terminal 1 at Dubai International Airport a year later. It has also won contracts for the concourses 2 and 3 at the airport. In the last year it has worked on the Queen Alia International Airport in Amman, Jordan, due for completion at the end of next year. “The baggage handling system works are progressing as planned,” said the project manager in Amman, who declined to be named. He adds that the work structure in Jordan is similar to elsewhere. “From a technical viewpoint, the work process is similar to our other projects.” Chen Xin at CJIC draws a distinction between companies from different countries when assessing the success of Asian firms in the Middle East. “Recently in other GCC countries, oil field projects and civil works have been taken by Asian companies, but only Korean companies secure mega projects in Abu Dhabi, and Chinese companies are still struggling to take projects and survive here in the UAE,” he explains. But the future looks bright for his countrymen with government support, despite the challenges produced by the downturn. “I do believe the price is coming to bottom for the UAE market,” he says. “The low cost of secured projects will affect their execution and delivery, and definitely time extensions as well. “However, Chinese companies are still having more chances to win projects by virtue of cost managing, value engineering, alternative Chinese material proposals and the efficiency of the Chinese worker. Furthermore, with the assistance of government involvement, certain PPP/PFI projects are under negotiation.”
FACE TO FACE
THE DREAM BUILDER In less than six months, Mohammed Alabbar has delivered two of the world’s most eagerly awaited projects. How did he do it? By Anil Bhoyrul
I
t’s been a good year for Mohammed Alabbar. We’re barely into June and the charismatic chairman of Emaar has already delivered two of the biggest projects on the global stage. The iconic Burj Khalifa tower opened in January, and four months later came the first ever Armani Hotel, built within the tower. “When you start building something, you can either build the same boring environment or you can do more. What’s important is whether that single piece of stone is really affecting human life. Some things are very easy to do and some things are very hard. But that’s our job, we get it done,” he says. Few could argue with him right now, particularly Emaar shareholders. Last month the property development company announced first quarter 2010 revenue of AED 2,886 million ($786 million), underpinned by the robust performance of the company’s hospitality and shopping mall subsidiaries. This was an impressive 87 percent higher than the first-quarter 2009 revenue of AED 1,540 million ($419 million). Net operating profits for the first quarter of the year reached AED760 million ($207 million), 152 percent higher than the first-quarter 2009 net operating profit of AED302 million ($82 million). But this, it seems, is just the beginning. Key construction contracts
28 CONSTRUCTION WEEK JUNE 5–11, 2010
have been awarded in Egypt, Jordan and Saudi Arabia that will drive Emaar’s integrated community developments in these countries. “Several of these projects will be handed over this year, including homes in Egypt; and commercial offices in Syria at The Eighth Gate development,” says Alabbar. While the likes of Syria’s Eighth Gate represent where the action will be later this year, it is the past few months that has really seen Alabbar and Emaar capture the headlines around the world. After many delays, the long awaited opening of the Burj Khalifa finally took place on January 4th. From a construction standpoint the project broke almost every record there is to break, and the industry has universally agreed that the end product is indeed a world-beater on every count. For Alabbar however, it marked the end of several years of being extremely hands-on, many sleepless nights and keeping and eye on practically every detail of the construction process. “The only thing was I was anxious and impatient, then it was almost done and it was dusty and I wanted to see it shine, like a little boy. This is my global wonder that I want to enjoy. I am always looking. I was so lucky to be able to do this. There have been a few sleepless nights, problems with contractors and quality issues that we had. Things we agreed on and in reality they don’t look good.
FACE TO FACE
NOVEMBER 25–31, 2010 CONSTRUCTION WEEK 29
FACE TO FACE
Emaar has partnered with famed Italian designer Giorgio Armani (above, left) to create the stunning 160-room five-star hotel which occupies the first eight floors of the Burj Khalifa.
“The hardest thing is the ability to deliver it and not compromise on quality – especially the finishes and installation,” he says. On January 5th, as the big clean up was underway following the spectacular fireworks display to mark the opening of the Burj Khalifa, Alabbar was back at his desk planning the next “biggie.” It happened to be in the Burj Khalifa tower again, as the finishing touches were being put to the first Armani Hotel in Dubai. The 160-room hotel was personally designed by Giorgio Armani and finally opened its doors to the public on April 28th. Despite 30 CONSTRUCTION WEEK JUNE 5–11, 2010
several delays, the general consensus is that it was worth the wait – in addition to the rooms that occupy the first eight floors, plus levels 38 and 39 of the tower, it boasts eight restaurants, retail outlets and a spa. The buzzword is “luxury”, with Eramosa stone floors and zebrawood panels. “Now, for me, as I enter this building, everything that I look at feels “Armani”. I feel the Armani comfort and elegance from every angle. Armani tried to design this well and we tried to execute it well,” says Alabbar. The hotel is the first venture between Armani and Emaar, but it looks like being the
first of many. The two companies are also working on a hotel project in Milan, while the first ever Armani Resort is penciled in for Marrakech, and the first Armani Residences Villas for Marassi in Egypt. Other destinations including New York, Tokyo, Shanghai and London are also being considered. “Our journey has started here in Dubai. What next? Well there are a lot of projects on the drawing board, but we are being meticulous in choosing the type of city we want,” says Alabbar. So where will this journey take Emaar next? The company’s growth strategy for
FACE TO FACE For upto the minute indepth analysis log in to constructionweekonline.com
CAIRO CALLING
Emaar Retail has opened the region’s first KidZania, which aims to promote physical and intellectual growth of children.
2010 is to focus on the larger Middle East, North Africa and South Asia (MENASA) region, which is home to more than 30% of the world’s population, of which some 800 million people are below the age of 25. “Our strategy is to develop integrated lifestyle communities in these markets that meet the growing demand for affordable luxury,” says Alabbar. Emaar made rapid progress in its various projects in different stages of completion during the first quarter of 2010, especially the residential and commercial developments in Downtown Dubai. Boulevard Plaza
and Marina Plaza are also nearing completion, and work on other residential towers is progressing. Emaar Hospitality Group recorded strong occupancy levels at all five Address hotels in Dubai in the first quarter of 2010, and Emaar Malls Group hosted more than five million visitors during the month-long Dubai Shopping Festival at its flagship mall, The Dubai Mall. Weekly visitor footfall during the festival month was up an average 30% as compared to the prior month. Emaar Retail, the entertainment and retail business of Emaar, opened the region’s
Under Alabbar’s leadership, Emaar has continued to extend its presence across the globe, with Egypt now seeing the benefits first-hand. Emaar Misr, the wholly-owned subsidiary of Emaar Properties, has begun construction of The Emaar Drive Project, a new road infrastructure development that will connect Uptown Cairo, its master-planned community, to the 6th of October bridge and the Ring Road. The EGP 250 million project will directly link Uptown Cairo to key destinations in central and greater Cairo. Phase one of The Emaar Drive Project will enhance ease of access of travellers coming from West Cairo areas such as Mohandessin and Zamalek through 6th of October Bridge, to the last exit landing on the extension of Ramsis Street. The new road will connect directly to Uptown Cairo’s main gate on the Nasr city side. Phase two of the road project will link Uptown Cairo to the Ring Road and New Cairo through Shaheed Highway, and will be completed by 2011. This also complements the government’s plans to move government entities to New Cairo to overcome the congestion and space constraints in downtown Cairo. The first phase of The Emaar Drive Project is scheduled for completion later this year. This is to ensure the road is ready for Uptown Cairo customers, who will receive their homes in the first phase of the development in the coming months. Hazem Ashery, general manager, Emaar Misr, said that one of Uptown Cairo’s main attractions is its ideal location. “Uptown Cairo is the only new development being built in Central Cairo. No other project can offer the same location advantage as that of Uptown Cairo, and The Emaar Drive Project brings the community even closer to the centre of Cairo,” he says. The Emaar Drive Project will consist of two roads of three lanes, together sprawling a length of more than 3 km.
FACE TO FACE
“Projects like this are built to last for hundreds of years. And I think the world is now telling a positive story about Dubai” first KidZania, the award-winning edutainment concept promoting the physical and intellectual growth of children through professional role-plays. Along with Dubai Aquarium & Underwater Zoo, Dubai Ice Rink, SEGA Republic and the 22-screen Reel Cinemas, Emaar Retail strengthened its leisure portfolio in The Dubai Mall in the first quarter of 2010. Within the healthcare portfolio, the healthcare subsidiary Emaar Healthcare Group opened a new clinic in The Meadows, complementing the Dubai Mall Medical Centre, the region’s largest out-patient medical facility, which opened in 2009. Among international milestones for the company in the first quarter of the year are the on-schedule progress on projects in Saudi Arabia, Egypt, Jordan, India, Turkey, Syria and Pakistan. In India, the company’s joint venture Emaar-MGF is on course with its planned initial public offering of AED 2,790 million ($761 million). Alabbar says: “India is one of our key markets in our global expansion strategy, and we are today one of the largest foreign direct investors in the country’s real estate sector. We have a large land reserve in India of approximately 11,340 acres across 26 cities — 96% of which is fully paid for, and we have total development plans for about 437 million ft2, of which nearly 335 million ft2 is proposed to be residential projects.” Talking to Alabbar, you often have to stop and ask yourself whether we really have just been through the worst financial crisis in living memory. His passion and enthusiasm
Alabbar says that In India, the company’s joint venture Emaar-MGF is on course with its planned IPO of $761 million.
appear greater than ever – as does his optimism for the future. “When you talk about the financial crisis you have to look at the global situation. What you see here today at the Armani Hotel is much better than what was originally designed. When you walk around the whole site you can see with your own eyes the quality we have developed. Projects like this are built to last for hundreds of years. But financial cycles, they come and go. And I think the world is now telling a positive story about Dubai,” he says. So how does Alabbar himself see the future panning out, particularly in Dubai which has been badly hit by the real estate market crash?
“You need to keep in mind that Dubai is an icon within 500 million people that can never change. This is the city of the future for 500 million people. “With respect to all other cities, this is the one. It will grow, growth is coming back. I think, with respect to everyone else, there will be one player. Other players are a little injured. It will be an interesting time for us. The market changed, we are tight and we have learned from our mistakes but this city will move on. Other friends of mine are hurting and I wish them well, but we will be the player,” he says. Alabbar has in recent years become a major figure on the global stage, and is widely seen as one of the few “stars” who have con-
$761M VALUE OF EMAAR-MGF’S PLANNED IPO IN INDIA • 160 NUMBER OF LUXURY ROOMS AT 32 CONSTRUCTION WEEK JUNE 5–11, 2010
FACE TO FACE
ALABBAR: The man behind the rise of Dubai
tinued to shine in Dubai, despite the financial crisis. He is largely credited with not just building up Emaar into a world class property developer, but crucially, expanding the company into many different areas, long before the property crash. He talks freely and comfortably about the various different sectors and achievements. But at heart, he will always be a developer. As he explains: “My friend said to me recently that ‘Mohammed, when you graduated from university the first thing you did is you got your job, you borrowed some money to renovate your mother’s house. And I saw you detailing and thought you were a developer from that day’.” Few could argue with that.
Market watch Emaar share price performance 5 4 3 2
07/’09
11/’09
02/’10
05/’10
Emaar shares are currently trading at around 9% down since the turn of the year, hovering at the AED 3.50 mark. This down from the 12 month peak of AED 5.01 achieved last October, but far better than the low of AED 2.27 seen last July. Of 15 analysts surveyed by Bloomberg, nine say buy, three say hold and just two have a sell note on the firm. The target price is AED5.25 with HC Brokerage the most optimistic, putting a AED 6.6 price on the shares.
As chairman of Emaar Properties, Alabbar has played a key role in the development of Dubai's real estate sector. Alabbar has also contributed to the growth in Dubai’s non-oil sector as vice chairman of Dubai Aluminium Company Ltd (DUBAL) from 1992 to 2003. From 1992 to 2002 he served as vice chairman of the Dubai World Trade Centre (DWTC), developing Dubai into a regional hub for exhibitions and conferences. Alabbar is also the chairman of Emcredit, the first independent credit information company in the UAE. Alabbar earned his undergraduate degree in Finance and Business Administration from The Albers School of Business and Economics at Seattle University in 1981. He also received an honorary doctoral degree in humanities from his alma mater in 2007. He has spoken in a number of international forums, representing the UAE several times at the World Economic Forum in Davos, Switzerland. He also posts regularly on the Hammers mad and West Ham football fans forum. A keen sportsman, Alabbar was the chairman of the UAE Golf Association (now the Emirates Golf Federation), which promotes and supports the annual PGA-level Dubai Desert Classic Golf tournament. He was recently named among the top ten golfing personalities in the world by Golf World magazine. Alabbar chairs Emaar-MGF, the joint venture of Emaar and MGF Developments Limited of India, rolling out the country’s largest foreign direct investment in real estate. He is also the chairman of RSH Limited, the leading pan-Asian marketer, distributor and retailer of international brand names. He is also committed to the cause of educational reform in the region.
THE ARMANI HOTEL DUBAI • $786M EMAAR’S Q1 2010 REVENUE NOVEMBER 25–31, 2010 CONSTRUCTION WEEK 33
ON SITE
On the road again A crushing plant in Abu Dhabi h has placed l d iitself lf at the quarry-face of sustainable construction, recycling concrete into aggregate for use in road building By Stuart Matthews
C
onstruction and demolition in the emirate of Abu Dhabi has changed and there’s more to come. You may not know it yet, but soon you will have to recycle all construction and demolition waste. A new recycling plant in Al Dhafra, on the very outskirts of Abu Dhabi’s future urban sprawl, has been developed by Thiess Services Middle East – a joint venture between Al Habtoor Leighton Group and Australia's Thiess Services – for this very purpose. Last year, the company won an exclusive concession to build and operate the recycling plant for 15 years. For now, disposal of recyclable concrete spoil is free for contractors, though the door remains open for charges to be introduced at a later stage. The plant has two distinct purposes. Firstly, is stops a lot of useful construction material simply heading straight to landfill. Secondly, it takes this material and turns it
34 CONSTRUCTION WEEK JUNE 5–11, 2010
into aggregate, ready to be reused in suitable construction projects. “So it's free to get rid of waste, from there we value add it and produce a high-grade material,” said Mark Chandler, C&D recycling manager. Right now the process is just for concrete, which is being turned into aggregate for road building. Gradually, aggregates for other construction uses will be developed. The site already has a stockpile of asphalt, which will soon be added to the plant's recycling programme. Having been officially opened about a month ago, production is gradually building to full capacity. However, the business case for the plant and its products is a strong one. The Center of Waste Management Abu Dhabi – the government client behind the project – has developed regulations that will mean all construction and demolition waste will have to be recycled. Further regulation
will require projects in Abu Dhabi, which have a use for the products the site produces, to use a minimum of 40% of the recycled material in their construction. “With the regulations they want to put in place, waste has to come here,” said Chandler. “We can deem it unsuitable, but it has to come through our fingers, or it is illegal dumping. “The regulations will mean that everything that is suitable for recycling can no longer go to landfill.” This marks a change in the emirate, where much waste has been used either as landfill, or for land reclamation. Now the recycling will realise the full value of the materials, which until now have frequently been thrown away. THE PRODUCT “The beauty of recycled concrete is that you can actually recycle it endlessly, it doesn't
ON SITE
The plant processes construction and demolition waste, recycling it into aggregate.
wear out,” said Chandler. handler. “Concrete can und in circles; it's a woncontinuously go around derful resource for recycling. Some plastic can be recycled once or twice; glass can only be done if it's sorted correctly. So when you look at concrete, colour doesn't matter, as long as you get the specifications right, you can recycle it as many times as you like.” The cost for each tonne of the end product will be the same as the market rate from any quarry. But, compared to the usual sources of raw materials, such as Oman or Ras Al Khaimah, traveling distances to projects in the emirate will be greatly reduced. This will help to lower the carbon footprint of projects under construction in the emirate and reduce associated haulage costs. Thiess has high-hopes for the product it will make from the construction waste. “We believe we can produce a product that is not only as good, but actually better, than the virgin material,” said Chandler.
The company claims a better degree of compaction, in part generated by the even size of the aggregate produced through recycling. For now the output will be suitable for the different base layers used in road building, literally everything beneath the asphalt. “We can build a road from scratch, all the way up to asphalt, out of concrete,” said Chandler. “There's no reason why any road can't be built out of recycled concrete.” With road projects on the scale of the Mafraq-Ghweifat highway, a 327km strip of tarmac that provides access to Abu Dhabi’s Western Region and the industrial centre of Ruwais, there should be plenty of opportunity to put the material to the test. Volume shouldn't be a problem either. With a capacity to handle more than a hundred truck loads of waste a day, the site can take in 5 000 to 16 000 tonnes per day. The facility has an output design load of more than 7 000 tonnes per day. »»
15 years Duration of Thiess Services sole concession to recycle construction and demolition waste from Abu Dhabi
16 000 40%
The peak tonnage of waste the site is expected to receive in a single day
The minimum amount of recycled material suitable construction projects will have to include
7 000
The tonnage of recycled material the plant can produce each day JUNE 5–11, 2010 CONSTRUCTION WEEK 35
ON SITE CONCRETE RECYCLING The concrete starts its journey through the plant by being fed into jaw crushers. Bigger chunks are broken down and drop on to conveyors. Once the first crush is done, the material passes under strong electro magnets to extract pieces of steel, before passing through picking stations. With plastic and other oddments removed, there's another crushing stage and then another magnetic steel extraction. The finished product is then conveyed to the end of the process, where it is dumped in evenly spread mounds.
36 CONSTRUCTION WEEK JUNE 5–11, 2010
ON SITE
JUNE 5–11, 2010 CONSTRUCTION WEEK 37
ON SITE
“The regulations will mean that everything that is suitable for recycling can no longer go to landfill.” THE PROCESS Meeting this capacity means having some big kit on site. Dump trucks leave piles off concrete at the top of a hill. A couple of Caterpillar 988 wheel loaders are used at the face to drop this material into the feeders. These wheel loaders are the second biggestt in range from Cat, but the third biggest, the 980, is also working on site. n The concrete is fed into two Lippmann Milwaukee primary jaw crushers, to start its journey through the processing plant, which features several screens, a number of powerful magnets – which are known to break people's watches if they get to close – to pull out unwanted steel, and picking stations, all of which are linked by a series of conveyors. The screens and picking stations allow contaminants, such as plastic and cardboard, to be manually removed from the mix. The conveyors are up to six feet wide, and designed to put an even layer of material all over the surface, so the pickers can see it clearly. Picking is considered one of the
INSIGHT
Leadership opportunity Dr Olisanwendu Ogwuda, a senior teaching fellow at Heriot-Watt University, Dubai Campus, looks at how infrastructure in the Gulf region can be a valuable ‘virtual quarry’ resource, as some structures near the end of their life span 38 CONSTRUCTION WEEK JUNE 5-11, 5–11, 2010 2010
Mark Chandler (left) is the C&D recycling manager at the Thiess Services site in Al Dhafra.
plum jobs on site, as it actually takes place inside air-conditioned cabins. “There's a massive screening capacity,” said Chandler. “In my view, its the best equipment you can put in this type of plant for our volumes.” The type of crushing employed is low speed compression crushing. While impact crushing is a common alternative and will be used for recycling asphalt, big hunks of concrete can cause devastating wear and tear on such machinery. “Something like a lift weight can go through the machine without busting any-
Developed countries need to maintain their road networks for continued economic growth, while developing countries are building their road networks to reach standards similar to developed countries. The developed economies pay more attention to the creation of a sustainable network. Developing countries will also need to give consideration to future maintenance needs. The nature of the market in any country, in terms of the provision and maintenance of the road network, is based mainly on price.
thing,” said Chandler. “In an impact crusher it's like a grenade going off.” A control system allows operators to monitor the process from one spot. Parts of the crusher can be stopped and started, feed rates can be adjusted, and if there are any material quality issues, software allows the team to identify where the resulting product is in the stockpile. Once extracted by the magnets, any steel is sorted, cleaned and sent elsewhere for recycling. The only rubbish to go back to landfill is anything taken out that is unsuitable for recycling.
Parts of the world have inadequate supplies of virgin aggregate and at the same time valuable construction rubble is being sent to land-fills or used as low-grade/low-value materials such as granular fills or subbase material in roads. In other instances they are used as partial replacement materials within new products. A current barrier to a more effective and efficient use of construction rubble is concern over consistency of quality and predictability of performance. The concerns arise from current
approaches in processing of construction rubble. Processing is usually undertaken at waste transfer sites and the economics of the market are such that low-grade materials only are produced with minimum processing and little need for predictability of performance. Although specifications for use of recycled materials exist, the barrier of consistency and predictability of performance is significant. However, specifiers need the confidence in high performance recycled materials. Herein lies
ON SITE
Although it's early days in the operation as yet, Chandler estimates that less than 1% of the material from every tonne of concrete recycled will go to landfill. “There's a massive saving in landfill space,” he said. “General rubbish will compact 5:1, but you can't do that with concrete.” SAFETY FIRST What's very noticeable is the clean and orderly lay out of the site. A one way system keeps everyone moving in the same direction and reduces risk of vehicle accidents. The site team are in steady radio communi-
the specifics of the barrier, which requires science and technology to underpin system development and performance prediction that is confirmed by actual performance in service. It should be noted that recycling is not an absolute solution to dwindling natural resources, but it can extend the life of non-renewable resources. The demand for materials for uses also needs to be put in context. Even if all potential materials were recycled, the quantities are such that they would only meet a small proportion of the
cation with the machine operators as they move around. Conveyors and other fixed plant were raised an additional two metres above the height normally classified as ‘plant clearance’. This offers workers in loose clothing and headgear added safety from entanglement in moving parts, since they are well beyond reach. This is just one of the areas where Thiess has made an investment in safety. And it’s an investment that has paid dividends in the set up of the plant prior to production, which went so smoothly that there wasn't a single lost-time injury.
demand. Non-renewable natural resources will have to meet the bulk of the demand for the foreseeable future. However, the decision-making process should be based on an overall appraisal of potential suitable materials, including recyclable materials. The Gulf is well placed to embark on this journey of providing a more sustainable road infrastructure, where consistency and predictability of materials from virtual quarries can be evaluated. This journey should begin
“There has been a massive investment in safety in the plant. It doesn't matter how safe you make it, there is always a risk somewhere, so the investment in safety was enormous,” said Chandler. “It was key that we focused on making the plant as safe as possible in the design stage.” The safety investment will be a valuable asset when plant volumes ramp up to capacity. When the materials produced become a common addition to road works and other sites around the emirate, the construction industry will have taken a very tangible step toward being sustainable.
now to avoid the pitfalls of experiences in other parts of the world. We can evaluate the performance potential of these virtual quarries, which exist all around the Gulf, and how these may meet the future demand for road construction materials, at the same time ticking the ‘green’ box of sustainability. This is an opportunity to lead with a form of construction that will cascade to what can be described as ‘fourth world countries’ – developed countries of the future. JUNE JUNE 5–11, 5-11, 2010 CONSTRUCTION WEEK 39
COMPLIANCE
The cost of compliance Successful project management comes down to meeting contract targets without compromising on the quality of steel rebar and other essential construction materials By Carlin Gerbich 40 CONSTRUCTION WEEK JUNE 5–11, 2010
M
ajor construction projects are some of the largest and most complex investments organisations face. From initial plans to hand-over dates, contract negotiations and material supply, to final developer sign-off, the process is a protracted and complicated one, made all the more difficult with additional pressures placed on project managers to ensure buildings remain on spend, time and compliance targets. Monitoring compliance is itself a complex task: ensuring the project remains true to the contract and that all changes made filter through to the right people is one matter, while the procurement of materials – and ensuring that they meet required standards is another major issue that project managers and developers face.
COMPLIANCE
Emirates Steel says UK Cares approval gives them a competitive edge over non-certified companies.
It’s a task made trickier in this region by the fact that there are no unilateral building codes or standards in practice across the GCC. There are plans to implement a set of statutes in the UAE, but quite when that will happen is a matter for debate. What isn’t up for debate is that the potential for companies to cut corners and save costs by using products that may not be quite up to the job is there, and that the problem is a concern for the future of construction throughout the region. One of the more troubling areas is in the production of steel rebar for concrete reinforcing. Concrete’s compression properties are outstanding, but it lacks corresponding tensile properties to give it the strength to be used for load-bearing spans, without the use of steel reinforcing bars, or rebars.
The problem is, cheap and unproven rebar is notoriously easy to manufacture: you just need a mould and a supply of molten steel to produce something that resembles the real thing. It doesn’t take a structural engineer or metallurgist to work out that not all steel rebar is created equal, and that using rebar from an unqualified source is an exceptionally risky business. “They say that in concrete, you bury your mistakes,” says Ben Bowsher, executive director of UK Cares, the British based certification body primarily concerned with compliance of reinforcing and pre-stressing steels for construction. “And the temptation is certainly there, during lean times, to use products that save you money. I’m not saying that I’ve seen examples of it here in the UAE, but
the temptation is always there, and it’s worrying,” Bowsher said. “I’ve even heard the term ‘blending’ used ¬ and that’s just as worrying. Mixing material from a known source with rebar of an unknown quality is just as troubling because you never know where it’s going to be used.” Certification is simply a risk-reducing tool. It eliminates the need for procurement managers and purchasing officers to check in to the backgrounds of their suppliers or have products individually testing for quality or performance. UK Cares certification includes technical assessment at every step of the production and supply process to ensure rebar not only meets the required standards, but that its technical specifications also meet those stipulated by British Standards. JUNE 5–11, 2010 CONSTRUCTION WEEK 41
COMPLIANCE
It’s not a simple process. It can take UK Cares anywhere from a couple of months to approve a cutting and bending company’s procedures, and up to a year (and even longer if changes have to be made) to approve a steel mill. Audits are carried out twice a year, and certificates are issued on an annual basis to ensure companies maintain standards. The process also costs. UK Cares is a nonprofit organisation but it’s not a charity, so the cost of sending its representatives out to approve and audit companies has to be met by the companies themselves. The market price for steel rebar market price is about $650 (AED 2,400) per ton – and Bowsher estimates the cost of approval and annual audits, across the board, to be around 40p (AED 2) per ton of rebar produced. “Even if it was 50p or £1 per ton, it’s not a lot of money for peace of mind,” Bowsher said. “We know that customers of the 70 companies with UK Cares approval worldwide are able to sleep at night knowing that products they ordered and paid for are exactly what they specified,” he added. There are now 10 companies in the UAE and one each in Saudi Arabia, Qatar, Bahrain and Oman that carry UK Cares certification, and each produces rebar with its own mark so that customers can quickly identify products from genuine approved suppliers. The latest to join the ranks is Abu Dhabi based company Emirates Steel. It’s the latest feather in the cap for the company that is one of the first Category 3 companies to be accredited under Abu Dhabi’s new Emirates Health and Safety Management System (EMSMS). Last year,
“UK CARES certification is a risk reducing tool that allows procurement managers to sleep at night” 42 CONSTRUCTION WEEK JUNE 5–11, 2010
COMPLIANCE
30%
The amount experts believe LEED certification could add to build costs over traditional methods
$650 4m tons Current market value, per ton, of steel reinforcing bars
Estimated amount of steel rebar being used on projects throughout the UAE every year the Abu Dhabi Executive Council issued an executive decree on the implementation of EHSMS Regulatory Framework in different industries within the emirate to protect workers, the environment and to ensure the conservation of natural resources. As soon as the decree was issued, Emirates Steel implemented its own Integrated Management System (IMS) to ensure its procedures were in approved to ISO 14001 (Environmental) and 18001 (Occupational health and safety management) levels. It also began the UK Cares assessment process. “Emirates Steel’s initiative in developing and implementing its IMS not only stems from its desire to excel in the steel industry, but also to protect the health and safety of our employees and the community, as well as our environment,” Abdel Moneim Tawfik, Emirates Steel’s Quality Assurance Manager said. “Cares approval is a formal recognition of Emirates Steel’s commitment to deliver quality products and ensure customer satisfaction. Cares certification is accepted globally and gives a competitive edge over other non-accredited steel producers.” While monitoring costs money, so too do changes to production methods – and it’s a concern looming on the horizon as the steel industry looks to become more environmentally focused.
“The LEED (Leadership in Energy and Environmental Design) system is good in many ways,” Bowsher said, “The steel industry is going to have to change if we’re to improve our sustainability and low-carbon targets. It’s not going to be easy: producing steel is not a clean process – but there are lots of things we can do to improve it.” “We have to work more closely with the LEED framework to introduce techniques to reduce factory carbon footprints. It’s what governments are demanding, and we have to change with it,” he said. While very few disagree that adopting ecological principles are admirable, the LEED ranking system itself has come under fire from several quarters for adding to the total build cost, without necessarily improving green credentials. Incremental charges for design, documenting compliance, administrative fees and compliance verification all add up, with some claiming as much as 30% could be tacked on to the total build cost for following LEED ideals. Architect Frank Gehry, the man behind the Guggenheim Museum in Bilbao and its Abu Dhabi equivalent, has been vocal in his views about the system: “A lot of LEED is given for bogus stuff”, adding that the costs were “enormous” and “don’t pay you back in your lifetime.” The LEED program is largely voluntary, but more and more clients are pushing for projects that follow its principles. However, LEED's detractors argue that the additional costs could be ploughed back in to developments to make them more environmentally friendly, rather than being spent on administrative processes. The same could be said for spending AED2 on every ton of rebar to ensure that it meets international standards. While it seems a trifling amount, it soon adds up with the quantities of steel rebar being used in construction throughout the GCC. “With more and more pre-cast concrete being used, I’d hate to think of the consequences of using substandard rebar and that slab failing while being craned in to position,” Bowsher concluded. JUNE 5–11, 2010 CONSTRUCTION WEEK 43
SUSTAINABILITY
Honeywell worked with FM consultants to implement energy efficient technology at Meydan.
44 CONSTRUCTION WEEK JUNE 5–11, 2010
SUSTAINABILITY
Facilitating sustainability Sustainable construction: what’s holding the UAE back? CW looks at why involving facilities management companies at the start of a project is the best way to ensure sustainable systems are implemented effectively By Elizabeth Broomhall
E
verybody is talking about sustainability. Sustainable power, sustainable water, sustainable infrastructure. The problem with sustainability in GCC construction is that there is no set way of implementing solutions, and under renewed pressure to go green, developers, property owners and contractors are frantically ‘retrofitting’ their buildings and structures rather than taking a chance on sustainable systems at the beginning. Aside from being a somewhat costly procedure, retrofitting has the added disadvantage of causing a great deal of inconvenience to the end users of a building. A possible solution to the problem being put forward by sustainability specialists currently, is to involve facilities management consultants at the start of a project – a practice relatively unheard of in the region until now. Managing the maintenance and operation of a building, FM companies argue that they are in a good position to advise designers and project managers on technology, equipment and systems which will reduce energy consumption and operational costs while increasing the sustainability of their buildings. Simple though it seems, the idea of involving FM companies at the start of a project inevitably brings with it a degree of controver-
sy, with concerns over costs and confusion over services, at the centre. But like most other developing industry-trends in the region, it seems it is just a lack of awareness as to the benefits and possibilities of FM consultancy during construction that is keeping the region behind Europe. A BACKWARDS SYSTEM Famous for launching some of the largest, tallest, first and best projects in world, it may come as a surprise that the Middle East construction market could neglect to involve FM firms at the beginning of its projects with a view to improving energy efficiency. Unfortunately, both sustainability and FM processes have taken a backseat in recent years, creating widespread fears among energy experts of potential blackouts, high building operational costs and additional pollution. As an example, Honeywell’s Business Development Director for the Middle East, Kyle Bashy, explains how 70% of properties in Dubai have not had motion sensors installed, even though this one piece of technology could save 80% on a building’s energy consumption. “You walk into any building in Dubai and most of them don’t have motion sensors to control the lights and air conditioning. This is essential in a place where JUNE 5–11, 2010 CONSTRUCTION WEEK 45
SUSTAINABILITY
22% of all energy consumed is lighting and another 60% is air conditioning.” Part of the problem with designing such systems into a project comes from inaccurate assumptions about the price and benefits of the sustainable systems themselves, as is the case with solar-powered heating systems. But the main issue, and a more worrying one, relates to inaccurate assumptions about the value of FM services during the construction process, and inevitably, as regards their ability to advise project managers on how to build in a sustainable manner. “In terms of facilities management, we are a long way behind the likes of Europe and the USA,” says Roger Swainson, the Senior Facility Manager at FM consultants Focus International Life Cycle Management. “There is an ongoing struggle to convince developers and project managers of the advantages of facilities management, which we believe is due to a poor perception of FM in relation to money. Unlike a contractor who usually has something to show for his work, the values of FM are not so obvious, even though it is equally necessary.” Separately, Swainson explains how there tends to be a short supply of new technologies, which can deter developers and contractors from implementing sustainable systems at the outset. “LED lighting for example, which is more energy efficient than normal lighting, is new to the Middle East, which means that if one were to visit lighting outlets here, one would have difficulty finding attractive LED fittings, if any at all.” Of course, there is also the issue of regulation. Damac’s Vice President Niall McLoughlin believes FM involvement is essential in sustainability, but that currently, there may not be enough regulations in place to encourage collaborative working. “As a progressive developer, we believe that FM firms play an important role if they are involved from the design stage of a project. A sure way of increasing collaboration will be to upgrade various building codes and regulations to force parties to work together.” 46 CONSTRUCTION WEEK JUNE 5–11, 2010
FM firms recommend LED lighting at the start of a project to save energy costs in the long run.
Indeed, in some European countries, these kinds of regulations are key to ensuring sustainable building. “In Greece every building is designed with solar systems in mind, as it is mandatory to utilise solar technology for all projects," explains John Owen of SOLE UAE Solar Systems. "A villa has to have piping on the roof ready for solar system installation. The truth is that solar systems are easy to install if the project is designed to take solar. THE PRICE OF NON-COOPERATION Evidently, the problems associated with project managers and FM companies not working together to implement sustainable systems are extensive, though the primary
“There is an ongoing struggle to convince developers of the advantages of facilities management.”
concern among industry experts is the cost. From the expense of general building maintenance after construction and the obvious costs of high levels of energy consumption, to that of damage to the developer and contractors' reputations and the charges to the property owner for the retrofitting itself, not working with FM firms comes at a price to clients, developers and construction firms alike. “If you don’t work with FM firms to address sustainability at the design level,” Bashy explains, “it becomes extremely expensive for developers, and sometimes impossible for contractors, to implement green technology further down the line. At Meydan for example, we implemented an IP converged solution which reduces energy consumption by running several operations through one network. We started work one year before the project commenced and insisted on involving FM firms, as this solution required very complex cabling works which would’ve been impossible to install after construction.” According to Swainson, developers and project managers who neglect facilities management also risk acquiring a negative
SUSTAINABILITY
business reputation. “Poor or non-existent facilities management [at the start of a project] will inevitably lead to disgruntlement among tenants, which can harm business reputations. It all depends on how much value is placed on assets and reputation, as to whether facilities management is considered important or not. Badly designed and maintained buildings can be a death sentence waiting to happen.” HOW FM COMPANIES CAN HELP As a key facilities management consultancy in the Middle East, Focus International has been emphasising the advantages of FM involvement during construction for some time. The company claims it is in a prime position to assist in implementing sustainable and energy-efficient systems, by improving the effective commissioning of equipment and introducing alternative products that can minimise demands on electrical and water systems. “Many consultants in this part of the world fail to design their systems in such a manner that they can be effectively commissioned, which in turn, will have a negative effect on energy consumption and monthly energy bills,” says Swainson. “For instance, open cooling towers have a tendency to waste vast quantities of water. Consideration should be given as to how they can be eliminated in favour of air cooled chillers or closed circuit cooling towers.” Likewise, McLoughlin believes that FM firms can offer advice to project managers which his company as developers might otherwise not consider. “The feedback and suggestions received through FM is critical for sustainability,” he explains. “FMs have actual hands on experience with equipment, allowing them to recommend products to project managers that are cost effective, easy to maintain, energy efficient and have the right credentials for estimated usage.” An example is LED lighting. As a natural choice from a post-construction, ‘maintenance’ perspective, it is unlikely to be recom-
The new range of Otis elevators can massively reduce energy consumption, according to the company.
70%
of properties in Dubai do not have motion sensors, despite the fact that this could save 80% on energy use
50% 60%
of energy consumption could be saved with energy efficient lifts
of energy consumed in Dubai is through air conditioning systems
mended by any other than a facilities management firm, but with somewhat specific space and cabling requirements, it is critical that the system is accommodated during the design and construction stages. As well as having a lifespan 50 times that of a normal light fitting, an LED lamp consumes 10-15% less electrical energy, and produces little or no heat. Similarly, energy efficient lifts, often only recommended by an FM firm, can reduce energy consumption in the long run by 50% compared with conventional lift systems, but will need to accommodated during construction. Aside from recommending alternative, energy-efficient equipment, FM firms can also advise project managers on energy-saving technology, which again, according to Bashy, they may not already be aware of. “A lot people in the Middle East are not aware of advances in technology which are available to them, or else they assume it’s expensive.” Perhaps less obvious, FM firms have been recognised for their ability to recommend technology and products that enhance the efficiency of systems that are themselves not known for being energy efficient. From insulating paint, to finishes that reduce cleaning (and so use less chemicals and cleaning equipment) to technology that enhances the life cycle of equipment, and envelope and façade-related products that can minimise HVAC and lighting. Slashing a building’s carbon footprint, these products are frequently recommended by facilities managers, and are just waiting to be implemented by Dubai's most forward-thinking project managers. The question is: who is responsible for ensuring this happens? “Everyone needs to take responsibility,” says Scott Petersen, Marketing Director for Energy Solutions at Honeywell. “Contractors need to take more responsibility for the operation of a building and involve sustainability specialists and FM firms so they can build buildings in the most sustainable way. Architects and designers need to ensure they design structures which can be operated efficiently in the long run.” JUNE 5–11, 2010 CONSTRUCTION WEEK 47
FACTORY BUILD
High voltage CW talks to Ducab HV Cable Systems CEO Jon Vail about the JV’s plan to make the UAE selfreliant in terms of its HV cable requirements By Gerhard Hope
A
t present, dewa is contracting out most of the UAE’s high voltage (HV) cable requirements to international players like ABB of Switzerland, Areva of France, Siemens of Germany and Riyadh Cables of Saudi Arabia. Ducab HV Cable Systems – a joint venture between DEWA, ADWEA and Ducab – aims to slash supply-chain costs and lead times by meeting all the UAE’s requirements locally. Its products will range from 66 kV to 400 kV, covering the highest voltage used in the GCC at present, and hence becoming the
48 CONSTRUCTION WEEK JUNE 5–11, 2010
region’s first dedicated high-voltage facility. “We will focus on 66 kV and 132 kV cables in our initial start-up, and then move gradually onto 400 kV, where the test cycle is about one-and-a-half years,” says Vail. Cable demand in the UAE is reportedly about 180,000 copper tons a year, and 770,000 copper tons a year across the wider GCC. “Ducab currently supplies 50% of the UAE’s low- and medium-voltage requirements. Once fully operational, Ducab HV Cable Systems plans to sell more than AED 1 billion worth of cable and associated services
annually, of which about 60% will be consumed in the UAE. The remainder will be exported to the GCC and nearby Asian and North African areas,” says Vail. The total cost of the new facility is AED 500 million, including working capital. It is being built on a 22 000 m2 area adjacent to Ducab’s existing facility in Jebel Ali. The groundbreaking ceremony was in November 2009, with Khansaheb as the main civils contractor and MACAir as the MEP contractor. The piling contractor was Dutco Balfour Beatty, while the new facility was designed by Holfords, a division of Hyder Consulting. PARALLEL “From a construction point of view, the factory will be completed early next year, by the end of January. Khansaheb has agreed to a time-saving schedule for us to install the machinery in parallel. This will allow us to start installing machines probably by Q2 and Q3 this year. Some of the machines have arrived already, so we just need to get the foundation details sorted out on-site,” says Vail. “All the equipment has been sourced from major European companies. It is very similar to the equipment we have already, only bigger.
FACTORY BUILD
The lead time is ten to 14 months. The build time for the factory when we started was only 12 months, so we had to order the equipment in advance. The equipment defined the size of the building. It is not as if we have a building of a predetermined size and will then try and fit everything in; the building was designed to accommodate the specific equipment we need,” says Vail. It is these specific requirements that have resulted in some specific architectural features of the new facility. “It is unusual for a factory because it has a very tall tower over 150 m high, or the equivalent of a 40-storey building. This is necessary for the vertical extrusion process, which we think is the best way to make high-quality cable. There are alternatives involving horizontal extrusion, but we do not think the quality is as high. This means we have invested more capital in the facility itself, but the end result will be a better-quality product,” says Vail. He points out that the conductors of these 400 kV cables are 2 500 mm2, which is a thousand times bigger than a standard household wire. The reels these cables are wound onto are 5 m in diameter. “The major issue with such big cables is the electrical stress, which is just voltage divided by distance. The more stress means that the slightest weakness or defect can cause the cable to break down – and no one can afford to take a risk with these cables. 40-YEAR LIFESPAN “If a building wire does not work, a light goes out. If a low-voltage cable fails, a street may be without power. However, if one of these highvoltage cables goes wrong, you take half of the city out, so you cannot afford to take any risk.” This is why these cables, which are designed to be in use for 40 years, require a one-year test as a representative sample of the intended lifespan. “Once we have installed the machines, there is still commissioning to do, and of course there is quite extensive testing to make sure the quality is right. Without the quality being good, we will not let it out of the factory. We are building a laboratory facility specifically for high-voltage testing, including a Faraday Cage, which is like a big metal box to stop any interference from radios and mobile phones, for example, so we can pick up
any potential defects in the form of very tiny electrical impulses,” says Vail. Commenting on the challenges associated with the project, Vail says: “In some sense it is easier starting with a clean slate. When you have an existing factory, the boundaries are already defined. With a clean slate, the boundaries are removed, so you have to look at your existing facilities and ask that if you had to do it again, what could you do better? What can be done to improve it even further?”
Ducab's Jon Vail (top, right), with Derek King from Aecom, on site at the build of Ducab HV's new facility in Jebel Ali. The structure of the factory is starting to take shape (bottom), with completion expected in January 2011.
“It is not as if we have a building of a predetermined size and will then try and fit everything in; the building was designed to accommodate the specific equipment we need.”
SUSTAINABILITY Some improvements to be introduced at Ducab HV Cable Systems include skylights to allow more natural light in, and the use of ambient heating for some of the processes. The cooling water needed will be circulated in a closed system to increase efficiency, while wastewater will be collected and reused for irrigation purposes. In addition, condensate water from the factory roof will also be collected and reused. Commenting on the new facility’s business plan, Vail says that although it is designed specifically for high-voltage cables, it can make smaller sizes as well. “We will need to keep the factory busy with the 66 kV to 132 kV range, which are the bigger volumes and do not require the one-year test. The high-voltage side will be project-driven by DEWA and ADWEA, which will grow their off take gradually.” As for when the first cable will emerge from the new facility, Vail says: “I expect to be able to fully make and test cable from the new facility by Q1 next year.” The first step in this process is to get the insulation line running, which is critical in terms of the overall quality of the cable. “We have the advantage of being able to get conductor from the existing Ducab facility next door, run it through the new insulation line, make a cable and test it until that process is right.” In terms of logistics, Vail says the new facility will simply tap into Ducab’s existing supply-chain operation. In terms of the overall management team for the new facility, Vail says he is the first appointee. “We will start to recruit later in the year. At the moment we have a Ducab team of about 30 working on the project. Overall we will create about 100 employment opportunities when the new facility is fully up and running.” JUNE 5–11, 2010 CONSTRUCTION WEEK 49
PROJECT UPDATE ON SITE CW reviews a collection of its most recent site and plant visits to keep you up to date with project progress
WANT TO UPDATE YOUR PROJECT'S PROGRESS, OR HAVE IT INCLUDED HERE? Email: stuart.matthews@itp.com
SAUDI BINLADIN GROUP FOR INDUSTRIAL PRECAST Location Jeddah Visited May 2010
AL WAHDA STREET Location Sharjah Visited May 2010
SANDOVAL GARDENS Location Dubai Visited April 2010
50 CONSTRUCTION WEEK JUNE 5–11, 2010
The Saudi Binladin Group for Industrial Precast operates out of Jeddah, a city with a whole street full of offices for the company and on the outskirts there are enormous factories and holding yards. The plant is supplying a number of projects across the country, including the Princess Noura Bint AbdulRahman University for Women in Riyadh and the King Abdullah University for Science and Technology.
Central Sharjah is moving closer to a transformed road system to meet today’s traffic volume, following the latest milestone in Package 5 of the redevelopment of King Abdul Aziz Road. The latest completion of note, officially announced on 30th April, is the opening of the viaduct on the west side of Al Wahda Street. The viaduct crosses King Abdul Aziz Road at a 90 degree angle, itself a major project.
Bavaria Gulf’s flagship Sandoval Gardens project has been an interesting mix of German and Arab expertise, and its townhouses are near to completion. The 36 townhouses are the first part of an AED260 million twin-development of the overall Sandoval Gardens. All townhouses conform to TUeV, a standard of quality that is a common benchmark, which means all construction and finishing is assessed by a third-party.
PROJECTS
MIRDIF CITY CENTRE Location Dubai Visited April 2010
DUBAI INVESTMENTS PARK Location Dubai Visited March 2010
MEYDAN Location Dubai Visited March 2010
OCEAN HEIGHTS Location Dubai Visited March 2010
UAE-based Alec was awarded the main contract to build the US $816 million Mirdif City Centre in September 2007, with construction getting under way almost immediately. Developed by Majid Al Futtaim Properties, more than 16000 jobs were created at the peak of the design and build stage. The team behind the mall are hoping for a Leed Gold rating, to reflect the work they did to make the building sustainable.
In 1997, way before the construction boom really took off, Dubai Investments’ management took it upon themselves to lay foundations across 24 million m2 of desert and start building a mixed-use city from scratch. In March, the developer announced the launch of the final phase of development, which is set to become a hub for logistics services spread across 500,000m2. Construction was due to start in May.
Dubai was thrown back into the limelight when the US $10 million Dubai World Cup kicked off at the new Meydan Racecourse in Nad El Sheba. The enormous 18.6 million m² project consists of four separate areas including the development’s central feature, the Racecourse with Meydan Hotel. Meydan City Corporation has announced plans to build an equestrian city in China’s Tianjin province.
Construction of Ocean heights tower began in August 2007. The US $175.6 million (AED645 million) main contract was awarded to Arabtec. As it rises, the tower’s floor plates reduce in size, allowing the rotation to become even more pronounced. At the peak of construction, there were 30 contractors and 2000 people on site. On December 23, 2009 – 23 days ahead of schedule – the building was topped off at 310m.
JUNE 5–11, 2010 CONSTRUCTION WEEK 51
PROJECTS
U-BORA TOWERS Location Dubai Visited March 2010
INFINITY TOWER Location Dubai Visited February 2010
CENTRAL MARKET Location Abu Dhabi Visited January 2010
SOUTH OF SHAMKA Location Abu Dhabi Visited January 2010
52 CONSTRUCTION WEEK JUNE 5–11, 2010
Business Bay's U-Bora towers is being built by Korean firm Bando, the project features a podium with a curved residence building, which has a roofline that sweeps from 12 levels at one end, up to 16 at the other. The build was started back in 2007, initially with Simplex acting as subcontractor. The subcontractor left site in September 2008, leaving Bando both as developer and lead contractor.
Infinity Tower, located in the Dubai Marina, is set apart from its neighbours by its rotating structure and is spiraling into the sky at a fast pace. Each slab plate rotates 1.08 degrees around a fixed cylinder core. Once the tower is complete, the 73 floors will add up to a cumulative 90 degree angle. There are no pillars in the building; instead it is supported via a complex concrete column structure.
Central Market was named Abu Dhabi’s safest construction site just prior to Construction Week’s visit. The project combines three super-tall towers with an Arabian Souk and covers 5.2 million m2. With more than 6000 men on site at any time, the contractor, Arabian Construction Company is proud of its safety record and the measures it takes to keep all of its workforce safe on the massive site.
South of Shamka will comprise of 10,000 new villas, taking up no less than 17 million m2. In January it was at the ground works stage, operations have been split between Tristar Contracting and Bin Nawi Contracting. The site was using a GPS package from Topcon. This comprised a system fitted to two bulldozers, with a base station and a ‘rover’ – another device which clamps to the side of a car for readings on the move.
PROJECTS
BURJ KHALIFA Location Dubai Visited January 2010
SAHARA LIVINGS Location Dubai Visited December 2010
THE AVENUES Location Kuwait Visited December 2010
KING ABDULAZIZ CENTRE FOR KNOWLEDGE AND CULTURE Location Dhahran Visited N/A
Possibly the most famous building in the world and certainly the tallest, the Burj Khalifa got its official opening in the early days of 2010. Big name contractors such as Arabtec and Besix were involved in the record-breaking build, which also played on the skills of Hyder Consulting and Depa. Developer Emaar made claim to eight world records, all based around the tower’s height and accompanying features.
Sahara Livings is a residential development consisting of 84 villas spread across an area of 18,116m² in Dubai Industrial City. Reem Dubai Contracting was given 548 days to complete the project after being awarded the main construction contract in February 2009 and, in December 15% of the development had been completed, with a total of 78 villas currently under construction.
The construction of Phase III of The Avenues, Kuwait’s largest shopping mall, is steadily progressing in the Al Rai district of Kuwait City. The mall has been designed by the London and Los Angeles offices of global architectural practice Gensler. Kuwait’s Mabanee is developing the project. Phase III of The Avenues will consist of more than 86,000m2 of retail space and is scheduled for completion in early 2012.
Situated near Dhahran on the eastern coast of Saudi Arabia, the King Abdulaziz Centre for Knowledge and Culture is being developed by Saudi Aramco, at an estimated cost of US $400 million (SR 1.4 billion). Covering a total of 70,000m2 the main construction tender for the project was retendered to include more contractors in the bidding process, including Dubai’s Gulf Technical Construction Company (GTCC).
JUNE 5–11, 2010 CONSTRUCTION WEEK 53
APPOINTMENTS Senior Development Appointments Realty & Hospitality, INDiA Share in a colourful future The appointments will be responsible for the direction and delivery of a diverse and expansive portfolio of projects in REALTY & HOSPITALITY ranging from Malls, 5* Luxury Resorts, Business & City Hotels with High End Branded Operators, Residential high rise, complexes & luxury living to high speci cation Commercial Mixed Use, encompassing master planned developments catering for the demands of a progressive nation. We have appointed a number of key people for the client but due to their increasing portfolio we are now looking to secure further appointments, recruiting professionals to cover all aspects of construction activity in the Realty & Hospitality portfolios from concept to completion, design and construct. The focus of the expanding team is the delivery of assets and strict control over the overall Build Programme, Project Costs and Budgets, Resource Management, Design, HSE, Quality, MEP and an integral involvement in the pre development & construction of future portfolio projects, their sustainability, viability and social interaction. We are looking to make key appointments in; • Director Of ProjectsREALTY - tax free package to $240,000 + fully inclusive package • Senior VP x2 REALTY - tax free package to $216,000 + fully inclusive package • Chief Architect REALTY - tax free package to $204,000 + fully inclusive package • Senior VP HOSPITALITY - tax free package to $216,000 + fully inclusive package • Chief Architect HOSPITALITY - tax free package to $204,000 + fully inclusive package • VP for MEPHOSPITALITY & MEGA HIGH RISE - $204,000 + fully inclusive package The Right Candidates will be delivery focused Construction professionals from Main Contractors, Consultants, PMC or Developers, delivering multiple projects simultaneously with individual project values in excess of $100m. You will be a Construction Graduate or equivalent, experience of 15years + in High Quality Hospitality, Residential High Rise, Commercial High Rise or Master planned large scale Mixed Use Developments. You will be a team player, a leader and have highly developed communication skills to negotiate, mediate and manage stakeholders, consultants, contractors and government bodies alike. Please note: all Direct or Agency applications made to client will be redirected to the Retained Consultants.
Taking India and you to the next level One of India’s leading and most prestigious Real Estate Developers is embarking on a building transformation in India and in doing so will set a new president and standard in Realty Developments in the country. Backed by tradition, a desire for modernity and progress the group is planning and developing projects that will take the Indian realty industry into a new era of growth and prosperity. Development portfolio in excess of $2b inclusive of; Residential High Rise Luxury Hospitality Commercial Mixed Use Sustainable Communities Applicants should apply to the Retained Search Consultant and Recruitment Partner: CONSULTANTS LLC Grosvenor Business Tower, TECOM, Dubai, UAE. PO BOX: 283127 Applications to; Dan Bowler, Director at; dbowler@ gtsholdings.net OR, Olly Piltz, Director at; opiltz@ gtsholdings.net. Or call in con dence; Dan Bowler on 00971 50 377 2869
GTS Consultants UK/ Europe/ Middle East/ ASIA
54 CONSTRUCTION WEEK JUNE 5–11, 2010
Olly Piltz on 00971 50 377 2630
SPECIALIST SERVICES
For directory information visit constructionweekonline.com/directory
TO ADVERTISE PLEASE CALL +971 4 210 8351 OR EMAIL JASON.BOWMAN @ ITP.COM
BUILDING MATERIALS
CONSTRUCTION/MANUFACTURERS
CONSTRUCTION/MANUFACTURERS
Full range of plaster, tiles and gypsum tools
OTAL (LLC) Dubai, U.A.E Phone: (+971-4) 267 9646 e-mail: otal@eim.ae website: www.otal.ae PP CORRUGATED SHEETS
RECRUITMENT
,OOKING TO RECRUIT WORKERS FROM
)NDIA .EPAL
"ANGLADESH 3RI ,ANKA
0HILIPPINES 4HAILAND
6IETNAM 0AKISTAN
OR LOCAL LABOUR SUPPLY 7E ALSO UNDERTAKE -IGRATION 3ERVICE TO !USTRALIA #ANADA 4EL &AX % MAIL ASSIDUAA EIM AE STEEL
STEEL
STEEL
JUNE 5–11, 2010 CONSTRUCTION WEEK 55
FOREMAN
FOREMAN
Email: foreman@itp.com
The price ain’t right
S
ince I finished working on the Burj Khalifa late last year, I have to admit I am still obsessed with the place. And so should everyone be, as this is clearly the one project that is still hugely influencing Dubai’s property market, several months after it opened. I hear that secondary sales on the tower are up 30% in recent weeks. Does this mean everyone is still trying to buy into the project I helped build? Not quite. Word is that since January the asking price for studios in Burj Khalifa has dropped 20%, while twobedroom apartments have seen prices fall by around 5%. Problem seems to be that since me and my pals handed over the project, it has been pay up time for many investors – who are now struggling to meet their final payments, and so sticking their properties up for sale. Still, at least not everyone is short of cash. The website propertyfinder.ae currently has 25 properties for sale in Burj Khalifa, 56 CONSTRUCTION WEEK JUNE 5–11, 2010
including a full floor with a starting price of AED90m ($24.5m). Located above the 90th floor and 15,384 ft2 feet in size, the residential floor has a mix of one, two and three bedroom units and is currently owned by an Iranian buyer who is looking to flip the property for a profit. I wish him well…
Taking its toll Don’t you just love Salik, Dubai’s Road Toll system. On my rather modest salary, I reckon I go through around AED 500 a month at the very minimum. But maybe I should be grateful. Word going round our site is that we could soon be getting a couple of new contracts, for, you guessed it – more Salik gates. Favourite locations are both the Emirates Road and Al Khail Road in the emirate. Rumours are that there could be as many as 18 new Salik gates built in Dubai over the next five years. I’ll keep you updated if I hear more.
Beach boys So the World Cup finally kicks off in just six days.
On the spot: penalties could be on the cards if rumours of more Salik gates turn out to be true. Meanwhile, what's the chance of an evening work ban for the duration of the world cup?
Never mind the midday working ban, I really think we need an evening working ban so we can all watch the games. I actually think the construction market in the region is getting a pretty big boost from the greatest soccer show on earth. Don’t believe me? Check out what some of the hotels are literally building in terms of outdoor venues for fans to watch the event. My favourite is Le Meridien Hotel in Dubai, where the world famous Barasti Bar has decided to construct a special “fans stadium.” A couple of my colleagues
helped work on this project. All will be revealed at a grand opening ceremony on Thursday June 10th, on the eve of the tournament. But I am told it is an incredible 1500 seater affair that took three weeks to put together. The Park Hyatt in Dubai has gone one better, building not just a mini-stadium but, I hear, an out-door air conditioning system to go with it. But I'm told that the original plans for the Barasti Beach Stadium were for a 10,000 seater spectacular, practically the size of some of the actual stadiums in South Africa!