For the construction specialist
Rapid Pace Tarek Shuaib on growing Pace’s regional business through design excellence ON TOPIC
How are planners helping to steer projects in the region?
IN PRACTICE
Taking a multi-brand approach to lighting design
ON SITE
VE - how to use it to derive actual value on projects
ISSUE 040
September 2017 Publication licensed by Dubai Production City A product of Big Project Middle East
CONTENTS
On topic InduSTRy VIEWS fROM acROSS ThE MIddLE EaST
09 anaLySIS
09
12
16
20
26
32
38
44
50
52
Core Savills’ David Godchaux examines how Dubai’s residential, office and retail sectors fared in the second quarter of this year 16 OPInIOn
A number of design considerations have to be taken into account when new developments are to have usable underground areas, according to Cundall’s Fazel Bashir 20 InSIghT
We speak to three consultants about the role construction planners play in the development of new projects
In practice anaLySIS, InSIghTS and InTERVIEWS
26 InTERVIEW
Pace CEO Tarek Shuaib highlights his firm’s recent successes, and reveals how he intends to grow his business in key markets through a design-led focus 32 InSIghT
We catch up with Veit Mueller, SVP of Zumtobel Group – MEIA, to find out about the group’s multi-brand segment approach to clients
On site caSE STudIES, OPInIOnS and SnaPShOTS
44 InTERVIEW
Jason Saundalkar talks to Mark Graham, managing director of Macro MENAP, about addressing the region’s FM market 48 OPInIOn
Value engineering can positively influence projects as long as it’s implemented correctly, says the founder of Sharon Jutla Interiors 52 nEWS
Emaar launches new mall in Dubai Hills Estate 2 SEPTEMBER 2017
WELCOME
Group EDITOR’S NOTE
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Editorial
Awards Season I guess it’s true what they say - time flies when you’re having fun. It feels like it was just a couple of weeks ago that I was sitting at my desk and lamenting the onset of summer. Yet now we’re comfortably into September, with just a handful of months to go before the weather becomes pleasant, and 2017 is one for the history books. Summer slowdown? Hardly. Putting together this issue of Middle East Consultant was as interesting as ever, but aside from working on the magazine, I’ve also been devoting a solid chunk of my time to the forthcoming Middle East Consultant Awards. The annual event takes place on November 7 at Ritz Carlton JBR in Dubai, and nominations officially close on the 22nd of September. Since you’ve all done sterling work on seriously impressive projects in the last 12 months, I’m looking forward to receiving each and every one of your nominations. Please visit www. meconsultantawards.com to read our nomination guidelines, and submit your nominations. Coming back to this issue of MEC, there’s a lot packed into it. I caught up with Pace CEO Tarek Shuaib to learn about what his firm has been doing in recent months, and it was a real pleasure to write about a true regional success story. You can read the interview on page 26. Going into this month’s issue, I was also looking forward to working on the sustainability feature since this is something of a personal interest for me, and I was really satisfied. It was great to learn about the region’s progress with regards to sustainable building and practices. After speaking to a few of you, it was clear that although the region was slow to embrace the drive towards sustainability (and there are still some holdouts), governments as well as project owners, consultants and contractors are keen to embrace sustainable practices going forward. You can find the feature on page 38. Enjoy the magazine and don’t forget to nominate!
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Video: See what you missed last year at Cityscape global
The article by Craig Ross on fire safety issues (“Grenfell Tower: Lessons from a tragedy”, August 16) was certainly timely. There were several differing factors behind the tragic fire in London in June as compared to the string of incidents in the UAE – including the Tamweel Tower fire back in 2012, Address Downtown and not to mention the blazes at the Torch. But there are certainly still some vital lessons for all to consider. There are some good fire-safety regulations in place in the UAE. But as Mr Ross rightly points out, site quality control checks are key to ensuring that this translates into best practice on the ground. Name supplied, via email
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ON TOPIC
ANALYSIS
Dubai Market Watch Core Savills’ David Godchaux highlights how Dubai’s residential, office and retail sectors fared in Q2 of this year, and considers how the market will shape up in the coming months
O
verall transactions in Dubai’s residential market increased in Q2 of this year. While sales prices begin to show slight signs of recovery in a few submarkets, rentals have continued to soften across the board, creating one of the last opportunities to enter a recovering market in the coming quarter. “We expect rents to start stabilising in core locations by next year, while predicting potential room for softening in the secondary locations,” says David Godchaux, CEO of Core Savills. Many landlords have kept units vacant for 12 to 18 months, as they were not ready to adjust rents when the overall market started to soften. A lot of them are now reacting by decreasing rents to attract tenants back and finally initiate rental income, sometimes by more than necessary.
Consequently, tenants are increasingly conscious of market conditions. Many have successfully renegotiated contracts, while others have shifted homes or upgraded to a better unit at a similar or lower rent. The rental depreciation witnessed in the last 12 to 18 months has yet to have a significant negative influence on the sales market, but it does slow the pace of recovery of sale prices. Although yields have contracted, they are still northwards of 7.5% for most apartment districts and 5.5-6% for mid-segment villa districts – higher than other forms of investment in the region. Godchaux explains, “This led us to run a simulation on 20 prominent properties across Dubai to gauge at what rental level would the yield cease to be attractive to investors. Our findings reflected that SEPTEMBER 2017 9
ON TOPIC
rents would have to be 25-40% (depending on the location) lower than the present level to start having a notable negative impact on the investor market and prices. Even with the present subdued rental market, this is an unlikely probability over the next 24 months.” Notably, there is a statistical bias in calculating rental drops, as the market is largely transacting at the lower end of the spectrum, bringing the area average down. That said, rental contractions are felt across 18 of the 19 submarkets that Core Savills tracks. Making the jump
A growing segment of tenants is shifting from rental to ownership, as better payment terms from both banks and developers come into play, while rental yields remain relatively high across Dubai even after some level of compression. This makes the cost of renting versus owning still more expensive compared to other global cities. As predicted in Core Savills’ Q1 2017 report, the growing offplan supply continues to negatively affect ready property sales. This detrimental effect on the secondary market has been particularly felt in a few apartment districts. According to the report, “Existing owners try Change in Villa Rents, Q2 2016 vs Q2 2017 0% -1% -2% -3% -4% -5% -6% -7% Jumeirah Dubailand Emirates Village Hills
10 SEPTEMBER 2017
The Lakes
The Springs
Arabian Ranches
Palm Jumeirah
and attract the same pool of investors and end users as they attempt to sell their ready properties. They contend with highly competitive and attractive payment plans offered by master developers, for instance in Downtown Dubai. With a wider variety of products to offer, developers can retain their edge over individual landlords, hence for now affecting a portion of the secondary market.” Sales prices in the core mid-market locations, along with a few projects in Dubai’s outer areas, are witnessing higher movement in transaction, due to a growing shift from rental to ownership. As a result, this has caused a slight upturn in sales prices – however, it is to be noted that the revival is very gradual. Office market
Diversity remains key with regard to office demand. Apart from the oil and BFSI (Banking, Financial Services and Insurance) segments, occupier demand is spread across most sectors – a strong endorsement of the diversified Dubai economy. Furthermore, the enduring demand for business centres persists, highlighting the supply gap for smaller fitted spaces and aligning the needs of start-ups, SMEs and new corporate entrants. International operators and regional names are increasingly addressing this gap. Trends are beginning to surface: a cross segment between retail and commercial space is emerging, with gymnasiums and fitness centres rising in demand. The growing interest for bona fide mixeduse developments and adoption of the live-work-play philosophy for millennials (the next generation of occupiers) requires integrated services like fitness centres in a pedestrian ecosystem, in close proximity to offices. This has led to a spike in enquiry levels for retail within office buildings, bolstering rents in prime areas. Lease terms favouring tenants are increasing in districts such as Business Bay and JLT, where the bulk of the stock is strata. We have noticed that landlords are attracting tenants with incentives and even contributions, specifically in utility bills and fit-outs (or amortisation of fit-out over the lease term), to ease large initial capital expenditure.
ON TOPIC
Change in Apartment Rents, Q2 2016 vs Q2 2017 2% 1% 0% -1% -2%
Source: Core Savills
-3% -4% -5% Dubailand
DIFC
Dubai Marina
JLT
Jumeirah Village
Downtown Dubai
Rent-free periods are also increasing to six and nine months from the previous standard of three to four months, particularly for longer lease terms. However, this trend is not reflected throughout the entire market. Office supply forecast
Supply delivery up to 2017 was over 1.6m sqft. The remaining pipeline for 2017 looms at 1.4m sqft, including One Central’s Offices 2 and 3 spanning more than 745,000sqft. In 2018, One Central’s remaining Offices 4 and 5, phase one of Innovation Hub and Amesco Tower in JLT are expected to be handed over, topping nearly 1.8m sqft all together. Other large developments under construction include D3 phase two and ICD Brookfield Place, announced to be delivered by 2019. We have also noticed several upcoming mixed-use projects adjusting their asset portfolio, accommodating more residential or retail instead, marginally affecting office supply estimates.
“A growing segment of tenants is shifting from rental to ownership as better payment terms from both banks and developers come into play, while rental yields remain relatively high across Dubai even after some level of compression”
Business Bay
Discovery Gardens
Sports City
Palm Jumeirah
The Greens
The Views
Retail
We expect The Dubai Mall, Mall of Emirates and Ibn Battuta Mall to experience a significant surge in footfall, to do well with their present stock and expansions, and to remain the top choice for brands as the market starts to saturate. As Dubai continues to attract and retain a diverse talent pool, changing consumer preferences and younger demographics have led newer retail formats to come to the market. These projects enhance the public realm through pedestrianised high streets, while adding a human scale to build form – a shift away from heavily built spaces. Developers are also introducing community retail in conjunction with their residential developments, addressing existing captive demand for F&B and supermarkets. We predict community centres, which offer a well thought-out tenant mix and serve a strong captive market, to perform well while retaining retailers, as well as minimising leakage to super-regional malls, particularly for basic needs. Retail outlets which do not have access to public transport, coupled with a poorer tenant mix and lower catchment populations, may witness absorption issues and downward pressure on rents. “Dubai has long shed its ‘emerging retail market’ tag and has positioned itself as a global shopping destination, in turn positively affecting other domains of its diverse economy. With rising levels of new stock coming to market, and first signs of market saturation starting to show, it is to be seen if demand can continue to match up – albeit the strength doesn’t become a threat instead. Despite a relatively closed market, we foresee the retail sector to progressively segment itself with higher and lower performing assets created by a process of natural selection by retailers. A gap is anticipated to form between these two subcategories, reflected through heterogenous rents and vacancy levels – a case similar to Dubai’s two-tiered office market. Retailers are expected to optimise footprint and mark a flight to quality towards perceived high functioning malls, while the slower performing assets may see a cascading effect of rising vacancy levels caused by this shift,” concludes Godchaux. SEPTEMBER 2017 11
ON TOPIC
ANALYSIS
Centred on Saudi Arabia Faithful+Gould’s David Clifton weighs in on the largest economy in the Middle East, and considers how the construction sector will shape up in the coming months
T
he initial OPEC cuts briefly supported the oil market in the $50-55/barrel range. However, the market has dropped back into the mid to high $40s, and conversations have now commenced around further cuts in supply. KSA forecasting was based on an average of $51/barrel for 2017. To achieve Saudi Arabia’s planned reduction of its budget deficit from 17% to 9%, it seems that further production cuts are required to bolster a significant recovery in the oil price. At present, the deficit has the potential to be slightly worse than forecast. In the twelve months to Q1 2017, construction as a percentage of GDP contracted from 7% to 6.2%, as backlogs continued to fall and awards in late 2016 failed to fill the gaps. A good start to the year was followed by a slow second quarter, indicating the market is still in some flux. The committed major schemes from the Crown Prince for late 2017 need to flow through to stem the industry’s falling level of work.
Within the GCC, political turmoil has weighed on the industry in general, and construction has felt the effects as badly as other sectors. Q1 in KSA marked a surge of industry awards to circa $11bn, compared to a quiet Q4 2016. This has fallen back significantly in Q2 to an estimated $5bn, which reflects the region, with no GCC country performing as strongly as in Q1. Other factors weighing on the market have been Ramadan falling just prior to the traditional quiet period of the summer holiday season, liquidity still moving its way into the industry, and the oil price being range bound. With alternative financing working its way through the government sector, we have seen significant moves to market in aviation, power and water. Cause and Effect
GACA has so far awarded five airports (King Khalid Riyadh terminal
“The government sector is now starting to apply project management office (PMO) processes and procedures designed to deliver best practice and transparency within ministries and government-owned organisations” 12 SEPTEMBER 2017
ON TOPIC
Saudi Arabia GDP, 2007-2017 (US$ billions ) 800 700 600 500 400 300 200 100
07
08
09
10
11
12
13
14
15
16
17
Average Rebar Price, July 2016-June 2017 (SAR/tonne) 1750 1650 1550 1450 1350
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Saudi Arabia General Inflation, August 2016 - June 2017 4
3
2
Source: Faithful+Gould
1
0
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
upgrades, Qassim, Hail, Taif and Yanbu) in 2017, at an estimated $4.9bn, making it the stand-out client in KSA in 2017 with nearly 30% of awards by value YTD. Numerous other schemes are still to come to market or be awarded, as GACA commences the process of privatising several of its key assets. The growth in this sector is currently driven by solid commercial fundamentals. Demand is expanding from a growing, young population that increasingly demands connectivity, and the private sector was expected to start the recovery in the construction industry in 2017. However, with the focus on real estate in the sector – even factoring in lower costs of construction – the headwinds faced in real estate have continued, with a near 10% fall in sales prices compared to 2016. This has made the viability of numerous schemes challenging, even when factoring in the upcoming ‘white land tax’. However, this should drive focus towards the affordable end of the market, which is currently very poorly supplied. The effects of aligning the industry pipeline of projects and programmes to countries’ requirements are becoming evident. Yearon-year, there has been a drop of over 5% in schemes either in the pipeline or being built. This can be in part explained by the contract completions and lack of awards, although certain trophy schemes have disappeared already from the pre-contract stages or have been reduced in scale. This trend is expected to continue with PWC’s reprioritisation or cancellation of schemes across ministries on behalf of the Ministry of Planning and Economy. However, the mid-term probability of schemes in the pipeline actually moving forward has increased. The government sector is now starting to apply project management office (PMO) processes and procedures designed to deliver best practice and transparency within ministries and government-owned organisations. Under the stewardship of the NPMO (Mashroat), several government entities are in the process of procuring or rolling out their own PMO, although this process has taken somewhat longer than expected. The effects of this roll-out will only be felt during 2018 and beyond, so the need to prioritise projects by exception is critical, if the industry is to survive at a suitable scale to deliver in the future. Makkah Metro has taken time to move forward, and this scheme could be awarded prior to the end of 2017 (and is therefore included in our awards forecast). Tendering activity in H1 has been relatively subdued in terms of value. Numerous bids have been in the market from private, semigovernment and indeed some government entities, but most schemes haven’t been of a size to support the quantum of workers or supply chain. As an industry, there is estimated to be a circa $60bn gap in the backlogs across the region. This in turn has placed further pressure on the whole contracting supply chain. Although an upturn is expected, and though regionally awards in H1 have outperformed H1 2016 by 15%, it should be noted that 2016 was the worst H1 for more than five years. With $16bn of awards in KSA in 2017 to date, our forecast of $27bn for the full year may need to be revised upwards, if the Crown Prince’s commitment to major awards later this year occurs. SEPTEMBER 2017 13
ON TOPIC
OPINION
01 Daniel Rimmer is managing consultant at HKA.
The Provisional Sum Loophole in the Middle East Daniel Rimmer believes it’s time to amend contractual provisions in FIDIC, to introduce clarity into the use of provisional sums
01
F
rom recent experience using the FIDIC Red Book (1999) standard form of contract, there is a significant lacuna when applying Clause 13.5 – provisional sums. The FIDIC Red Book doesn’t distinguish between defined and undefined provisional sums, but does provide a definition of what provisional sums can contain and how they are to be valued. Once an engineer has issued an instruction to expend a provisional sum, there may be an element of uncertainty concerning the time allowed within the programme to carry out these works. This leads to the question: What if the contractor does not include any time within its programme for a provisional sum? Is it entitled to an extension of time when the 14 SEPTEMBER 2017
engineer instructs the expenditure of that sum? Experience in the Middle East offers no answer, and there remains doubt as to whether expenditure of a provisional sum can bring entitlement to an extension of time. Clause 8.4 of the FIDIC Red Book does not specifically mention provisional sums as grounds for an extension of time. Is the inference therefore that the contractor has accepted the programming risk of such expenditure? Possibly so, in that Clause 4.11, sufficiency of the accepted contract amount, states: “Unless otherwise stated in the contract, the accepted contract amount covers all the contractor’s obligations under the contract (including those under provisional sums, if any).” This quotation is under a clause heading of “sufficiency of the accepted contract amount”. While clause headings are not definitive, the phrase “the contractor’s obligations” may be sufficient inference that provisional sums are intended to be included in the contract period. But what happens when a stated value for a provisional sum proves to be understated? When a change in material may account for the difference, and the scope may be similar, then arguably the time will not be affected; but if the additional cost is a result of additional work, then what is the contractor’s position? The
answer may well be the use of Clause 8.4(a), which lists grounds for extension of time and states: “a variation... or other substantial change in the quantity of an item of work included in the contract”. If a delay can be proved to result from the additional expenditure, then arguably the contract should provide a remedy, and it is likely that Clause 8.4(a) may be applicable. Provisional sums are expended by engineer’s instruction, and it is presumed that if the approved programme for the works includes the expenditure of provisional sums, then it is implicit that the engineer must instruct the expenditure of such sums in accordance with the specified dates in the programme. If he fails to do so, then clause 1.9, delayed drawings or instructions, may apply. This provides the remedy for the contractor of both additional time and cost if the engineer issues late instructions, which can be proved by the contractor, to delay the completion date. The practice of inserting provisional sums into contracts is common, but doing so introduces risks for both parties, and it is time to amend the contractual provisions in FIDIC to introduce clarity into the use of provisional sums. The alternative is to make amendments in the conditions, to ensure that the matter is addressed to remove any potential dispute.
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ON TOPIC
OPINION
01 Fazel Bashir is an associate director at Cundall.
Deep Basements Design Considerations Multiple design considerations have to be taken into account when new developments are to have usable underground areas, says Cundall’s Fazel Bashir
01
D
eep basements are becoming quite common in central business districts, downtown areas and prime high-rise developments, where land area is limited and costly. It is also common in cities which have a shortage of parking spaces because of poor city planning and therefore impose strict parking requirements on new developments. Design and construction considerations are an important aspect for engineers to be aware of early on, to advise clients such as developers, architects, project managers and contractors. These considerations are widely applicable to projects in the Middle East, and 16 SEPTEMBER 2017
most are even applicable to projects globally. With the many masterplan projects launching or restarting, site investigations and geological studies are very important considerations for developers, consultants and contractors. Several factors lead to fluctuation in the ground water table, such as dewatering in the surrounding areas, development of the masterplan and seasonal temperature variations. Hence, consideration of the appropriate maximum water table height becomes a key parameter for the design of the basement. Lack of consideration for this parameter means developers and owners could face water cracking, leakage and durability issues with the basements, a serious risk which can be underestimated. Design Considerations
There are several factors to consider: Ground Water Pressure: The water table is usually encountered 1.5-3m from the ground surface in developed urban areas close to the sea. As the depth of the basement increases, the uplift water pressure also increases linearly. The increase in water pressure has global uplift and local high-pressure effects. Providing additional structural mass, tension piles, retaining walls and ground anchors are some of the solutions. Globally, another option is providing a drainage system which becomes
active when it triggers water. This option is costly and not common in the Middle East. Concrete Durability: The ground water in the region is highly saline and quite often contains considerable concentrations of chlorides and sulphates. This means the concrete can be attacked by sulphates, and reinforcement corrosion can take place because of the presence of the chlorides. Some solutions are concrete mix, concrete cover, limiting crack widths, a waterproofing membrane and cathodic protection. Permanent Retaining Wall Design: The permanent retaining wall needs to be designed for lateral soil pressure, hydrostatic water pressure, surcharge pressure and lateral seismic earth pressures. Furthermore, the crack width in the retaining wall needs to be limited, as per code requirements and local standards. Basement Slab Diaphragm Action: The basement slab acts as a restraint for the perimeter retaining wall and a medium to transfer the lateral earth pressure to the lateral stability elements such as the core walls. Some of the considerations for engineers are the presence of large openings at or near the retaining wall or the lateral stability elements, and slab offsets between the retaining wall and the lateral stability elements. Foundation Design: The foundation solution selected for deep basements is most
ON TOPIC
often one of the following: raft foundation, piled foundation or pile-assisted raft foundation. This is most effective for the design of tall buildings and requires complex and detailed analysis in close coordination, as well as input from geotechnical engineers. The drivers for selection of the appropriate foundation solutions include building height, basement depth, ground water table, allowable bearing pressure, boundary conditions, and time and cost of the foundation solution. Temporary Works Considerations
Temporary or enabling works are the scope of works assigned to a specialist contractor. The scope of works allocated to the specialist
contractor include site set-up/hoarding, site survey, verification of the geotechnical investigation, dewatering, temporary shoring wall, excavation and temporary bracing. Site dewatering is one of the initial considerations for the enabling works contractor, following site set-up and site survey, before subsurface excavation for shoring and foundations. It involves the use of submersible dewatering pumps, centrifugal pumps or application of vacuum to well points. Dewatering of deep basements is a running cost and in practical conditions usually lasts until the middle or end of completion of structural works. To reduce the running cost of dewatering during construction, some
engineers consider other foundation solutions such as a piled foundation, and turn off the dewatering system following completion of the basement construction. During the construction practice, the shoring walls are temporary and relied upon during the construction process only. There will be a second concrete wall (referred to as a retaining wall), which is treated as permanent and designed for lateral ground pressures. In North American and European construction practice, it is normal to consider the shoring wall a permanent wall as well, and save on additional material, time and cost. An allowance should be made for the thickness of the shoring wall, construction
“Design and construction considerations are an important aspect for engineers to be aware of early on, to advise clients such as developers, architects, project managers and contractors� SEPTEMBER 2017 17
ON TOPIC
“An allowance should be made for the thickness of the shoring wall, construction tolerance and the internal permanent retaining wall at the early concept stage� tolerance and the internal permanent retaining wall at the early concept stage of the project. This is important, since the thickness and construction tolerance for the retaining wall are not permitted to encroach outside the project site footprint, and it will affect the design if it is neglected. The overall thickness of the shoring wall depends on the depth of the basement, the magnitude of earth pressures, site constraints and the degree of internal or external bracing to the shoring wall. Site excavation is usually a time-consuming process of the enabling works package, depending on area, depth and accessibility to the basement. Excavation works need to be coordinated with the construction methodology of the basement. This includes but is not limited to diaphragm wall construction, raft/pile construction, waterproofing installation and storage of materials. Depending on ground conditions and diaphragm wall design, either a single line or multiple lines of ground anchors will be required. Ground anchors will need to extend beyond the building footprint, hence the consequences of temporary works extending outside the site boundary will need to be considered. To adopt a ground anchoring system, the
ground anchors have to be clear of services and utilities on the access road and waterway side. In addition, approvals from local authorities and no objection certificates have to be procured. Similarly, if there are adjacent empty plots owned by private developers, approvals from the plot owners have to be sought to temporarily ground anchor. Internal Bracing
In case it is not possible to use ground anchors on either or all sides of the plot, internal bracing can be considered an alternative. The layout and location of internal bracing depends on the geometry of the basement footprint, construction logistics and site constraints. Using steel members instead of concrete as material for the internal bracing is suggested, due to the high demobilisation costs. Pile design is usually a specialist design item by the piling contractor. The designers have the obligation during the design process to make assumptions on pile layout, diameter and length, in order to inform the design of the foundations. Structural engineers can liaise with geotechnical engineers and piling contractors during the design stage, to size the piles. Considerations for pile design include
ground conditions (soil friction/end bearing capacity), pile capacity (tension/compression), crack width criteria, and pile shear capacity (particularly at the pile head, where it can be subjected to high shear forces due to the raft thermal/shrinkage movements). Instrumentation of the enabling works and monitoring of the ground water table and movement of the shoring wall should be considered, to make sure they are within the allowable limits. It is important to note that basement design solutions will not always be traditional, and can be affected by the specific project site conditions and its interface with the boundary conditions. Procurement Route
Clients usually have two procurement methods when it comes to initiating the construction process, and each has its own unique pros and cons (as laid out below): 1: Appoint a temporary/enabling works contractor and hand over the works to the main contractor following the completion of piling works. 2: Appoint a main contractor, and appoint the temporary/enabling works contractor as a sub-contract.
Attributes
Option 1
Option 2
PROS
Relatively short period to appoint the contractor
Main contractor takes full responsibility for all the works
Tender action can be initiated following reasonable level of completion of foundation design and drawings
Less risk and liability for client
Requires detailed coordination between the enabling/ temporary works contractor and the main works contractor
Relatively long period to appoint the contractor
CONS
Requires detailed scope and liability coordination between the enabling/temporary works contractor and the main works contractor. Client might be exposed to some level of risk
18 SEPTEMBER 2017
Tender action takes place after preparation of DD or CD level documentation
ON TOPIC
20 SEPTEMBER 2017
ON TOPIC
INSIghT
Precise Planners
Are planners being engaged early in project lifecycles? What innovations are they bringing to the table, and how are they dealing with challenges? Middle East Consultant investigates uildings are a highly complicated arrangement of structural elements, mechanical systems, materials and finishes. Hundreds of elements must come together perfectly for a project to be successful, but perhaps the most important part of any project is construction planning. In essence, construction plans take an architect’s ideas and designs, and transform them into something that can actually be built by contractors. Detailed, well thought-out construction plans are essential for any construction project to mirror the original design intent. To some extent, plans can also be used to track the progress of a project; however, a more accurate picture can be drawn up with the help of an up-to-date construction programme/schedule, as well as other modern innovations. Plans are also essential to securing permissions and permits from local authorities, and – broadly speaking – planners consider a number of angles as part of their process. Dan Palmer, director of Master Planning & Sustainable Development at Arcadis Middle East, explains, “Planners often take a more holistic view of a project and look not just at individual assets, but at how a project fits within the context of a wider community. This can best be observed when it comes to designing sustainable communities. Here, it’s not just about designing sustainable/ efficient buildings but about considering other aspects such as public transportation access, integration with the public realm and open space that can facilitate healthier lifestyles. Once a building is placed into that sort of environment, you’re already one step ahead in terms of designing a sustainable community and creating something which is a success for all parties involved.” In the last couple of years, a number of new innovations and advanced technologies have enabled consultants to scale up their planning services to clients. In fact, with the help of virtual reality
(for example), it’s now possible for clients to almost fully experience a project before the first brick has even been laid. “3D modelling, building information modelling (BIM), 4D innovations, virtual reality and other smart solutions offer clients the ability to visualise projects in their conceptual stage, and with BIM, the ability to monitor project progress and cost as they are built. Our smart initiatives also allow projects to be efficiently monitored and managed,” comments Syed Khizer Ahmed, VP and Infrastructure director at Parsons. Planners are also increasing their engagement with other project stakeholders, in an effort to ensure that work proceeds smoothly. Timothy Harwin, director at HKA’s Dubai office, comments, “There are many manuals and protocols regarding planning and scheduling of construction projects; however, in my experience the best planning consultants are those who are able to engage with the technical aspects of a project, and who understand the complexities of coordinating and scheduling various stakeholders.” Early Engagement
Although clients and the industry have evolved in some respects, there are still opportunities for improvement, particularly with regard to when consultants are brought onboard to work on projects. Simply put, for construction planning to have the biggest impact, consultants should be engaged as early as possible in the lifecycle of a project. This has not traditionally been the case in the region, but the market is beginning to embrace early engagement. Arcadis’ Palmer states, “Early involvement of all parties is becoming more common, particularly on design and build contracts, although it’s not quite the norm yet in the region. The Middle East has consistently proven its ability to modernise and embrace new ways of working, so as the industry begins to demonstrate the benefits of ‘a one team from the start’ approach, this way of working is likely to become more common. This approach also allows an integrated development process where all parties are bought into the same common goal, SEPTEMBER 2017 21
ON TOPIC
01 Dan Palmer is director of Master Planning & Sustainable Development at Arcadis Middle East.
ensuring the success of the design and implementation process.” HKA’s Harwin agrees with Palmer’s comments, saying, “I agree that this is a growing trend in the Middle East region. Past experience has taught project owners/clients that it is best to spend time and effort 01 01 in planning the project right from the beginning, since this can assist them in forming various financing, contracting and procurement strategies to mitigate risks.” Peeyush Shukla, programme director at Parsons, is keen to highlight that involving contractors early on in a project’s lifecycle also has its own benefits. “It works very well under designbuild or public-private partnership types of procurement. If adopted, contractor early involvement results in cost optimisation and efficient 02 construction processes. We have experienced impressive outcomes due to the early involvement of the contractor in our projects in other parts of the world; however, design-build and public-private partnerships are not commonly used procurement systems in this region. In the Middle East, a commonly adopted procurement system is design-procure-construct, and under such procurement, contractor early involvement is not possible.” One of the drivers encouraging project owners to engage consultants earlier is the liquidity crunch, which 03 has put significant pressure on project budgets. As a result, there’s a greater emphasis on getting the most value out of budgets. “Previously, clients were open to get going, start constructing and resolve technical, planning and commercial problems as they arose. This was done with the aim of completing the project as soon as possible and reaping the commercial benefits. As a result, many construction contracts were not tailored to the specific requirements of the project, and construction programmes were not sufficiently thought 22 SEPTEMBER 2017
02 Syed Khizer Ahmed is vice president and Infrastructure director at Parsons. 03 Timothy harwin is a director at hKA.
out and coordinated. Extensions of time were not awarded, contractors became unmotivated and projects were further delayed as a result. In the current market, which is often driven by stricter project financing constraints, we see that clients are now motivated to engage with detailed planning at an earlier stage. This allows the commercial risks to be identified earlier and contracting or procurement strategies put in place,” elaborates HKA’s Harwin. Parsons’ Ahmed summarises: “Early engagement is the right approach and a win-win for all involved. By being involved in the design phase, there is an opportunity for us to contribute in design development, which not only meets client expectations but also ensures agency compliance, constructability and cost-effectiveness.” Proper Planning
While construction planning is a very powerful tool that can steer a development to success, a number of issues can reduce its overall effectiveness. James Barraclough, master planner associate and senior project manager at Parsons, warns that programmes or plans may not be effective if a client’s requirements have not been fully understood to start with. “Ensuring the entire team has a clear understanding of the client’s vision and needs from the outset is key. Maintaining this understanding throughout the life of the project, as different options are developed, tested and revised, is paramount. Both capturing and communicating the progress and direction to all team members throughout the project
ON TOPIC
“Planners often take a more holistic view of a project and look not just at individual assets, but at how a project fits within the context of a wider community” lifecycle is critical to ensuring the team’s combined efforts achieve the same client goals and relevant authority approvals.” HKA’s Harwin points out that it can also be difficult to get all the involved parties to actually follow plans and programmes. “It is sometimes challenging to convince parties to engage with programmes and even schedules as a planning tool (as they are intended), rather than using them to simply track progress and support claims submissions. This mindset can usually be changed by finding a way to persuade the various engineering, procurement, construction and commissioning managers to take ownership of certain sections of the programme – with the assistance of the planner to make their life easier.” Having to satisfy multiple parties can also get in the way of effective planning. Palmer notes: “One of the main challenges is balancing the needs of all parties involved. The design team needs
to ensure they provide an interesting and attractive environment for clients and residents, while also providing an attractive investment opportunity within the target development budget.” Once their services have been engaged, consultants must also walk a fine line to maintain neutrality in dealings with project owners, contractors and any other stakeholders. “The role of a consultant is to provide a client with advice on what the best course of action is to take under the current circumstances, and not to tell a client what they want to hear. Sometimes this professional advice may come with some unpleasant news for the client regarding project delays, forecast completion dates or contractual culpability,” asserts HKA’s Harwin. “However, in my experience the best consultants provide realworld solutions on how clients can mitigate their exposure, recover the time and money that they are due, and provide recommendations on how to improve future practices.”
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Although maintaining neutrality may have been a challenge in the past, Parsons’ Ahmed reckons the regional market has matured in recent times. “Maintaining neutrality is indeed a professional obligation, and Parsons ensures that it maintains a neutral position at all times. We don’t see this as a challenge, as the industry has matured. Clients and stakeholders respect and value the impartial and subject-specific technical solutions we offer.” Mitigating Project Challenges
Considering the sheer number of elements that have to come together properly for a project to be successful and launch as intended, it’s almost a given that challenges will arise. One of the most common challenges is delays, and here construction plans and programmes can help get a project back on track. “When projects are delayed, both contractors and employers need to make decisions on the next course of action, based on the circumstances. Whatever decision is made comes under intense scrutiny later in the project, whether a claim for extension of time is made or the parties decide to enter into some form of agreement or settlement. To make the best decision, clients need to be armed with an accurate and updated construction programme. This allows a proper assessment to be carried out and timely decisions to be made,”
explains HKA’s Harwin. Parsons’ Shukla elaborates. “For Parsons, tracking schedule and project costs begins long before reaching the shop-drawing stage. Immediately upon the commencement of the construction stage, we share a guideline with contractors for the development of a project schedule. We ensure that the project schedule is fully resource loaded and sufficiently detailed to monitor. Activities are discrete to a degree that even a minor deviation is identifiable. Processes like engineering, procurement, construction, testing and commissioning are all well-defined and tracked. In addition, we ensure that project schedules clearly define the timeline for the submission of shop drawings, a period for review and approval, dates for ordering material and dates for the delivery of material. Our schedulers regularly monitor progress and flag areas of concern.” He concludes, “Ensuring that architectural/design intentions are met is also tracked through a meticulous process. While reviewing a material submission or approving a vendor, we ensure that a compliance statement in line with design/architectural intent is prepared. This helps in identifying any deviation and ensures compliance to project requirements. Visiting vendors’ facilities, reviewing samples and preparing mock-ups also helps in this regard.”
“By being involved in the design phase, there is an opportunity for us to contribute in design development, which not only meets client expectations but also ensures constructability and cost-effectiveness” 24 SEPTEMBER 2017
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IN PRACTICE
INTERVIEW
Progressing at Pace Middle East Consultant talks to Tarek Shuaib about Pace’s design-led growth plans and the importance of remaining agile in a challenging market ith over 1,200 projects under its belt, Pace has grown to become one of the region’s premier architecture, design, engineering and planning firms. Founded in Kuwait City in 1968 by Hamid Abdulsalam Shuaib and Partners, the consultancy has spent nearly five decades working on high-profile projects in Kuwait and across the Middle East, and continues to deliver projects to clients across a wide range of sectors. In recent months, Pace has been involved in the retail and healthcare sectors and has lent its extensive expertise to clients on massive infrastructure undertakings. Notable projects include the Avenues Phase IV and V in Al-Rai Kuwait, the Riyadh Metro, the Kuwait University Administration Facilities, the Jahra and Abdel Nasser roads, Jahra Hospital and Bahrain Bay. Next year the firm will celebrate its 50th anniversary, and it is eyeing fresh growth. “We continue to evolve our brand and operations to ensure we build on our local reputation of quality, reliability, vision and integrity, and transfer that onto the regional stage. This includes the expansion of our operations in Saudi Arabia and Bahrain,” explains Tarek Shuaib, managing partner at Pace. Shuaib has been CEO of Pace since 2005, and has seen his company’s business grow in the country and beyond. “Our work in planning, property and infrastructure continues to expand both in Kuwait and internationally, as clients look for organisations that are capable of delivering projects to international standards, and provide lasting benefits to the individuals and communities that they serve.” As part of its growth strategy, the firm has diversified its portfolio across sectors and has focused on developing its project management consultancy and international business. “Having a typology of projects 26 SEPTEMBER 2017
across the region helps us to spread the risk of challenges that are presented with movements within the political climate of the region. We endeavour to work with all our clients to foresee challenges and react to the changes that arise as a result of this.” Shuaib is also aware that constant vigilance and adapting to new realities quickly is critical to running a successful business. “As a business, we must think globally and be mindful of factors from outside of the region which can have far-reaching impacts for our industry at a national and regional level. Recent geo-political changes remind all of the importance of businesses to remain agile in order to react to such changes.”
“A key element of our work is building the profile of Pace, and the region as a whole, to attract talent in the long term. People need to understand the benefits of working both in the construction consultancy industry, and region, in order to make informed decisions about their work goals”
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Current Market Realities
GCC countries, as well as those across the wider Middle East, have been affected by low oil prices and global liquidity over the last several quarters, and the negative impact on project budgets has been widely observed. Shuaib notes that budgets have been reduced for public sector projects, which has had a direct impact on consultants and contractors across the region. This in turn has pushed firms to adjust their strategies to maintain margins in the face of tighter project budgets. Shuaib is optimistic about opportunities in the current market, and reckons that desires to diversify economies will stimulate the construction sector. “Governments and clients are seeking to diversify their economies and projects, attracting wide-spread investment in non-oil related industries. This in turn puts the emphasis on the construction industry, as countries look to suppliers to make good on investments in infrastructure and property. As a result, we’ve seen countries such as Saudi Arabia preparing long-term development plans such as Vision 2030 which encompass all major sectors including building infrastructure.” In its home country of Kuwait, Pace is on strong footing thanks to its well-established reputation and consistent spending by the local government. “Spend has been consistent in some countries 01
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“Personally, I am never satisfied, although I am also proud of our achievements to date. We have big ambitions for our future – we continue to strive for excellence in design above all else, and this is critical to our ethos” such as Kuwait, where the government has recognised the need to renew existing or develop new infrastructure to meet their economic objectives. While there is still a level of current certainty in regard to mega projects, we expect the variety and amount of projects will reduce in the foreseeable future. That said, as governments diversify their sector portfolios, they will seek to improve conditions for those
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wishing to participate in the growth of new industries. The private sector has been more bullish in this regard, and is investing in projects while following the overall trend of careful spending.” Shuaib maintains that his firm’s pipeline of work is healthy as a result of his firm’s experience and capabilities. “Our business continues to grow across all segments. Architecture and infrastructure has seen significant growth in terms of projects, and the teams that are serving these disciplines in our business. We do, however, continue to monitor market conditions closely.” Business Agility
Pace prides itself on being a client-focused firm, and believes its success stems partly from continuous evolution. “At Pace, we know that you can never sit still, and as a client-centred organisation, we are continually striving to improve. As part of this commitment, we are developing a centre of excellence and rolling out BIM throughout our operations. To date over 60% of staff are BIM trained, and all new major projects are BIM projects.” The firm has also implemented new health, safety and environment (HSE) standards. “This is part of the firm’s drive to raise the bar of HSE standards in the region, which vary greatly.” Shuaib has also made internal changes, and notes, “We recently
Bahrain Bay Tower is under design, and will feature housing, offices, retail and public spaces. 02 The project was launched in 2015 and will reach heights of 170 metres.
undertook the restructure and realignment of our corporate functions, including the operations and development departments. This included business process engineering in tandem with investment in the development of our project management consulting capabilities. We know the value and importance of continued training and development for staff, and make significant investments to ensure that staff wellbeing 02 and skills are at the optimum level.” Pace is also committed to sustainability, and insists that it approaches each project with the aim of reducing the impact on the environment. “We are committed to ensuring that all of our projects are designed and constructed against the highest standards of sustainability. Many of our projects have utilised sustainable construction techniques and materials, including solar technology. For example, we have brought the first solar energy station to an education campus in Kuwait.” Shuaib explains that recent regulation has helped push the
“Having a typology of projects across the region helps us to spread the risk of challenges that are presented with movements within the political climate of the region. We endeavour to work with all our clients to foresee challenges and react to the changes that arise” SEPTEMBER 2017 29
IN PRACTICE 03 Components of the Jahra Hospital Expansion include the main hospital building, women’s centre, multispecialty dental clinic and regional health administration building. 04 Pace used sunlight breakers as a shading means to control harsh direct sunlight. 05 Goals of the Jahra Road and Jamal Abdul Nasser Street development include reducing traffic accidents and meeting future traffic demand. 03
sustainability cause in the region. “As an example, the Kuwait government has set plans for 15% of its energy to be from renewable sources by 2030. This in turn has put emphasis on solution providers to raise sustainability efforts.” The company currently employs over 700 professionals including specialised architects, engineers, planners, landscapers, environmental specialists, project managers, and interior and graphic designers. As Pace’s business grows, Shuaib – an International Associate Member of the American Institute of Architects and a member of the Kuwait Society of Engineers – says his firm will look to hire new talent in an effort to keep up with business demand and maintain quality of work. “One of the issues we face as a business is recruiting the right talent both at home and internationally. Nurturing and attracting talent from and into the region offers unparalleled benefits for our 04
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societies as a whole. We’ve noticed an upturn in the talent that is available within the region; however, a key element of our work is building the profile of Pace, and the region as a whole, to attract talent in the long term. People need to understand the benefits of working both in the construction consultancy industry, and region, in order to make informed decisions about their work goals.” Shuaib adds that Pace is committed to maintaining a healthy working environment and encourages staff to grow their skill sets. “We challenge and encourage our staff to reflect and speculate to become well-practised problem solvers. The work environment at Pace is a continuous education process for all team members, where they are constantly challenged to further refine their skills and their knowledge. Our designers are inspired by works across the globe, and contribute to the company’s growth and its level with international and global standards.”
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“We are committed to ensuring that all of our projects are designed and constructed against the highest standards of sustainability. Many of our projects have utilised sustainable construction techniques and materials” Turning 50
Pace is in the process of preparing for its 50th anniversary, and one of its goals is to inspire those in the construction sector. “We are looking into our archives of completed projects and hope to make some of the information public in 2018. It is our hope that professionals and students in the construction field will be able to benefit from it in some way.” Beyond that, Shuaib intends to build upon the good work his firm has delivered to clients. “Our values remain the same of bringing the highest levels of quality, reliability, creativity, adaptability, efficiency, professionalism and integrity to all of our projects. This is what drives us.” “Our projects continue to attract success, with recent award wins for the Jahra and Farwaniya Court Complexes, as well as the Central Bank of Kuwait and Jahra Road projects. We have also recently been shortlisted for an architecture award, and are proud
of the global recognition our work is receiving.” Shuaib, a certified architect, says that design will remain a critical focus. “Personally, I am never satisfied, although I am also proud of our achievements to date. We have big ambitions for our future – we will continue to strive for excellence in design above all else, and this is critical to our ethos to ensure that all the solutions provided for clients are efficient, valuable and innovative.” Summing up, Shuaib is confident his company will continue to deliver quality products that meet and exceed the expectations of clients. “With deep and creative thinking during design, we always aim to generate ideas and strategies that provide far-reaching benefits for users of any given project. We are committed to ensuring that as a business we never stop improving. After all, our work is not just about the success of Pace; we want the quality of our architecture and engineering outputs to assist the region’s physical and human development. That is the main driver for our team’s work.” SEPTEMBER 2017 31
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INTERVIEW
Bright Future Veit Mueller, SVP of Zumtobel Group – MEIA, discusses his firm’s multi-brand segment approach to clients, what the acquisition of acdc means for the group and the lighting market in general ounded in Austria in 1928 by Dr Walter Zumtobel, the Zumtobel Group has since grown into a global lighting solutions powerhouse. The company now has sales offices and partners in approximately 90 countries and employs a global workforce of over 6,500. The group’s production network is also global, with 13 plants on four continents, and in its nearly 90-year history, it has acquired companies including Thorn, Tridonic and, most recently, acdc. In the Middle East, the group’s various companies have provided lighting solutions for several prestigious projects including the Emirates Palace and Yas Marina hotels in Abu Dhabi, as well as Dubai’s Burj Khalifa and Al Maktoum International Airport. In the last 12 months, the Zumtobel Group has concentrated its efforts on two areas, in an effort to better address the regional market with its brands. “Zumtobel Group has been working hard on two key topics. Firstly, introducing the multi-brand segment approach to our clients. We now have additional brands and new divisions in our business, which really allow us to deliver complete solutions to our clients across a broad range of segments,” explains Veit Mueller, SVP of Zumtobel Group – MEIA. “By using products from across our lighting brands, we can offer clients the best quality solution for the entire space at a budget that suits them. The lighting market in the Middle East is transitioning to LED very quickly, which means – in addition to the advanced technology lighting products – promotion of our controls and systems division is becoming important to really get the most out of every lighting installation.” 32 SEPTEMBER 2017
The group has also carved out an advisory role for itself in the region, and based on feedback from partners and customers, it has made educating market players a priority. “Education has also been a key topic for us recently. There are so many competitors in the LED lighting market that people have been asking us to help them understand how they can specify good quality LED products, and what are the key factors to look out for. We have conducted several seminars across the region to improve the level of knowledge in the market, and are hard at work to continue internal and external knowledge increase,” says Mueller. Zumtobel has maintained an office in Dubai for 10 years, and earlier this year it unveiled its new facility. “Globally, the office environment is changing rapidly. It’s no longer just a place where people sit down and carry out basic tasks built around a nine-to-five working day. Offices are much more dynamic now, and technology is changing the face of the environment. Millennials working in today’s office expect much more than just a place of work; it is more about collaboration and working in teams to solve complex problems. The environment needs to provide creative breakout spaces, places to relax and have less formal discussions.” Mueller says his company is setting the standard for office lighting, and believes the revamp helps employees work better, while also serving as a space to demonstrate its various solutions. “Our new space includes areas for meetings, discussions, networking and training. We offer a complete digitally connected experience to all our staff and visitors. Our latest and innovative products such as the Mellowlight Infinity and our Litecom control system allow us to display products at the forefront of technology. In the 750sqm premises, visitors will be able to see the application of luminaires in offices, retail, art, industry and outdoor.”
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“Architectural façade and hospitality lighting are precisely the areas where we see major opportunities. We also see a great deal of potential in the run-up to Expo 2020, and acdc will be a key part of our success” Business Synergy
In 2015, the Zumtobel Group announced that it was acquiring UK global LED lighting specialist acdc. With the acquisition now complete, Mueller is supremely confident about the business opportunities on the horizon. “Architectural façade and hospitality lighting are precisely the areas where we see major growth opportunities. We also see a great deal of potential in the run-up to Expo 2020, and acdc will be a key part of our success. Furthermore, the acdc team has a highly developed innovation culture which enables them to provide fast and dynamic responses to market requirements. It is our aim to retain their culture and their excellent customer relationships.” He continues, “Huge growth potential exists for the acdc brand, particularly with regard to marketing the acdc product portfolio through the Zumtobel Group’s worldwide sales organisation. Together 01
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we will continue to dynamically drive forward the acdc brand and strengthen its position in the global lighting market.” With several companies offering complementary solutions and hundreds of projects to its credit, the Zumtobel Group is well positioned to take advantage of current and future lighting opportunities. Mueller is particularly optimistic about what the coming years will bring, driven mainly by regional mega projects. “Demand for the latest in lighting technology in the region continues to be high, as upcoming mega events such as the Dubai Expo 2020 provide a catalyst for regional growth. The GCC LED market is expected to continue with significant annual growth in the next few years, and at this rate the penetration will be significant by 2020, giving the Zumtobel Group ample opportunities with our ecofriendly and smart lighting systems.” Mueller is particularly positive about the hospitality sector from
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IN PRACTICE 01 Abu Dhabi’s Grand Mosque relies on lamps and control gear from Zumtobel Group’s latest acquisition, UK-based acdc. 02 acdc supplied the Atlantis Palm Hotel – Dubai with a number of interior lighting solutions. 03 Hamburg’s Elbphilharmonie concert hall’s various lighting solutions were developed and delivered by Zumtobel. 04 Tridonic has also lent its lighting expertise to the Emirates Palace Hotel in Abu Dhabi.
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the standpoint of new developments and upgrades. “Hospitality is an area that is growing and will continue to grow in the run-up to 2020. Not only are there opportunities for new build, but we are now seeing many of the hotels go through their first major refurbishments. We also see the mid-tier hotel market as an opportunity for the future, as places
“Low-cost, and often lowquality, competition from Asia remains a challenge. That is why we will continue to educate our customers on the wider benefits of good quality lighting, and dealing with a group that has decades of experience in the field” 36 SEPTEMBER 2017
like Dubai look to attract an even broader audience. I think we will see an increase in refurbishment business in the near future, as more and more people look to make the switch to LED.” Going forward, Mueller 02 also expects the lighting design profession in the region to grow, and exert more influence on market tastes. He believes this will give project owners a nudge to invest in lighting that is both high-quality and sustainable. In fact, the group is already working towards this goal. “It’s definitely something we try to propagate here in the region and globally, because of our heritage. There are some projects where people think about this now; it’s more widespread when consultants are involved on the project from an early stage.” A Question of Budget
Although Mueller is confident about future business prospects, he points out that there are challenges that need to be taken into account. Reduced liquidity and political uncertainty are in some cases pushing clients and project owners to focus on reducing their initial investment, rather than considering the long-term benefits of quality solutions that have higher up-front costs. “Low-cost, and often low-quality, competition from Asia remains a challenge. That is why we will continue to educate our customers on the wider benefits of good quality lighting, and dealing with a group that has decades of experience in the field. One of the key advantages of LED is its extended lifetime, but we are still seeing many inexpensive, poor quality LED products being sold that are failing in very short time periods. To really appreciate the technology advantage, one should always go to a reputable manufacturer – in the long term it is the much
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more economical choice, even if first costs reflect the higher quality of the solution.” One trend that crops up from time to time is costcutting under the pretence of value engineering. This can be a challenge when a project owner’s engagement with the project is limited, according to Mueller. “When the owners are involved or the consultants are 03 very strong from the beginning, cost isn’t the primary concern and long-term considerations remain. But if the owner is less involved and budget is limited, costs become a first consideration.” Mueller is quick to point out, however, that there are plenty of contractors who are more than capable of executing value engineering in the true sense. He also notes that the Zumtobel Group has reacted to cost challenges by optimising its products to fit project and client requirements accordingly. “From the Zumtobel side, we reacted to this to a certain extent and de-specified some of our products. What this means is you don’t get all the bells and whistles in the lower cost products, but it’ll still create the same good quality light. With these products you may not be able to dim them or perform colour changes, etc. So there are fewer options, but this means contractors have both high-end options and cost-effective options to choose between.” Addressing Light Pollution
Concerns about light pollution have been increasing in the last few years, as growing evidence has linked it to negative effects on human health, the disruption of ecosystems and wildlife, and increased energy
consumption. Mueller notes that his company is well aware of the issues and is actively working to drive changes and adhere to legislation. “As far as general dark skies are concerned, there are many areas around the world where dark sky rules are very prevalent, and we work in those areas quite successfully. We are also part of a push of introducing more and more controls into spaces, which means that when lights are not needed they are turned off, so you don’t have the negative results.” Mueller says his firm is also committed to increasing awareness of solutions that are green and don’t have a negative impact on the environment. Here, he notes that while legislation generally comes from associations and consultants, his firm is pushing environmentally friendly technologies. “Guidelines and specifications typically come from associations where you have consultants, manufacturers and a couple of other concerned parties working together. Generally, it always appears to start from the consulting side. From our standpoint, we are definitely interested in increasing awareness about environmentally friendly technologies, and we are already reacting to requests from the market.” 04
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Going Green
Sustainability is a hot topic, but where does the Middle East actually stand on the adoption and legislation of green practices? Middle East Consultant talks to four consultants to find out ustainability in the built environment space has gathered a lot of steam in recent years, and it’s easy to see why. According to a recent UN World Urbanisation report, more than half of the world’s population (54%, to be exact) is now living in urban areas – a first in human history. Looking beyond that already eye-opening number, the report forecasts that this figure will swell to 66% by 2050. This means cities will have to grow significantly to accommodate new residents, jobs and other demands, which in turn means additional pressure will be put on the already stressed environment and natural resources. Growing urbanisation, along with new legislation from governments and independent agencies, is driving developers, consultants and contractors to embrace sustainable design, materials and building techniques. Managing construction waste as well as a project’s impact on the environment through its entire lifecycle has also become a concern for many in the industry. It’s safe to say then that sustainability has moved beyond being just a buzz word or a marketing tool. “From my experience, sustainability within recent years has begun to be a more desired and focused goal for clients and developers. Clients have realised that sustainability is not only a marketing tool but will add SEPTEMBER 2017 39
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01 Michael Boyle is a senior sustainability consultant at AESG. 02 huda Shaka is an associate
benefit to the ongoing operation of a project. Thus, sustainable design is being considered at the initial design stages and holistic approaches are taken to implement this within the project,” explains Michael Boyle, senior sustainability consultant at AESG Middle East. 01 01 Nick Constantine, senior surveyor, Project and Building Consultancy at Cavendish Maxwell, agrees with Boyle but notes that the approach to sustainability varies from one developer to the next. “The trend we are seeing is that larger developers take a more holistic approach, engaging consultants at an early stage and aiming to exceed the minimum green building specification set by the government. Smaller developers, however, are generally constrained by their targeted internal rate of return (IRR), especially with sales 02 02 prices plateauing and construction prices gradually increasing in recent years. This has resulted in smaller developers often only implementing the minimum standards required to obtain their building completion certificate.”
director – Middle East Planning Team at Arup.
Green Education is Key
a strategic level, setting an ambitious sustainability vision backed by robust strategies and plans to achieve specific targets at a city/country level sets the right policy framework, and provides incentives for the public and private sectors. This needs to be coupled with minimum sustainability requirements for projects (buildings, communities, infrastructure), which are enforced and regularly updated to respond to growing awareness. Investment in outreach, training and research is also essential, and this can also be supported by independent nongovernment bodies.” Generally speaking, the industry appears to be moving in the right direction; however, local legislation and infrastructure has to keep pace to enable tangible changes. AESG’s Boyle points out, “With the introduction of legislation, such as the DGBR and Estidama systems, the construction sector is certainly moving in the right direction. However, the feasibility of implementation of legislation should also be considered. Examples include the provision of sufficient infrastructure
Despite the positive strides towards sustainability, all the consultants that Middle East Consultant spoke to note that there are still many industry players in the region that remain unconvinced or limit their efforts to minimal compliance. Converting these stakeholders is important of course, and governments can continue to play a significant role in driving the adoption of sustainable practices. “Governments and independent bodies have been pushing the sustainability agenda across the GCC. There have been several collaborative efforts; government, industry, private and communities are working together to make a big impact, in line with the future vision of the GCC. As with many places around the world, necessity drives demand for sustainable solutions. The necessity for non-reliance on nonrenewable energy sources to fuel our built environment, economy and society can drive this collaboration to raise awareness and change the behaviour within the region, to build a self-driven sustainable future,” comments Hala Yousef, senior ESD consultant at Cundall Middle East. Huda Shaka, associate director – Middle East Planning Team at Arup, adds, “The role of regional governments can be multi-tiered. On
“There is more work to be done both on legislation and enforcement. Sustainability requirements at a building scale are gradually being introduced into regulations and building codes throughout the GCC, such as Estidama and Saa’fat”
40 SEPTEMBER 2017
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IN PRACTICE
03 hala Yousef is a senior ESD consultant at Cundall Middle East. 04 Nick Constantine is a senior
for recycling of construction waste, and the availability of materials that meet the criteria required to comply with both legislation and optional voluntary rating systems, such as LEED, that clients may choose to target for their projects.” “There is more work to be done 03 both on legislation and enforcement. Sustainability requirements at a building scale are gradually being introduced into regulations and building codes throughout the GCC, such as Estidama and Saa’fat. There is, however, less guidance on sustainable development at a community or city scale. In order to have sustainable urban development, regulation must cover all scales of developments and develop an integrated and holistic approach,” Arup’s Shaka notes in agreement with Boyle. Conversely, Cavendish Maxwell’s 04 Constantine reckons cities like Dubai are paving the way for other cities in the region. “Legislation such as the Dubai Green Building Regulations and Specifications – which were introduced by Dubai Municipality in 2011 for government buildings and extended to include private buildings in 2014 – have provided a much-needed foundation to encourage developers, contractors and consultants to incorporate sustainability into their projects. I am confident that such legislation will be expanded upon and updated in the future, in line with the Dubai 2020 Urban Master Plan and Dubai Integrated Energy Strategy 2030.” Unique Regional Challenges
Approaching sustainability in the Middle East presents an interesting challenge to industry players, as projects – broadly speaking – tend to be quite large in scale, and the region is prone to extreme weather, which means cooling is a high priority. Both these factors have the potential to handicap a project’s sustainable potential before it even gets off the ground. However, it is possible to mitigate these challenges, and this starts with consultants getting involved with projects early in their lifecycle. Cundall’s Yousef explains, “We take a very early approach in ensuring sustainability is embedded in our projects across the GCC. Early client engagement to regionalise the issues mean regional solutions are thought of, which may not be conventional, and therefore require 42 SEPTEMBER 2017
surveyor, Project and Building Consultancy at Cavendish Maxwell.
the client’s engagement – and buy-in – to adopt such conceptual changes and integrative design strategies.” “During the concept stage of a project, passive design measures are a key consideration in reducing the heat gain in buildings. Building orientation, massing and shading can be optimised to reduce heat gain, and thus reduce the associated cooling load. Energy modelling is a useful tool in assessing the anticipated energy consumption of a building and testing the impact of energy-saving conservation measures on the overall consumption,” notes AESG’s Boyle. Arup’s Shaka believes that the unique sustainability challenges inherent to the Middle East encourage firms to innovate with their approach to projects. “The large scale of projects offers a unique opportunity to implement holistic and strategic sustainability thinking and gain synergies across systems. The high cooling requirements during summer months is a reality which needs to be factored in and mitigated to the extent possible, through good design – and through challenging norms, in some instances.” A Question of Cost
The higher cost of sustainable solutions and implementation have traditionally been cited as deterrents to the adoption of sustainable solutions. In reality, the higher initial investment ultimately results in lower running costs once a project has been completed. “Very often, with the correct design input and lifecycle analysis, the initial higher capital costs of building a sustainable property are offset by the reduced operating costs. In the GCC, the typical development model is to sell the property, not retain and operate it. This means that the developer does not benefit from the lower operating costs and has to pass on the higher initial cost to the end user via higher sales prices. Although people are generally becoming better informed of the benefits of purchasing a higher-priced property, which has lower long-term operating costs, there is still much work to do to ensure this way of thinking becomes commonplace,” says Cavendish Maxwell’s Constantine. AESG’s Boyle is convinced, however, that the costs associated
IN PRACTICE
with green building and sustainable operations are exaggerated. “The cost associated with integrating sustainability features within new developments is often highly overestimated. With existing regulations such as the Dubai Green Building Regulations, Estidama, etc, and the ever-increasing market for green building products and suppliers, the cost impact of designing and constructing a green building can almost be negligible.” Embracing a Green Future
Sustainable construction has caught the attention of stakeholders in the industry, and it appears that demand will only rise in coming months, driven by market and environmental realities, and other influences. Cundall’s Yousef explains, “Increasing utility prices and budget constraints will in the long term have a positive impact on sustainability demand in the region. Traditionally, CAPEX had been the biggest focus of developers; however, a shift in thinking is starting to emerge, in looking at the overall lifecycle impact sustainable design will have on a development. Hence, the emergence of CAPEX and OPEX being looked at side-by-side will only grow in the region.” He adds, “As the market shifts to organic growth, we will see
fewer new developments, as in any developed region. This will allow the industry to re-shift their focus to existing developments that are operating unsustainably, and tap into a retrofit market that will see existing developments reshaped to meet a sustainable future.” AESG’s Boyle reckons new government initiatives will also support sustainability drives. “The recent Shams Dubai initiative allows individual private solar photovoltaic systems to connect to the grid and feed in excess power, and this has resulted in an increase in private installations, due to the improved financial feasibility. Opportunities will also come from new building rating systems and regulations. Within Dubai, the Al Sa’fat Rating System may be implemented any day, which will offer new buildings the opportunity to target differing levels of certification in reward for the voluntary implementation of sustainable design and construction requirements.” He concludes, “Another new building rating system focusing on the well-being of building occupants, the WELL Building Standard, has also been released, and there are currently eight projects that are already registered within the UAE. AESG have two WELL-accredited professionals, both of whom are local WELL faculty members, and we anticipate the uptake of the WELL certification to grow in the coming years.”
“With existing regulations such as the Dubai Green Building Regulations, Estidama, etc, and the everincreasing market for green building products and suppliers, the cost impact of designing and constructing a green building can almost be negligible” SEPTEMBER 2017 43
ON SITE
INTERVIEW
Prime Position
Macro has enjoyed significant success in its recent history and recently appointed a new MD for its regional business. Middle East Consultant sits down with Mark Graham for an exclusive chat about the FM market and his regional business plans roperty consultancy and facilities management (FM) firm Macro is a wholly owned subsidiary of international consultancy and construction company Mace. Macro has been in operation since 2002, and expands upon the services offered by its parent – Macro currently offers strategic and tactical facilities management services to a diverse mix of clients. According to Mace’s 2016 annual results, Macro reported an 8% increase in profits from contracts, and entered nine new markets in 2016: Bahrain, Costa Rica, the Czech Republic, Japan, Jersey, Jordan, Oman, Pakistan and Turkey. The firm’s staff count also grew by 6% to 766, and the firm recently appointed Mark Graham as managing director of Macro MENAP. Graham first started working with Mace in 2004 and moved to the UAE in 2012, where he joined Mace as director of finance and corporate services. He then ascended to the role of commercial director in 2016, before taking on his current role. Middle East Consultant caught up with Graham to discuss Macro’s business past and future.
Macro offers a range of different services. In terms of business, which have grown or shrunk in the last year, and why do you think this is the case?
Macro provides FM consultancy, integrated facilities management (IFM), a helpdesk and CAFM service, technical services and owner association management – all these business segments have grown over the last year. The biggest growth we have seen, however, has come from IFM and technical services. The reason for this growth has been due to a contract win with a financial institution, where we provide workplace services across nine countries in the Middle East, as well as Pakistan. Additionally, we have expanded our education portfolio and are now covering over 250 schools in the region. Which of these segments will be the biggest contributor to your bottom line in the next year or two?
Our integrated FM contracts because they are long-term, as well as our consultancy business, due to the major programmes we are presently involved in. Talk us through any changes you’ve made internally in terms of
What were some of the key business highlights for Mace in the
operations, processes, staff, etc.
last twelve months?
Since I was appointed to lead the business in the Middle East, we have changed the structure of our business operations in the region considerably. The new structure sets us up for growth and provides opportunities for our people, while enabling us to be even more client-focused. Macro is a multinational company and we are ensuring that our business is aligned globally, working as one team, sharing knowledge and expertise across borders.
It’s been a successful year. We entered a number of new countries in the Middle East, and increased our staff count considerably. One of Macro’s most notable wins was an international contract with Standard Chartered Bank, managing a 4.2m sqft portfolio across four continents. We were also voted FM Consultancy of the Year recently, our seventh win in this category.
44 SEPTEMBER 2017
ON SITE
01
“There will always be challenges, but it doesn’t really matter what they are – it is how you deal with them that sets you apart from the competition. You need to innovate and always look to the future” SEPTEMBER 2017 45
ON SITE 01 Overall park management, ticketing and reception, and F&B management are some of the services Macro
What are your plans going
is responsible for at Abu
forward? Is regional growth
Dhabi’s Umm Al Emarat Park.
on the table? 02
Growth is absolutely on the table, but in focused areas and countries in the Middle East region. We want to continue to grow our service offering and expand both our regional and global footprint organically. We are well positioned to offer clients an integrated global solution across the entire property lifecycle.
Mark Graham is managing director of Macro MENAP.
you apart from the competition. You need to innovate and always look to the future. What are the opportunities and challenges for your firm in the GCC? Are there any
Which sectors and verticals
standout markets you’d like
are showing the most promise,
to focus on?
and how do you plan to tackle current regional challenges?
We are very strong in the finance 02 and education verticals, and this is something we would like to build on. In the last year, we also expanded our activities in leisure, as well as arts and culture, which seems to be a growing sector in this region. Globally, we are also strong with technology, and this is something we want to bring to this region. We focus on our strengths and look at how we can help clients provide a smooth, streamlined service. There will always be challenges in the market, but it doesn’t really matter what they are – it is how you deal with them that sets
“The new structure sets us up for growth and provides opportunities for our people. Macro is a multinational company and we are ensuring that our business is aligned globally, working as one team, sharing knowledge and expertise across borders” 46 SEPTEMBER 2017
Working across borders brings its challenges, with different legislations and ensuring your work culture blends well with the local culture. However, entering a new market also offers new opportunities. We are particularly excited about the development of FM in Saudi Arabia and Pakistan. How does Mace Macro differentiate itself from other firms offering similar services?
We are flexible in our approach, tailor-make solutions and will follow clients across borders. Our contracts with Invesco and Standard Chartered Bank demonstrate this, where we have entered new markets as a result of our clients’ needs. Our managed service offering also means we are capable of being independent from the supply chain, which means we can negotiate favourable deals while offering a better service for clients. Our biggest differentiator is that although we are a relatively small company, we are able to provide solutions across 40 countries. Have there been any new approaches, innovations or technologies enabling you to offer better services to customers?
Our helpdesk and CAFM service is constantly developing. We are increasingly using mobile and handheld technology, and our consultants regularly review drawings via building information modelling (BIM), and use a streamlined technology-focused asset tagging process. We are also working on the introduction of robotics and technology to carry out repetitive tasks such as floor cleaning. In addition, we are adding workplace efficiency assessments to our regional consultancy service offering, to improve the occupant experience and area usage.
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ON TOPIC
OPINION
01 Sharon Jutla is the founder of Sharon Jutla Interiors.
Deriving Value Value engineering can have a positive impact on projects, as long as it’s implemented correctly, says Sharon Jutla The GCC economies are poised for stiff challenges, driven by multiple factors but mainly by a liquidity deficit. This will have a trickle-down effect on the construction industry as a whole. As a result, several infrastructure developments will stall due to a shortage of funds. Investment experts are aware of the fact that the current liquidity challenges brought about by dipping oil prices, against the backdrop of subdued government spending, has negatively affected asset prices, equities, credit growth and bank balance sheets. At the moment, companies and governments are cutting costs on projects under the pretence of value engineering; however, cost-cutting is not the specific focus of value engineering.
01
Defining Value Engineering
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he Middle East construction sector is going through another challenging year, with the number of new contracts lower than previously forecast. As a result, we’ve seen a number of newly tendered contracts for refurbishments and extensions, as developers try to generate more revenue from existing assets. The theme of 2017 could be said to be cost certainty in an uncertain world, and recent developments in the region have demonstrated the wider impact on the local construction industry of uncertainty associated with falling commodity markets. 48 SEPTEMBER 2017
Value engineering aims to improve function and quality by solving problems as well as reducing unnecessary cost, thereby adding value to the product. This is mainly realised by considering material availability, methods of construction, planning and organisation, transport, site limitations and other factors. Quality improvement, environmental impact and a reduction in lifecycle costs are just some of the main benefits that can be achieved. Naturally, value engineering should commence early in a project’s lifecycle, mainly because this is where the benefits are optimal. Here all details, including selections and materials, can be carefully studied and assessed, in order to create a strong, creative
design. This ensures that the design of the project is not compromised. The quality of each creation is maintained due to careful compliance with client expectation without compromising the original idea. The project contractor is welcome to weigh in on the process, but it should not negatively affect the project timelines or budget. The Design Process and Value Engineering Stage
Today, most projects are handled by a team of professionals. To commission the design team, the owner participates in a rigorous selection process that includes designers, engineering experts and architecture selection. Some owners rely on a project manager to represent them in this process. Once the selection of a general contractor and a construction management consultant has been identified, the design team is then consolidated. A project begins once a space programme has been identified, a list of project requirements defining scope and function has been developed and a budget defining cost has been set. The design and construction teams then review the design schematic and development, and prepare preliminary statements of probable cost. Design and cost evaluation will then be done in comparison to the initial project scope and budget. This will give the owner and the team a clear picture of how well the project is progressing vis-à-vis the budget.
ON TOPIC
This is enabled by a continuous monitoring process through each step of the project. Value engineering in typical construction projects is used sporadically, usually when the design team encounters a budget problem. On many occasions, it has been effectively used to rally the project design team to identify and fix problems in a bid to save costs. In some cases, the project owner, contractor and designer prevent true value engineering from being achieved, especially when they get too invested in their respective disciplines. Open mindedness and flexibility is the key here. While there is also the possibility of reducing costs marginally, this
often leads to a reduction in quality and actual value. Client Role & Design Changes
It is imperative that precautionary and value engineering measures be considered, especially in the creative process, so that quality isn’t negatively impacted. If this is not done, the contractor might be forced to effect the changes in order to complete the project within the set budget – a move that could affect the project design and uniqueness. For value engineering to succeed, a more precise and appropriate definition of value is paramount. The quality level should be clearly defined by the owner, while the
delivery of a design that meets expectations is the sole responsibility of the designer. Designers are often convinced that better quality is equivalent to better value, but this isn’t always accurate. The fact is, better quality will likely cost more but not necessarily be of greater value. What constitutes value should be made clear to the project owner, to avoid incurring unnecessary additional costs on the project. A well-executed engineering process delivers a cost-efficient project that satisfies the owner’s needs and objectives. It also significantly enhances a team’s ability to solve issues effectively, reduces the team’s expenses and allows an efficient construction process.
“Value engineering aims to improve function and quality by solving problems as well as reducing unnecessary cost, thereby adding value to product cost-effectively” SEPTEMBER 2017 49
ON SITE
SHOW PREVIEW
Cityscape Conferences to highlight innovative solutions Modern solutions will tackle challenges of the current era
O
ne of the key focuses for exhibitors at the forthcoming 16th edition of Cityscape Global will be sustainable building. Zaha Hadid Architects (ZHA) will be among those demonstrating that reducing a building’s energy consumption and emissions through advancements in design, materials and construction techniques is vital to developing Dubai’s future buildings. In advance of his presentation at the Cityscape Global Conference in September, Tariq Khayyat, head of region at Zaha Hadid Architects (ZHA), said that he believes Dubai has significantly pushed the boundaries of sustainability by supporting and implementing innovative solutions. “Sustainability is no longer a choice option within the industry. One of ZHA’s current projects in the region, the Bee’ah Headquarters in Sharjah, has environmental considerations woven into every aspect of its design. We’ve created a design in response to the natural environment, minimising energy and resource consumption,” said Khayyat. Taking place one day before the Cityscape Global exhibition, the Conference will host keynote presentations and panel discussions on Sunday, 10 September at The Conrad Dubai. 50 SEPTEMBER 2017
The values of executing sustainable practices in building design and architecture are echoed by Carlos Ott, founder of Carlos Ott Architects. “We have been designing sustainable projects for years, starting with projects in Canada and Germany and now all over the world, including in the MENA region,” he commented. Under the theme ‘Reshaping the Industry’, the full-day forum will provide insights into the real estate and property sector, with a market overview morning session and split afternoon sessions: the Real Estate Brokers Programme and Architecture Programme. Impactful topics such as the emirate’s regulatory landscape, Dubai’s blockchain strategy and the prospect of healthcare as an attractive real estate asset will be up for discussion. Industry leaders, including HE Marwan Bin Ghalita, CEO of Dubai Land Department and Real Estate Regulatory Authority; Mohammed Shael Al Saadi, CEO, Department of Economic Development (DED); Craig Plumb, head of Research, JLL MENA; and Wesam Lootah, CEO, Smart Dubai Government, are scheduled to share their expertise. Cityscape Global will take place from Monday 11 September to Wednesday 13 September at the Dubai World Trade Centre. For more information on Cityscape Global, visit www.cityscapeglobal.com.
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ON SITE
Emaar launches new mall in Dubai Hills Estate Emaar Properties has announced the Dubai Hills Mall in the heart of its Dubai Hills Estate development. Scheduled to open in late 2019, the mall will have a gross leasable area of over two million square feet and will house more than 750 outlets. The mall is billed as a regional retail and leisure destination in the 11m sqm Dubai Hills Estate community. Mohamed Alabbar, chairman of Emaar Properties, said, “We are developing Dubai Hills Mall with a fresh concept where the focus is not just on providing retail and leisure choices but also for visitors to create memories and lifestyle experiences. Integrating advanced technology features with the principles of a regional mall, it will be a socially and culturally inspiring space for people young and old, residents and visitors, to meet, connect and relax.” The mall will feature a 20-screen cineplex, a 65,000sqft hypermarket, seven anchor retail stores and parking for over 7,000 vehicles. It will be accessible from Sheikh Zayed Road, Mohammed bin Zayed Road, Umm Suqeim Road and Al Khail Road, and will have a dedicated link to the Dubai Metro and other public transport. Other facilities include F&B outlets and an outdoor concert area.
52 SEPTEMBER 2017
Dubai Municipality makes use of ‘Dubai Lamp’ mandatory Dubai Municipality has made the use of the energy-efficient ‘Dubai Lamp’ mandatory for all new developments in the city. The municipal authority will begin verifying the use of the bulb in December. Layali Al Mulla, director of Dubai Municipality’s Buildings Department, explained that all consultancies have to develop a proper mechanism and commit to the use of the Dubai Lamp across all developments, including those under construction. The LED bulb was developed by Philips and is specified to generate 200 lumens per watt and aims to cut power consumption by up to 95%. Authorities say the bulbs will help the emirate cut emissions and strengthen its green credentials. “In case other lamps similar to the Dubai Lamp have already been purchased or contracted upon ahead of issuing this memo, the contractor concerned shall have to submit the relevant purchase invoices upon applying for the Building Completion Certificate,” said Al Mulla.
ON SITE
SNC-Lavalin receives goahead for EPC phase of ammonia plant
New strategy approved for Dubai building permits Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and ruler of Dubai, has approved a new strategy for building permit procedures in Dubai. The strategy will speed up the process of acquiring building permits from government entities. The strategy has been set up by Dubai’s Committee for Building Permit Procedures Development. It aims to enhance the emirate’s positioning as a city where the active building and construction sector plays an important role in its economic development. Designed to assist investors in the real estate sector, the strategy is built on three key pillars. The first is developing and streamlining permit procedures; the second is unifying systems and requirements; the third is providing a one-stop-shop that allows all procedures and processes to be completed. This provides a comprehensive scheme that ensures the processes of acquiring permits is sped up across all stages. Daoud AbdulRahman Al Hajri, assistant director general of Dubai Municipality of Engineering and Planning and head of the Committee, said the new strategy reflects the vision of Sheikh Mohammed bin Rashid Al Maktoum, and will enhance customer happiness, save time and create a stimulating environment that promotes Dubai’s investment climate. As for the strategy preparation process, Al Hajri noted that since its formation in February 2017, the Committee has held several meetings and workshops with the stakeholders concerned to discuss the various details of acquiring building permits.
SNC-Lavalin has received notice to proceed with the engineering, procurement and construction (EPC) phase on the liquid ammonia plant it is working on in Salalah, Oman. This phase of the project follows the early works programme, which it was awarded earlier in 2017. The anhydrous liquid ammonia plant is being built for the Salalah Methanol Company LLC (SMC). “SNC-Lavalin is pleased to enter into this next phase of the Salalah ammonia project, which is of great importance for SMC and the Sultanate of Oman,” said José J. Suárez, president, Mining & Metallurgy, SNCLavalin. “This project demonstrates that our strong expertise is recognised by clients and major financial institutions alike, and we are committed in offering our client and the region a world-class project that they are going to be proud of.” SNC-Lavalin’s Abu Dhabi office is responsible for project delivery, and is being supported by other local and international company resources.
SEPTEMBER 2017 53
ON SITE
CM opens office in Oman and appoints Khalil Alzadjali as head Cavendish Maxwell (CM) has just opened an office in Muscat, and has appointed Khalil Alzadjali as head of its Oman business. Speaking about the new office, founder and chairman Jay Grant said, “The move is part of an ambitious yet sensible expansion plan that will enable us to get closer to clients, demonstrate our exceptional capabilities and meet the growing demand for our real estate services in Oman.” The firm says increased infrastructure spending and employment avenues are expected to boost demand for residential, commercial and specialist property classes. This in turn is expected to drive up demand for real estate data and market intelligence from banks, developers and property owners. “Landlords and developers have very limited information about the market, such as what to build, what the market needs and the risks that parties face,” says Alzadjali. “The government and private sector should work together in order to assist and improve the real estate market in Oman, by controlling tax on properties and ensuring transparency on property information.”
54 SEPTEMBER 2017
KEO appointed for Expo 2020 Village project KEO International Consultants is providing design and construction supervision services for the Expo Village development. The residential community is being developed by the Dubai World Trade Centre, and when completed, it will host Expo 2020 Dubai visitors and participants. The design, engineering and project management specialist was previously engaged to concept design the buildings and infrastructure of the Expo Village. KEO will also provide full design and construction supervision of phase one of the project. The development is expected to be delivered by Q4 of 2019, and is expected to boast efficient design with high sustainability principles. “We are very proud to be the design consultant of a legacy development such as the Expo Village, which will support the successful delivery of Expo 2020 Dubai – the first World Expo to be held in the region. The completion of the design phase and the supervision is only made successful through the dedicated efforts of our international team of experts and the effective collaboration with the Dubai World Trade Centre (DWTC), as well as the various stakeholders involved. KEO’s vast experience in delivering mega projects, coupled with our innovative approach, equip us to deliver to the highest standard and to always place the client at the heart of what we do,” said Donna Sultan, president and CEO of KEO. KEO recently completed the technical design for six parcels and provided the supervision services for piling works of five parcels.
ON SITE
MEC opens nominations for 2017 awards event
F+G appoints Paul Sweeney to senior KSA role Per a statement issued by Faithful+Gould (F+G), Paul Sweeney has just taken the reins as head of programme management in Saudi Arabia. The integrated project and programme management consultancy says it has enjoyed significant growth in the Kingdom in recent times, and expects its order book to grow by 15% over the course of 2018. Sweeney brings considerable knowledge of international PPP schemes in the healthcare and education sectors to F+G, thanks to his experience on both the client side and the SPV/developer side. Faithful+Gould says his skills and appointment position the firm in line with the Saudi government’s move towards alternative financing solutions, as part of the country’s Vision 2030 strategy. “The demand for our expert programme and project management services has risen exponentially, making this an opportune time for Paul to join us. His appointment further enables F+G’s growth strategy, not just for KSA but for the wider region, aimed at ensuring we remain in a position to deliver the best solutions to our clients, supporting the delivery of their projects on time, to budget and to their quality aspirations,” said Spencer Wylie, Faithful+Gould KSA country director.
The third annual Middle East Consultant (MEC) Awards are scheduled to take place at the Ritz-Carlton JBR in Dubai, on 7 November 2017. Several awards are up for grabs, including Female Executive of the Year, Technology Champion of the Year, Smart Project of the Year and Technology Champion of the Year. The Middle East Consultant Awards celebrate the achievements of architects, consultants and designers in the Middle East, and highlight stand-out projects. Individuals and organisations can begin nominating for categories of interest by visiting www.meconsultantawards.com. FAQs and nomination guidelines are also on the website. The MEC team invites consultants of every discipline, from across the Middle East and North Africa, to submit their nominations by 22 September 2017. All nominations will be judged by a panel of experts carefully selected from the region’s construction sector, including top management from several of the region’s most prominent contractors, developers and property analysts.
SEPTEMBER 2017 55
THE BACK PAGE
LAST WORD
01 Boris Ritter is the general manager of Sesam Business Consultants.
Strength in Diversity Requires Unity Boris Ritter believes that mastering cross-cultural communication is key to maximising the performance of diverse teams
01
M
ulticultural teams are a huge competitive advantage for organisations in the regional construction sector. When well-managed, they are perfectly positioned to challenge the status quo in finding exciting and creative solutions to construction requirements and challenges. At the same time, it is also important for organisations to be aware of the challenges involved in managing multicultural teams.
This is especially important in the Middle East, where teams are in most cases quite multicultural, with members from across the world. It’s important then that companies focus their attention on the effort, skills and demands needed to properly run a culturally diverse workforce. In line with this, cross-cultural communication should be a crucial focus for companies operating in the Middle East, whether it’s with regard to communicating with stakeholders (developers, consultants, etc) or internal comms. Equally, it’s important to encourage teams to enhance their understanding of other cultures, as this will help them better interact with people both inside and outside the firm. Central to this training is demonstrating that reaching out to others effectively requires taking language barriers, cultural differences, personal communication styles, sensitivity and temperaments into consideration. Parallel to this, it takes a conscious effort to create a cohesive team atmosphere where members bring out the best in each other and feel they can be vocal. Recognising and respecting your team’s differences means acknowledging that cultural differences exist in the first place.
Different people have different reactions and opinions, as well as styles and directness when it comes to communicating with others. This of course means that it is relatively easy to misinterpret cultural differences and jump to conclusions. Assumptions like this risk the stability of the team, which can then affect the work at hand. Misunderstandings can also lead to tension and the unnecessary escalation of minor matters, and give rise to disputes on projects. The difficulty is that it is not always easy to think ahead, or to be sure the person you are working with understands you the way you want and expect them to. Sometimes we expect critical details to be understood in the context of a given situation or through other social cues, and we may not even realise that those cues have gone unnoticed by the other party. Therefore, simple and clear communication must be emphasised. As professionals in the construction sector, we must trust in each other to share the same goals and objectives for the good of the work and the organisation. Getting across that you appreciate, respect and enjoy being around the people you work with is a universal mother tongue. This form of communication goes beyond cultures and words.
“Respecting your team’s differences means acknowledging that cultural differences exist in the first place” 56 SEPTEMBER 2017
Inspiring Innovative Leadership
Leaders in Project Management
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