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As energy supply dynamics on a global scale continue to spook investors, the potential impact on the construction and renewable energy industries could be substantial SEPTEMBER 2015 THE DEFINITIVE GUIDE TO THE REGION'S CONSTRUCTION PROFESSIONALS Analysis of how corporate taxation in the UAE could affect the regional construction industry Experts based in Saudi Arabia analyse its real estate market and how the government is playing an active role in combating industry challenges Gasoline prices headed up, diesel prices headed down. What do the changes mean for local construction businesses?

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OHSAS 18001 certified ISO 9001, 14001 and 130+years of project experience LEED Platinum, LEED Gold and LEED Silver Capability End to End Integrated Solutions Pioneering Engineering Construction since 1881 www.drakescull.com 700+ Projects Delivered For over 130 years, Drake & Scull International PJSC has been shaping skylines and transforming the lifestyle of communities around the world. Drake & Scull is an industry leader, with a proven history of delivering more than 700 projects through its General Contracting, Engineering, Rail, Oil & Gas, Water and Wastewater Treatment and Infrastructure development business streamlines across the region.

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construction business news me SEPTEMBER 2015 3 28 THE END OF EASY MONEY Oil prices have fallen 55% since September 2014 and the IMF has warned GCC governments to curb spending in the face of predicted budget deficits this fiscal year. As global supply dynamics continue to spook investors Construction Business News ME looks at the potential impact on the construction and renewable energy industries news in person ALEC CEO Kez Taylor sPEAKS WITH cONSTRUCTION bUSINESS nEWS me about making health and safety a culture rather than an imposing rule analysis Gasoline prices headed up, diesel prices headed down. What do the changes mean for local construction businesses? TAKE 10 With ever greater pressure on fossil fuels, renewables are contributing a greater share to the overall energy mix. These are the 10 most impressive renewable projects from around the world COUNTRY FOCUS Experts based in Saudi Arabia analyse its real estate market and how the government is playing an active role in combating industry challenges TECHNOLOGY Dr Asif Sharif, GM and regional director at CONJECT, reveals that 7 out of 10 of the region’s projects are still not being supported by project collaboration systems, and explains the reasons why these systems should be used 8 18 24 34 38 42 cover story 34 38 contents

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construction business news me SEPTEMBER 2015 4 S U B S C R I B E c o n t r i b u t o r s subscriptions@bncpublishing.net Managing Director Walid Zok walid@bncpublishing.net Director Rabih Najm rabih@bncpublishing.net Director Wissam Younane wissam@bncpublishing.net Group Publishing Director Diarmuid O'Malley dom@bncpublishing.net Business Development Director Rabih Naderi rabih.naderi@bncpublishing.net +966 50 328 9818 Group Editor Melanie Mingas melanie@bncpublishing.net Editor Lorraine Bangera lorraine@bncpublishing.net Sales Director Alex James alex@bncpublishing.net +971 56 6783 192 Sales Manager Mostafa Abdo mostafa@bncpublishing.net +966 56 6695 333 Marketing Executive Mark Anthony Monzon mark@bncpublishing.net PO Box 502511 Dubai, United Arab Emirates P +971 4 4200 506 | F +971 4 4200 196 For all commercial enquiries related to Construction Business News ME contact sales@bncpublishing.net T +971 55 339 5097 All rights reserved © 2015. Opinions expressed are solely those of the contributors. Construction Business News ME and all subsidiary publications in the MENA region are officially licensed exclusively to BNC Publishing in the MENA region by Construction Business News ME. No part of this magazine may be reproduced or transmitted in any form or by any means without written permission of the publisher. Images used in Construction Business News ME are credited when necessary. Attributed use of copyrighted images with permission. All images not credited courtesy Shutterstock. Printed by International Printing Press www.ippuae.com Stuart Matthews Marlow McGuinness Ltd Naji Attalah, head of AEC and manufacturing at Autodesk, writes about how building information modelling is revolutionising the construction of healthcare facilitieS Dominic Wright, Business Development Manager at Generation 3D speaks with Construction Business News ME about the rise of 3D building printing technology COMMENT Gary Watkins, CEO of Service Works International, analyses integrating building information models with computer maintenance management system for meaningful data Dr Ioannis Spanos, senior sustainability manager of KEO International Consultants, writes about powering GCC buildings with renewable energy Liz Kentish writes about the collegiate and collaborative approach to training and development, needed to reap dividends in the facilities management sector Craig Gibson analyses how corporate taxation will affect the construction industry in the UAE Robert Carr, director of environment and sustainability at WSP | Parsons Brinckerhoff, looks at what it really means as a consultant to be green. Malcolm Dias examines ports progress in the GCC and makes the case for increased port-infrastructure spending PROJECT REVIEW Georges Chehwane, chairperson and owner of Plus Holding, speaks with Construction Business News ME about its latest luxury residential project in Metn, Lebanon Q&A Boris Ejsymont, regional manager of SolidNature GCC, talks about one of the first building materials used in ancient times, natural stone, and how its use today is still relevant SUPPLIERS SAVE THE DATE EDITOR’S PICK 46 48 22 45 50 52 56 57 54 58 62 64 66 48 CONTENTS

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PIPELINES NOT PIPE DREAMS. Infrastructure development is critical to the growth of the economy. That’s why at HSBC, our award winning capital financing team provides bespoke and innovative advice, supporting your business in making the most of global infrastructure opportunities. With nearly 150 years of experience in supporting global businesses, including 65 years in the Middle East and North Africa, we can support your business vision for the future. See how we can help your business www.business.hsbc.ae/solutions Issued by HSBC Bank Middle East Limited, P. O. Box 66, Dubai, UAE. Regulated by the Jersey Financial Services Commission and Central Bank of the United Arab Emirates. CRN 150603 © Copyright. HSBC Group 2015. ALL RIGHTS RESERVED.

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6 construction business news me SEPTEMBER 2015 Filling the energy gap Bahrain was the first country to discover oil in 1932 and since then the GCC region has used its reserves as its main source of energy and income. Today as oil prices remain unstable it is increasingly important to consider the need to take energy diversification more seriously. Oil, which is the backbone of most economies in the region, affects every sector including construction. In fact according to Alpen Capital report, the dip in oil prices poses a major challenge to the growth of the regional construction sector, as it forces states to restrict spending. Deloitte’s construction report points out that the GCC’s population will grow from 350 million to 602 million by 2050; a growth that will require a 34% increase in electricity generation capacity by 2020. Clearly, renewables are the way to go in terms of looking for new energy sources. Including renewables in the energy mix began in 2008, just after the financial crisis, when Abu Dhabi was first in the region to set a target of achieving 7% renewable energy power generation by 2020, followed by Dubai which set a 5% renewable energy power consumption target by 2030. Endowed with abundant sunlight, the two cities decided to primarily focus on solar, and their efforts gained tremendous momentum over the last eight years. The first major initiative was Abu Dhabi’s 100MW Shams 1CSP plant launched in 2013. It was the first largest renewable energy project in the Middle East, praised by Jonathan Porritt CBE, British environmentalist during a talk at TEDxExeter 2012 in the UK. He called the launch of Shams 1, the first of a whole generation of CSP plants around the world, to be a step in the right direction for Abu Dhabi. While Dubai launched 13MW of solar PV as the first phase of what will soon become 1000MW Mohammed Bin Rashid Al Maktoum Solar Park. The project is scheduled to open in 2017, and aims to achieve a total capacity of 3,000MW by 2030. Other emirates in the UAE have made efforts towards diversifying energy, however in terms of renewables there haven’t been any drastic measures like Abu Dhabi and Dubai. According to Masdar and IRENA’s REmap 2030 analysis, there are no federal energy policies in the UAE constitution. Emirates are free to manage and regulate energy as they please, though there have been exceptions like reducing the use of incandescent light bulbs and inefficient air-conditioning units. To make largescale changes that would really affect the overall energy scope of the UAE, coordination is vital. This has been recognised by the Ministry of Energy, which is making efforts to develop an effective national strategy. Investing in renewables is not only sustainable but will soon be cost- effective. According to the a report by University of Cambridge and PwC, though the price of oil fell dramatically last year, the price has always fluctuated. It would be more editor’s note sustainable in the long run to depend on renewables, whose cost according to the report, has been declining gradually yet constantly. UAE has made great progress with solar, yet there needs to be more done in the region as a whole. Recent report by ICAEW urges UAE and other GCC states to prioritise more efficient energy use. It notes that although the recent drop in oil prices has made conventional sources of energy cheaper in the GCC, this must not discourage investment in alternative energy supplies. It recognises that despite recent improvements and initiatives, the GCC’s energy efficiency remains low compared to world benchmarks. It seems clear that the only way to achieve a global standard would be through synchronisation among emirates and GCC states. Lorraine Bangera Editor

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NEWS Drake & Scull International PJSC (DSI) reported a total revenue of AED2.39bn and net profit of AED34m for the H1 2015 ended June 30. The company achieved a 2% YoY growth in revenue in H1 2015. Around 37% of the consolidated group revenue was generated in KSA which remains its largest market in H1 2015. Opera- tions in the UAE picked up momen- tum and contributed 28% of the group revenue; up by 7% as compared to the same period in 2014. Operations in Qa- tar improved and contributed 16% of the group revenue for the period, up by 8% compared to last year. Total new project awards for the first half of the year reached AED1.42bn taking the group backlog value to AED13.24bn as of 30 June 2015. The engineering and general contracting businesses constituted 87% and 13% of the new project awards secured in the first half of the year respectively. The UAE comprised the largest share of the new awards accounting for 75% of the group awards and Oman comprised 25% in H1 2015. The majority of the new awards were secured in the hos- pitality sector which accounted for 58% of the group awards while the com- mercial and residential sectors stood at 24% and 18% respectively. Khaldoun Tabari, CEO and vice chair- person of DSI, said: “Despite the bear- ish business sentiment across the sec- tor, we’ve started Q3 2015 on a positive note with AED305m worth of new proj- ects in Kuwait and we remain focussed on improving our operation efficiency and increased focus on collections across all markets.” Indian Prime Minister Narendra Damo- dardas Modi used his visit to a con- struction labour camp in Abu Dhabi to highlight India’s concern about the welfare of its nationals working in the GCC construction sector. A senior Indi- an government official told Reuters in New Delhi that PM Modi’s intention is to convey that the safety, security and welfare conditions for Indian workers should not be ignored. The visit took place on day one of Mo- di’s two day visit to the UAE – the first of its kind for an Indian Prime Minister in 34 years. He was joined by Dr Anwar bin Mohammed Gargash, Minister of State for Foreign Affairs and head of the honorary mission. The visit was organised to enable a conversation with the workers, where PM Modi thanked them for their hard work and dedication. Even though the PM addressed the workers, he made no contact with the media. PM Narendra Modi PM Modi highlights concerns for labourers DSI records AED58m operating profit in H1 2015 His visit is especially topical as contro- versy continues to surround the supply of foreign labour on projects for mega events such as Dubai Expo 2020 and the FIFA World Cup 2022 in Doha. According to Indian embassy statistics, 2.6 million Indians expats in the UAE out of the total 9.5 million populations. The embassy states that about 60% of the In- dian population are workers. The Indian government as well as the UAE government have put improv- ing the working conditions of workers in the region on the agenda. Last year, India launched a campaign for work- ers’ higher wages in the GCC to meet the higher living cost. While the UAE has imposed several measures including mid-day breaks for workers during the summer, improving healthcare facilities and accommodation. However, all these measures aren’t necessarily enough. Salil Shetty, secretary-general of Am- nesty International, told Reuters: “Lack of proper regulation by the authorities in both India and the UAE of the booming migrant-worker recruitment industry, in- cluding visa brokers, has allowed rogue recruiting agents to cause serious human rights abuses with impunity.” Khaldoun Tabari, CEO and vice chairperson of DSI FACTS & FIGURES Results for 2015 H1 at a glance Revenue = AED2.39bn Operating profit = AED58m Net profit = AED34m New projects = AED1.42bn Total backlog = AED13.24bn construction business news me SEPTEMBER 2015 8

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Qatar Railways Company has presented the architecture opportunities available at Doha Metro’s first 37 stations to an auditorium of 300 project managers, design and build contractors, and prospective suppliers. The attendees witnessed a presentation on the architectural opportunities and discussion led by Qatar Rail’s procurement and architecture department. Qatar News Agency reported that the conference, “Architectural Works for Doha Metro – Phase 1”, acted as a platform to share Qatar Rail’s procurement strategy, the packages, pre-qualification process, and the projects including the interior fit out for the stations, the structure for the elevated stations as well as the landscaping plans. The first phase of the project (37 stations) is due for completion by 2018 while the second (60 stations) by 2030. Parsons has been awarded the infra- structure design and construction super- vision services contract for the Dubai Expo 2020 site. The contract will include designing, monitoring, managing, and delivering of the project’s infrastructure. The upcoming and most-anticipated site in the UAE is 438-hectares wide and houses multiple pavilions, souks, and entertainment venues. Todd Wager, the Parsons Group presi- dent, said: “Given the magnitude and distinctiveness of Dubai Expo 2020, this is a significant win for us and we are deeply committed to supporting Dubai with our global and local resources to provide a new level of sustainable de- sign and operational services.” Other notable projects awarded this year in UAE include the Dubai Water Canal Project awarded by the Road and Transport Authority (RTA). Qatar’s WPS postponed by three months UPC increases number of projects approvals The government of Qatar has delayed the launch of the much awaited wage protection system (WPS) which was due to be launched August 18. Qatari newspaper The Peninsula reported that the launch has been postponed to help the private sec- tor, who already had a six month head start, to prepare for the imple- mentation of the system. The online WPS system, a result of the constant allegations by interna- tional NGOs on Qatar for mistreat- ment of its construction workers, will affect a total of 50,000 private companies. The government aims to help the nation’s 1.4 million con- struction workers in receiving their salaries on time, which seems to be the biggest complaint. By having salaries transferred through banks, the government will unable a better and more transparent system. Companies could be fined up to $1,600 or could face recruitment ban if they don’t adhere to the new mandatory system, once in place. The new date for the launch of WPS has now been pushed by three months and will be on November 2 this year. In a report released by Abu Dha- bi Urban Planning Council (UPC) in August this year, the total floor area of developments approved have tripled in the second quarter of the year. The UPC announced that 26 de- velopment projects spanning a total gross floor area (GFA) of 2,327,073 m2 were approved during Q2, com- pared with 708,999 m2 in the previ- ous quarter. The number of Estidama Pearl Rat- ings awarded and announced by the UPC during the quarter has also in- creased. The figures show that 1,017 villas have been awarded 2 Pearls, 41 buildings have been awarded a 1 Pearl Rating, and 22 buildings 2 Pearls, making the total number of Pearl Ratings for Q2 1,080. Qatar Rail showcases phase one of Doha Metro Parsons Wins Infrastructure Contract for Dubai Expo 2020 Dubai Expo 2020 upcoming site construction business news me SEPTEMBER 2015 9

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construction business news me SEPTEMBER 2015 10 NEWS Mixed-use Project Award Kuntsevo Plaza in Moscow, Russia One Shenzhen Bay in Shenzhen, China Ronesans|BIZ Office in Istanbul, Turkey Commercial Project Award Bearys Global Research Triangle in Bangalore, India IRENA Headquarters in Abu Dhabi, UAE The Forum in Hong Kong Leisure and Hospitality Project Award Ali bin Hamad Al Attiya Arena in Doha, Qatar Element Suzhou Science and Technology Town in Suzhou, China Lusail Sports Arena in Doha, Qatar Community, Culture and Tourism Project Award Dakar Congress Center in Dakar, Senegal Indonesia Convention Exhibition (ICE) BSD City in Tangerang, Indoeasia Ko Shan Theatre New Wing in Hong Kong Residential Project Award Aparna Hillpark Boulevard in Hyderabad, India Bloom Gardens in Abu Dhabi, UAE Qent Istinye in Istanbul, Turkey Retail Project Award Em Quartier in Bangkok, Thailand Galleria Dalian in Dalian, China Welcome Pavilion and Cascade Dining in Abu Dhabi, UAE Sustainability Project Award – Built Bearys Global Research Triangle in Bangalore, India IRENA Headquarters in Abu Dhabi, UAE Ko Shan Theatre New Wing in Hong Kong The Turkish Contractor’s Association Headquarters in Ankara, Turkey Heartland 66 in Wuhan, China Hongqiao World Centre in Shanghai, China Nakheel Mall and the Palm Tower in Dubai, UAE Astana Trainstation in Astana, Kazakhstan Main Office Building, Macau Traditional Chinese Medicine Science and Tech Park in Zhuhai, China Parsan Headquarters and Administrative Building in Istanbul, Turkey Novotel Linkong 1-16 in Shanghai, China Olympic Sports Initiation Center in Rio de Janeiro, Brazil Piroz in Erbil, Iraq Greens International School in Kerela, India National Institute of Water Sports in Goa, India National Museum of Qatar in Doha, Qatar Botanika Nature Residences in Metro Manila, Philippines ONE at Palm Jumeirah in Dubai, UAE The Piers in Muscat, Oman Nakheel Mall in Dubai, UAE Qingdoa Jinmao Harbour Shopping Center in Qingdao, China The Heart of Yiwu, “An Urban Living Plaza” in Yiwu, China Finalists of Cityscape Awards for Emerging Markets announced BUILT FUTURE Mixed-use project award COMMERCIAL PROJECT AWARD LEISURE AND HOSPITALITY PROJECT AWARD COMMUNITY, CULTURE AND TOURISM PROJECT AWARD RESIDENTIAL PROJECT AWARD RETAIL PROJECT AWARD SUSTAINABILITY PROJECT AWARD

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Porto Arabia Towers Doha, Qatar ©2014 Hill International, Inc. Hill International The Global Leader in Managing Construction Risk www.hillintl.com For nearly four decades, owners and developers in the Middle East have turned to Hill International to manage their construction projects and programs throughout the region. Hill is proud to have helped our clients turn their most challenging visions into realities. We have participated in over 10,000 projects with a total construction value in excess of $500 billion, managing all phases of the construction process from concept through completion. Hill is also the leading construction claims firm in the world, having helped resolve problems on some of the most complex projects throughout the Middle East and around the world. To minimize risk and maximize results on your next project, turn to Hill International Dubai Office: 971 4 227 0078 Doha Office: 974 4 435 8381 Corporate HQ: 800 283 4088 If you can imagine it, we can manage it. Qatar National Museum Doha, Qatar Mall of Qatar Doha, Qatar Viva Bahriya Towers Doha, Qatar

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NEWS Al Shafar General Contracting Co. LLC (ASGC) last month com- pleted structural work for the Marina Bloom development. The mixed-use project is developed by UAE-based Bloom Proper- ties. It will feature a 5-star hotel, 57 executive serviced apart- ments, and waterfront retail areas in the Al Bateen Area in Abu Dhabi Marina. Initial construction work started in April 2014 and the project is expected to be fully complete by Q3 2016. CEO of ASGC Bishoy Azmy said: “I am delighted to an- nounce a key milestone with the completion of the structure for the Marina Bloom Development, which commenced in April 2014. This development, which is mixed-use and in- cludes a premium hotel, once again demonstrates ASGC’s expertise in the delivery of quality and high-end hospitality and residential construction projects.” ASGC completes structural construction on Marina Bloom Tristar Group is to open a new $20.43m chemical warehouse and bagging plant in Jebel Ali Free Zone (JAFZA), a first of its kind for the free zone, due to open in 2016. The plans were revealed by Tristar Group CEO Eugene Mayne at a ground- breaking ceremony with Skeberis Plas- tics managing director Reinhard Fischer and JAFZA officials led by group CFO Asim Al Abbasi and VP of customer rela- tions and development Omar Bin Hendi. The 350,000 sq.ft chemical warehouse is a joint project between UAE-based Tri- star and Skeberis Plastics, headquartered in Greece and Belgium with a regional office in the UAE. The facility is designed to handle a throughput of 250,000 tonnes bulk ma- terial of plastic granules per annum with silos and a racking capacity of more than 15,000 pallet positions for packed chemi- cal and plastic granules products. Once fully operational the one-stop shop for polymers and liquid logistics will offer better time to market delivery because of the location’s direct access to Jebel Ali Port and Maktoum International Airport and in the future to Etihad Railways. “Jafza was our first choice location due to flexibility in the logistics chain with transportation and freight readily avail- able and because of the ability to lever- age this multiplatform logistics facility to support our company’s other logistics service offerings,” disclosed Mayne. Skeberis will provide technical support for the management and day-to-day functions for the bagging operations. “The operating partnership between Tristar and Skeberis is another milestone for the chemical and pet- rochemical industry as the new facility of- fers unique opportunities for optimising the supply chain for producer and customer,” pointed out Fischer. New $ 20.43m chemical warehouse for Tristar in JAFZA Upcoming Marina Bloom construction business news me SEPTEMBER 2015 14

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As ‘green’ infrastructure investments increase in the GCC, Frost & Sullivan predicts the lighting market to be worth $3.5bn by 2020. The current mar- ket, worth $2.5bn, is projected to grow at a compound annual growth rate (CAGR) of 11-12% in the next five years. Most of the demand is powered by the big three GCC nations: UAE, Saudi Arabia and Qatar. Lighting accounts for 25% of total energy consumption in the Middle East, a higher electrical usage than anywhere else in the world according to Frost & Sullivan, while in the GCC around five mega tonnes of carbon dioxide emissions can be saved annually by switching to LED. A recent shift in government preference towards smart and green infra- structure solutions, and the demand for LED and solar lighting technology has shaped lighting consumption patterns across the region. “Growing investments into regional large-scale civil and commercial in- frastructure projects are driving demand for contemporary and sustainable lighting solutions,” said Ahmed Pauwels, CEO of Messe Frankfurt Middle East, organiser of Light Middle East. “Countries are now diversifying into manufacturing and service sectors and more and more investments are focused on infrastructure sectors like public transport, roadways, and sea ports to improve connectivity and regional trade and commerce.” This year’s Light Middle East will concentrate on LED technology and the latest solutions from lighting manufacturers and suppliers. The trade show will be taking place from October 6 to 8 at the Dubai International Convention and Exhibition Centre. Lighting market worth $3.5bn by 2020 Software for facilities, property & maintenance management Understanding your requirements T: +971 (0)4 449 5380 E: info@fsime.ae W: www.fsime.ae  Asset, helpdesk, maintenance & facilities software  Single User to enterprise scalability  Onsite or fully hosted  Accessible anywhere  Cross-platform mobility for smart phones & tablets  Standalone or integrated with Concept Evolution Innovative FM Technology for Smart Buildings A 30 turbine wind farm in Iran’s Arvand Free Zone will be constructed following a deal between a “private com- pany investing on behalf of Germany” and Iran, accord- ing to national news service, Press TV. Iran’s first wind farm, in Khuzestan Province, in the southwest of the country, will be able to generate 100MW of electricity through wind power, while a co- located photovoltaic power plant will produce 40 MW of electricity. Managing director of Arvand Free Zone, Esmaeil Za- mani, said that this deal aims to attract foreign invest- ment and incorporate the use of renewable energy in the region. He said that the unnamed German investor will help generate 130,000MW/hr electricity annually by 30 wind turbines in the free zone. He added that the first phase of the project included construction of a 48MW power plant in less than 18 months and the second phase included construction of 58MW, which will be commissioned in 2019. The German investor will reportedly use the latest tur- bine technology in the project. Unnamed German investor to fund Iran wind farm

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construction business news me SEPTEMBER 2015 16 NEWS The UAE Ministry of Labour indentified 30 companies violating the midday break law out of 27,000 visits conduct- ed between mid-June and the end of July. The law explicitly bans labourers from working on site between 12:30pm and 3:00pm. Maher Al Obed, Assistant Under- Secretary for Inspectional Affairs, said that the MoL has entered its 11th year of implementing the decision, and that statistics show high rates of commit- ment to the law. He said: “The deci- sion aims to protect workers’ health and safety during extreme conditions such as working in high temperatures in the summer season.” The visits conducted by the ministry also includes spreading awareness through dis- tributing pamphlets about health and safe- ty amongst labourers. The ministry urges companies to provide shaded areas for the labourers during break period and adopt eight hour work day. Companies are also expected to reimburse labourers for over- time according to the provisions of Federal Law No.8 of 1980. According to Al Obed, violators of the law are AED5,000 per worker found working during banned hours, not exceeding AED50,000, risk a tem- porary shut-down and a reduction in their classification. He added: “There are some excep- tional cases that require continuation of work during those periods for technical reasons, but employers are obliged to provide cold drinking water, safety tools and materials, including salt, lemon, and fresh salads, which are all required necessities as approved by health au- thorities in the country.” Nakheel awarded a new construction contract in its 560 hectare Al Furjan community in Dubai. The contract worth AED38m is for a new mosque and a retail sector to be called the Nakheel Pavilion. The developer has appointed Dubai-based Al Sakher Contract- ing LLC to construct the project which is scheduled to open in 2017. The 8,000 sqft mosque, which will be the first in Al Furjan, will accommodate 500 worshippers. While the 90,000 sq.ft Na- kheel Pavilion will include more than 35 shops, cafes restaurants and services including a nursery, gym and supermarket. The leasing is currently underway. This new complex will be built on the western side of Al Furjan. It is the second Nakheel Pavilion at the community, the first is situated in the south and is under construction spanning across 100,000 sq.ft. It has a swimming pool and sports courts as well as retail facilities, and is due to open in mid-2016. Con- struction of a mosque for 700 worshippers at Al Furjan South will also begin soon. 30 companies violate midday break law across the UAE Labourers in the UAE during their midday break Nakheel awards AED38m contract at Al Furjan

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A report from Kuwait’s Ministry of Finance has con- firmed the approval of construction of power plants, desalination facilities and other infrastructure projects worth $9.9bn. Struggling to meet rising demand for electricity, like its neighbouring Gulf countries, Kuwait’s upcoming proj- ects will add 3,580MW of capacity, along with waste treatment and developments for the education ministry. Most of the projects, however, do not have a set time- line except for the sewage plant which will be complet- ed by 2020. The report does not state how the project would be funded beyond the first 50% which will be raised through stock market offerings. Some of the projects include the second phase of the gas-fired Az-Zour North power and desalinated water plant that has an initial capacity of 1,800MW, the first phase of the Khairan power plant with 1500MW of ca- pacity, and the Al Abdaliyah power plant with a capacity of 280MW. The Gulf State also plans to generate 15% of its energy from renewables by 2030, with over 100 solar-powered fuelling stations planned to be operating by 2017. In ad- dition, a pilot 70MW project in the Shagaya desert is expected to be completed by next year. Kuwait invests in $10bn infrastructure projects Marble entrance of Emirates Palace Manufacturing Custom Made Hotel Furniture & Doors MANUFACTURING TECHNOLOGIES Dubai, United Arab Emirates | Tel: +971 4 884 1650 | Email: sales@intermetal.com | www.intermetal.com 28 - 30 September 2015 Dubai World Trade Centre Hall 6, Stand C241 Intermetal specializes in the design and manufacture of Hotel Furniture and Doors to meet exact specifications and budgets.

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construction business news me SEPTEMBER 2015 18 IN PERSON R ecognised for its health and safety, Al Jaber Legt Engineering and Contracting (ALEC) stands out as a top contractor when it comes to health and safety. Last year, ALEC's threshold Lost Time Injury Frequency Rate (LTIFR) was set at 0.030. The company not only remained well below this threshold but has more than halved the LTIFR for 2013. Its LTIFR history demonstrates a 90% reduction in LTI's between 2006 and 2014. Kez Taylor, CEO of ALEC, says that this has been pos- sible because the team has integrated health and safety in its daily rhythm. He explains that the first thing to understand about implementing good health and safety measures within a construction company is that it is a culture and not a list of things to do. Taylor emphasises: “You have to develop a culture of safety within the business. And what we have realised is that you cannot do that by policing.” “I think we have been very successful with this tech- nique. Our statistics has been excellent in terms of less incidents on site.” Compared to competitors, Taylor says that ALEC has “excellent standards” especially when talking about health and safety, because every team member is motivated to buy into it. “And I mean everyone,” he says, “Your con- struction workers, your subcontractors, your employees. Everyone!” His opinion on safety is that it is not a rule book to be followed by employees to meet a specified requirement. Driving excellence Kez Taylor, CEO of ALEC ALEC CEO Kez Taylor speaks with Lorraine Bangera about making health and safety a culture rather than an imposing rule, and how his team excels in every project

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construction business news me SEPTEMBER 2015 19 “It has to be something everyone understands. They have to be safety conscious in the way they behave and operate.” Benefits of a healthy team The CEO says that benefits of main- taining good health and safety within a construction company are so many. From having a healthy staff to being recognised as a good company to work for, it gives a construction com- pany an additional credit. Healthy and safe staff mean loyal and productive staff as well. Taylor admits that in his time working for ALEC he has observed that there is a link between productivity, safety and a clean environment. Though it is hard to measure, it could be noticed through mere observation. He explains that when working in a clean, orderly and safe environment, workers are able to dedicate their time towards the job at hand and in turn be more productive. International pressure Health and safety has been a topical issue with critical reports published on a near monthly basis and fatal- ity rates under close scrutiny from international NGOs, who have been urging local governments to take a more proactive role in their duty of An accident on a site isn't just lost time, it also severely affects morale. “If there is an accident on the site, you will notice the productivity will plunge. People lose confidence and it takes a while to bring it back.” As the GCC region takes an ac- tive role to make things better for its construction workforce, Taylor says that things have definitely improved when it comes to health and safety measures, explaining: “Back in the day, you could see construction workers eating their lunch high up in high-rise construction site with no barricades. It was seen as a token act of bravery and not doing it would lead to being mocked by your peers. That has definitely changed!” Thriving for excellence Historically ALEC is a construction business but in the past few years, it has diversified into related businesses for MEP, fit-out, precast, and more. “Our portfolio is a lot broader than it used to be,” says Taylor. “But we are still predominantly a construction business focussed on airports, retail, hotels, themed developments, and high-rise buildings. “ care towards employees. In 2011, more than 1,000 artists called for a Guggenheim Boycott over migrant worker exploitation at the Guggenheim Museum site in UAE. The act pressured Abu Dhabi’s Tourism Development & Investment Company (TDIC) and Guggenheim Foundation to improve working conditions for labourers. Two years ago, a report by UK- based The Guardian suggested that 450 Indian workers died in Qatar within a year span, most of them were thought to be working in the construc- tion sector. The regional construction industry has been deemed notorious, with a lot of pressure on governments to make things better. Last year, UAE-based The National reported that the number of workers killed by falls in Abu Dhabi reduced by a third according to the Health Authority of Abu Dhabi. In Taylor’s 14 years in the regional construction industry, he has wit- nessed a positive change in attitudes towards health and safety, but he maintains the onus to reduce fatalities lies with each and every contractor. Though several measures are in place to avoid fatalities and accidents on ALEC’s sites, the CEO ensures that his teams are trained to prevent inci- dents and eliminate fatalities. DID YOU KNOW? ALEC’s project team at Concourse D, Dubai International Airport, obtained a record 30 million lost time injury free work hours which is one of the largest achievements on record. Dubai International Airport – Concourse D project achieves 30 million LTI Free Award

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construction business news me SEPTEMBER 2015 20 IN PERSON Taylor has been with the company from the very beginning, and in fact was transferred to the UAE from his first industry role in South Africa. He used to work for a construction company called Grinaker, with ap- pointments in South Africa, Mauri- tius, Zambia, and some of the Indian Ocean islands, before making his way to the UAE in 2001. Taylor moved to the UAE with his team from Grinaker to open a con- tracting firm, now ALEC, with a strate- gic vantage over operations. While it’s a running joke among Taylor and his colleagues that he’s never had more than one job interview, his dedica- tion to the industry is likely to mean he never has to. “ALEC stands out because of its vision; we want to be excellent at whatever we do, we want to deliver on time, and we want to make sure our projects are successful.” Call for alignment The key to delivering successful projects is if everyone works well together. “A project consists of many dif- ferent bodies, you have the con- sultants, designers, the contractors, the subcontractors, and often they are not aligned with the common objective that they are trying to Taylor’s quick tip on constructing great projects “What you got to do is work towards common objectives, roles and responsibili- ties. First priority should be to construct it well and on time. Then, you have to think beyond just the construction of the project, consider its lifecycle with factors like the maintenance and running costs. If you can do that effectively, you can end up with a project that is cost effective, and easy to maintain, which in essence is a great project” Projects achieving significant LTI-free milestones: • Expo (DLP) - 7.8 million man hours • T1 Forecourt - 2.4 million man hours • Sofitel Hotel - 2 million man hours • NDIA, Qatar - 3 million man hours • Anantara Resort & Spa, Oman - 1 million man hours • Muscat International Airport - 1 million man hours • Doha Festival City - 3 million man hours • Abu Dhabi Airport T1 Segregation - 1 million man hours • Jame Noor al Salmy Mosque - 1.2 million man hours • ADNOC - 1.7 million man hours • ALEC DIC Yard - 4 million man hours Empire State building in New York was constructed in one year and 45 days

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construction business news me SEPTEMBER 2015 21 achieve. In my opinion every one of those people needs to align to concentrate on a common goal. We need to continue to focus on mak- ing a clear alignment within the system,” observes Taylor While the GCC construction in- dustry is still in its infancy, it is the simplicity of management structures which Taylor credits as integral to clear lines of command. Testament to his point, the 102-storey Empire State building in Manhattan, was constructed in the 1920s in just one year and 45 days with small teams, which were clearly aligned. The structure stood as the world’s tallest building for nearly 40 years after its completion in 1931. There were 3400 workers involved in the project with official records showing a fatality rate of five workers on site. In this day and age, when there are so many parties involved in a construction, a way to work well with all teams could be having a lot of companies under one umbrella, such as ALEC and its related busi- nesses which have the scope to work collaboratively across the disciplines, or autonomously. It could be challenging to find the right balance when working in con- struction. However, Taylor says that construction is construction, and it is the same in any part of the world. “What is more important is to figure out how to get it right now,” he observes. “This would be benefi- cial for everyone in the construction industry later.” “One of the major problems in Nicky Harris- Dewey, health, safety and environment (HSE) compliance manager at ALEC discusses health and safety measures: How does ALEC look at HSE differently com- pared to other companies in the region? When we look at HSE, we think of how can we improve it, integrate it, streamline into the construction process, rather than being a standalone policing mechanism. We still have to monitor and record, those are the requirements legally. But rather than seen as the lone ranger coming in and stopping the works, we are aligning with our team, interfac- ing with them, and working with them, to find solutions to HSE problems that are integral to our business. We have improved hugely over the last nine years. I could say we have made 100 or 99.9% improvement in HSE. How does the company integrate HSE at every level? We start at the lower levels, we have daily talks with every employee. The team leader will have a talk, based on the particular activity and make sure they understand the dangers involved. Our most popular initiative is the industrial theatre which is basically a skit. We use industrial theatre as a means of communicating and inculcating our vision and our culture. We will select the topic, such as heat stress, and include our construction workers into role playing what happens when you’re working in an intense heat environment, and show what to do and what not to do. How have the workers responded to the industrial theatre? They have responded very well to the visual. The first year we implemented that we didn’t have a single hospital case relating to heat stress. We had an increase with the number of walk-ins to the clinics because workers were more aware and said, “I feel a bit odd” or “I need something”. That was a good sign for us as our team had an aware- ness about what was going on in their own bodies and caught it before it escalated to requiring urgent medical treatment. ALEC’s team awarded HSE award trying to align everyone toward a com- mon objective is that everyone gets defensive so quickly. They go into their corners and defend their team, losing focus of the entire goal. The only way to change that, is to create an environment where team members are empowered to trust each other and work together.”

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22 T he bureaucracy of legislation and red tape is often met with resistance, owing to the need for additional resource and the challenging demands of implementation. In 2014, however, Dubai Municipality became the first public authority in the Middle East to introduce the mandatory use of Building Information Modelling (BIM), there was a wave of support in the construction industry across the UAE. “The main BIM advantage is resolv- ing design clashes between different disciplines –mechanical, electrical, civil – resulting in major savings in time and redundancies,” Khaled Awad, a consul- tant on the initial designs for Masdar HQ, the zero-waste, carbon-neutral flagship project outside Abu Dhabi, was quoted as saying at the time. Awad added that BIM had been “indispensible” and “is critical in complex structures and with- out it such projects would incur sizable losses in time and money.” A common obstacle to BIM deploy- ment in the region is the requirement for cultural change. People think about BIM as a tool for saving time and money, rather than a collaborative process that requires a major change in process and culture. Other potential barriers are resource availability, changes in govern- ment spending plans, private sector financing, and risk management. BIM digital modelling helps every- one to optimise their interactions with the building, resulting in a greater whole-life value for the asset and has the potential to deliver more valued judgements and more sustainable infrastructures for owners and occu- pants. A quality computer maintenance management system (CMMS) is also increasingly recognised to improve the effectiveness and efficiency of the maintenance management in the built environment. Together BIM and CMMS present maintenance managers with a powerful opportunity for the advance planning of buildings and infrastruc- ture as part of a cooperative team with a cross-section of professionals who all have a vested interest. The early involvement of maintenance in design and performance can unlock collab- orative ways of working to create im- proved efficiencies and better reporting data. The integration of information al- lows BIM to support a built asset from construction right through to operation. The increased predictability of proj- ects, which can be visualised at an early stage, gives owners and operators a clear idea of design intent so that this can be modified to achieve specified, desired outcomes. Scanning and converting ex- isting buildings to 3D models also allows maintenance engineers to look at the impact of re-modelling, refurbishment or extension options. Adopting BIM within a building’s development strategy results in major benefits by bridging the gap between the team that builds the facility and the owner and occupier who oper- ate the building. There is massive global potential for BIM and CMMS to operate in the same sphere with a developing understanding and meaningful exchange of information to support the sustainable development of buildings and infrastructure in the Middle East. Gary Watkins is CEO of Service Works International. Working with the company from the outset, he is responsible for lead- ing the SWG business and securing the organisation’s consistent international growth. He has nearly 30 years’ extensive IT and built environment experience and Public Private Partnership (PPP) experience totalling more than 10 years. construction business news me SEPTEMBER 2015 Gary Watkins, CEO of Service Works International, analyses integrating building information models with computer maintenance management system for meaningful data Bridging the gap COMMENT Successfully integrating BIM with CMMS management systems can provide: • Better quality and standardised data: Allowing maintenance managers to take informed decisions through the whole lifecycle of the facility (around areas such as asset maintenance, energy consumption, and cost efficiencies) • One source of information: That creates one version of the truth, providing that BIM data is updated with additions, amendments and deletions from the CMMS system • Reduced costs: By introducing BIM into the operational part of the building’s lifecycle, the cost benefits achieved during the design and construction cycles can be extended into the whole lifecycle, which makes up 80%of the entire cost. By having accurate, up-to-date and complete data ready when the building is handed over to the maintenance team, the cost of the traditional data capture from design/ construction information to FM data is reduced • Improved performance: The holistic nature of the BIM and CMMS integrated data ensures that problems can be diagnosed quickly and performance predicted, resulting in fewer equipment and asset failures. Maintenance engineers can see a 3D visualisation of the asset and its location, together with all service history and contract information in advance of a visit, reducing repeat visits, improving response times, and reducing disruption for the client • Improved reporting: BIM ensures that information is all in one place making timely, accurate and in-depth reporting far easier

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ANALYSIS 24 construction business news me SEPTEMBER 2015 Pumped up

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construction business news me SEPTEMBER 2015 25 Gasoline prices headed up, diesel prices headed down. What do the changes mean for local construction businesses? Stuart Matthews writes T he announcement was unexpected, brief and the change came quickly. In a little over the space of a week the UAE went from having substantially subsidised fuel, to seeing its petrol and diesel prices determined by global market val- ues and the newly-formed Fuel Price Committee. For years the price of petrol and diesel in the UAE has been subsidised by the government. This has shielded buyers from global fluctuations in the cost of petrol and diesel, influenced by the price of oil. With these subsidies removed UAE consumers now pay rates based on average global prices. However, these new prices are still regulated by the government via the committee, which is tasked with monitoring the global prices of fuels and is expected to announce each month’s new prices on the 28th. “The decision to deregulate fuel prices has been taken based on in-depth studies that fully demonstrate its long term economic, social and environmental impact,” says Suhail Al Mazroui, Minister of Energy, at the time of the announcement. “The resolution is in line with the strategic vision of the UAE government in diversifying sources of income, strengthening the economy and increasing its competitiveness in addition to building a strong economy that is not dependent on government subsidies. This step will put the UAE on par with countries that follow sound economic methodolo- gies. It is also anticipated to improve the UAE’s competitiveness while positioning the nation on international indices.” The changes will introduce some potential price volatility to the market, though this is likely to be extensively cushioned by the monthly cycle of price announcements. While the driving public are facing increased costs at the pump, and probably in taxis in the future, the construction sector may gain a little, in more ways than one. The most obvious gain is that when the changes came into force the price of diesel actually came down 29% to be AED2.05, while petrol on the other hand went up between 23-24%, depending on the octane rating. ENOC petrol station in Dubai

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26 construction business news me SEPTEMBER 2015 ANALYSIS Khatija Haque, head of MENA Research at Emir- ates NBD. “Ultimately, ratio- nalising fuel subsidies and moving to a more flexible pricing system should encourage con- sumers to switch to more fuel efficient cars and in- crease the use of public transport. It should also encourage greater invest- ment in public transport, renewable energy and energy efficiency.” Subsidised fuel prices tend to encourage waste- ful consumption and contribute to excessive emissions. It’s clear the changes in pricing are also intended to encourage what’s been called ‘rationalised’ consumption. This is particularly aimed at private consum- ers but the overall transport sector was responsible for 22% of the total greenhouse emissions in the UAE in 2013 amounting to 44.6 million tonnes of carbon dioxide. Reducing this output by exposing consum- ers and businesses to market prices fits with other broad government strategies aimed at making the UAE a ‘greener’ country, such as intro- ducing solar power and developing green building regulations. These are viewpoints advocated by Abhay Bharghava, associate director, Energy & Environment Practice, Frost & Sullivan. He believes there are two key perspectives to consider. “Firstly let’s look at the context of the UAE, which has always subsi- dised fuel in the country and obvi- ously the bill for the subsidies was being paid for by the oil prices that the country could command. This is something that the country and of course, the oil exporting world, is now struggling with. They have situation with the oil price that is not going away. “If any economy maintains subsidies it reduces income and that can lead to a tougher credit rating. So as we see it the removal of subsidies is good for the long term health of the economy.” “Considering the international pric- es of oil and petroleum derivatives, we expect diesel prices to go down. This will stimulate the economy as lower diesel price would mean lower operating costs for a wide number of vital sectors like industry, shipping and cargo among many others,” says Al Mazroui. Everything from heavy machin- ery to diesel generators got a little bit cheaper to operate as a result. While fuel is only a small part of the full lifecycle cost of a construction site’s most expensive motorised kit, every little bit counts and savings in one area may help offset the costs accrued for the petrol-powered site vehicles used elsewhere. While businesses in the UAE now pay the highest fuel prices among GCC countries - those in Saudi Arabia pay the least - by global standards fuel is still a low-cost com- modity in the region. Internationally taxes are levied on fuel costs to cov- er anything from road improvements to environmental programmes and these taxes usually far exceed the core cost of the fuel; just ask anyone from Norway, which enjoys the world’s highest fuel prices despite substantial oil reserves of its own. Observers though are certain there will be an upside. The International Monetary Fund (IMF) has estimated that it could save the UAE $500m in just the rest of 2015, with these sav- ings likely to increase in the years ahead. Removing costly subsidies also enhances the country’s economic com- petitiveness for investors and creditors, who might put money into businesses or extend loans to fund growth. The timing of the change could not have been better. Oil prices are at their lowest since 2009, offering consumers a buffer against sharp price increases, while reducing government expendi- ture at a time when oil revenues are slackening off. “Given the current relatively low price of crude oil and related products, it would seem to be an opportune time to reform state subsidies of fuel without causing a sharp spike in inflation or the cost of living in the near term,” says Five fuel savers There’s a load of ways you can cut fuel consumption in site vehicles and keep running costs down and a lot of them require no spending at all Check tire pressure: Tires gradu- ally deflate over time and incorrect tire pressure can increase fuel consumption as a soft tire makes it harder to move the vehicle. Tires come with specific inflation requirements found in the vehicle’s hand- book, or on a sticker in the driver’s door frame. Make sure your fleet’s drivers know what it is and check that it’s right. Endless shattered tire carcasses on the roads demonstrate how little attention is paid to the rubber vehicles ride on. Empty vehicles out: Site vehicles often find themselves used as mobile stor- age units for tools, materials and portable kit, all of which adds to the weight of the vehicle. Every kilo counts when it comes to fuel economy, so lighten the load by storing stuff properly. Slow down: Moderate acceleration and reduced top speeds will save tankfuls of gas if drivers can be persuaded to change their habits. Correct gear selection in heavier vehicles makes a sizeable differ- ence too. Train drivers: Even experienced driv- ers can benefit from a little refresher. Advanced skills courses are often available from vehicle manufacturers, whether it’s for a new ute or the latest bit of trucking tech. Courses often concentrate on safe, economic driving, which can ultimately make a significant difference to fuel consumption over the life of a new vehicle. If you’ve got a big order going in, push for free driver training too. Maintain vehicles: The construction ute is often one of the worst-maintained vehicles seen on the road, while they probably compete with taxis for the highest mileage. The same applies to some of the haulage trucks feeding sites with essential materials. Maintenance matters and keep- ing it regular will not only extend the life of the vehicle but reduce its operating costs too.

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27 A healthy economy could see the construction sector receive a boost from increased spend on infrastruc- ture projects and, in the long term, increased investment in public trans- port. Removing fuel subsidies could benefit the budget directly freeing up resources for spending elsewhere, such as on infrastructure. Research from the IMF has shown that the GCC spends 3.4% of GDP on fuel subsides, substantially higher than other regions. By comparison, what it classifies as advanced economies spend less than 0.1% of their GDP on fuel subsidies. “The second perspective is that we are, as part of the overall Middle East region, very prone to wasteful consumption,” says Bharghava. “Per capita energy intensity is high and with an increase in fuel prices what hopefully will happen is that people and businesses will try to cut down on consumption where they can. “In our opinion it’s a great move and in line with what the government is doing to go green. It started with so- lar was followed by energy efficiency measures for buildings and now the removal of fuel subsidies. It is clearly trying to attack the issues that have plagued the economy from a wasteful consumption point of view.” While subsidies maybe under pressure Bharghava doesn't believe electricity subsidies will be next in the sights, as the local economy con- tinues trying to encourage automated manufacturing and other energy- intensive industries to expand. Trans- port costs, whether hidden or up front, are likely to remain fixed too. So while there is an immediate sav- ing to be had for some companies, the cost of local road transport is only a tiny portion of the final price of imported materials. The changes may also act as a catalyst for the greater development of alternative fuels. But the large- sale introduction of alternative fossil fuels, such as CNG or LPG, may be hampered by a lack of readily avail- able infrastructure for filling and maintenance. “And where would that fuel come from because we don't have those processing facilities here in the coun- try and that means asking for a new industry to develop,” says Bharghava. The lower diesel prices may how- ever encourage greater shift to the use of the fuel in transport vehicles. While diesel cars are almost unheard of in the region - thanks in part to low fuel quality as well as low petrol costs - fleets of smaller vans and buses running on petrol could well find themselves being replaced with diesel variants. This could prompt a stall in purchasing decisions for those running commercial fleets, while they take a wait-and-see view of how fuel costs in the UAE will sta- bilise after a few months of the new pricing regime. One immediate challenge for this shift may be at the pump itself. Most gas stations have one or two diesel bowsers sitting alongside a dozen or so petrol filling spots. Long queues at busy gas stations could get longer if there is a significant boost to the diesel vehicle numbers. From an environmental per- spective a push to greater use of diesel could open up the market for biofuels in the UAE. Available at the same price point as regular diesel the biofuel variety comes with the added advantage of not having much in the way of carbon emissions. Biofuel company Neutral Fuels converts used cooking oil into biodiesel, and added Dubai Municipality to its growing list of customers in February this year. “[Subsidy removal] has definitely increased the size of the target market for our biofuel.” says Karl Feilder, CEO of Neutral Fuels. That government entities are getting behind the use of biodiesel may be a sign of things to come as the UAE cranks up pressure to make environmental changes and lets companies pay the real price for their consumption habits. Busi- nesses that can tailor their usage to take advantage of the new price regime may, in the long run, earn themselves a bonus for their bot- tom line. construction business news me SEPTEMBER 2015 Suhail Al Mazroui, Minister of Energy, Abhay Bharghava, associate director, Energy & Environment Practice, Frost & Sullivan Price points Unleaded Gasoline 98 old price 1.83/litre new price 2.25/litre Unleaded Gasoline 95 old price 1.72/litre new price 2.14/litre Gasoline E Plus 91 old price 1.61/litre new price 2.07/litre Diesel old price 2.35/litre new price 2.05/litre

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construction business news me SEPTEMBER 2015 28 COVER STORY construction business news me SEPTEMBER 2015 28

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construction business news me SEPTEMBER 2015 29 Oil prices have fallen 55% since September 2014 and the International Monetary Fund has warned GCC governments to curb spending in the face of predicted budget deficits this fiscal year. As global supply dynamics continue to spook in- vestors Melanie Mingas looks at the potential impact on the construction and renewable energy industries

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construction business news me SEPTEMBER 2015 30 simple supply and demand in addi- tion to heighted US production and a rise in fracking. However the im- pact on the fiscal health of the GCC could cause significant waves. The above-water appearance has been one of poise and composure, but there is no doubt some fast ped- dling going on below the surface. The ability of each GCC state to bankroll planned projects is pegged on oil remaining at a certain price per barrel (see fiscal breakeven price graphic). The long term effect should prices fall below, few are certain of. Yet Oliver Klaus, Dubai bureau chief at Energy Intelligence, warns that of all the industries ac- tive in the GCC the construction industry could feel the effects first. “Middle East oil producers have not delayed many projects thus far, but the recent drop in oil prices may make them rethink the timing or the feasibility of some of their plans. It could raise question marks about enhanced oil recovery proj- ects in Oman and Qatar, or heavy crude developments in the Neutral Zone shared between Saudi Arabia and Kuwait.” He adds: “In general, indus- tries that rely to a large extent on government spending will be most affected as revenue from crude sales I f one story has dominated the summer of 2015, it has been that of the tumbling oil price. After four years of steady income, with the price per barrel resil- ient enough to remain over $100 in the face of complicated and ongo- ing global economic factors, recent months have seen values tumble, day by day, to lows unseen since 2009. According to the International Monetary Fund (IMF), the decline totals 55% since September 2014. In a crescendo of negative market forces, last month Standard and Poor’s went as far as to speculate that “gradual weakening in econom- ic conditions” will “adversely” affect the regional banking industry. Growth of net income and de- posits in Gulf-based Islamic banks will slow down, while asset quality is seen to deteriorate, the ratings agency warned. If the trend continues the GCC could be set to lose $215bn in oil revenues, more than 14% of the six state’s combined GDP, according to calculations by the World Bank. While the developments are reminiscent of the use of oil prices to bring down the Soviet Union in the 1980s, governments have been quick to dispel such rumours this time, putting developments down to is being eroded. The construction sectors in the GCC are among those relying heavily on government proj- ects and would be among the first ones to feel the consequences of reduced state spending.” The concerns are far from new. As long ago – in economic terms at least – as Q1 this year analysts were sounding warning alarms. Now, as Q3 dawns, those con- cerns are far from fading and all the signs of a tectonic shift in spending power are present. With so many huge projects planned, could we be looking down the barrel of a greater crisis? Klaus responds: “Ongoing delays in oil companies’ investment deci- sions and cancellations of new oil and gas projects, amid sustained low crude prices, could have a knock-on effect on new capacity ad- ditions in coming years and lead to a supply crunch.” A new way of life There is no solid plan forthcoming, should the downward spiral contin- ue, as to how the GCC will diversify its economy. It can be buoyed with foreign assets and currency reserves, but not forever and for now, at least according to Kuwaiti Oil Minister Ali Saleh Al Omair, hopes are pegged COVER STORY Saeed Al Abbar, chairperson of EmiratesGBC

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construction business news me SEPTEMBER 2015 31 on a boost in the growth of the global economy. In July, Al Omair was quoted in Al Qabas newspaper saying: “There is satisfaction among member states with indications of better growth of the world economy. “We do not look at the amount of production, but what concerns us primarily is the rate of growth of the world economy, which will bring the required balance to keep prices at the desired level.” Should that fail, regional economies are prepared for “several years” of reduced hydrocarbon income. The issue isn’t contained to the Middle East. Surmising the view from outside, The New York Times reported last month that Venezuela, Iran, Nigeria, Ecuador, Brazil and Russia will suffer economic and perhaps even political turbulence, while Gulf States are likely to invest less money around the world, and may cut aid. The saving grace for the regional construction industry could be that prices for other commodities have also declined, though not by as much as oil prices. The IMF reports that metals are expected to be 13% lower in 2015–19 than was projected in October 2014. Baseline fore- casts for average gas prices remain broadly unchanged; even if, some gas exporters such as Qatar, are fac- ing lower gas prices because their contracts are indexed to oil prices. One thing can be agreed upon – the days of “easy money” are numbered. According to the IMF’s breakeven price calculations, Bahrain and Oman face the largest threat. Bahrain, the most severely affect- ed, is contemplating a request for budget support from its Gulf allies. Oman has released a 2015 budget that includes no spending cuts or additional revenues, but may resort to both in the year ahead. While the Economist Intelligence Unit estimates that Oman's fiscal breakeven oil price climbed from $84.5/barrel in 2011 to $110.6/b in 2014, the Sultanate’s fiscal budget, set in January, projected a deficit of 8% of GDP with spending set to rise by 5% compared to 2014. The project pipeline comprises the dualisation of Adam to Tham- rait road; ongoing works at Duqm Port; a new residential city in Liwa; wastewater plants and a number of hotels. In Bahrain, where construction contributes 10.7% to GDP, planned projects include the Gulf rail line development; a public transport network due in 2030; Bahrain In- ternational Airport Expansion; the construction of infrastructure for three planned cities; and investment in power and water projects. If the wealthiest GCC states are unable to step in and prop up their smaller neighbours, some tough de- cisions may have to be made about the feasibility of entire pipelines of mega projects, unless funds can be generated from elsewhere. Klaus advises: “GCC governments have a few options at their disposal including drawing on their reserves, issuing debt, selling assets and cut- Fiscal Breakeven Prices, 2015 (USD per barrel) Sources: National authoriries; and IMF staff calculations

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construction business news me SEPTEMBER 2015 32 COVER STORY ting back on spending. The immedi- ate moves are likely to be tapping their substantial reserves as Saudi Arabia has been doing over the last few months for example, and issu- ing conventional or Islamic bonds. Again, Saudi Arabia has done so already and others, like Kuwait, are expected to follow. “At this point, it seems rather unlikely that governments would resort to the sale of assets as it’s going to be more difficult in today’s environment to secure the sale price they’d want to achieve. Govern- ments also appear to remain com- mitted for now to sustain spending as a means of stimulating their economies and creating jobs for their local populations. Another option governments may seriously consider now is cutting back on cer- tain subsidies, in particular around electricity and water, as the UAE has done,” he adds. In the 2015 Deloitte Powers of Construction report, governments are urged not to cut back on project spending, specifically airport proj- ects, which will be vital to econom- COVER STORY ic diversification in the long term. “Against this backdrop of com- mercial pressures and greater public scrutiny on delivering value for money, there is an increased priority for capital projects to be delivered efficiently and by fit-for- purpose organisations. Setting up the delivery strategy and organisa- tion at the start of the project is, of course, critical to success, and this is something that Deloitte has been supporting a number of global and regional airports to achieve,” the report read. The role of renewables While the construction industry could see some mega-projects halt- ed until further notice, the renew- able energy industry is set to gain. Bucking the austerity drive, Kuwait announced it is to spend $100bn on energy projects over coming years, but a closer look at the announcement showed much of the money would be used to pursue the country’s ambition to source 15% of all power from renewables under its 2030 development plan.

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construction business news me SEPTEMBER 2015 33 The view from the World Bank • 90% of total budget income in the GCC is generated from oil revenues • 75% of total export earnings and over half of GDP generated from oil and gas • $215bn loss in oil revenues, more than 14% of the GCC state’s combined GDP will be lost if prices remain low • $39bn budget deficit predicted for Saudi Arabia due to falling oil price, 2015-end • 5% deficit of GCC-wide GDP could be recorded at year end, despite the recorded 10% surplus in 2013 The numbers behind the plan leave little room to manoeuvre. Ku- wait has one of the highest energy consumption rates per capita in the world, with the average Kuwaiti using 22 times more resources than the country provides per person. It is widely believed Kuwait will need 20% of its oil production capacity just for energy generation within four years, a consumption rate deemed unsustainable given that two thirds of the country’s GDP is dependent on the oil industry. The impact on other planned infrastructure spending has yet to be analysed. “It cannot be denied that the re- cent drop in oil prices does high- light the need for diversification for the oil exporting economies, especially the ones in the GCC,” says Abhay Bhargava, regional head of Energy and Environment Practice MENA at Frost & Sullivan. “The GCC countries cannot base their power generation on one single foundation of conventional fuels, as this will lead to overde- pendence, resulting in high risk. Additionally, there is wastage of crude by using it for power genera- tion, while it could be diverted into the petrochemicals and refining industries, leading to development of higher value-add downstream products that can result in greater benefit for the economies,” Bhar- gava was quoted as saying earlier this year. “Based on these parameters, it is critical for the GCC countries to re- consider their energy mix. All these countries are also facing power-re- lated issues since, they either buy or rent Gensets in order to supplement their energy needs. Thus, there is deficiency, and the choice will be to invest in solar or conventional power,” he said, adding that today there is an increased willingness to look at diversifying into renewables in the region as capital costs are go- ing down. It is important to note that recent oil price volatility has not been the trigger for renewable projects, however it could be the final push External Losses from Lower Oil Prices Sources: National authoriries; and IMF staff calculations Note: External losses from lower oil prices are calculated as the projected difference in the USD calue of net oil exports in 2015, using the 2015 oil price assumptions in the January 2015 REO Update and the October 2014 REO, and the volume of net oil exports in the October 2014 REO, with adjustment for idiosyncratuc country specific factors. Dark blue (green) bard refer to MENAP (CCA oil exporters. required to drive meaningful mo- mentum in the renewables sector. “Efforts to build an efficient infrastructure to support renew- able energy have been undertaken for several years now. No doubt, increasing demand for energy – led by the demand from a growing population – will continue to shift the dialogue towards green energy. In fact, we are also seeing a strong focus on promoting retrofitting existing buildings with the goal of making them energy efficient,” says Saeed Al Abbar, chairperson of Emirates Green Building Council, which recently issues the ‘Technical Guidelines for Retrofitting Exist- ing Buildings’, aimed to serve as a guide for UAE industry professionals and building end-users. “We see positive and tangible change on ground in the UAE’s shift towards renewable energy – and this will only gain momentum in the coming years,” he adds. The bottom line is, that as eco- nomic push and pull factors con- tinue to re-draw the boundaries of government ambition, business dy- namics will have to respond – and in future the government’s role will evolve from that of budget holder to policy developer, supporting the private sector in helping to achieve ambitious growth plans through ro- bust PPP frameworks and transpar- ency in the tender process.

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construction business news me SEPTEMBER 2015 34 TAKE 10 The UN estimates that almost three billion people don’t have access to reliable electricity. With ever greater pressure on fossil fuels, renewables are contributing a greater share to the overall energy mix. These are the 10 most impressive renewable projects from around the world power projects Officially inaugurated in 2009, after 14 years of construction, the Tekeze Dam is the tallest in Africa and will generates 300 MW of hydrelectric power, adding 40% more energy to the 683 MW previously generated for Ethiopia. The project was the largest public works project in the country’s history at the time of construction and provides a clean, renewable source of power for a rapidly growing population and creates opportunities for sustained social and economic growth. The engineering and design, construction, and construction management was handled by MWH Global. The dam is a double curvature (logarithmic spiral) concrete arch dam, a method of design that minimises the amount of concrete, creating a 70km long reservoir. An underground powerhouse, containing four 75 MW Francis Turbines, is located approximately 500m downstream from the dam and fed by a 75m high intake structure connected by a 500m long concrete-lined power tunnel. A 105km long 230 kV double-circuit transmission line was constructed through rugged, mountainous terrain with minimal environmental impact to connect to the Ethiopian national grid. Hydropower is the primary source of energy generation in Ethiopia, a coun- try with few natural resources and expensive imported fuels. Sustainable Masdar City is designed to be the world’s most sustain- able eco-city, providing an example by which other cit- ies can transform their energy generation, transportation systems and architecture to lower the environmental impact of their existence to close to zero. Initiated in 2008, the project today features homes, restaurants, shops and schools and will eventually become home to 40,000 people, with 50,000 people commuting to work and learn. The city has its own Institute of Science and Tech- nology and an entire portfolio of renewable energy projects. Its solar PV plant – the largest of its kind in the Middle East – produces 17,500MW of clean electric- ity annually and offsets 15,000 tonnes of carbon emissions per year. The plant consists of 87,780 multi-crystalline and thin-film modules supplied by Suntech and First Solar. Tekeze Hydropower Project 2 Masdar City 1 Masdar Institute of Science and Technology Tekeze Hydropower Project in 2007. Image courtesy of Paul Snook.

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construction business news me SEPTEMBER 2015 35 A cabinet meeting chaired by the chief minister of Indian state Madhya Pradesh, Shivraj Singh, approved the proposal for commissioning the world’s largest solar power plant in the Rewa district, in May 2015 and the $750m proj- ect is now said to be close to completion. Covering 1,500 hectares, the project had received a pledge of low cost fi- nancing support from the World Bank, to an extent of 49% of the project cost. A JV company has been established for the project with the new and renew- able energy department permitting use of revenue land for the project while Power Grid Corporation will work on grid linkages on power generated by the project and its transmission lines. Madhya Pradesh Power Management Com- pany will purchase 40% power generated. Madhya Pradesh is one of India’s leading states when it comes to renewable power, with a number of other projects in solar, wind and small hydro. Located near Póvoa de Varzim, Portu- gal, this is the world’s first and only commercial wave power plant and resembles a 150m long, 3.5m wide red snake which floats on the surface of the sea, half above the water, half under. Each of its four segments houses independent hydraulic power plants. As each segment moves with the sea, its hydraulic power plant pumps a biodegradable hydraulic fluid through a turbine which pro- duces up to 0.75MW of electricity per unit. Three of these, constructed at a cost of $13m are currently producing a total of 2.25MW at peak, and plans exist to eventually expand the wave farm to 21MW. 3 Apple’s solar plant Aguçadoura Wave Farm 4 Madhya Pradesh Solar Project5 Aguçadoura Wave Farm Tech giant Apple became the largest corpo- rate user of solar power in the US this year when it announced an investment of $850m in a solar power plant through a partner- ship with First Solar, one of America’s largest photovoltaic (PV) manufacturers and provider of utility-scale PV plants. Through a 25-year purchasing agreement, Apple will get 130MW from the new California Flats Solar Project. It is as much electricity as the company uses to power all its operations in the state. According to a statement from First Solar, the 2,900-acre California Flats Solar Proj- ect occupies 3% of a property owned by Hearst Corporation in Cholame, California. Construction is expected to begin in mid- 2015, and to be completed by the end of 2016. The output of the remaining 150MW of the project will be sold to Pacific Gas and Electric under a separate long-term PPA, and the project is fully subscribed between the Apple and PG&E PPAs.

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construction business news me SEPTEMBER 2015 36 TAKE 10 In July this year Siemens announced it had won an or- der from Dong Energy to supply its wind turbines for the Race Bank Farm project, an offshore wind power project on the east coast of the UK. Expected to be worth up to $1.2bn, Siemens will provide 91 of its 6MW turbines for the project, which will reach a total capacity of up to 580MW. The Race Bank offshore wind power plant will be erected around 32km off the British eastern coast and will cover an area of 62km2. The wind turbines will be erected on monopile foundations in water depths between 6m and 26m. Race Bank is part of the second round for public tenders in Great Britain. Installation of the 154m diametre turbines is to com- mence during the spring of 2017. New Zealand harnesses its geothermal power at several locations across the country and operates dozens of plants. But the Nga Awa Purua plant features the largest single-shaft geothermal turbine in the world. The 132-MW Nga Awa Purua plant is the largest single-turbine project ever developed. The turbine was manufac- tured by Fuji Electric and the power plant is owned and operated by Mighty River Power. The Rotokawa geothermal field, where the plant is location, lies about 14km northeast of Taupo and 9km east of Wairakei. The associated thermal area has extensive surface features including fuma- roles, eruption craters and collapse pits. Lake Rotokawa fills one crater, and there are large deposits of sulphur surrounding and beneath the lake. In 2007, Statkraft, Europe’s leading renewable energy company, announced plans to build the first prototype osmotic power plant, following a decade of research. Located in Norway, calculations indicate that the technology could contribute around 1,600 TWh on a global basis annually. Osmotic power is based on the natural process of osmosis. In an osmotic power plant, sea water and fresh water are separated by a membrane. The sea water draws the fresh water through the membrane, thereby increasing the pressure on the sea water side. The increased pressure is used to produce power. The global technical potential for osmotic power production is estimated at around 1600 TWh, including around 200 TWh in Europe and 12 TWh in Norway, or 10% of Norway’s current power production. The research work is sup- ported by The Research Council of Norway. Race Bank Farm 6 The Statkraft Osmotic Power Plant 7 Nga Awa Purua plant8 Race Bank Farm The Statkraft Osmotic Power Plant. Image courtesy of Damian Heinisch Nga Awa Purua plant. Image courtesy of Pichugin Dmitry

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construction business news me SEPTEMBER 2015 37 The Rance Tidal Barrage is the world’s oldest and largest tidal power plant. Con- structed in 1967 in Bretagne, France, the Rance barrage works by block- ing the entrance to the estuary of the Rance River, where average differ- ence between low and high tides is 8m. The 24, 10MW bulb turbines that sit in the barrage beneath the surface can be turned by the water as it flows both into and out of the estuary, allowing the dam to produce electric- ity almost continu- ously. The original project cost $134m to construct. Although this project is yet to be completed, the Moham- med Bin Rashid (MBR) Solar Park is one of the largest strategic renewable energy projects in the world that is based on the IPP model. The project is managed by Dubai Electric and Water Authority and is set to increase the share of renewables in Dubai’s total energy mix to 7% by 2020 and 15% by 2030. According to information released by DEWA, the Solar Park will host a solar testing facility to study and evalu- ate the performance, long-term stability and reliability of the panels under actual local weather conditions in tests involving 32 module commercial types from over 20 manu- Rance Tidal Barrage 9 Mohammed Bin Rashid Solar Park 10 Rance Tidal Barrage Image courtesy of Gencho Petkov

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construction business news me SEPTEMBER 2015 38 COUNTRY FOCUS Experts based in Saudi Arabia analyse its real estate market and how the government is playing an active role in combating industry challenges Which sectors in Saudi Arabia real estate market are doing the best: resi- dential, retail, office or hospitality? Ahmad: Driven by a growing population and rising income levels, the perfor- mance of retail and office in selected cit- ies is considered attractive. Also, currently hospitality sector across the kingdom is doing extremely well. Although the activity level in the resi- dential sector has recently slowed down, the demographic and organic growth of the population base will likely ensure the sustainability in this sector. Therefore, it is considered the most attractive in the long run. Jones: Given the current market scenario, and increasing population in the country, the residential market outperforms its competitors. A shortfall in residential mar- ket supply has put a considerate amount of pressure on the residential sector. On the other hand, a plethora of supply in the office and hospitality sector will take time for the market to absorb. Ahmad: Residential and retail are the best performing asset classes across the all major cities of Riyadh, Jeddah and Dam- mam. However, in holy cities of Makkah and Madinah, hospitality and retail has outperformed other sectors. Report by Knight Frank suggests that there is an increase in the demand for office space, will the demand be met in the near future? Damrah: There is an increase in demand in relatively all sectors which is under- pinned by a growing economy and high population growth rates. However, the Riyadh market is anticipated to have some imbalance in the future as supply is expected to substantially increase. On the other hand, the supply demand balance should not change much within Jeddah as both supply and demand are expected to increase in tandem with each other. Jones: Office space demand has largely been driven by the public sector, pre- cisely the non-oil public sector which is largely concentrated in the commercial cities. Following the supply of few com- bEATING ODDS THE Imad Damrah, managing director of Saudi Arabia at Colliers International Mark Morris Jones MRICS, director and country manager at Chestertons KSA Fayyaz Ahmad, director of Riyadh at JLL

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construction business news me SEPTEMBER 2015 39 mercial flagship projects, vacancy rate have remained relatively stable, showing signs of match of demand and supply in the market. Overall, as demand is gener- ated over the years, the country is in line to receive a considerable amount of sup- ply for the next three years with a view to match the supply. Has rents in residential markets and offices remained stable? Could you elaborate on why or why not? Ahmad: Given the issue of affordability in the residential sector, the rental market is showing healthy growth. Rents are increasing because demand for housing outstrips supply. However, this is not the case for the office sector where situation differs from city to city. For example in Jeddah rents are stable as future supply is relatively limited. Contrary to this office rents in Riyadh are decreasing due to an oversupply situation. The outlook of the office sector is therefore less resilient as compared to the residential sector. However, some of the projects continue to perform well due to excellent parking, work friendly environment and other services they offer to their tenants. Damrah: In Riyadh, rents have remained relatively stable in the office market as developers are trying to secure tenants as much as possible before King Abdullah Financial District (KAFD) completes con- struction, whereas apartment rental rates have increased which is mostly due to relatively limited supply increases relative to demand. While in Jeddah’s office sector, rents have sustained their increase in prices as demand is relatively balanced with sup- ply. The city’s residential sector situation is similar to Riyadh’s. Jones: Office markets remains relatively stable, as new supply in the market keeps pace with the ever generating demand in the country. On the other hand, the residential market has witnessed a steady growth in the rental segment, as public shits to rentals from owning a house due to the lack of affordable housing in the country. Additionally the lack of supply in highly populated areas has also contributed to the rental growth in the country. What are some of the major chal- lenges faced by developers in Saudi Arabia? Damrah: High land prices, unavailability of land in strategic locations, the 30% down payment requirement by Saudi Arabian Monetary Agency, labour short- ages, time consuming to obtain permits and the lack of professional contractors are some of the major challenges. Jones: One of the major challenges, in my opinion, is to match the demand of the customers, as customers vary a lot area to area. The major point of obstacle being the difference between willingness and ability. Much of Saudi Arabia’s population is attributed to young generation leading to comparatively low income which makes affordability a major drawback for purchasing a house. Over and above the income factor, with the new mortgage laws in place which restrict the loan amount to a maximum of 70% is another factor for slowdown in the sales market. Ahmad: Challenges include scarcity of credit, Escrow laws, Saudis wary of off plan purchases, cultural acceptance of community developments, and new laws of 30% down payments for residential real estate financing. How has the rise in population in Saudi Arabia been challenging to deal with by the local real estate market? Ahmad: Saudi Arabia is the largest potential real estate market in the GCC with abundant oil wealth along with a growing population. The increase in population, particularly youth, drives a long-term demand for housing. The local market presents best opportunity for residential and retail asset classes. That being said, affordability still remains the substantial challenge. Jones: The local market has witnessed a steady increase in demand over time with population increase and due to various government initiatives to boost the hous- ing sector. With the government expecta- tions looking at a rise in the population in the coming years, the rising population will outweigh the current supply in the market causing property prices to rise in the country. Damrah: The growing population has positively affected the market in terms of natural demand, especially for real estate components like residential and retail. However in many cases, the market has not been able to cater to this demand, which has put pressure on prices. This has affected affordability, especially for the residential sector where we are see- ing multiple initiatives by the government to make housing more affordable. How is the lack in affordable hous- ing being addressed by the Saudi real estate sector? Ahmad: The government’s main priority is to tackle the affordability issue so that more Saudis can shift from rental to own- ership. The Ministry of Housing is work- ing with private developers to release more affordable units. Similarly REDF is trying to facilitate citizens to build or own a house but increasing land and housing prices makes it difficult to achieve the desired results. construction of a tower building in Riyadh, Saudi Arabia.

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construction business news me SEPTEMBER 2015 40 YEAR POPULATION SIZE (Thousands) Males females total 1980 5274 4569 9843 1985 7281 5993 13274 1990 9073 7133 16206 1995 10377 8191 18567 2000 10834 9311 20145 2005 13762 10928 24690 2010 15392 11866 27258 2015 17407 12490 29898 2020 19326 13015 32341 Construction projects getting delayed is quite common in Saudi Arabia. Could you highlight some key considerations for the delay? Ahmad: Delay in construction projects is normal across all the GCC countries. Shortage of labour, increasing cost of hiring new labour and changes in design during the construction and developer- contractor relationship are among the major causes of delay. Jones: Delays can cost a fortune to contractors. Construction delay can be due to a number of reasons, depend- ing on country to country. Construction activity delay in Saudi Arabia has been focussed primarily on two main factors, which are lack of man power and politi- cal instability. Damrah: If we look at recent delays, this is mostly due to labour market correc- tions that are expected to be smoothed in the coming few months. Furthermore, inadequate planning and lack of proper project management could also be a major reason for delays. How has the dipping oil prices af- fected the real estate market? Ahmad: Lower oil revenues should have limited short term impact on the Saudi real estate market given the willingness COUNTRY FOCUS Facts & Figures According to KPMG report: • Saudi Arabia’s GDP growth rate was 3.59% in 2014 • Saudi Arabia recorded a fiscal deficit of $14.3bn in 2014 mainly due to the steep decline in oil prices Table1: Population size of Saudi Arabia by gender, 1980-2020 Jones: The cabinet's structuring of new laws in the real estate sector can be a welcome move to boost the affordable housing supply in the market. Statistics revealing that up to 50% of space inside the big cities such as Riyadh and Jed- dah is underdeveloped and owned by wealthy individuals with an intent to earn speculative profits. The imposition of tax on unused/undeveloped land can have a positive impact in the industry where developers will have the opportunity to target areas of low-mid income generat- ing families. Damrah: To alleviate this shortage, the Ministry of Housing’s latest mandate involves developing 500,000 low cost housing units across Saudi Arabia. There has been some progress; however, there were certain challenges that have left the progress behind the desired targets. Approximately 65 projects are under construction (74,518 units), 25 projects are under bidding (21,360 units) and 95 projects are in the design stage (141,567 units). Overall, the Ministry is in the process of providing land, housing units and loans to over 306,000 applicants. In addition the REDF has reduced the waiting period for housing loans from 16 years to 10 years. The target is to reduce this further by five years. of the government to fund expenditure from its total reserves and by issuing a sovereign bond of $5bn as it tries to close the budget deficit caused by the collapse in oil prices. There is still a focus on social in- frastructure with the highest areas of spending (after defence) being education, health and transportation. The Saudi real estate market is heavily dependent upon high levels of government spending and a more prudent approach is unlikely to have an immediate impact on the real estate market in 2015. If oil prices stay down then government may not be able to maintain the trend of rapid increases in spending, which could constrain the growth of the real estate market in the longer term. Jones: Countries which rely heavily on oil as a major source of income, and countries which have high cost of oil production are the ones which are heav- ily effected when oil prices plummet. Parallel to this the real estate industry is first in line to absorb the risk of declin- ing oil prices, as investor money from oil producing nations shrinks. Damrah: Despite a general slowdown that can be attributed to several factors, up till now the market has not reacted negatively. This can be explained by two major reasons, firstly government spend- ing has not been affected in the budget of 2015 despite the falling oil prices. Saudi government announced the largest budget on record in 2015 at $227bn, which marks a growth of 0.6% from 2014 budget plan. And secondly, demand in the market is genuine which is based on strong demographics. What role does massive mixed-use

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construction business news me SEPTEMBER 2015 41 development projects such as JEC’s Kingdom City play in boosting the country’s real estate sector? Ahmad: Massive mixed-use projects not only generate employment but also create demand for surrounding small real estate developments which benefit from shadow effects of the large development. Damrah: I believe the most important factor they play is to create contem- porary CBDs and new nodes of future growth in the city. It also helps in opening up investor’s appetite for large- scale development projects and provides assurance that quality mixed-use devel- opments can achieve a price premium. Furthermore, they elevate the standard of construction and open up opportuni- ties for various real estate investments around their location. Jones: As we say diversification is an important tool to reduce the risk of any portfolio, hence applying the same con- cept to a country’s source of revenue is equally important. Saudi Arabia being an oil rich nation, which depends heavily on oil as a source of income, a diversifica- tion into the tourism and retail attractions can have a lasting effect on the country. Not only the real estate sector is boosted by this, but it also enhances tourism in the country creating a source of income for the oil rich nation. What are some of the trends you have noticed in the current Saudi Arabian real estate market? Damrah: We have seen that developers are becoming more sophisticated in their developments. They are focussing more on their target segment and how they can differentiate their developments from competition, which has increased in the market. Developers are also becoming more specialised by only concentrating on sectors that best describe their ability. Developers have started to make strategic plans that will help transform their business model from speculative land trading to professional real estate development. Jones: The Middle East region is very sensitive to oil price fluctuation, as major revenue is generated through oil extrac- tion. In line with that context, the real estate market in the region is also directly co-related to oil price. As the real estate sector involves heavy investments, cash generating countries in the Gulf region will boost the real estate sector when oil prices are at the peak. With the recent plummet in oil prices, and with Saudi being one of the top oil producing nations in the world, a direct impact on the real estate sector was bound to be seen. A consider- able amount of correction continues in the Saudi Arabia real estate market as oil prices have not seen any recovery lately. Major cities such as Riyadh and Jeddah which drive the country’s prime business activities have seen a slow- down in the real estate sector in term of transactions. Ahmad: Investors are looking for more income generating opportunities which provide a boost to real estate income generating funds. In a market where interest rates are low on treasury bills and government bonds, income generating funds provide attractive opportunities to invest in various real estate asset classes in major cities of Saudi Arabia. DID YOU KNOW? According to UN reports, Saudi population will reach approximately 40.4 million in 2050 from 9.8 million in 1980. Riyadh, Saudi Arabia How will appointing a private builder, Majed Al Hogail, former managing director of Rafal Real Estate Devel- opment Company, as housing min- ister of the country positively affect the real estate market? Ahmad: He has just been appointed, so it is too early to measure any effect on the real estate market but we expect positivity in the long-term as he is aware of the chal- lenges faced by the housing market and might be a right person to prepare long- term strategy to tackle those issues. Damrah: I believe this will have a positive effect on the residential market, especially as the ministry has been reach- ing out for the support of private sector to build residential units. The ministry will better be able to reach out to developers as the minister is someone with a hands on experience of developing real estate projects. He understands the issues devel- opers faced in the past and are currently facing in turning out viable projects. Jones: Rafal Real Estate Development Company has a very good reputation in the Saudi market and has delivered some quality schemes. The new minister will bring that experience and respect from the property industry to the position and will be able to act as a conduit between the private sector and the government, so that the latter can deliver the base require- ments to allow the private sector to deliver tailored products to the market.

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construction business news me SEPTEMBER 2015 42 TECHNOLOGY In the first of a three-part series on Construction Collaboration Technologies, Dr Asif Sharif, GM and regional director at CONJECT, reveals that 70 % of the region’s projects are still not being supported by project collaboration systems, and explains the reasons why these systems should be used W hat is Construc- tion Collaboration Technology? Let’s start by defining what we mean by construction collaboration technology. Construction collaboration technology refers to software applications used to enable effective sharing of project-re- lated information between geographi- cally dispersed members of a construc- tion project team, often through use of a web-based software as a service (cloud) platform. Having provided solutions for the past 15 years in this sector, the last nine of which have been in the Middle East, the CONJECT team has seen dramatic growth of investment in construction technology. ERP systems, document management, estimating and project planning tools are routinely deployed. Newer tech- nologies including those that support Building Information Modelling (BIM) and mobile solutions are gathering pace, whilst interest in emerging technologies such as 3D printing and virtual reality are also increasing. Our Middle East team has recently reviewed the UAE and Qatar mar- ketplace in terms of the number of projects being supported by collabo- ration technology and found a 70/30 split: 70% of projects are not using collaboration technology, whilst 30% are being supported. One prominent UAE contractor reported that in their own experience of delivering twenty local projects over the past five years, they used a collaboration system on one single occasion. The inference was that if the client didn’t request a collaboration system, then they would execute on construction delivery without out the use of one. In looking more closely at the 30% segment, some companies use generic internal platforms designed entirely for corporate usage; and at the opposite end of the spectrum were those using industry specific, externally managed and hosted collaboration platforms. When a project team comes together (consisting of client, designer, project manager, consultant and contractor), these roles/ companies will have their own systems already established in their respective offices. However, project success depends on an independent and common envi- ronment to enable the sharing of key project information between different users from different organisations, dur- ing the lifecycle of the project. So why are some clients slow to embrace collaboration tools? I’m not in Construction Whichever sector clients operate in - for example retail, hospitality, healthcare, education – the construc- tion industry is often viewed as new to these stakeholders. These clients will use the construction industry as an enabler to deliver their services, and as such could be deemed as infrequent procurers of construction services. The consequence of this is they have limited understanding of the industry, its complex supply chains and processes, and are occasionally apprehensive to engage, as the need to commission a new project in the future could be some way off. The reality of commissioning a con- struction projects is that before you get the end product, you need to engage Dr Asif Sharif, GM and regional director at CONJECT TALKING COLLABORATIOn

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fully with the supply chain which can be complex and multi-tiered. We’ve always done it this way, so why change? Buildings have been built for thousands of years without web based col- laboration so why do we need it now? Because projects have become more so- phisticated, and as a result construction delivery is more detailed, supply chains more complex and the industry as a whole has become more fragmented. All of the above factors contribute to the need to have an easy to use, consistent, common platform to keep project teams informed and enable easier decision making during the course of the project. I’m not yet convinced about the cloud The market is beginning to move to acceptance as more cloud applica- tions are being developed and used. Confidence is on the increase as CIOs understand how cloud data is delivered to users, and there is more clarity now about the issue of data ownership than in the early days of cloud systems. Without a cloud infrastructure, collaboration software would need to be established on servers at each physical location, or in the case of remote workers, individual software copies installed on each computer or device. The effect of a non-cloud infrastructure usually means the IT in- frastructure becomes fragmented and decentralised, leading to less control, increasing the risk for both data loss and more inconsistencies in project performance reporting. It’s the first time we’ve worked together In most cases the ‘collective’ project team are meeting for the first time when brought together to work for a client. If a JV of two or more con- tractors happen to work for the same client a second time, it’s likely there will be some different personalities representing these companies, and potentially a different engineer and programme manager. A collaboration system encourages greater communication, harness- ing of information and processes – which gives a very structured approach to the delivery of a proj- ect, whether the team members are working together for the first time, or have had prior involvement. Original documents with seals/signa- tures are still required This is especially evident in the Middle East, coupled with a belief that paper records are more official and therefore legally more acceptable. Whilst hardcopies are needed for documents such as instructions and con- tracts, there are those which don’t need to be in hardcopy, such as transmittals. The location and having a scanned cop- ies of such hard copy documents should be registered on system for future searching and retrieval. Having a structured record of all the information which has been sub- mitted and distributed by the vari- ous consultants and suppliers on a project in an auditable environment provides the user community with a ‘single version of the truth’. As a result, the ability to report on what has and has not been delivered and reviewed and what is outstanding will be of significant benefit. Software is too expensive This statement could be down to perception. The level of investment could be as little as 0.5% of the overall project value, so in real terms this might be considered a small invest- ment, capable of delivering consid- erable cost and time savings on the project particularly if there is a dispute on the project. In addition, cloud based collaboration solutions provide huge flexibility to the user, easily enabling them to ramp up or scale down usage in line with the user community, in other words matching the software requirement to the stage and profile of the project. Actual costs saved, may well be invis- ible to the user. For example the ques- tion could be asked as to how many projects we know of that finish on time, on budget, with no claims or disputes. In June of this year Arcadis reported that construction dispute values in the Middle East are up 88% in 2014 over the previous year. A by-product of ‘robust’ collabo- ration systems is the ability to run meaningful real-time reports to assess the actual impact of delays in deci- sion making on project outputs. The ability of the solution to auditable, objective reports and produce data on bottlenecks related to decision making is key to helping resolve and mitigate potential disputes. The project size is too small to jus- tify the investment Many specialist subcontractors do work on smaller short term projects. The complexity of the project should be the main consideration here. As part of the CONJECT survey, we spoke to a fit-out team who had recently completed a hi-spec hotel refurbishment in Dubai; in what was considered by to be a medium-sized, seven-month project, saw this contrac- tor having to manage over 600 varia- tions on Excel spreadsheets. Going back to the earlier point of using a collaboration solution to suit the profile of the project – i.e. a seven month timeframe; flexibility of dura- tion and billing around the use of soft- ware, should also be coupled with the construction business news me SEPTEMBER 2015 43 “In delivering twenty local projects over the past five years, we have only used a collaboration system on one occasion” Bulgari Resort

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construction business news me SEPTEMBER 2015 44 TECHNOLOGY ability to scale down the functionality to address the primary pain points. In this particular case, by establish- ing a collaboration solution for short term use, the contractor would have been able to ‘lose the spreadsheets’, and would have benefitted hugely in terms of time-saved in production, with a knock on effect of potentially speeding up the payment cycle. Turning to Building Information Modelling (BIM) As BIM by its nature requires collabora- tion between designers, constructors and more importantly operators, it’s in- evitable that the marketplace is seeing a natural convergence of BIM and col- laboration tools to provide more robust ‘structured data’ on built assets. The CONJECT Dubai office receives many enquiries from customers look- ing to implement BIM without a clear definition or scope of requirements. Collaboration systems which provide a Common Data Environment (CDE) delivers a framework that supports BIM for the project team, in exactly the same way that these systems have historically supporting other forms of project information. Over and above the improvement gains in managing processes, the true value in BIM, and where it becomes hugely significant is in the handover and Operation and Maintain (O&M) stages, particularly when we consider that the construction phase represents only 20% of costs whilst the operation- al phase represents 80% of the total cost of a built asset. Who Ultimately Benefits? There are gains for the project teams as a whole. The focus of collaboration tools should be to provide value to each of the participating companies and helping to develop and sustain better working relationships between the various project stakeholders. From a client’s perspective, col- laboration platforms are designed to capture information relating to the asset they are procuring in a structured form, gathering accurate records on the facility to improve the planning process for operations and mainte- Analysis: the CONJECT team analysed a segment of data* extracted from a total 462 UAE & Qatar $100m+ value projects under execution between 2012-2015 (excluding $1bn+ megaprojects) Findings revealed that 7 out of 10 of these projects were not being supported in the construction delivery phase with 'fit for purpose' collaboration technology * Source: MEED Projects nance. As such, at any point in time they are able to understand current project status (i.e. where are we now) and gain a truly accurate prediction on project outcome – completion dates, design quality and possibly forecast final cost. Where necessary - for ex- ample if costs are predicted to exceed budget, they can use this understand- ing to make decisions to positively change the forecasted outcome. Design managers can effectively co-ordinate the flow of design informa- tion, whether during the design phase or later where they need to react to change during construction delivery. Greater collaboration during design with the construction teams will enable effective construction. The greater the quality and accuracy of design, the less risk contingency needed to be held across the construction team members. With regards to project managers (PM), collaboration platforms should facilitate the ability to monitor all fac- tors that will influence the successful outcome of a project. By selecting the appropriate platform, PMs can look out for the earliest sign of problems so they can direct resource to resolve them before they occur, thereby managing key areas of risk in detail, to ensure they mitigate its occurrence. From a cost consultant’s perspec- tive, rather than being dependent upon Excel spreadsheets that have no auditing and operate on a historical reporting basis, commercial teams can now see what’s happening real-time if the collaboration platform has the abil- ity to monitor and report on financial matters. Rather than being passed information on a piecemeal basis they have better control and visibility across all transactions that will have a financial impact. Construction teams can utilise a functionally rich, tried and tested collaboration platform to produce, manage and coordinate design and construction information in a timely manner. The advent of BIM is almost making this a prerequisite for projects now. The submission and tracking of RFIs, technical submittals, approvals, requests for change and instructions can be seamlessly managed to ensure proactive management of information – rather than using a simplistic re- pository of data supported by manual processes. We cannot continue to work piece- meal, quality suffers, and the industry remains immature, especially when compared to other industries such as manufacturing. Embracing collabora- tion is proven in providing a much better user experience for all parties, and ultimately a far better level of customer satisfaction. Collaborate, share and learn, and continue to learn - which can’t be a bad thing for the industry as a whole. Dr. Asif Sharif is General Manager Re- gional Director of construction technol- ogy providers CONJECT, and a holds a Doctorate in International Construction Procurement Strategies. Next month, Dr. Sharif writes “Not All Collaboration Systems are Built the Same”

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construction business news me SEPTEMBER 2015 45 COMMENT 5% of final energy from renewables by 2030, while Abu Dhabi’s objective is 7% of capacity from renewables by 2020. Oman, meanwhile, revealed an additional 100-200 MW of solar photo- voltaic capacity. The renewable energy bandwagon extends far beyond the GCC, though. Bloomberg New Energy Finance esti- mates that renewables will account for 70% of new power generation capacity globally by 2030. For the region, how- ever, member states can strengthen their initiatives further by implement- ing relevant regulations. These new policies and regulations should address both large-scale cen- tralised generation and small- and- me- dium scale projects, including install- ing rooftop solar photovoltaic panels and solar water heaters in the cities. A GCC-wide study notes that a clear legal framework will ensure consistent and sustainable deployment of renew- able energy projects across the region. A lot still needs to be done to sustain the region’s renewable energy initiatives, especially in the construc- tion sector. It is a challenge that the GCC must face together to attain a more sustainable and environment- friendly future. Dr Ioannis Spanos is a senior sustainability manager at KEO International Consultants. He will be speaking at the CPD-accredited workshops during The Big 5 Kuwait in September 2015. Time to renew Dr Ioannis Spanos, senior sustainability manager of KEO International Consultants, writes about powering GCC buildings with renewable energy on energy sustainability management of GCC buildings, a staggering 50 to 60% of electricity is used to power air conditioning alone. Another study revealed that the total energy con- sumed for space cooling has more than doubled. Many GCC governments have already begun taking steps to reduce this alarming level of energy use in buildings. They have set their sights on renewable resources to ease their do- mestic energy consumption. Integrating solar cooling systems into buildings, for instance, is one such key measure that could help in the reduction efforts. Solar cooling works by utilising thermal energy from the sun as the principal energy input for the system to cool and dehumidify a space. Renewable energy power generation is more cost effective and the cheapest option compared to diesel genera- tion. In the GCC where air condition- ing dominates the electricity demand curve, solar power generation is the best way to go. The region should take advantage of its rich resources of renewables. It not only benefits from strong regular sunshine but also has the space to establish large-scale solar power plants. Heavy investments on ambitious projects and research and develop- ment initiatives have been rolled out to realise the region’s renewable energy goals. In the UAE, Dubai aims to generate T he energy demand in Gulf countries has risen exponentially over the years, driven mainly by their unstoppable eco- nomic growth and rapid population expansion. If the region’s electric- ity consumption stays at its current growth rate track of almost 8% a year, then it needs to double its ca- pacity every decade in order to meet the demand. This means that 100 gigawatts (GW) of additional power will have to be generated over the next 10 years to satisfy the region’s requirements. In the case of buildings and struc- tures, air conditioning consumes the highest energy. According to an article Snapshot: GCC renewables projects Kuwait Solar photovoltaic - 10MW Solar power - 50 MW Wind - 10 MW Qatar Solar photovoltaic – 100 MW Bahrain Waste-to-energy - 25 MW Saudi Arabia Solar photovoltaic - 16 GW Solar power - 25 GW Wind - 9 GW Waste-to-energy - 3 GW Geothermal - 1 GW

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construction business news me SEPTEMBER 2015 46 TECHNOLOGY Naji Attalah, head of AEC and manufacturing at Autodesk, writes about how building information modelling is revolutionising the construction of healthcare facilities T he building information modelling (BIM) process offers healthcare organisa- tions and building profes- sionals the opportunity to use data-rich models to simulate real-world performance of designs, and computational fluid dynamics (CFD) tools help to quickly and easily evaluate design options. Ultimately, using BIM and CFD can enhance building performance—helping to mitigate healthcare-associated infec- tions, reduce energy consumption and improve patient comfort. BIM is an intelligent model–based process that helps owners and service providers achieve business results by enabling more accurate, accessible and actionable insight throughout a project lifecycle. Healthcare organisa- tions and building professionals alike are increasingly recognising the role that BIM can play in bringing predict- ability into the design and construction process. BIM helps design and con- struction teams create more accurate, coordinated designs faster; improve collaboration and data management; speed decision making among stake- holders; and better manage schedules. Because healthcare buildings are among the most complex project types, working with coordinated, accurate BIM data during the design and construction process can result in substantial cost and time savings. Beyond design and construction, BIM can also help improve the perfor- mance of buildings over their lifecycle, supporting improved patient care and reducing operating expenses. The tight integration of BIM and simulation technology from Autodesk now makes it easier and more cost-effective for healthcare organisations and build- ing design professionals to maximise their investment in BIM. More ac- curate, data-rich building information models produced by Autodesk’s Revit software for BIM enable healthcare project teams to use advanced simula- tion tools to help explore the real- world performance and cost of design scenarios early in the design process to achieve more optimal design solu- tions. In particular, Autodesk BIM 360 simulation capabilities that support the use of CFD can help provide insight into critical environmental factors of healthcare facility designs that influ- ence care and operations, including airflow, thermal comfort, and tempera- ture influences. Specific healthcare applications for CFD simulation that is enabled by BIM can help mitigate healthcare associated infections, improve patient comfort, and reduce operating expenses over the building lifecycle. CFD for infection control The control of healthcare-associated infections (HAIs) presents challenges with severe health and economic con- sequences for healthcare institutions in the Middle East and across the globe. According to the Centers for Disease Control (CDC), one in 20 people will contract an HAI during the course of re- ceiving treatment at a healthcare facility. Building design and engineer- ing professionals can play a key role in preventing HAIs through design considerations they undertake before construction begins. Hand-washing is recognised by the CDC as the single most important measure to prevent the spread of infection in healthcare build- ings. However, given that an estimated 10 to 20% of HAIs are transmitted by the airborne route, building ventila- tion systems can play a significant role in preventing the spread of airborne microbial contaminants. Immune- compromised patients who stay in healthcare facilities for prolonged periods of time face the greatest risk of infection and mortal- Naji Attalah, head of AEC and manufacturing at Autodesk Upgrading healthcare

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ity from airborne infections. As an example, mortality rates reported from aspergillosis, an airborne fungus, due to construction activities in healthcare facilities have been reported as high as 95% in bone marrow transplant pa- tients, 13-80% in leukemia patients, and 8 to 30% in kidney transplant patients. Controlling air quality is critical to minimising infection in operating rooms and other areas of the hospital that support immune-compromised patients. External air supply, operating room staff, and the space itself can all be sources for infections in operat- ing rooms. Aerosol transmission of microorganisms is affected by factors such has increased humidity, tempera- ture, population density, ventilation rate, and room airflow. Room air flow is governed by a combination of air movements caused by ventilation, dif- ferences in temperature, moving bod- ies, and the location and operation of equipment. By designing room airflow to ensure sterility at the surgical site, the risk of post-operative infection can be minimised. Simulation using CFD tools can help building design teams model designs, such as operating rooms, to visual- ise and analyse room air flow and temperature distribution to minimise the risk from aerosol-transmitted infec- tions. BIM enables design teams to model equipment and room variables, such as hospital staff, in realistic levels of detail to support more accurate simulations of air flow. Using CFD, project teams can easily test multiple design options to help achieve optimal air flows, humidity levels, and tem- perature distribution before construc- tion begins. A study undertaken in Australia vali- dated that fine-tuning a design using CFD can lead to a safer environment for patients and more cost effective ventilation solutions. The study noted that traditional air distribution in oper- ating rooms has not always resulted in the optimal supply of sterile air to the surgical site. Key objectives for con- trolling the operating room environ- ment are: ensuring sterile air reaches the patient without mixing with air flows over staff and equipment; creat- ing streamline or laminar air flow over the operating area; making sure tem- perature is controlled and air velocity and temperature do not adversely affect the condition of the patient. The study found that CFD simu- lation enabled the design team to model a proposed operating room air distribution system, to test each of the variables to help identify flaws in the air distribution, and make adjust- ments to achieve the optimum flow and temperature conditions. By using the visual results of CFD simulations, the project team gained a better un- derstanding of how the placement of HVAC system components and equip- ment affects the environmental condi- tions in operating rooms. Through simulations, the project team was able to make a positive improvement in the air quality in operating rooms and as- sist in the reduction of post-operative infection rates. CFD for energy savingS Hospitals consume more total energy than any other commercial building type, and are second only to retail food establishments in their energy use per square foot. This energy con- sumption comes at a staggering cost. According to the U.S. Green Building Council, hospitals spend nearly $8.8bn annually on energy. Given that up to 3% of the average hospital budget is spent on energy, reducing operating expenses through energy savings can have a substantial impact on a hospi- tal’s bottom line. According to Energy Star, every $1 a non-profit health- care organisation saves on energy is equivalent to $20 in new revenues. For-profit hospitals can boost earn- ings per share by a penny by reducing energy costs by 5%. Healthcare organisations are in- creasingly embracing energy efficient solutions. In fact, 84% of hospitals rated energy efficiency as an impor- tant attribute of requests for propos- als they evaluate. As such, building project teams are turning to simulation solutions such as CFD to help design higher-performing, more sustainable buildings. The seamless integration between design software applications that support BIM and CFD tools helps building project teams incorporate en- ergy efficiency into the design process. CFD for patient comfort Simulation can also help project teams design more comfortable health- care spaces for patients and visitors. Healthcare design teams are increas- ingly exploring innovative design concepts like underfloor air distribu- tions, displacement ventilation, radiant panels, chilled beams, and different diffuser types. CFD enables explora- tion of creative design solutions virtu- ally to help teams validate or eliminate them as viable options. This process helps to better ensure the comfort of occupants and visitors in spaces throughout the hospital—lobbies, patient rooms, common areas, atria and dining areas—in a low cost and sustainable way. In conclusion, healthcare build- ing project teams can take advan- tage of BIM design data to perform more realistic simulations of building performance—even during the early stages of the design process. With the use of simulation technology for CFD, building project teams can evaluate multiple design options based on various scenarios and environmental conditions, such as temperature and humidity levels. Now, the Autodesk Revit software for BIM and new cloud-based CFD simulation tools enables project teams to harness the flexible, scalable computing power of the cloud to run an unlimited number of simulations si- multaneously and compare results side by side. By offloading computationally intensive studies from local computers, project teams can compress the analy- sis phase of projects while finding optimal design solutions. When combined, BIM and CFD tools can offer significant value to healthcare building project teams in helping them plan, visualise, and vali- date designs. By incorporating simula- tion early and often in the design process, project teams can help reduce infections, maximise energy efficiency, and create more comfortable spaces for patients. construction business news me SEPTEMBER 2015 47

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3D construction business news me SEPTEMBER 2015 48 TECHNOLOGY Dominic Wright, business development manager at Generation 3D speaks with Construction Business News ME about the rise of 3D building printing technology 3D I n the last two years there has been a lot of talk about 3D print- ing technology in various sectors. The technology has catapulted into a country-wide frenzy after UAE National Committee announced its plan to build the world’s first fully functional 3D printed building in Dubai. The project is said to be a major initiative for the city’s Museum of the Future project. The initiative marks the rise of 3D printing technology to be used in con- struction, beginning a dialogue within developers in the industry. However, the technology itself has existed for the last 30 years, and this has been the first time the region has been embrac- ing it so well. Dominic Wright, business devel- opment director at Generation 3D explains that this is because the technology has seemed complicated in the past, and even today a lot of people in the industry shy away from it especially when they don’t have a technical background. However, Wright assures that it only “assumed” to be complicated, whereas in reality it is very similar to paper print- ing. Generation 3D is one of the few companies in the region that provide 3D printing services to developers within the construction industry. The 3D model, produced by these companies, are similar to other miniature models that exist in the market only these are extremely accurate. Wright shows a 3D model of himself made in his company to illustrate the technology’s accuracy. Most models are done by the company’s Projet 860Pro printer that Wright states is the largest 3D printer in the GCC. These models are very useful for marketing a project, he assures. “Ac- cording to Harvard Business School’s report, if you have something physical that you can see and touch, it engages 80% more people. “For some reason we are more at- tracted something that’s more physical and tangible.” Apart from its accuracy, Wright emphasises that 3D printing is espe- cially useful as it is so swift. When a developer is planning a project, 3D printing could be a lot more useful than the standard models that usually takes a long time to manually create. Wright says that we use the 3D image generated by CAD and then give it life through our 3D printing technology. “What takes standard models weeks, can take us a day.” He admits that the printer (costing revolution Dubai’s upcoming 3D printed building Perks of using 3D printing technology in construction : »» Reduce production time by 50 to 70% »» Reduce labour costs by 50 to 80% »» Save construction waste by 30 to 60%

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$160,000) could be expensive, and so are the products used to run it. However, he reasons the this is only because 3D printing is relatively new, especially in the region. “This will change as major players in printing technology such as HP are branching into this technology.” He says that after initial investments, this kind of technology is very cost- effective, as labour time is reduced and there is less to zero waste. Using the hype The technology has existed since 1980s but it has been in the last five years that it has picked up pace. There is a growing interest in the regional market, which Wright thinks will get bigger with time. He compares 3D printing technology to PC computers that were introduced in 1970s and are now used in every office in the world. “This particular region is new to 3D printing technology, whereas in the West it is limited yet not uncommon.” Wright says in the GCC there are probably ten competitors he knows of that use 3D Printing technology, retaining a huge untapped market. Lack of knowledge is probably the key reason for people not getting readily involved. However, he admits that recently graduated professionals have had some sort of exposure to the technology and are more open to learning about it. With Dubai’s recent initiative to building the 3D printed building, Wright predicts it won’t be long before it would be used by contractors. He says overall it would probably take another 10 to 15 years. Till then he as- sumes there would be a gap between the people who readily adopted it and those who didn’t. construction business news me SEPTEMBER 2015 49 A 100 of these miniature models could be printed in a day Projet 860Pro printer Benefits of 3D printing technology: »» More accurate »» Time efficient »» Cost effective »» Zero waste Dubai’s fully functional 3D printed building The project will be an office building approximately 2,000 sq.ft in size and will be printed layer-by-layer using a 20-foot tall 3D printer, then assembled on site in Dubai in just a few weeks. All interior furniture, detailing, and structural components will also be built using 3D printing technol- ogy, combining a mixture of Special Reinforced Concrete (SRC), Glass Fiber Reinforced Gypsum (GRG) and Fiber Reinforced Plastic (FRP). This combination will make it the most advanced 3D printed struc- ture ever built at this scale and the first to be put into actual use.

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50 construction business news me SEPTEMBER 2015 Liz Kentish writes about the collegiate and collaborative approach to training and development, needed to reap dividends in the facilities management and construction sector E very child has a favourite teacher. Someone who brings the subject to life and inspires them to discover more. And there are always less favourite teachers who make even the most excit- ing subject as dull as dish water. But, while some teachers are undoubtedly better than others, it is often the style of teaching that makes the life of Gamal Abdel Nasser interesting to one child, nomadic tribes thrilling to another and Pythagoras’s theorem the bee’s knees to other students. And the same can be said of training courses in the construction and facili- ties management sectors. So much of a delegate’s enjoyment and achievement from a course is down to the style of teaching of the trainer themselves. Everyone processes and learns information in different ways. Children and adults have three different learning styles: visual, auditory, and kinesthetic. Visual learners like graphs, charts, pictures, and seeing information, are able to memorise and recall various facts, tend to remember things that are written down and learn better in training courses by watching. Meanwhile auditory learners retain in- formation through hearing and speaking and prefer to be told how to do things and then summarise the main points out loud. They may learn best with back- ground music. And finally kinesthetic learners like to use a hands-on approach to learn new material, would rather have someone demonstrate how to do something than verbally explain it, and prefer group work, often while fidgeting or fiddling with other things. But the reality is, that in the Middle East, training courses only appeal to au- ditory learners. Here the tradition is for the trainer to download their knowledge to their students and for the students to respectfully listen and take notes. There is little in the way of interaction and col- laboration and scarcely an opportunity to challenge the lecturer and debate the points made. In addition to the three styles of learn- ing, learners are either independent or dependent. The vast majority are depen- dent learners meaning that they work better in collaborative groups. Again, the traditional way of training in the Middle East doesn’t support the majority of people – dependent learners. The old style of theoretical learning only appeals to a certain style of learner. This means that a large proportion of the students or delegates are not gaining the full benefit from their training. A more collegiate and collaborative ap- proach to learning, which is more typical in the UK facilities management (FM) market, would benefit all delegates and ensure that everyone gains the maximum benefit from their training investment. The FM sector needs to take a more holistic approach to professional learn- ing. We don’t just learn by looking and hearing, but with all of our senses. Bringing music, laughter, movement, different smells, toys, brain food such as nuts and fruit, can all help to create the most memorable – and therefore most effective – learning experience. And there are other benefits of a col- laborative approach. Students don’t just sign up to a training course to benefit from the trainer’s expertise, but also to learn from the other students. Through group work on a training course, they can share experiences of their day jobs and what tools, techniques and ideas work and what don’t. Through this discussion, they create a professional network of mutual support which lasts long after the course notes have been consigned to the filing cabinet. It can also break down barriers be- tween the different groups in the Middle East. Interactive training sessions can see both nationals and non-nationals work- ing together as one team, while being respectful of their different cultures. This will not only allow them to work to- gether better once back in the workplace but will create a better performance for that organisation and its clients. To test how people like to learn, ask them to recall a great learning experi- ence. Chances are it won’t be a formal lecture but something like someone coaching them, a mentoring morning, a practical on-the-job training session or perhaps a tour around a building by the facility manager. Which brings us back to the class- room. Infants are taught the basic of learning – to read, write and count – using all of their senses. They write numbers in chalk on the playground concrete, they chant words, they create dance rhythms to basic calculations, and they use new words to describe unusual smells. FM trainers in the Middle East need to take tips from the classroom to get the most out of professional learners. We need to be brave and step outside our comfort zone to get the best learn- ing experience. Liz Kentish is managing director of Kentish & Co, the people development experts specialising in facilities man- agement in the UK and Middle East. She is a qualified coach, licensed trainer, international conference chairperson and public speaker who has specialised in the service sector for over 20 years. Shrewd training COMMENT

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construction business news me SEPTEMBER 2015 52 COMMENT Garrulous intellectual soirees, and corporate tax Craig Gibson analyses how corporate taxation will affect the construction industry in the UAE Double Taxation The UAE has bi-lateral treaties with a number of countries to restrict double taxation on companies doing business in the UAE. This means that the taxation on remittances a company makes to its global head office is offset against the equivalent taxes it is liable for in the UAE. This makes the UAE an attractive place to do business, even more so when one considers that the UAE does not, in practice, demand those taxes for which the company is liable. This is relevant to the majority of businesses in the UAE, but for the purpose of this article I will focus on manufacturing companies and suppliers. Insofar as the implementation of double taxation practices remain the same between the UAE and the country the material is sourced from, the price of the materials would not be greatly impacted by the enforcement of a corporate tax I nterest in UAE taxation has been aroused again by the under-secretary at the Ministry of Finance, Younis Haji Al Khouri, stating that a draft of corporate taxation reforms is likely to be finalised in Q3 2015. The UAE public seems to discuss tax in the UAE pe- riodically. Understandably, since it could influence wheth- er many of us, or our employers, continue to consider the great nation of the UAE to be our home, or not. Timing and Framing Two notable points regarding Al Khouri’s announcement are its timing, and its framing. Firstly, the International Monetary Fund (IMF) is a vociferous supporter of the UAE introducing excise taxes and a more standardised corporate tax policy, and it is to the IMF that the UAE will this year post its first fiscal deficit since 2009. Secondly, Al Khouri stopped short of suggesting a timeframe for its implementation. It is important to recognise that the UAE already has corporate taxation legislation in place; the current musings concern the development of the legislation, not the embry- onic introduction of it. Taxation Corporate tax in the UAE is not currently a federal matter, it is dealt with at emirate level. So there are policy differ- ences between each emirate and in theory each emirate is entitled to enforce such taxation as it sees fit. In practice however, only oil companies and foreign banks are forced to pay corporate tax, at levels of up to 55% and 20% respectively. Despite each emirate being able to apply corporate tax independent to its neighbouring emirates, they appear to recognise the collective strength of a unified strategy. A similar understanding appears to be in effect at a GCC level. Other than Bahrain and the UAE, all the GCC coun- tries impose a general tax on companies. Perhaps the UAE is looking to capitalise by realigning that general tax with the GCC collective. However, I do not think it would be to the UAE’s benefit to enforce a wider corporate tax policy in isolation from other GCC countries as it would compromise the UAE’s competitive edge.

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construction business news me SEPTEMBER 2015 53 policy within the UAE. This is because the first prin- ciples of said material cost remain unaffected in their country of origin. Operational Costs The operational costs of companies in the UAE merit greater consideration. The increased administrative costs associated with enforced corporate tax would probably not drive those companies out of the UAE, but they would be forced to optimise their operational costs; this would lead to smaller workforces, smaller staff remuneration packages, more stringent payment terms with suppliers, etc. This could lessen the pull factor of the UAE as an in- ternational expat destination, and businesses with global operations may shun more onerous payment terms, particu- larly considering payments terms in the GCC are already very unfavourable to providers. Ultimately, companies already established in the region would not likely depart, as the costs associated with such relocation are gargantuan, and that does not factor for as- sociated costs of loss of productivity, start-up and business development costs elsewhere, etc. Therefore, these costs would be absorbed. This absorption however may absolve the UAE of some of the region’s most sophisticated minds, who may no longer consider the UAE to be as attractive a hub to live and work. More Sophisticated Accounting Practices I must note however, the region’s garrulous intellectual soirees are nigh clamorous in their encouragement of more sophisticated accounting practices in the UAE. As undoubt- edly recognised by Al Khouri there are a number of bene- fits including improved accountability and greater corporate governance at the vanguard. More intricate accounting and taxation practices would also lead to greater tax-deductible incentives, which would probably benefit charities and improve the lives of the most vulnerable in our society. Commercial Acumen Nonetheless, let’s give the industry leaders and decision makers the credit they deserve by recognising that the greatest impediment to the enforcement of amended corpo- rate tax legislation, is commercial acumen. The ten largest general construction contractors in the UAE are private companies; not obliged to disclose all their finances. Many of the largest international contrac- tors, which operate in the UAE as a joint-venture partner- ship with local companies, dilute their earnings within an international division of the company so the performance figures of the company acting within the UAE or region are malleable depending on their business objectives and strategy. This is not by default. At the other end of the spectrum, the smaller, family-run construction companies founded on building skills cannot afford the resource, technology or time to navigate a com- plex taxation framework. The US found that three quarters of 2014 tax return respondents complained they lacked the resources to file accurately. Bearing in mind that this is a country whose founding father Benjamin Franklin wrote in 1789 that two of life’s certainties were death and taxes, rushing the topic does not look likely to benefit the UAE. Status Quo Aggressive taxation would be such a tectonic shift of the UAE’s business landscape that it would wreak havoc with the construction industry; an industry which the UAE government has successfully cultivated as part of the UAE’s development beyond oil and gas. I consider Benjamin Franklin’s hypothesis regarding the unavoidability of death to be empirical, but I am not quite as sure that corporate tax in the UAE is as imminent as the public’s next wave of interest in the possibility. It appears wise that the UAE’s leaders are not in a rush to change the status quo. Craig Gibson, MRICS MCIArb MScL LLM Pg. Dip. Law BSc (Hons) – Omnium International. He is dual-qualified in law and quantity surveying. A Chartered Surveyor with experience of ICC and DIFC arbitrations and a passion for simplifying conflict. Africa Algeria Egypt Morocco Sudan Tunisia Asia China India Indonesia Japan Malaysia Pakistan Philippines Singapore South Korea Sri L anka Thailand Turkmenistan EUROPE Belgium Bosnia Finland France Germany Italy Malta Netherlands Poland Romania Spain Switzerland Greece Holland Belarus Turkey Bulgaria Middle East Jordan Kuwait Lebanon Syria Yemen North Amercia Canada Australasia New Zealand Countries the UAE has double taxation treaties with

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construction business news me SEPTEMBER 2015 54 PROJECT REVIEW L ocated in Metn, between Broumana and Bakfaya, Tilal Bhersaf is placed at an altitude of 900m. The location is known for its pleasant climate and a quick drive to Lebanon’s capital, Beirut. Develop- ers on the project, Plus Properties, organised a sunset reception at Tilal Bhersaf project to announce the completion of the construction works in August 2015. Mock-up apartments were showcased to invitees who in- cluded the media, clients, celebrities, and government officials. Georges Chehwane, chairperson and owner of Plus Holding, said that location was the perfect spot between a busy career and a peaceful life. “Tilal Bhersaf is a quick 17-minute drive from work in the city.” As for the scope in real estate market in Lebanon, he says that from the last 40 years the local market has never witnessed a crash in real estate prices. “Basically, investing in real estate is a safe and guaranteed invest- ment in Lebanon.” The community composed of 15 low-rise buildings aims to provide a secure and private space for its inhabitants. According to Chehwane, the harmonious residential com- munity separates itself from other properties in the region. Tilal Bhersaf spans an area of 21,000sq.m out of which 4,500sq.m is dedicated to buildable space. The remaining area is composed of inner roads and landscapes. Chehwane says: “A project is only as good as the details that go into it and we, at Plus Properties take details seri- ously. This is why we have chosen unrivalled specifications that give residents and visitors an enjoyable experience.” The community is built between the natural landscape of Lebanon with an aim to incorporate luxury. He explains that the project tries to bring together high- end specifications, luxurious finishing on interiors and exteriors of the buildings with a vast area of uninterrupted greenery that composes more than 40% of the entire plot. He adds: “We did not just stop there, we went further to providing all life amenities and facilities including an infin- ity pool, a fully equipped gymnasium, 24/7 security and maintenance with an entrance through one sole gate that ensures maximum security to every resident in this project.” Amid the hills Georges Chehwane, chairperson and owner of Plus Holding Tilal Bhersaf is located in Metn is placed at an altitude of 900m Upcoming Tilal Bhersaf residential complex overview of Lebanese real estate market • In the past seven years there has been a decreased interest in Bei- rut real estate from 38% to 29% • Demand for smaller sized apart- ments has risen from 44% in 2010 to 60.9% in 2013 • There has been an increase investments in local properties by Lebanese emigrants • Lebanese real estate has never witnessed a crash in real estate prices from 1975 till 2015 Construction Business News ME speaks with Georges Chehwane, chairperson and owner of Plus Holding, about the group’s latest luxury residential project in Metn, Lebanon

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56 construction business news me SEPTEMBER 2015 What does a truly sustainable company look like, particularly in the construction industry? From a consultant's perspective, director of environment and sustainability at WSP | Parsons Brinckerhoff Robert Carr looks at what it really means to be green T here is a lot of talk about sustainability in today’s society particularly in the business world – every company has a sustainabil- ity claim or pledge and many of them sound very similar. In the Middle East construction industry there are two types of players – the global brands with local presence and the homegrown businesses, some- times with global presence. The chal- lenge with the former when it comes to sustainability is that most global organisations have green credentials at a global level, but it can be hard to as- certain from the outside how that filters down to the local operations here. I can say this because we are a glob- al company, with global sustainability programmes as well as local initiatives and so we tackle this challenge daily. I often ask myself, if I were a client and I wanted to find a truly sustainable and ethical company how would I be able to identify them? How would they know that we really have embedded sustainability as part of our culture, not just as a tick in a box somewhere in a corporate document? If you look at an organisation’s web- sites you will find the same terminol- ogy and promises across the board, and I would hazard a guess that the information we put in our bidding material is largely standard as well. So what is the differentiator? We can all do the operational check list – monitor our energy usage, our waste, encourage sustainable travel and other efforts to reduce carbon, print less, and recycle more. But, controversial as it might be, the reality is that these actions have a very small sustainability impact compared to the impact we have through the projects we work on. So yes of course we do all these things as well, this is normal practice, but where we are focussing our attentions is on the work we do - the advice we give, the designs we produce. This is where the real impact is and this is how consul- tants can develop their contribution from the mediocre to something more. The answer to my earlier question is that you need to look for it in the behaviours of the people in the or- ganisation. Do they wait to be told by you, the client, to include sustainable measures or do they challenge you to adopt them before you’ve even thought about it? Is it part of their everyday behaviour, in every decision they make and every output they give you? This is where we have a solid plan to get there based around four key deliverables. The first is that learning opportuni- ties about how to take this embed- ded sustainability approach to every project we work on are available to all through our internal university. Not just designers, not just those who sit in the sustainability team, but everyone. Secondly, we have set ourselves a target that 5% of all our designers - whether they work on buildings, rail or power plants - have a professional sustainability qualification. This will ensure that this business wide mindset will prevail and we hope in future that 5% will be a minimum standard rather than an ambition. We are also going through a process of updating all our specifications and standards so that they don’t just reflect the regulations in the market but reflect our ambitions for sustainability as well as the leading innovations and trends. This means that as a client, no matter what area of the business you engage with, you can be assured that the stan- dards we work to will already include provision for sustainable design and practice as a minimum. In some cases this will have cost benefits, but in all it will at very least be as cost effective as the regular specifications. Finally, we have embedded sustain- ability into our core business manage- ment system, which impacts everything that we do from the way we log a new prospect or project to the way we ad- dress sustainable design. To me, this is what it means to be green to the core – sustainability isn’t an add on, it should run through the veins of the organisation, touching ev- ery aspect of the way it operates. To re- inforce this, accountability needs to rest with the design teams not a separate ‘sustainability team’, and it needs to be governed all the way up through the company. When we discuss projects, operations and strategy at a leadership level, we always consider our sustain- ability performance. Rob Carr is the director of environ- ment and sustainability in WSP l Par- sons Brinckerhoff. He is a Chartered Environmentalist with nearly 20 years’ consultancy experience work- ing across a range of environmental and sustainability issues, specialis- ing in property, infrastructure and urban development sectors. Integrating sustainability from within COMMENT

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construction business news me SEPTEMBER 2015 57 Yanbu Industrial Ports in addition to the proposed expansion of the current Riyadh Dry Port. DP World very recently announced that it will begin work on a new $1.6bn Container Terminal 4 at its Jebel Ali Port. Terminal 4 will add 3.1 million TEU capacity in phase one, bringing the port’s total capacity to 22.1 million TEU by 2018. Sharjah’s Khorfakkan Port located on the Gulf of Oman outside the Straits of Hormuz; the ports of Sohar and Salalah in Oman with a new one being developed in Duqm; the new $7.4bn national port project (NPP) in Qatar’s Mesaieed Industrial City and the $1bn Mubarak Al Kabeer Port in Kuwait, among several others, are all expected to pack a punch when inaugurated and fully functional. Building a super mega port is both capital and labour-intensive. Huge financial allocations are necessary. The complexities and logistics of construct- ing, expanding or upgrading ports is also, logistically speaking mind-bog- gling. Ports also have to contend with issues related to security, infrastructure development, over capacity, storage, speedy clearances, rapid turnover of vessels, investments in machinery and equipment, labour-related issues, pilferage and streamlining of processes among many other vexatious issues. Clearly, there are benefits too. Ports are big employers and enhanced trade volumes propel business growth whilst contributing greatly to the exchequer and the economy. Will the colossal expenditures in de- veloping ports eventually make for the proverbial ‘safe harbour’ in new invest- ments? The tide is clearly in favour. Investment in port development a ‘Safe Harbour’ lectively have more than 35 major ports with aggressive and ambitious plans to expand the existing network as they seek to diversify their economies. Rapid industrialisation, the existence of vast transportation infrastructure, the planned big-ticket investment in rail and metro networks, the initiation of large engineering and manufactur- ing projects, all-round growth of the economy, a rapidly-growing consumer base and the steady proliferation of commerce is fuelling the growth of ports and logistics facilities. The region also spawned many suc- cessful, mega free zones such as the Jebel Ali Free Zone Authority (JAFZA), Dubai Airport Free Zone Authority (DAFZA), Khalifa Industrial Zone Abu Dhabi (KIZAD), Sohar and Salalah Free Zones (Oman), Bahrain Logistics Zone (Bahrain) and a slew of free and special economic zones along with industrial and economic cities in Saudi Arabia. The proliferation of free zones is also the driver for ports across the GCC. Examples of port developments abound. The new $665m King Abdul- lah Port, now functional in King Abdullah Economic City on Saudi Arabia’s Red Sea coast off Jeddah is a case in point. The Kingdom is also expected to invest $100bn by 2020 in seaport infrastructure development alone. The Jeddah Islamic Port (JIP) which is currently undergoing a $510m expansion project, which will eventu- ally increase capacity by 45% to 1.8 million TEUs. Simultaneously, there are port development projects across different GCC nations such as the $750m second terminal at Dammam's King Abdulaziz Port in Saudi Arabia and the Jubail and D espite the plummeting oil prices, the burgeon- ing $40bn GCC logistics industry revenues (2013 estimates, Masah Capital Report) shows no sign of abatement and ups the ante for the creation, development or re-development of sea ports in the region. By conventional wisdom, it is a global logistics industry axiom that 90% of trade is transported by the international shipping industry. Therefore, there is no denying that the maritime transport is very essential to the world’s economy. More and more nations around the world in general and the GCC govern- ments in particular are now coming to terms with the need to develop mari- time infrastructure. For the GCC this has already manifested itself in massive investments with the creation of new, colossal, monumental ports that are al- ready functional or will get operational as per schedule in the near future in addition to upgrades and modernisa- tion of existing ports. As a spin-off, several ports in the region—including Dubai’s flagship Jebel Ali Port, Abu Dhabi’s Khalifa Port, Sharjah’s Khorfak- kan Container Terminal and Oman’s Sohar and Salalah Ports among others have become or have the potential to develop as major trans-shipment cen- tres for trade and commerce. As an example of the high-invest- ment infrastructure standout, but by no means unique to the region, is the enormous, $7.2bn ultramodern, technologically advanced edifice that is Khalifa Port located in Al Taweelah, Abu Dhabi that is proving to becoming a game-changer in the region. Currently, the six GCC countries col- Malcolm Dias, editor of Logistics News ME, examines ports progress in the GCC and makes the case for increased port-infrastructure spending COMMENT

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construction business news me SEPTEMBER 2015 58 Q&A According to regional experts, developers will increase invest- ment in GCC marble, stone, and ceramics expanding to 5.8% this year to $5.4bn. What is driving this demand? As development in this region contin- ues to boom, there is an increasing va- riety of natural stone and other ‘stone’ options such as ceramic tiles and artificial stones. The latter are becoming more popular due to the competitive pricing. However this can get difficult to sustain and may sometimes cost the developer much more in the long run as they may have to replace the entirety of the materials used within a few years in addition to the costs of shutting operations. The best thing about a good quality natural stone is that it can last a lifetime with proper maintenance. With the increase in de- dominantly as a construction material here than compared to the West. What kind of structures most often use natural stone as a building material? There is actually no limit or particular restriction to where you can use natu- ral stone. It all depends on the style, concept, design and budget of the building project; mostly determined by the architect, designer or project manager in line with the client’s vi- sion for the project. Could you tell us more about Solid- Nature and one of your key projects in the Middle East? SolidNature supplies and manufac- tures natural stone that is used for various purposes. We are not a com- pany that treats the stone as a trading of commodity, but as a natural art provided bynature. Not only do we source, produce and fabricate stone but we also dry-lay, install and main- tain projects. We do not call ourselves a supplier but a natural stone spe- cialist. Through years of experience in this field we have grown to be specialists when it comes to supply- ing natural stone. One of our largest and most prestigious projects in the region is the Qatar National Library in Doha. For this project, we are not only delivering a special type of travertine for flooring, wall cladding and ceilings, but also supervising the installation process to ensure that the vision of the client is achieved. One of the special features of this project is that parts of the ceiling is Back to the Stone Age Boris Ejsymont, regional manager of SolidNature GCC, speaks with Construction Business News ME about one of the first building materials used in ancient times, natural stone, and how its use today is still relevant velopments and projects in the region, there is automatically an increase in the demand for natural building materials such as natural stone. These items play a big role in developments as they are not only aesthetically pleasing but also a practical choice given their strength and durability. Why is the use of stone in con- struction in the Middle East a good alternative? The use of stone is ideal in this region primarily due to two factors: Weather conditions in the region and the aesthetical value of the stone. With the weather reaching extremes and oftentimes harsh conditions mate- rial used for construction needs to be tough to withstand constant exposure to extreme heat, humidity and sun- light. One of the best materials to be able to withstand these extremities is in fact, natural stone. Is the use of stone more common in the Middle East than other regions? True natural stone has always been something unique and associated with luxury. This is mainly due to the fact that it is natural and sourced from vari- ous quarries around the world. The ex- traction process of natural stone itself is costly, demanding specified experience and knowledge to extract the best and finest portions; in turn making it more desirable and higher in calibre than ceramic or artificial stone for example. Due to natural stone being easily adapt- able to harsher weather conditions, aes- thetically pleasing and with the exclusiv- ity factor of the stone, it is used more Boris Ejsymont, regional manager of SolidNature GCC

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construction business news me SEPTEMBER 2015 59 vital to use suitable products, good machinery and to have trained and experienced staff. How do industry events assist the regional stone industry? It presents an opportunity for people in this industry to connect with vari- ous suppliers and be introduced to the sundry of materials represented during the fair. Events of this nature are always interesting to us as it of- fers us the chance to be able to see what the trends are in the region and to scope out what our peers in this industry are migrating towards and are offering. We not only take away a lot of market knowledge and learn from consumers and peers but also learn how to diversify and tailor our offerings to take it one step further and innovate the solutions that we introduce to the market. Is natural stone more expensive com- pared to other building materials? Yes, it is. As with certain natural resources, the extraction process is al- ways more complex. Not only are the scale of operations much larger than that of a production house produc- ing artificial stone but to ensure the quality of the stone is kept up to par, specialised equipment and stages of refinement are often required. To en- compass projects of this scale, rather vast funding is needed - in turn the price paid for quality is often more than other building equipment. Emerald onyx table versally relatable benefit is that some stones have the ability to retain heat or cold- depending on the type of stone. What are the best practice solu- tions to prevent and treating stone defects? A good quality natural stone will last you for hundreds of years if main- tained properly. When treating stone, it is important to properly seal and impregnate the stone’s surface against liquids, chemicals, stains and other contaminants. Be aware that sealants might change the colour of the stone and it is therefore vital to find the right type of sealant but also to go with a reputed brand. When polish- ing the stone from time to time it is comprised of very thin travertine tiles glued to a “honeycomb” backing to create a remarkably signature style bespoke to the library. Tell us more about using art to brand SolidNature Nature is constantly creating the most amazing pieces of art. Whether it is through scenery, patterns or the vivid colours you can find in nature, it always serves as inspiration and as the basic foundation to any piece of art through the ages or for any outlets of fashion. At SolidNature we wanted to serve as a platform to showcase nature’s incredible art. Stone is in itself natural art; from the colourings of each slab, the veinings or remarkable quality of each stone, each piece is unique and different. These are all inimitable qualities that constantly amaze us and a message we hoped to share by branding our- selves in this way. What are the benefits of using stone? Natural stone is not only a luxury product but each piece of stone is unique. It is not only aesthetically pleasing but it is highly sustainable and is a material that has the capabil- ity to last a lifetime- if cared for and maintained properly. In addition to being sustainable, in some cultures natural stones are believed to carry healing or calming qualities. A uni- Honey onyx wall cladding

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construction business news me SEPTEMBER 2015 62 Dubai-based Protechtem LLC’s Dukkaboard is a range of water-protection system for bathrooms and showers. With a 25 year warranty Dukkaboard panels have a high-density polystyrene core sandwiched between polymer modified, glass-fibre reinforced cement coating which adds rigidity and strength. All components comply with UK and European building regulations and safety requirements. Showers and bathrooms can be pre-assembled as pods or built on site. Both are subject to intensive flood-testing to prove their water-tight qualities before being passed for installation of plumbing fittings, tiles, and sanware. Moisture and rot-proof, the system is ideal for bathrooms, showers, and wet rooms, eliminating the common causes of tile failure associated with chipboard, plywood, plaster, and plasterboard. Being lightweight and workable, the prod- ucts are easier and faster to work with than all other types of building board. They replace wet finishes and can be used in place of floor screeds and rendered/plastered wall finishes, enabling fast- track tiling and saving costs. Managing director John MacKinnon claims that the Dukkaboard has been well-received by devel- opers and contractors. He said: “Our order book for 2015 is already close to 50% ahead of budget.” H unter Douglas Middle East, manufacturer of sun control systems, has released a new Screen Nature Ultimetal sun control fabric, which will help cut energy cost in GCC buildings by 25%. The GCC has already taken up sustainable measures in its building sector, with the UAE leading the way. This year, the Dubai Supreme Council of Energy has embarked on an ambitious scheme to convert 30,000 of its 130,000 buildings to be energy ef- ficient by 2030. The new fabric reflects 70% of solar energy that strikes buildings and can substantially reduce energy costs. It is especially useful in projects with a lot of glass, such as skyscrapers. Robin van der Velden, manager of window cover- ing division at Hunter Douglas Middle East, said: “With GCC countries among the world leaders in focussing on sustainable buildings, skyscrapers in particular require advanced solutions to cope with harsh daylight, while ensuring people have a comfortable climate and visibility. Screen Nature Ultimetal pushes the boundaries of sustainable sun control, combining visual appeal, thermal performance, and environmental properties, while substantially reducing energy consumption.” D ubai-based Transguard Group in conjunction with Sealed Air, are currently trialing cleaning robots at Dubai Festival City. The robots, widely considered as a first for the region, come in three different types in Sealed Air’s Diversey Care products range called Intellibots. Each machine is designed for a particular type of floor and environment. Robot currently on trial is the Hands-Free Cleaning HydroBot Scrubber, which is specifically intended for hard floors and is ideal for retail environments, such as indoor shopping malls. “The versatile HydroBot allows the operator to switch between manual cleaning and Hands-Free Cleaning, so at the push of a button the operator can walk away to clean in other areas while the floor is being cleaned and the quality of clean- ing is also consistent,” said Charlotte Butt, senior manager of Mobilisation, Transguard The Hands-Free Cleaning operating system incorporates up to 19 sensors, giving the robot a 360-degree view of its sur- roundings, and allowing it to operate and clean on its own. The HydroBot also comes equipped with Eco Save which is an advanced four-stage purification system that can filter water to one micron, providing clean, reusable water and eliminating up to 85% of its wastewater and chemicals, which significantly lowers its impact on the environment. New sun control fabric to help reduce energy cost in the GCC Region’s first robotic cleaners on trial Water-protection system with 25-year warranty enters GCC SUPPLIERS News

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construction business news me SEPTEMBER 2015 64 Oman Fire and Security E xpo 14-16 September 2015 Oman International Exhibition Centre, Muscat OFSEC 2015 will bring together local and international exhibi- tors who will showcase their solutions, latest technologies, cutting edge innovations, cost-effective products and services to meet the requirements of governments, businesses, indus- trial and commercial entities, aviation, construction, infrastruc- ture, transportation, manufacturing, oil and gas and utilities sectors. The exhibition will attract participation from a large number of exhibitors and representation from over 30 countries, with a slew of product and service launches, to the trade visitors and potential buyers from the region and beyond. The expo is aligned with the demand and supply of the market across the board of industries to share best practices, tackle challenges, and explore breakthrough methods for the integration of safety and security technologies. GULFSOL 14-16 September Dubai World Trade Centre GulfSol is a key event in the Middle East dedicated to the so- lar industry, showcasing the latest solar thermal and photovol- atic technologies available in the region. This will be the sec- ond edition of GulfSol in Dubai which is currently organised by dmg events. Visitors can take advantage of the workshops and also register as delegates in Global Solar Leaders’ Sum- mit, a high level summit bringing together senior government officials and private sector stakeholders from across MENA to discuss and debate the region’s solar future. The Big 5 Kuwait 14 – 16 September Kuwait International Fair Last year’s show hosted over 5,000 construction profession- als, creating a platform for manufacturers and distributors of construction goods and services to showcase their products, network with Kuwait’s biggest buyers. This year will include an additional hall dedicated to build- ing interiors products such as kitchens, bathrooms, stone and more. The exhibitor profile for this event will include chemi- cal building products and preservation of structures and build- Construction Business News ME rounds up of the latest and most sought-after exhibitions, conferences and seminars coming up in the construction industry Upcoming events Dubai World Trade Centre SAVE THE DATE ings, tiles and paving stones, construction materials, building machinery, building components and structural elements, building equipment, tools, scaffolds and formwork, domestic and building services control technology etc. Materials H andling Middle E ast 14 - 16 September Dubai International Convention and Exhibition Centre This year’s Material Handlings Middle East will feature more than 150 brands from 17 countries. Currently in its eighth edi- tion, the event will include prominent market leaders in ma- terials handling, warehousing and lifting equipment, logistics and postal service providers. The dedicated trade show will focus on the rapid progress of automation across all sectors of the materials handling industry, and highlight significant solu- tions and innovations presented by participating exhibitors. This year will also feature the inaugural Warehousing and Materials Handling Conference, a two-day summit analysing key growth drivers and restraints, emerging trends and their impact on the regional materials handling industry. Cityscape E gypt 16 - 19 September Cairo International Convention Centre Cityscape Egypt, the International Property, Investment and Development event will again be a great opportunity for regional and international real estate industry to come together to network and to establish joint venture partnerships and to discuss the future of the real estate industry. The exhibition and conference is complemented by a lineup of networking events, giving investors and developers the opportunity to interact face-to-face. Light Middle E ast 6 - 8 October Dubai World Trade Centre Light Middle East is a trade fair for the region’s lighting design and technology industry. Last year’s event included 325 ex- hibitors from 27 countries showcasing a range of international brands. The three-day event offers a comprehensive interac- tive platform for manufacturers, architects, designers, consul- tants, engineers, construction companies, hospitality industry professionals, government officials and more. The Lighting Middle East Conference, held along with the exhibition, aims to be a platform for key leaders in the inter- national and regional lighting industry to analyse innovative technologies, changing global trends and evolving regulations impacting the industry.

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construction business news me SEPTEMBER 2015 66 I n early August, urban design stu- dents at the UAE University were offered the chance to work on some of Abu Dhabi UPC’s upcoming proj- ects. The collaboration between the two entities was established in order to set up a training programme for local students to enhance their young talent. The organisation is set to provide five annual internship opportunities, as well as the chance to work on some of its key planning projects. As internships in the region gain more popularity, firms are buying into the strategy in order to hire the best pos- sible talent. The challenge in hiring local talent, according to Abdulla Al Shamsi, executive director at the Stategic Affairs of the Abu Dhabi UPC, is a shortage of graduates and experts with an urban planning major. He says: “Many people come across as excellent at the inter- view, but when it comes to performing in the actual work environment, they are totally different or not up to par. “This challenge is improved through the internship process because intern- ships allow us the time and oppor- tunity to assess and evaluate interns’ talents and their potential as perma- nent employees.” Students speak out Tamer Ehab Khalil, student at American University of Sharjah, views an intern- ship as snapping out of a “dream zone” whilst in university. He says that it is important to be as creative as possible, however it is good idea to gain experi- ence in the real world. He adds: “Having an internship is very useful. First of all the students have the chance to interact with architects or designers rather than professors. Secondly, they might work with other interns and can share their experiences, and thirdly, it could even help them score a job after graduation.” Arghavan Hatamabadi, another stu- dent at American University of Sharjah, says that internships are is a great expe- rience to have in a fresh resume. Should money matter? Most internships in the region are paid poorly or not at all, however, Shamsi says that even though the internship offered by UPC is a paid opportunity , other things are more important. He observes: “Money seems to be a criteria for interns. However, gaining exposure to real life issues, working with experts in the field and building relationships with them is far more beneficial in the long term, therefore money should be a less important fac- tor when applying.” Students in the region seem to think internships could be useful in two ways, a way to earn some money or gain some experience. Hatamabadi says: “If I get an internship opportunity with a local well-known firm where I can Display of historical artifacts inside Dubai Museum EDITOR'S PICK receive guaranteed experience, money wouldn’t be an issue as the experience and knowledge gained would compen- sate for it.” Khalil agrees and takes it a step further by adding that money shouldn’t be a criteria at all because the idea of an internship is not to be a “part time job”. He says: “The focus of any internship, in my opinion, should be education oriented. This should be understood by both the student and the firm.” In Khalil’s opinion it is important to have a mindset to learn and experi- ence. While he also urges that it is important for firms to bring value to the experience as well. He says: “The firm should have a mindset of respon- sibility towards the future architects and designers and educating them as to how a firm operates.” He explains that there is a tenden- cy in the industry to “use and abuse” interns by making them do work that nobody else wants to do, and as a result the intern doesn’t learn from the experience. Both students do agree that the opportunities for good internships exist in the region but it is up to both interns and the firm to make it a pro- ductive experience. Learning the rop es After Abu Dhabi Urban Planning Council’s (UPC) announcement to include university students in major projects, Lorraine Bangera speaks with graduating students to know the value of an internship in the GCC

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Highly efficient 'construction kit' With its modular design concept, the crane-inde- pendent Automatic climbing formwork SKE50 plus provides an efficient solution to every type of structure. On-site safety and protection from wind and weather is possible with Protection Screen Xclimb 60, a gapless self-climbing enclo- sure. The system comes in several versions, giving you the ideal solution for every requirement. Highrise core concept The Lubeca Jumpform, now in Doka's portfolio, has room for all site equipment needed. Powerful hydraulic cylinders cranelessly raise the platform to the next casting section. Bridge | Tunnel | Highrise | Residential | Energy www.doka-me.com The Formwork Experts. Highrise Innovation Added value that makes all the difference