< Previous20 CONSTRUCTION WEEK NOVEMBER 2020 EDITOR’S LETTER WWW.CONSTRUCTIONWEEKONLINE.COM The Covid-19 pandemic has hit the construction industry particularly hard. Companies I speak to every day say they’re “living on the breadline” just to stay afloat. Sadly, it’s inevitable a good few won’t survive. The collapse of Arabtec last month – hitherto the UAE’s largest contractor – is a stark reminder that no enterprise is too big to fail. So, what are the ways in which companies can navigate these unprecedented times? Unfortunately, it’s a reality that few sectors are willing to collaborate to develop or share ideas for fear of being “one-upped” in a highly competitive market – especially in the construction industry where so few projects are being put out to tender just now. But in an extremely tough climate, where firms are fighting for scraps in a race to the bottom, what is the solution for a sustainable future that creates a resilient, collaborative industry? Plenty of construction activity might have continued seemingly unabated during these exceptional times but one thing I have learned is this: all minds need to work together to succeed and thrive. Our Leaders UAE conference in September, which brought together some of the biggest construction names across four panel discussions, took away many insightful lessons that we could all learn. Kez Taylor, CEO of UAE contracting giant ALEC, made one of the most forceful comments when he said the industry is in an “awful mess”. But the man driving Dubai’s iconic One Za’abeel construction project forward also provided a ray of optimism. Success, he said, will depend on collaboration. As a case in point, ALEC was among the key drivers for stakeholder collaboration after launching the Project of the Future initiative alongside global consultancy firm Cundall. As part of the initiative, the participants were required to look at challenges facing all stakeholders in project delivery within the industry and explore how reoccurring and past mistakes can be eliminated. The winning team came up with a solution called BRAINS (the Built Environment Ranking Artificial Intelligence Network System), and they will share their concept at an industry roadshow later this year. Another key point from the UAE conference was the importance of public-private partnerships (PPP). While PPP has been long perceived as expensive, they can also be solutions for a number of factors to bring skills, knowledge, and jobs to the economy, particularly during these times, through the ultimate form of collaboration. A perfect example of this is Expo 2020 Dubai. The Switzerland Pavilion is being constructed as part of a PPP model, which are providing once in a life time opportunities. Our industry can be stubborn, perhaps reluctant to change, but we have to lead the transformation, and we have to be the ones to demonstrate the value of greater collaboration. Why collaboration is king in UAE’s construction sector Building leaders must pull together to get through this crisis and find some much-needed resilience “OUR INDUSTRY CAN BE STUBBORN, PERHAPS RELUCTANT TO CHANGE, BUT WE HAVE TO LEAD THE TRANSFORMATION, AND WE HAVE TO BE THE ONES TO DEMONSTRATE THE VALUE OF GREATER COLLABORATION” Ashley Williams EditorFOR MORE INFORMATION PLEASE VISIT WWW.COMMERCIALINTERIORDESIGN.COM/cid-AWARDS OR CONTACT ONE OF OUR TEAM TODAy For sponsorship enquiries: rebecca lockwood Sales director Tel: +971 4 444 3268 Email: rebecca.lockwood@itp.com For NOMINATION enquiries: JANE O'NEILL EDITOR Tel: +971 4 444 3626 Email: jane.oneill@itp.com For event enquiries: daniel Fewtrell Director of Awards & Marketing Tel: +971 4 444 3684 Email: daniel.fewtrell@itp.com For Table sales enquiries: anthony chandran table sales executive Tel: +971 4 444 3685 Email: anthony.chandran@itp.com silver SPONSORs category SPONSORs Social media SPONSOR WEDNESDAY 25th November jw marriott marquis hotel dubai Last chance to book your seats PRESENTED BY GOLD SPONSORS #CIDAWARDS FIT-OUT PARTNERIN CONVERSATION 22 CONSTRUCTION WEEK NOVEMBER 2020WWW.CONSTRUCTIONWEEKONLINE.COM Project consultancy and project management firm Carter Associates’ chief executive officer and founder, Craig Carter, and chief operating officer and partner, Nathan Hones speak with Disha Dadlani about addressing hotels’ need for refurbishment. Carter Associates’ refurbishment work for Grand Hyatt Hotel, Dubai. Rooms were sequenced to minimise impact on operation and revenue. [image: Supplied] UAE’s hospitality sector has taken a major hit due to the restrictions and previously-enforced lockdown associated with the ongoing COVID-19 crisis, putting hotels across the region in an idle state for long periods. With lessened hotel activity, now is the right time for the sector to establish a plan to start addressing parts of their property which are beginning to lose relevance. Project consultancy and project management firm, Carter Associates, which specialises in hotel refurbishment, advises turning the current situation into an opportunity. The time is ripe to refurbish “A far-sighted owner of a property would benefit in the long-term by exploiting the ‘opportunity’ presented by the ongoing situation. Now is the right time to consider refurbishment, when a hotel’s operations are halted or restricted,” CEO of Carter Associates, Craig Carter, tells Construction Week. Classifying hotel types as business hotels and resort hotels, he adds that while hotel performance and occupancy is evidently “healthy” across resort hotels, many business hotels are still shut or operating at a very low occupancy. “What we are seeing is that some business hotels are seizing this opportunity to refurbish.” “Once the pandemic-scenario is behind us, these hotels will be at a different level than their competitive set, and are likely to see an increase in terms of occupancy and average daily rates.” Weighing in on the need to consider refurbishment, COO at Carter Associates, Nathan Hones, says: “Several hotels which were built quickly in the early 2000’s are now looking at improving the performance of their asset to suit the current market. At present, approximately 50,000 hotel rooms across UAE are in need of refurbishment. Refurbishing now would mean that post-COVID-19, existing older hotels are able to provide efficient and optimised mix of room and service offering, which can then help them get back on their feet again.” Carter Associates guides INCREASING THE LIFESPAN OF UAE’S HOTELSIN CONVERSATION WWW.CONSTRUCTIONWEEKONLINE.COM its hospitality clients on refurbishment strategies and helps them “reimagine the existing idea of their hotel,” Carter explains. Assessing economic viability The relevance of a hotel and the revenue it generates go hand in hand. “If you don’t maintain the relevance [of the hotel], the revenue and asset value is likely to drop,” Carter says. “The biggest costs to consider while operating a hotel are people, resources, and power or energy. It is crucial that an operator places equal focus on all three elements.” Hones stresses: “As an old hotel, let’s suppose you decide to do nothing. Such inaction would cause relevance, revenue and asset value to drop; moreover, potential guests are likely to be enticed by something new. Demolition versus refurbishment Hones continues: “Now, in an alternative scenario, suppose you demolish the entire building and start again as a solution to regain asset value and revenue. This is a very drastic option B; you’d be doing away with the majority of the existing framework and services. Carter Associates advocates and advises that a middle ground must be met in order to achieve the goal of ensuring property relevance and maintaining asset value. “A refurbishment is that middle ground,” Hones adds. “In a scenario where a building is fundamentally sound and efficient in structure, with an embodied energy that can be reused, a refurbishment - of elements that are no longer working effectively - is more advisable than demolition.” That’s where Carter Associates have a specific expertise, to create a feasibility studies to help evaluate various levels of refurbishment to ensure most efficient capital expenditure and return on investment.” Red flags to look out for In the refurbishment process, hotel operators are expected to assess the property with an overall view. “However, often operators tend to base their refurbishment decisions only on what the guests see, touch and experience during their stay. These include front of house elements such as the lobby, elevators, corridors and guest rooms, among other areas. In order to avoid incurring significant costs in the future, operators must also look into what guests don’t see. These include back of house facilities encompassing engineering elements. Examples are diesel generators, bathrooms, and fan coil units, among other areas,” Hones says. Carter Associates plays its part here by advising its hospitality clients to tend to and assess all of the aforementioned elements, rather than a ‘superficial refurbishment’, with an aim to avoid an “incremental loss in value in the future,” Hones adds. “Technical service teams across hotels generally consider all elements while refurbishing; however, sometimes, they need additional external third party opinion to validate their opinion to the owners.” It is important to understand what areas of the hotel must receive immediate attention. “Certain elements in hotel spaces - such as curtains, carpets, mattresses, furnishings - deteriorate at certain rates due to being physically softer and high- use. Others such as tiling, ceilings, and bathroom fixtures, last longer as they are physically harder. Hotels go through a range of refurbishments; soft refurbishments may take place around the 5-7 year mark; and hard refurbishments, which may be take place after 10-15 years,” Hones explains. Additionally, Carter Associates is working on a secondment or ‘outsourcing’ model, offering consulting expertise on an ‘as-needed’ basis, which is assisting greatly those companies who downsized their internal technical and project teams in view of the current climate. The project consultancy and project management firm’s efforts in this regard are focused on assisting companies to reduce their hiring costs and avoid the potential risk of hiring full-time employees during uncertain times. “We are focused on creating and sharing untapped knowledge and experience as well as flexibility for businesses to maintain continuity,” Carter concludes. Nathan Hones, COO at Carter Asociates [Image: Supplied] Craig Carter, CEO of Carter Associates [Image: Supplied] NOVEMBER 2020 CONSTRUCTION WEEK 23COVER STORY WWW.CONSTRUCTIONWEEKONLINE.COM24 CONSTRUCTION WEEK NOVEMBER 2020 “2019 was a defining moment for Cundall” INTERVIEW BY ASHLEY WILLIAMS | PHOTOGRAPHS COURTESY Cundall Cundall’s managing director and partner for the MENA region, Richard Stratton, sits down with Construction Week’s editor Ashley Williams to reflect on the firm’s successes, infrastructure development plans and its drive to becoming a sustainable leaderFOLLOW CONSTRUCTION WEEK @CWMIDDLEEAST COVER STORY WWW.CONSTRUCTIONWEEKONLINE.COMNOVEMBER 2020 CONSTRUCTION WEEK 25COVER STORY 26 CONSTRUCTION WEEK NOVEMBER 2020WWW.CONSTRUCTIONWEEKONLINE.COM The Cundall team picked up the Consultancy of the Year accolade at the CW Awards 2019 The developer is using post-tensioning concrete, which not only helps reduce cost but builds the structure effi ciently Established within the MENA region in 2007, international multi- disciplinary consultancy firm, Cundall, is among the many businesses that is turning heads within the industry with 2019 being the “defining year” for the firm. Over the past 12 months, the business was recognised with 10 industry awards and is involved in some of the most exciting projects across the region. Leading the almost 100-strong MENA division of the global business is managing director and partner, Richard Stratton, whose selfless nature of putting his workforce first is winning plaudits within the industry. Speaking exclusively to Construction Week, Stratton says: “I was given an opportunity many years ago to start a business in the region which we’ve grown over time and it’s the team here who have built that reputation,” says Stratton. “I simply represent the collective efforts and achievements of the organisation as a whole. We remain agile and support each other as a business. For me, one of the most enjoyable things about working within our organisation is that we work for the collective good of the global business rather than individually.” Despite the severe difficulties brought upon by the global pandemic, Stratton is determined to pick up where they left off in 2019 after describing it as the “most successful year regionally”. “2019 was the defining moment for Cundall. Without a doubt, this was our most successful year regionally,” adds Stratton. “When we set the business up in 2007, it was just before the major market crash in the region. Prior to the crash, we were barely able to cope with the volume of workload that existed at that time, therefore we didn’t really manage to penetrate the region very much. He added: “Getting the awards was really quite interesting. We had best engineer, best consultancy, best projects, including our own office. For me, this told a story about our business and our team from the past decade that we are doing all the right things and the industry recognised this.” As an avid sportsman, particularly with cycling, Stratton referenced a recent sports documentary when answering the millionaire dollar question: Are you now the best consultancy firm in the region? “I watch a lot of sports documentaries and I heard a quote from Lewis Hamilton recently where he says: ‘Every Formula 1 driver believes that they are the best’ - we believe that we are the best,” Stratton grins. “We’re not the biggest, and we don’t want to be the biggest, but we want to provide an excellent service to our clients and honour our own values, vision and mission. I think we will maintain our position in the market, but we’re not looking to increase the business in size dramatically. For us, it’s far more important to have a sustainable business rather than it simply being about turnover and churn.” Given that Stratton overcame the financial market crash when he set up the MENA business in 2007, he reflected on how the business reacted to the COVID-19 crisis through not being “tied up in bureaucracy” and “communicating effectively across the global business”. “When COVID-19 kicked in, myself and all my partners on the management board came together to figure out how the pandemic was going to affect our market, how we were going to stabilise the business globally and the areas that we needed to be focusing on,” explains Stratton. “With pretty quick succession, we were jumping on all of those issues and communicating with the rest of the business. The ability to not be tied up in bureaucracy around making decisions is good.” In terms of project delivery, he added: “Anytime that we’ve had big or demanding MAY 2020 CONSTRUCTION WEEK 27WWW.CONSTRUCTIONWEEKONLINE.COM COVER STORY projects, we’ve been able to mobilise and deliver on our promises, simply because we are so connected as a global business. We always try to build the right critical mass in all of our organisations to service the market. We don’t try and overgrow the business just because there is market opportunity. We look through that opportunity and see where the stability is.” Elaborating on the consultancy’s projects, Stratton expressed that they have “exciting and reasonably sized projects” underway in sectors such as education, leisure and the broader public-private partnerships opportunities that exist across a range of government areas, but remained tight lipped on the details due to confidentiality obligations. “It is very frustrating for us as a Expo 2020 Dubai’s ENOC Pavilion is among the major projects Cundall is working on Cundall are involved in several projects within ICD Brookfi eld Place Photo courtesy: EYCOVER STORY 28 CONSTRUCTION WEEK NOVEMBER 2020WWW.CONSTRUCTIONWEEKONLINE.COM business in terms of our confidentiality constraints and we have to honour them strictly, but this is why our clients trust us,” affirms Stratton. “We have some very interesting things in the pipeline and we were particularly happy to have been successful in winning the commission for the Red Sea Development Company’s Dark Sky Initiative. This is a very good example of the sort of projects that we love doing.” But one of the main areas that Cundall is focusing on going forward is infrastructure development, particularly within the rail engineering business. Cundall recently appointed global rail director, Stephen Dale, who will be responsible for growing the consultancy’s rail sector business globally. “The MENA region has lot of opportunities with rail in particular and other areas of transportation, therefore the next logical step for us was to have a global sector focus group and that is where we were delighted that Stephen Dale chose to join us,” says Stratton. “He has a wealth of experience in rail and has operated at consultancy, contractor and client level, therefore he knows what the market wants and will help us develop our sector offering to push it more globally and to have greater diversity across the business.” Stratton says, for now, its goals for the rail engineering business is to have “a credible and strong core team” that they can then build around. “We have a lot of people in the business that have a lot of rail experience. What we didn’t have was somebody with Stephen’s pedigree who could step up and lead it,” explains Stratton. “Once we start seeing some interest and more developments on the rail sector side, then we will build a team around it. He added: “We don’t want to be a “WE DON’T WANT TO BE A BUSINESS THAT IS HIRING TODAY AND FIRING TOMORROW. OUR FOCUS IS ON THE CORE ELEMENTS OF RAIL” Richard Stratton Cundall managing director and partner EY’s new offi ce in ICD Brookfi eld Place Photo courtesy: EYNOVEMBER 2020 CONSTRUCTION WEEK 29WWW.CONSTRUCTIONWEEKONLINE.COM COVER STORY With the business having three MENA offices, Stratton elaborated on the firm’s expansion plans into Saudi Arabia and also discussed setting up an office in Abu Dhabi. “Towards the end of 2019, we started looking at Saudi in more detail. It is quite a task to set up a business in the region as it is time-consuming and needs investment, but we are in the process of going through the registration for the Saudi office,” says Stratton. “We have a local partner in Saudi Arabia and we want to be there for the long-term to establish a sustainable business. We also want the nationals to run the business in time and we don’t want to flood it with western expats. Stratton also went into detail about expanding in the UAE. “We are also in the process of opening an office in Abu Dhabi to strengthen our position in the UAE to maintain our commitment and business here.” Richard Stratton recently picked up the MEP Executive of the Year at the MEP Awards business that is hiring today, and firing tomorrow. Our focus at the moment is on the core elements of rail, and then looking at other innovations that we can bring into that.” Stratton admitted that as the business has evolved over the years, they have “chipped away” to win opportunities in the infrastructure market as they needed to build credibility from when they first set up the business in 2007. “Infrastructure was something that we were quite conscious of when we set up the business here in Dubai, but we didn’t really have a credible offering in that area of the market,” says Stratton. “We chipped away over years to win opportunities and we have now secured two credible and sizeable opportunities in the market. We have delivered fully on one and we are in the process of delivering on the other. This has demonstrated our ability to deliver on rail projects across all of the disciplines.” Concluding the discussion, Stratton has set his sights on Cundall to become a sustainable leader for the industry, which he says is “what the business is all about”. “One of the goals that we set ourselves is to be leaders in sustainability. We’ve managed to become the first consultant to be carbon neutral globally which we achieved in October 2020,” Stratton proudly says. “The world is going to be a much better place if we are all pushing to be carbon neutral, net-zero or even net-positive. “We need to be ambitious and if we all look at our planet, we need to remember what we are working with and what we are destroying.” He concludes: “It’s our responsibility in this overall construction and design sector to take this seriously. We are well on the way of doing that - we want to build on that and continually improve on our sustainability offering across our global business.” Next >