44 www.estatesgazette.com 5 December 2015

Topics up for discussion in this winter’s Industrial Talks included design, build cost delivery challenges and procurement problems. Recruitment and the price of steel were also at the forefront of panellists’ minds. Noella Pio Kivlehan listened in

talkstalksChallenges/recruitmentKester Purslow: It’s been a very challenging year, but we are extremely busy across all the sectors we work in. We have a backbone of distribution as a

sector and across all of our end users and end-user clients and developed clients. It doesn’t really seem to be slowing down at the moment.

Again, we’ve seen a large number of end users still doing specific

built-to-suit requirements. Some of those are very big and very challenging projects.

One of the main challenges for us has been staff recruitment. Resourcing and bringing new people in is a challenge. We are constantly recruiting, not through wastage, just in terms of growth.

Stephen Pickup: Challenges on the property side have been rents and trying to peg rents... to manage the charges. It’s all about processing, unfortunately.

INDUSTRIAL TALKS

Obviously, [we want] to keep the rent down as much as we can, move gears, and in a challenging market we are seeing rises in certain areas. We’re just about keeping our head above water in that respect.

David Gavin: We’ve seen some changes over the past three years in regard to the retailers’ requirements. Automation is a big thing now. You fit the building around the automation, rather than fitting the automation in the building.

www.estatesgazette.com 455 December 2015

SAVILLS IDI GAZELEY

IN ASSOCIATION WITH

THE PANEL

SIMON BARNESDEPUTY MANAGING DIRECTOR, SEVERFIELD

KESTER PURSLOWTECHNICAL DIRECTOR, RPS PLANNING & DEVELOPMENT

JAMES KELWAYDIRECTOR, BUILDING & PROJECT CONSULTANCY, SAVILLS

DAVID GAVINDIVISIONAL DIRECTOR, MCLAREN CONSTRUCTION

ALISTAIR JESPERSENCONSTRUCTION DIRECTOR FOR UK, IDI GAZELEY

STEPHEN PICKUPHEAD OF REAL ESTATE AND PROPERTY SERVICES, TNT

We’re seeing the procurement routes changing significantly across all sectors, and there is a lot more two-stage tendering. I think that’s due to the pressure on the supply chain.

In regard to changes for our business, we’re constantly recruiting. We’ve always tried to get the best staff we can.

Simon Barnes: The challenges, as other people have mentioned, are finding and keeping skilled people. We have been looking for engineers, skilled fabricators, skilled draughtsmen. It’s really one of the challenges for us, given our location in Scarborough. [We are] trying to get people to invest upon themselves and the business, and keep an interest for everyone. So it is challenging, but that’s what we do.

Alistair Jespersen: We’ve seen tremendous growth, especially since spring of this year and we have changed our platform offering from being a trader/developer to an asset holder, so there are lots of considerations around that.

We’re looking at the products in far more detail in terms of it being a long-term hold, so the performance, the efficiency of that building, the design, even the sizes of those buildings, all start to change.

Procurement/steelSB: The Tata situation has had a lot of negative publicity. My own take on it is that it will affect primarily the kind of plate market and some of the smaller sections. I think the larger UBs and UCs [universal beams and universal columns] you typically see in structural steel will still come from Tata for the foreseeable future.

There’s a lot of price pressure from Europe. We remain, as we have done for the past 20-30 years, committed to supporting Tata. We take 90% of our steel from the company because we like the quality. We like the delivery. We like the reliability.

And we get a lot of efficiency because we order things to the correct length, so it cuts down on wastage. There are a lot of advantages in staying with Tata, so we’re not pressing the panic button.

In terms of the long-term view of steel prices, it’s crystal ball-gazing: it’s so volatile.

James Kelway: Regarding the gap between client expectations and suppliers, my experience is that when a prelet deal is coming together with an occupier, developer and an investor, we tend to find the timeline gets pushed up and up and up, then the deal’s done, the transaction’s done, everybody’s happy,

ALAMY

46 www.estatesgazette.com 5 December 2015

INDUSTRIAL TALKS

and they say, “Well, have you started on site yet?”

Where I see real advantage is if we are able to have more visibility with the client organisations around the deal in a way that can give more weeks’ notice through procurement, allowing security around placing early orders. That’s what I’m challenged with at the moment.

DG: But something will always come up. We normally place orders... as soon as we’re instructed. We place steel on day one and sometimes we go to place earlier than that, but then you’ve got the planning issues that come up. So the deal’s got to be that all the boxes are ticked, that the planning’s got to be done. It stretches out even further in regard to the time that you can start and sign.

JK: We try to rev the programme in a way that the plan has progressed: get into an initial agreement, get some underwriting, and off you go with the planning application which goes through its determination. You can’t physically start an assignment until those pre-commencement conditions have been discharged.

Equally, if we have more visibility or if there’s another way round the deal that

allows us to rev up the way in which we can procure things, it gets a commitment earlier on. That would just help get some of this lead-in period. That goes through the steel work, because the steel work is a critical part in the warehouse.

AJ: Steel procurement is stretching out now, and it starts to impinge on the question of how much risk we’ll be prepared to take. I haven’t got an answer for that. The determination of the planning consent, for example: would you be prepared to place an order beforehand? This is a conundrum.

DesignAJ: We are looking at multi-level opportunities, also the sub-divisibility and the multi-tenanted units, and we have task forces working on that.

KP: Certainly future flexibility and subdivision are the things we really are focusing on from a design point of view at the moment. [On two of our] most recent projects… both focused on multi-tier mezzanines, potentially multi-occupiers, and very much on future flexibility.

SP: From our point of view, whether design is generic or bespoke depends obviously on which direction the company goes. Obviously for the market, it is the home delivery sector that we are not

really in. I think home delivery will focus a lot of developers on small cross-dock warehouses, not building the 400,000 sq ft sheds.

BIM (building information modelling)SB: With BIM, there’s some great opportunities now with 3D software coming through and we’re seeing our 3D software being linked into the cloud, so we’ve got multiple users that could be extended to client integration, engineering integration. We’re seeing fantastic new fabrication machinery coming through the system. People are starting to develop robots that are a long way off yet for what we do, but the technology is coming through.

JK: It’s fantastic hearing that we’ve got a subcontractor embracing BIM because the future is digital. BIM will really help us get the visualisation, collaboration and flexibility around design in the delivery of our buildings, which will help our developer clients to help our occupier clients.

SB: Especially with our more learned customers, the likes of John Lewis, Waitrose, TNT, it’s almost a demand because it links into their fit-out and facilities management.

“One of the main challenges for us has been staff recruitment. Resourcing and bringing new people in

is a challenge. We are constantly recruiting, not through wastage, just in terms of growth”

FANATIC STU

DIO /ALAM

Y