INFRA MENA 4

PLUS Amin Al Arrayed First Bahrain John Cowling Faithful+Gould Ramadan Abdullah Serco Group

www.menainfra.com • Q1 2010

As Dubai struggles with debt, could the next 10 years

prove to be Abu Dhabi’s decade?

Planning for growthWith Aldar Properties’ Head of Infrastructure Talal Al DhiyebiPAGE 34

Confi dence builderWhy Arabtec CFO Ziad Makhzoumi is looking forward to the year aheadPAGE 44

Meeting local demandIs affordable housing the next opportunity for developers?PAGE 82

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Wow, where did the last 10 yearsgo? It’s been a rollercoaster rideof a decade, and no mistake. Itonly seems like yesterday that

the Burj Al Arab opened its doors to welcome thenew millennium and usher in an unprecedentedperiod of growth for the Gulf and the wider MENAregion. Consider what we’ve achieved in that time-frame: whole cities built from scratch; new islandsreclaimed from the sea; coastlines redefined; andheights reached that have never been reached be-fore. In terms of what has been achieved, the decadehas been an unparalleled success.

Nevertheless, there are lessons that must belearned if the second 10 years of the 21st centuryare to be as successful as the first. While the decadebegan brightly, the last 18 months have beenmarked by significant struggles within the con-struction and real estate industries across the re-gion. Most notably, the recent furore over DubaiWorld’s inability to pay back billions in loansserves as a cautionary tale for those that fail to con-sider the sustainability of their actions.

Dubai was built on boundless ambition and

use of resources and streamlining processes togenerate less waste makes sense regardless of ex-actly why it’s being done. Being known as a lowcarbon company will also have advantages in thekind of clients it is possible to attract and the kindsof people who want to work for you. Green cre-dentials are becoming increasingly valuable as abusiness differentiator.

In this regard, Abu Dhabi is leading the way.The emirate is positioning itself as a sustainabilitypioneer through its groundbreaking work on theMasdar initiative, and other projects are soon tofollow. Such forward-thinking will be vital overthe years (and decades) ahead. If Dubai’s plighthas taught us anything, it is that taking the supplyof an essential resource for granted can have graveconsequences for the future. n

Ben Thompson Senior Editor

a relentless drive to be the biggest and the best;admirable to be sure, but in pursuit of that dreamcertain economic fundamentals were largely ig-nored. The emirate’s troubles are a glaring ex-ample of financially unsustainable businesspractices, and directly mirror the environmentalsustainability challenges now facing the con-struction industry as a whole: just as we cannotrely on an inexhaustible supply of easy credit, sowe cannot expect the Earth’s resources to be lim-itless, either.

Traditionally, sustainability issues have gen-erally been viewed as little more than an imposi-tion, a box to be ticked if a company is to meet itscorporate social responsibility targets. But achange is coming and those that fail to respondwill see themselves left behind. Design and con-struction companies need to stop thinking of sus-tainability as a chore and get serious aboutbuilding it into their processes from the groundup. If the rewards of protecting the environmentdon’t seem significant enough on their own, lookat the drive towards sustainability as a tool for im-proving how the business works. Making better

If the progress made since the turn of the century isanything to go by, the Middle East can look forward to afascinating few years ahead.

FROM THE EDITOR3

“We need hands-on experiencewith the day-to-day problemsand practical implementationof the projects rather than apurely theoretical approach”Imad Al Jamal, Vice Chairman,UAE Contractors Association(p58)

“We have a very disciplinedapproach to growth, based onliquidity. If you don’t have themoney to build it, don’t buildit. It’s as simple as that”Amin Al Arrayed, GeneralManager, First Bahrain(p62)

“From a congestion andefficiency standpoint, I wouldsay that managing a roadnetwork today without an ITSinfrastructure is unimaginable” Caroline Visser, ITS Manager,International Road Federation(p114)

A decade of growth

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CONTENTS5

44

An oasis in the desertFacing a housing shortage of twomillion, Saudi Arabia is in direneed of middle-income andaffordable accommodation – couldthis sector prove to be the saviourof the housing market?

82

24

Building confidenceWith the rest of the UAE reeling inthe wake of Dubai’s recent debtconcerns, Arabtec’s charismaticCFO Ziad Makhzoumi is betting onhis firm’s sound financials to see itthrough the downturn and beyond.

Power shiftDoes the change in the balance of power between Dubaiand Abu Dhabi hold deeper implications for the UAE?

34Urban evolutionUndertaking multibillion-dollar civic projects to helpdevelop Abu Dhabi into an international business magnetand tourist destination, Aldar Properties’ Talal Al Dhiyebireveals the firm’s outlook for 2010.

CONTENTS_jan10 15/01/2010 16:30 Page 5

42 The shifting sands of theproject management landscapeBy Gregory Balestrero, President and CEO ofthe Project Management Institute

52 Part of the processJohn Cowling explains why he believes therisk management industry has come a longway

56 Sustainability in constructionMichael Sagermann underlines theimportance of sustainability

58 Resolving contractor differencesWith the complexity and volume ofcontractual disputes on the rise, is a newapproach to contract resolution needed?

60 A line of defencePANOLIN’s Patrick Laemmle examines thelatest trends and developments in lubrication

62 A demand-driven approachWhy First Bahrain Real Estate DevelopmentCompany is focusing on local needs ratherthan foreign investment

64 Commodities to productsUnderstanding the customer is key to salessuccess, says Medhat Stefanos

66 Adding a gloss to theconstruction industry The importance of quality in the paints andcoatings sector

76 Protective solutionsIdil Yurdakul Peker on silicon products

80 Innovative solutions in thepaint marketAn exclusive interview with Kansai Paint

94 High and dryWhy it’s vital that the MENA region learns tomanage its existing water resources moreefficiently

106 Making a splashWith HE Dr Rashid Ahmed Bin Fahad, theUAE Minister of Environment and Water

108 A fast paced evolutionSuvarna Jeetandra gives the low-down on thewastewater sector

120

52

CONTENTS6

130

Leading the way

Intelligent transport systems Part of the process

ROUNDTABLE DISCUSSIONS

68 Paints and coatings88 HVAC98 Water and wastewater 120 Intelligent transport systems


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86

68

CONTENTS8

98

126 Traffic managementPoul Svensgaard explains the importance ofroad signs and markings

128 The business of aviationBy Gordon Rosen, President of the ASIGroup

130 Leading the way How new safety standards are improving thefire safety industry

134 Practical preparednessDennis Smagac argues why multi-hazardresponse systems should be a part of everyemergency response plan

136 Improving data captureHow airborne geophysical methods areimproving information capture

IN THE BACK

138 In my view: Marc Dardenne140 Vantage point: The World142 On the shelf: Book reviews 144 Photo finish: Dubai Fountain

110 On the right trackSerco’s Ramadan Abdullah reveals how theDubai Metro is set to revolutionise transportin the emirate

114 Driving smart Caroline Visser details the benefits ofintelligent transportation systems

118 Streets aheadA look at Abu Dhabi’s extensive road networkaudit

Photo finish

Water and wastewater

Reliability in automated power control

Paints and coatings

ASK THE EXPERT

40 John Best, McLanahan78 Michael Back, NutshellNatural Paints86 Martin Malek, ComAp132 Barry Bell, Wagner FireManagement


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UPFRONT10

DECADE IN PICTURES

Looking back over the past decade, it’s fair to say that the Middle East has transformed – and even over the last 12 months circumstances have rapidly changed: from the heady heights of the Dubai Metro and the hugely successful Abu Dhabi Formula One Grand Prix, to some historic lows. Th ere is no doubt that in 2009, things started slipping for the Gulf region. Last summer, two vast family-owned conglomerates in Saudi Arabia defaulted on billions of dollars of debt repayments. Th en in December, Dubai World announced it would not meet billions of dollars of debt repay-ment obligations, on top of a slumped real estate market in which prices halved in the year following the August 2008 highs. Added to that are the $500 billion of planned infrastructure projects that have been abandoned or post-poned as funding dried up.

However, despite facing diffi cult decisions for the next decade – Gulf leaders must push through reforms to improve economic com-petitiveness, increase productivity and meet the growing population’s employment and housing needs, for example – there are indica-tions the region’s fortunes may once again pick up. Economists have noted that the eff ects of the global economic crisis are less pronounced than elsewhere, and that oil prices have dou-bled since the lows of US$33 per barrel seen in January 2009.

Th e London-based Economist Intelligence Unit believes that MENA economies will grow 4.7 percent in the coming year, while the In-ternational Monetary Fund predicts economic growth of 3.1 percent in 2010. While a jump in oil revenues will give a much needed boost to the region, it seems oil exporters may well use 2010 to diversify investments and break away into manufacturing, fi nancial services and tourism. Whatever happens, it seems the construction and real estate sectors will undoubtedly benefi t.

Indeed, for many other Middle Eastern economies, the outlook for the coming 12 months is set to see a boost by ongoing public spending programmes – Saudi Arabia, for ex-

ample, has a US$400 billion fi scal stimulus pack-age to be implemented through to 2013. Th at said, it will take a lot for Dubai to get back on track following the Dubai World debacle. And beyond the coming year, the region may have more tough times in store. It appears that policy makers are set to see a whole host of challenges beyond 2010. Jordan, for instance, may have to hold back on public spending due to funding constraints. And countries like the UAE – that protected the fi nancial sector from the down-

turn – may well have to consider lift ing these measures.

Nevertheless, according to the 2010 Real Estate Global Opportunity Index from consultants AT Kearney, the Gulf region holds the most

real estate development poten-tial around the world. Dubai’s

experience, where prices have dropped up to 50 percent in the last

year, should off er a cautionary tale for the other GCC countries to manage supply in accordance with demand. At the same time, though, Dubai’s capacity to rebound fast should not be underes-timated. Both Dubai and Abu Dhabi recorded their best real estate results in almost a year during and since the summer. 2010 certainly kicked off in the right way with the celebrations surrounding the Burj Khalifa; however, it is un-clear exactly how the next decade will turn out – and while it’s looking pretty positive from this perspective, one thing is for certain: it cannot have as many ups and downs as the decade that’s been left behind.

THE CHANGING FACE OF THE MIDDLE EAST

1. The centrepiece of Mecca’s Abraj Al-Bait complex will stand as the tallest hotel in the world 2. The decade was dogged by controversy over working conditions for foreign labourers 3. Construction on Abu Dhabi’s landmark Sheikh Zayed mosque was completed in 2007 4. The decade kicked off with the opening of Dubai’s Burj Al Arab in 2000 5. The Bahrain World Trade Centre integrated large-scale wind turbines within its structure 6. On the eve of the decade, the 828-metre high Burj Khalifa reached completion 7. KSA has six megacities planned for completion over the coming years, with KAEC its fl agship project 8. Man-made islands like the Pearl Qatar literally reshaped the region’s coastline

2

1

Property prices have fallen

by up to

in Dubai since 2008

50%

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UPFRONT11

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UPFRONT12

Th e King Abdullah Financial District is a major part of Saudi Arabia’s economic diver-sifi cation plan, which aims to make Riyadh a major fi nancial centre in the Middle East. “Everything is being done from scratch,” con-fi rms James Goettsch, President of Goettsch Partners and design partner on the project. “It is an ambitious project.”

Th e development is focused on providing a new fi nancial centre for Riyadh, Saudi Arabia and the Gulf Coast region. “Th ere is a feeling that they see what has happened in Dubai and Abu Dhabi, and they want to be part of that forward-looking, business development,” confi rms Goettsch.

Construction work began at the beginning of 2009 and once completed the KAFD will off er fl oor space of some 3.3 million square metres. Around 55,000 jobs will be created, as well as

high-quality residential buildings and leisure facilities on an area covering around 16 hect-ares. In addition, the concept of the new city district includes a monorail and giant skywalks – large bridges in the sky linking multi-storey buildings – in order to optimise the quality of living and minimise the use of cars.

Th e fi nancial district will be the headquar-ters of the Capital Market Authority (CMA) and the Saudi Arabian Stock Exchange (Tadawul), and will also provide a base for fi nancial in-stitutions and other service providers such as accountants, auditors, lawyers, analysts, rating agencies, consultants and IT providers. Th e area also boasts a fi nancial academy with places for 5000 students. Th e Financial District project should be completed in 2012 – aft er a construc-tion period of only three years.

THE KING ABDULLAH FINANCIAL DISTRICT


UPFRONT13

Fast facts• Th e King Abdullah Financial District is set

to become the leading fi nancial centre in the Middle East, providing an attractive work-ing environment for the growing workforce in the fi nancial sector

• Conceived as part of the overall economic diversifi cation programme

• Designed to meet the existing and growing demand for Type A offi ce accommodation

• Located north of Riyadh, the site is 1.6 million square metres and the develop-ment will have fl oor space of over 3 million square metres

• In addition to world class offi ce space and housing, the King Abdullah Financial District will also have a Financial Academy and recreational facilities

• Th e fi nancial academy will build on an already signifi cant investment in education and training

• A fully integrated development including offi ces, hotels, conference centre, shops and recreational facilities with easy access to the airport and well served by the road system

• Close proximity to the main business district of Olaya

• Construction began in 2007, creating thousands of construction and related jobs over a three-year period

• Th e land owner and prime developer is the Public Pension Agency


UPFRONT14

EU Energy Commissioner ANDRIS PIEBALGS discusses the progress Europe is making in pursuit of sustainable, competitive and secure energy supplies.

AN INTERNATIONAL PERSPECTIVE

Interdependence means that a country does not take energy decisions in isolation but takes the opportunities provided by other Member States into account. Th is is where huge welfare gains have already been reached and can further be developed.

Our electricity system has to be adapted to the new circumstances: more distributed genera-tion, more variable generation, more large-scale distant (and variable) generation. Th e electric-ity transmission and distribution infrastructure has to be reinforced; new lines have to be built: incorporating intelligent solutions, building new interconnections, using operational measures.

Th e diversifi cation of energy sources, trans-port routes and suppliers is crucial for ensur-ing energy security; its importance has been underlined by the gas crisis in January 2009, but it has been recognised also before the crisis. In the Second Strategic Energy Review An EU Security and Solidarity Action Plan adopted

by the Commission on 13 November 2008, the Commission proposed a number of initiatives aimed at increasing EU energy security.

Despite the fact that at the EU level, gas supply is reasonably well diversifi ed, at national level, however, a number of Member States rely on a single supplier for 100 percent of their gas needs and a number of others on just a few suppliers. Diversifi cation is thus important to spread and reduce individual risk, as well as to fully benefi t from an integrated and interconnected market-based system.

Fostering the transition towards a low carbon power generation system is a high priority for the European Union. Th e massive deployment of renewable energy in the electricity sector will require a lot of investment, both in power generation capacities and in transmission networks. By 2020, according to the scenarios prepared by the Commission in 2008, renew-able energy should represent 33 percent to 58 percent of the total power generation capacity necessary to meet the future demand and to

replace ageing facilities. Appropriate policies are needed to support this deployment. Na-tional plans for the promotion of renew-ables – to be adopted by Member States in 2010 – will be crucial. Any investment or choice of technology contributing to decarbonising the electricity sector will be relevant.

Renewable energy sources have tradi-

tionally gained the reputation of being a costly invest-ment. In the 1990s, this was true, as the oil price

was low. It is however important to realise that costliness is relative to the alternatives. As the oil price rose, even in the years before the fi nan-cial crisis, renewable energy sources became more and more attractive.

An important factor is the price of carbon and its meaning. Carbon allowances are issued to or bought by those who emit greenhouse gases. Th is means we place a price on emissions. Con-versely, renewable energy sources have low or no emissions at all and therefore do not carry with them the price of carbon, as no allowances have to be bought.

Today, we see the need to accelerate our work on technology. Th is implies an increase of the R&D budget level. In the Communication on Investing in Low-Carbon Technologies ad-opted by the Commission on 7 October 2009, we set out the needs and technology roadmaps that can take us there. We estimate that we will need to spend €8 billion per annum, by public and private sectors combined, on the technologies identifi ed in these roadmaps during the next 10 years. Th e debate on this is just beginning. Mobilising these resources will make a crucial contribution to achieving our 2020 objectives.

Technology is nowadays helping to reduce production costs of equipment used to gener-ate renewable energy sources. Production pro-cesses become mature and their costs are lower, while raw materials meet an increasing demand and factors of scale are reducing their market price. As a result, these types of product become commonplace with more producers and a grow-ing market putting pressure on price.

New transmission needs include transporting electricity in seas, cables using direct current technology seem suitable for this purpose. Some people think that direct current could also be interesting on land. As a result, a meshed direct current network could become a new pan-Eu-ropean electricity super highway, ensuring our renewable energy goals and enabling solidarity between Member States.


UPFRONT15

Salaries in the real estate and construction sector are likely to remain fl at this year and any hikes that happen will occur on a case-by-case basis, say analysts. Matthew Carter, Managing Director at McArthur Murray, told Emirates Business: “I think the prop-erty and fi nancial services sector may well remain fl at during the coming year. Th ere may be isolated cases of salary reviews where a particular skill or knowledge set is required.”

And according to Wassim Karkabi, Partner, Regional Practice Leader EMEA, Industrial Practice at Stanton Chase: “Real estate and construction fi rms involved in residential and commercial continue to suff er. As projects are scarce and companies focus their business outside of the UAE, construction companies have shift ed their attention outside of the country. Th is is not anticipated to change to a large extent over 2010. Some exceptions may occur, but there will not be too many such opportunities to cause the market to shift ,” he said.

Source: www.zawya.com

ON TRACK

India’s Road Transport and Highways Minister Kamal Nath has announced it has increased its per-day construction of roads to nine kilometres, and the target of developing 20 kilometres daily would be accomplished by April. Opportunities aplenty for construction companies in the country.MENAINF impact rating:

NO VACANCIES

In December 2009, Australian Transport and Infrastructure Minister Anthony Albanese declared Sydney’s air-port at full capacity, while also delaying a decision on the site for a second airport until 2011, pushing construction further into the future. Potential for air traffi c tension.MENAINF impact rating:

UTILISING WIND

Nine European countries, including the UK, have signed up to develop an in-tegrated off shore grid in the North and Irish Seas in order to utilise wind power and cut down on carbon emissions as well as become more energy secure. In-teresting times for the industry.MENAINF impact rating:

TRAFFIC SURGE

Th e International Air Transport As-sociation (IATA) has said that Middle East carriers recorded a 16.5 percent rise in passenger demand in November, out-pacing global growth, which stood at 2.1 percent. Will this trend continue? Only time will tell.MENAINF impact rating:

STRICTER SECURITY

Th e US has introduced tougher screen-ing measures for passengers arriving by air from 14 nations that the authorities deem to be a security risk. However, the X-ray machine produces ‘naked’ images of passengers revealing any concealed weapons or explosives, which has unsur-prisingly drawn criticism.MENAINF impact rating:

UK SLUMP

Construction activity fell in De-cember for the 22nd month in a row. Although the slowdown in the sector has eased markedly since February 2009, the weakness in December continues a pat-tern of only limited recoveryMENAINF impact rating:

AROUND THE WORLD IN 80 DAYS

Our guide to the last quarter’s global events – and their impact on your business.

UAE SALARIES REMAIN FLAT


UPFRONT16

KUWAITOne of the richest countries

in the world, Kuwait has the world’s fi fth largest oil reserves and is one of the

most attractive investment destinations in the region.

With a per capita income of US$60,800 and a GDP

of US$295 billion, the Arab state is one of the fastest

growing economies in the region; Kuwait also has the

second-most free economy in the Middle East, according to

the 2008 Index of Economic Freedom, making it one of

the best places in the region to conduct business.

Increasing oil prices since 2003 have resulted in a surge

in Kuwait’s economy and a booming construction sec-

tor. For instance, with the country’s oil production

expected to reach four mil-lion bpd by 2020, Kuwait

Petroleum Corporation plans to invest US$51 billion by 2012

to upgrade and expand the country’s existing refi neries.

And with the Central Bank of Kuwait injecting US$5.15

billion into the economy for a much-needed boost fol-

lowing the fi nancial crises, impressive investment levels

look set to continue for the near future at least.

JABER AHMED AL-JABER

AL-SABAH HOSPITAL

Th e project calls for construction of Jaber Ahmed Al-Jaber Al-Sabah Hospital in Surra, Kuwait – a 1120-bed facility with a total built-up area of 270,000 square metres. Th e hospital will provide a comprehensive range of medical services comprising di-agnostic and treatment services, a trauma centre and ER facility, outpatient services, dental services, obs/gyn services, inpatient care services, VIP suites for visiting heads of state and also another wing for VIPs. Kuwait Arab Contractors Co. was awarded the main construction contract in August 2009, and construction is expected to be complete by the end of 2012.

Project Value: US$1.1 billionCompletion: 2012Sector: Civic InfrastructureMain Contractor: Kuwait Arab Contractors

KUWAIT INTERNATIONAL

AIRPORT EXPANSION

Kuwait Directorate General of Civil Avia-tion plans to expand Kuwait International Airport to increase its capacity to 20 mil-lion passengers a year from six million. Th e expansion project involves the construction of a new terminal building that will be con-nected to the existing terminal building via a tunnel, the two existing runways will be extended up to 600 meters and a third runway will be constructed. Th e electrical infrastructure of the airport will also be upgraded to include a new control and com-munication system. A new airspace system plan will be developed consisting of a con-trol centre and national meteorology centre to improve the airport’s operating perfor-mance and to meet international standards.

Project Value: US$2.1 billionCompletion: 2013Sector: InfrastructureConsultant: Joint venture between Dorsch Consult and SSH International


UPFRONT17

AL HAMRA

Due to rise to 412m in height, Al Hamra will be the world’s tallest ‘sculpted’ tower and Kuwait’s tallest skyscraper, creating a dra-matic focal point that is visible throughout the city. Facilities at the tower will include six levels of retail; a rooft op garden held above the retail sector; the largest business centre within Kuwait at 2400 square metres build-up and 1800 square metres leasable; a Sky Lounge restaurant; 40 elevators to help you reach those dizzying heights; two refuge fl oors that can be used in an emer-gency; and a multi-storey car park. With the collaboration of project manager Turner In-ternational and main contractor Ahmadiah Contracting, Skidmore Owings & Merrill hopes to reach completion by the third quarter of 2010.

Project Value: US$543 millionCompletion: 2010Sector: Real Estate/Mixed DevelopmentConsultant: Skidmore Owings and Merrill

MADINAT AL-HAREER

Madinat al-Hareer (City of Silk) is a pro-posed 250 square kilometre planned urban area in Subiya that, upon construction, would include the 1001-metre tall Burj Mubarak al-Kabir, a natural desert reserva-tion and areas that concentrate on media, health, education and industry. Th e city will be built in individual phases with total com-pletion within 25 years. Construction on the actual site has already begun, with bridges, highways and roads being laid down as basic infrastructure to facilitate future construc-tion of structures within the city.

Project Value: US$27.5 billionCompletion: 2035Sector: Infrastructure/Real EstateProject Manager: Tamdeen Real Estate Company

BURJ MUBARAK AL-KABIR

Part of the Madinat al-Hareer project, the Burj Mubarak al-Kabir skyscraper is planned to top out at 1001 metres in order to refl ect the Arabian fairy tale One Th ou-sand and One Arabian Nights. Th e build-ing will include seven vertically stacked 30-storey ‘neighbourhoods’, including apartments, offi ces and hotels. Linking the neighbourhoods will be several four-storey ‘town squares’. In order to cope with high winds, the building is designed as three in-terlocking towers, each twisting 45 degrees to help stabilise it. Work on the tower has progressed slowly. It was originally slated to be completed in 2016.

Project Value: US$7.4 billionCompletion: 2016Sector: Real Estate/Mixed UseArchitect: Eric Kuhne & As-sociates/CivicArts


UPFRONT18

Th e wind energy industry installs nearly 20 GW in new capacity every year, represent-ing more than a US$40bn global industry. New capacity additions will exceed 25 GW this year, with that number expected to nearly double over the next decade. Driv-ing this growth is investment by the world’s leading utilities and energy companies, as they strive to diversify their portfolios, re-spond to public policy and address climate concerns. Th is growth has been a boon to ailing industrial sectors in Europe, North America, China, India, Australia and many other regions of the world. Among the wider range of economic impacts generated by the wind industry, various studies have shown that every 100 MW installed creates, aft er construction, fi ve to 10 long-term plant jobs and twice as many non-plant jobs.

Th ese ‘green jobs’ include trained tur-bine technicians, utility and transmission services, and various subcontractors to ensure the ongoing operation and mainte-nance (O&M) of the utility-scale wind plants that represent the industry’s future. Work includes performing inspection, preventa-tive maintenance and repair on the internals, blades, hubs and towers of today’s turbines.

12345678910

From infrastructure to waterfront developments, we take a look at the top 10 megaprojects in Bahrain.

Source: www.constructionweekonline.com

TOP 10

Villamar TowersUS$650 million

Marina West DevelopmentUS$700 million

Bahrain Monorail – Green Line US$1 billion

Durrat MarinaUS$1.5 billion

Al Dur IWPPUS$2 billion

Marsa Al Seef DevelopmentUS$2.5 billion

Qatar-Bahrain CausewayUS$3 billion

Diyar Al MuharraqUS$3.2 billion

Durrat Al BahrainUS$6 billion

Water Garden CityUS$7 billion

Turbine availability and energy output is fundamentally linked to technicians work-ing safely and productively at elevation.

Wind plant O&M service providers face growing challenges as turbines have grown larger in recent years, now reaching up to 160m tall: these include increased health-care issues and employee attrition. Costs are associated with repetitive manual climbing fatigue and the need for expensive external cranes for certain maintenance operations.

Turbine technicians receive over 200 hours of training, and cost up to US$20,000 to replace when all hiring, training and contingency costs are tallied. Annual tech-nician attrition ranges from 25 percent to 33 percent industry-wide, with certain locales approaching 50 percent. Take the case of the US, where projections call for over 15,000 turbine technicians by 2020. Replacement costs alone could reach more than US$100m at current attrition rates.

Power Climber Wind maximises the safety and productivity of wind generating assets by providing operations and mainte-nance support – an important but perhaps undervalued aspect of the drive to make the most of this abundant resource.

Please visit Power Climber Wind at www.powerclimberwind.com for more information.

THE POWER TO DELIVER

MenaInfra4_Upfront.indd Sec1:18MenaInfra4_Upfront.indd Sec1:18 15/1/10 16:50:2315/1/10 16:50:23

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Despite already hosting the 2009 FIFA Club World Cup and successfully holding its fi rst F1 Grand Prix, Abu Dhabi is planning to build a new sports stadium capable of hold-ing 65,000 people, possibly to aid an Olympic 2020 or FIFA World Cup 2022 bid.

When built, the new stadium will over-take the Zayed Sport City Stadium, currently the largest stadium in Abu Dhabi (60,000

capacity and the host of the 2009 FIFA Club World Cup along with Al Jazira Mohammed Bin Zayed Stadium).

Abu Dhabi currently has US$100 billion worth of construction projects under way, including the Saadiyat Island development, the US$22 billion Masdar city project and Khalifa City – the single biggest project in the capital, with a budget of US$40 billion.

Investment company Aabar, which is 71 percent owned by the UAE Federal Gov-ernment, has made an off er to purchase 70 percent of Arabtec in the form of a convert-ible bond at a conversion price of Dh2.30 per share. Arabtec Chairman, Riyad Kamal, told Gulf News that it would be a great opportunity that would strengthen the Dubai-based construction company.

“It will give it the potential for invest-ment in acquisition or participation in eq-uities in future projects, and in opening the potential for further projects in Abu Dhabi. Th at will defi nitely open the doors for us for further work in Abu Dhabi,” he said.

MEYDAN RACECOURSE ON TRACK

Meydan facts:• The grandstand is 5166 feet or 1.6 kilometres

• The Meydan Hotel has 290 rooms and suites

• Falcon car park has 8622 parking bays

• The horse tunnel is 2 kilometres long

• The rooftop Bubble Lounge is 787 feet long and has capacity for 4500 people

• The racecourse has a turf track and an all-weather track

CASH INJECTION? MEGA SPORTS STADIUM


UPFRONT20

Th e global requirement to reduce injury and death on our roads, many caused by exces-sive or inappropriate speed, has resulted in technology being designed to counter this socially unacceptable activity. Speedar Limited (formerly Ottery Electronics) was the original UK designer of the distance/time measuring system known as Vascar. Th is system has been widely used in police vehicles as a means of computing the average speed of a vehicle over a predetermined or measured distance.

New from Speedar is Video Vascar, which is designed to meet the latest system technical requirements for in-car use. It integrates the Vascar system with on-board video cameras, recorder and in-car audio to provide the irrefutable evidence required for enforcement. It may also be supplied with an on-board computer that will provide ANPR and Sat Nav capability.

Also available for incorporation into existing video systems is the handheld ver-sion, Vascar 21, designed for easy retrofi t into existing systems and capable of being integrated with any in-car video system

In its standard format, text information is displayed on the screen of the handheld control unit. On activation, the screen displays time and distance since activation and the speed of the police vehicle computed from inputs received from the vehicle. On completion, it displays the distance travelled, elapsed time, average speed of the target vehicle and the date and time that the reading was completed.

Some clever design features ensure that this unit meets the stringent requirements of the UK Home Offi ce HOSDB specifi cation. Th ese systems will be on show for the fi rst time at Intertraffi c Amsterdam 2010.

For more information please visit www.speedar.co.uk

District cooling is fast emerging as the most viable cooling solution in the Middle East, where the temperature frequently exceeds 45°C and air conditioning requirements consume 70 percent of the power during peak electricity demand. With power short-ages common in this region, governments are turning to district cooling to cool build-ings as a cheaper and greener alternative to air conditioning. Th is solution can not only mitigate the power crisis in the Gulf Co-operation Council countries but also help reduce carbon footprints through increased energy effi ciency and lower CO2 emissions. New analysis from Frost & Sullivan entitled Analysis of the District Cooling Market in the Middle East Region fi nds that the market earned revenues of US$580 million in 2008 and estimates this to reach US$2 billion in 2013 at a compound annual growth rate of 28 percent.

With the GCC becoming home to the biggest shopping malls in the world, there is a distinct need for district cooling in not only the residential sector, but also the commer-cial sector. Th e United Arab Emirates alone is expecting to have 80 million square feet of offi ce space by 2010, widening the scope for

district cooling companies. “Th e market is also expected to benefi t from the environ-ment-consciousness of governments, high oil exports, abundance of energy, a construction boom, and harsh climatic conditions,” say Frost & Sullivan Research Analysts Suganya Rajan and Darwin Kishore Selvaraj.

Among all Middle Eastern countries, Saudi Arabia seems to have the most un-tapped potential, with more than US$100 billion worth of construction projects un-derway. Its rapidly expanding industrial base and population have increased the demand for power, which averages an annual growth rate of nearly fi ve percent. Th e rising air conditioning needs account for almost 70 percent of this growth in power demand. By 2013, the district cooling market is expected to have an additional capacity of 4.5 million tonnage of refrigeration, mainly contributed by Saudi Arabia and Qatar. “Although there is a continuous rise in the demand for power in almost all GCC member countries, power is still provided at subsidised rates for the residential sector,” notes Suganya. “Th is puts a huge drain on the region’s utilities, as power costs account for around 50-60 percent of the district cooling production cost.”

KEEPING UP

DISTRICT COOLING HEATS UP

FAST FACT

The number of cranes in Dubai has dropped by 50% from peak construction levels


UPFRONT21

ROAD SAFETY MEASURES

Emerald Group Publishing, the leading publisher of transport books, launched the second edi-tion of the Handbook of Road Safety Measures (previously published in 2004) during Sep-tember 2009. Th is new edition gives state-of-the-art summaries of current knowledge regard-ing the eff ects of 128 road safety measures. It covers all areas of road safety including: the design of roads; traffi c control; vehicle design and vehicle safety features; vehicle inspection; driver train-ing; publicity campaigns; police enforcement and general policy instruments. With many of the original chapters revised and sev-eral new ones added, extra topics covered in this edition include: environmental zones, DUI leg-islation and enforcement, speed cameras and post-accident care.

More than 2000 evaluation studies have been reviewed and their fi ndings summarised by means of meta-analysis in the new edition of this important ref-erence work. Authoritative and unique in its broad coverage, this handbook serves as a comprehen-

sive reference manual for road safety professionals worldwide.

Praise for the fi rst edition in-cludes:

“In summary, an important, timely and useful book that should benefi t researchers and practitio-ners alike,” Will Murray, Research Director, Interactive Driving Sys-tems in a book review in Logistics and Transport Focus.

“Th is handbook off ers an enormous amount of information for the interested reader. Further-more, the reputation of the authors and their approach ensures that this book is a valuable addition to worldwide road safety research. As far as I know, this book has no competitor,” Fred Wegman, Managing Director of SWOV, in a book review published in the European Journal of Transport Infrastructure Research.

Emerald Group Publishing is very proud to be the leading pub-lisher of books in transport. To see more books in our collection please visit http://info.emeraldin-sight.com/products/books/

With the Dubai Metro proving to be a massive success, it looks like other emirates in the UAE are following Dubai’s lead. Last month, Qatar and Bahrain signed a

contract with German rail operator Deutsche Bahn to build rail and underground lines in the regions

FAST FACT

$25 billion

Eat your heart out Burj Khalifa, for Qatar’s Tornado Tower has been awarded the accolade for Best Tall Building in the Middle East and Africa by the Council for Tall Buildings and Urban Habitat. Standing 656ft (200m), the Tornado Tower houses 52 fl oors of offi ce space in Doha. Th e building was designed to minimise eff ects on the natural environment through proper site utilisation, innovative uses of materials, energy reduction, reduced emissions and water consumption.

‘Bringing fresh ideas’Th e Council for Tall Buildings and Urban Habitat (CTBUH) is the world’s leading authority on the design, construction and development of tall buildings and, in its own words, recogn-

ises projects that “contribute to the advancement of tall build-ings, bringing fresh ideas and innovative processes”.

In the Tornado Tower’s case, the building was credited for demonstrating relevance to the contemporary and future needs of the community in which it is located, by adding economic vitality to its occupants, owner, and community. Th e Tornado Tower won acclaim, when it was constructed in 2008, due to its innovative unitised facade solu-tion which allows the curvature of this iconic building to be expressed without the need for curved glass. Trapezoidal panels and their collection of angles give the building its signature curve and hyperboloid shape that is meant to depict “a whirl-wind in a desert storm”.

TORNADO TOWER: ‘BEST TALL BUILDING’


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RAILWAY SAFETY REVIEW

Aft er the fl ash fl oods in Saudi Arabia in November 2009, the General Organisation of Railways has announced that they are to review the construction of bridges, tun-nels and train lines for the Al-Haramain Train Project.

Th e President of the General Organi-sation of Railways, Abdul Aziz Al-Hiqail, made the announcement aft er saying that the route of the proposed train project would remain the same despite the recent fl ooding.

Speaking to Asharq Al-Awsat newspa-per, Al-Hiqail said, “Th e previous designs detailed bridges, tunnels and train lines, but the organisation has deemed it proper to review them in light of the recent fl ash fl oods.”

Unsurprisingly, he added that if potential alterations were found to be needed, the cost of the project may have to rise. However, he said that only the speci-fi cations of bridges and tunnels would be reviewed to ensure that they are able to tolerate diffi cult weather, while the route would remain the same.

Th e proposed Al-Haramain project will see high-speed rail transport between Makkah and Madinah, and link the two cities to Jeddah and King Abdullah Eco-nomic City in Rabigh. Once completed, the service will be able to transport over 20 million people per year.

Al-Hiqail said that to make way for the railway, 27 real estate units out of 61 would have to be demolished. However, he did say that the owners would be suitably compensated.

www.menainfra.com

Tallest building in the world

60Tower’s spire visible from

milesaway

you can see I R A N

308.8m taller than Taipei 101 (world’s next tallest building)

project cost about

US $4.1bn

8millioncubic feet of

concrete used in construction

22millionman hours

spent building structure

glass panels for th eexter ior c ladd in g

26,000

10°Ccooler at the top than the bottom

160

room hotel

Georgio Armanidesigned b y

3,000stairs f rom bottom to to p

the world's highest nightclub

Armani hotelheight of the

Residential suitesheight of the

the world’s tallestmosque

the world’s highestswimming pool

US $217mcost of the exteriorDubai Fountain part of enti re newDowntown Dubai

US $20bn

BurjKhalifa


UPFRONT23

Panolin 60, 61

Power Climber UF, 47

Project Management Institute 42

Roads and Transport Authority (RTA) 110

Saudi Aramco 66

Segura Consulting 94

Serco 110

Speedar UF, 117

Starrport 113

Tech Traders 68

Telegra 120, 123

The World 140

Total 107

Titan Cement Egypt 64, 65

Trojan 98, 103

Urban Planning Council 34

Utico 98, 99

Volvo 49

Wagner Fire Management 132, 133

Water Standard 2, 98, 101

Yas Island 34, 66

COMPANY INDEX Q1 2010Companies in this issue are indexed to the fi rst page of the article in which each is mentioned.

Abu Dhabi Authority for Culture and Heritage

(ADACH) 34

Abu Dhabi Department of Transport (DoT) 118

ADC 88, 89

Aeroquest 137

AkzoNobel 68, 75

Aldar 34, 82

Alupole 119, 120

Amana Contracting 66

Aqualyng Holdings 94

Aquaris 98, 105

Arabtec 44

ATEÏS Middle East 130, 131

Atlas Copco 56, 57

Aviation Software, Inc. (ASI) 128, 129

AWE IBC

Birdair IFC

Blue Stream Environmental Technology

108, 109

Bomag OBC

Burj Khalifa 24

CB Richard Ellis (CBRE) 82

ComAp 7, 86, 87

Delta 4, 126, 127

Dow Corning 76, 77

Dubai Metro 110

Emerald Books UF, 141

Faithful+Gould 52

Ferrari 34

Frost & Sullivan 66

FAST FACT

One of Qatar’s major construction projects has begun as Dohaland, a subsidary of Qatar Foundation, starts work on the ‘Heart of Doha’. The US$5.5 billion project will see a 350,000 metre squared area of Doha’s city centre, rebuilt to showcase ‘a city within a city that merges the best characteristics of the past with modern technologies’. The scheme was envisaged by the Emir of Qatar, HH Sheik Hamad Bin Khalifa Al Thani and his wife HH Sheikha Mozah Bint Nasser Al Missned, and it is hoped that it will be completed by 2016.

Heubach 68, 73

Hyder 37

Insulaad 68, 71

Intelagard 134, 135

International Desalination Association (IDA) 94

International Private Water Association

(IPWA) 94

International Protective Coatings (IPC) 68, 69

International Road Federation 114

Jones Lang LeSalle 82

Kansai Paint 80, 81

King Fahad Hospital 86

Landmark Properties 82

McLanahan 40, 41

Monodraught 88, 91

Nalco 92

Nutshell Natural Paints 78, 79

Optelecom 120, 125


24 www.menainfra.com

As acts of defi ance go, the opening of the world’s tallest building was some spectacle. Shrugging off its recent debt problems, Dubai threw the biggest party the emirate has seen since the height of the boom in honour of its new icon’s inauguration, with a combination of 10,000 fi reworks, light beams,

choreographed water displays and sound and music eff ects illuminating the night sky. Th e extravaganza was watched by thousands of UAE resi-dents crowded onto the Dubai Mall promenade and a further two billion people live on TV. And if the festivities lacked the ostentatious displays of excess witnessed at the unveiling of Th e Atlantis Hotel back in 2008 – the world’s most expensive private party at an estimated $20 million – then given that we’re in the middle of a recession the organisers did their best to run them close. Despite the economic climate, the emirate still man-aged to prove that when it comes to celebrating on a gargantuan scale, there’s no-one quite like Dubai.

And yet amidst the revelry and backslapping over completion of the city’s latest architectural wonder, one topic inevitably dominated the conversations, gossip columns and discussion board threads in the hours and days following the lavish ceremony: the record-breaking structure’s surprise rebrand from the Burj Dubai to the Burj Khalifa. “Th is is the tall-

With Dubai still taking stock after its recent debt restructuring, Abu Dhabi looks set to eclipse its fl ashier neighbour in attracting investment dollars over the next few years. But does this shift in the balance of power hold deeper implications for the UAE?

COVER STORY

BY BEN THOMPSON

POWERSHIFT?

DUBAI DEPT ED P24-33.indd 24DUBAI DEPT ED P24-33.indd 24 15/1/10 17:03:0215/1/10 17:03:02

www.menainfra.com 25



A tale of two citiesDubai’s recent problems have been well-

documented, particularly in a Western media that has positively revelled in the schaden-freude of seeing the desert dream come crash-ing down. Th e city’s once buoyant property market is currently blighted by oversupply, yet another 32,000 new homes are expected by the end of 2010; house prices, already down some 60 percent from their 2008 peak, are set to fall a further 10 percent in the next year; and more than 500 construction projects have been suspended or cancelled in the United Arab Emirates alone, with Dubai the most severely aff ected. According to a leading crane manufacturer, the number of cranes in Dubai has slumped by around 50 percent from peak construction levels and current orders have ground to a halt.

And then came the news that rocked the fi nancial world last November, when Dubai announced it would ask creditors of Dubai World, the conglomerate behind its rapid expansion, and Nakheel, builder of its palm-shaped islands, to agree to a standstill on billions of dollars of debt as a fi rst step to re-structuring. It was, says Eckart Woertz of the Gulf Research Council, a “watershed event” in the economic development of the emirate. “Before this, markets had assumed an implicit

government guarantee for such companies; now that such guarantee has not materialised, refi nancing on international markets will be more expensive or even impossible,” he explains. “As Dubai’s access to interna-tional capital markets has diminished, it will need to rely increasingly on Abu Dhabi as well as making the necessary restructuring moves.”

Indeed, as Dubai’s star has dimmed it is diffi cult not to compare it to the powerhouse city-state emerging just to the south. Abu Dhabi

est building ever created by the hand of man,” announced Dubai’s ruler Sheikh Mohammed Bin Rashid Al Maktoum at the ribbon-cutting ceremony. “Th is great project deserves to carry the name of a great man. Today I inaugurate Burj Khalifa in recognition of Sheikh Khalifa bin Zayed Al Nahayan.”

Th e gasp of the watching millions was almost audible. Many immediately turned their attentions to the practical implications of the name-change: the cost to souvenir manufacturers and producers of merchandis-ing; the numerous changes that will need to be made to signage, maps and tourist guides around the emirate; and the bill facing the company that reportedly spent more than US$500,000 on Burj Dubai branded uniforms for security and hotel personnel. Others, however, focused on the reasons behind the name change, speculating as to why – at the very moment the emirate should have been celebrating its greatest triumph – it chose to honour the ruler of near-neighbour Abu Dhabi instead in an uncharacteristic display of self-eff acement.

And while some saw nothing strange in the desire to acknowledge Sheikh Khalifa, the current president of the UAE, as patron of the tower, many more believed the gesture was linked to the US$10 billion bailout he recently extended to Dubai to help with its debt restructuring. Some even muttered darkly that the handout did, despite offi cial protestations to the contrary, actually have strings attached aft er all. But whatever the real reason, the symbolism behind the move was undeniable: anyone looking for evidence of Dubai’s waning infl uence and the growing role of Abu Dhabi as the Gulf ’s real economic powerhouse could see it clearly in the 828-metre tall building towering above them.

GCC CONSTRUCTIONElsewhere in the region, Saudi Arabia has 847 active projects valued at $417.9 billion, while Kuwait is moving forward with 160 projects worth $142.8 billion. In Qatar, 186 projects valued at some $48.2 billion are on track, and Bahrain currently has 232 active projects worth $40.3 billion. Oman’s 116

projects are valued at $38.5 billion in total.Source: Proleads



accounts for about 60 percent of the national economy of the UAE and ranks amongst the world’s richest cities, with GDP per capita amongst the highest in the world. As the world’s sixth largest oil producer, it is a major exporter and is linked to many of the largest global economies by trade. Th rough sovereign wealth funds such as the Abu Dhabi Investment Authority – considered to be the world’s largest investment fund – the emirate has multiple strategic overseas investments, and its development of globally recognised projects such as the Masdar Initiative mean Abu Dhabi is becoming ever more dominant on the world stage.

More importantly, the emirate has weathered the recent economic crisis much better than Dubai. “Abu Dhabi remains the wealthier emir-ate with manageable debt levels compared to its balance sheet,” says Alia Moubayed, Senior Economist at Barclays Capital. “It has a very ambitious economic development and investment programme, and the ‘catching-up’ process the emirate is undertaking to build its infrastructure to Dubai’s level naturally implies that more project work will be done there. Interna-tional investments will certainly fl ow into these ventures given the size of the proposed plans in the industrial and infrastructure sectors.”

In fact, the respective health of the two real estate sectors makes for interesting reading. Since Abu Dhabi’s real estate market proved more resistant to the overheating that hit others in the region, it has held up well against the global downturn. Moreover, its reputation for a more sustainable style of development has largely prevented the evaporation of investor confi dence that has plagued much of the rest of the Gulf. A rising arts and culture scene – based on ambitious collaborations with the Louvre, Guggenheim and other global leaders – is also helping to make the emirate more attractive to foreigners and, with more than half of the population under the age of 30, demand from the youth market should help to keep the commercial real estate segment strong over the coming years. In contrast to Dubai, National Bank of Abu Dhabi expects a shortage of more than 20,000 homes by the end of 2010, with demand rising due to a population increase and limited supply – both of which will further stimulate the construction sector.

Indeed, whereas Dubai is suff ering from a chronic surfeit of luxury property, in Abu Dhabi the timing of the slowdown caused developers to reassess their projects and cancel or scale back the more ambitious ones. In many ways, the downturn has been a blessing in disguise. “Most proj-

While Saadiyat Island has been designed to be the cultural heart of the emirate, Yas Island will be its entertainment hub. The 25 square kilometre

development off the coast of Abu Dhabi will be a key part of the government’s strategy to build its tourism industry. Its main attraction will be Yas Marina Circuit racing track which played host to the inaugural F1 Etihad Airways Abu Dhabi Grand Prix last November. The track winds its way around Yas Island’s landscape and was designed by Hermann Tike who created Shanghai’s main racing circuit. In keeping with the racing theme, Ferrari World Abu Dhabi will be the world’s largest indoor theme park and is housed in a building covering 200,000 square metres with a roof designed to look like the body shell of a Ferrari GT car. The island will also host the Warner Bros. Theme Park, which will feature attractions based on Looney Tunes, Hanna-Barbera and DC Comic characters. Meanwhile Yas Island Water Park, for which no completion date has yet been set, will boast aqua themed rides.

No development in the UAE is complete without a mall, and Yas Mall, featuring three department stores and 500 luxury units, will break the mould in terms of its cutting edge design and the international brands it aims to attract. It will cover an area of 296,000 square metres and will feature a car park with 16,000 spaces and several triple-level stores. In terms of accommodation, both residents and tourists will be well catered for. Residential villas and apartments will be built alongside the island’s various waterways and canals, including at the top-end, duplex waterfront apartments on the banks of the Yas Lagoon. Yas Hotel will be the island’s fl agship hotel and will be joined by several branded hotels along the Northern Crescent and Beachfront Esplanade. In all, there will be over 2500 guest rooms. In terms of its transport infrastructure, the developers are planning to include a public transport system and a 10 lane highway connecting Yas Island to both Abu Dhabi and Dubai which will reduce the drive time to the capital city to just 10 minutes. The environmental impact of such a road network will, the developers hope, be offset by the green initiatives taking place on the island, including the monitoring of the effects of the development on local waterways and the planting of 80,000 mangroves on the western shores of the island, adjacent to the island’s links golf course.

YAS ISLANDDeveloper: Aldar PropertiesDate for completion: 2014



ects have faced some kind of delay as developers take stock of potential de-faults from purchasers and experience cash fl ow issues,” confi rms David Dudley, director of the Abu Dhabi offi ce at property consultant Jones Lang LaSalle. “Th e vast majority of announced projects for which construction has not commenced are being put on hold until the market picks up, and the delay or cancellation of these projects means that markets will remain more stable during the current period of suppressed demand.”

The sleeping giantFirst-time visitors to Abu Dhabi today might fi nd it diffi cult to

imagine the emirate as one of the world’s most exciting cities. Unlike Dubai, swathes of the desert remain untouched by urban sprawl and its relatively low-key skyline contains none of the iconic landmarks associ-ated with its brasher, fl ashier neighbour. Indeed, this is a city that can best be described as a work in progress. Evidence of what the future holds can be seen in the construction work currently underway around the clock, building the foundations for the projects that will transform it into a modern-day metropolis to rival any in the region – or for that matter, the world.

Th e driver behind these changes is the Abu Dhabi 2030 Urban Struc-ture Framework Plan, a 25-year programme of urban evolution aimed at building an economically sustainable city that is able to support a population of up to fi ve million residents. Plan 2030 aims to cement Abu Dhabi’s identity as the capital of the UAE, but also to make it a global fi nancial, trade and tourism hub. Th e government has also committed to investing around US$100 billion to developing Abu Dhabi’s western region, which accounts for 83 percent of the emirate’s land mass but cur-rently houses just eight percent of its residents.

Craig Plumb, Head of Research for the MENA region at Jones Lang LaSalle, believes that the emirate is on an upward curve. “Abu Dhabi was probably the fastest growing market last year from a tourism perspective and has big plans to continue this,” he says. As such, Plumb expects it to

Al Reem is a natural island 600 metres off the coast of Abu Dhabi. However once developers have completed their US$30 billion project, it will be a very different

place. The island is currently being jointly developed by Sorouh Real Eastate, Reem Investments and Tamouh, each of whom has staked their claim to one of the emirate’s most ambitious real estate projects. Over 22,000 residential units are to be built on the island, which will be connected to the mainland by two or three bridges. The island has been designed to cater to a permanent population of residents rather than as a tourist attraction and will feature schools, medical clinics, shopping malls, restaurants, as well as hotels and a 27-hole golf course. The centrepiece of the island will be Shams Abu Dhabi, which is being developed by Sorouh Real Estate, owner of 20 percent of the development.

Shams will be a self-contained city in its own right, home to 45,000 residents and designed around canals and parks. At the heart of Shams will be Central Park, which, as its name suggests, will be modelled on the New York version and will feature a theatre district, waterside restaurants and shops. At the entrance to Shams will be the Gate District that will be made up of eight skyscrapers for both residents and businesses and a luxury shopping mall. The Shams project is expected to cost US$6.9 billion in total and will occupy 25 percent of the island. The residential areas will account for 90 percent of the project while the remaining 10 percent will be used for commercial and recreational areas. It will contain 100 skyscrapers, 22,000 residential units and a one million square-metre park. Other developments will include the 83-storey Sky Tower and the fi ve million square-metre Abu Dhabi Towers. The fi rst phase of Shams is expected to be completed later this year.

AL REEM ISLANDDevelopers: Sorouh Real Estate,

Reem Investments, TamouhDate for completion: TBC



be one of three Gulf economies, along with Saudi Arabia and Qatar, to recover fastest from the impact of the global real estate slowdown.

Key to this development will, of course, be the expansion of its transportation infrastructure – currently undergoing improvements and expansions across all segments to ensure infrastructure keeps pace with strong growth elsewhere – and its construction sector. According to a 2009 report from the Oxford Business Group, while Abu Dhabi did feel the eff ects of the downturn, overall the emirate remains well protected from the recession thanks to strong internal dynamics and ambitious public infrastructure plans. As with everywhere else in the region, the eff ects of the slowdown have made project fi nancing more diffi cult and competition between contractors for existing projects is fi ercer; on the fl ip side, however, the global crisis – coupled with volatile oil prices and falling infl ation – has caused materials prices to fall signifi cantly, a boon for well-capitalised builders.

Th is soft ening of construction costs has also changed the nature of the market to a certain extent. While oil and ma-terials prices were high, developers were largely compelled to build luxury developments in order to keep profi t margins healthy. Now that costs have come down, however, develop-ments with a lower price tag are increasingly getting the green light, clearing the way for much-needed activity in the middle and lower-income segments. Overall, the real estate market is undersupplied and aff ordable housing developments such as Al Reef Villas, the fi rst in the segment to come online in 2009, could make major strides in closing the supply gap.

Th e government too is keeping contractors busy with a raft of infra-structure projects planned in line with its broader goals and backed by stable energy (and therefore cash) reserves. Key projects such as Masdar – the world’s fi rst zero-carbon city – Saadiyat Island and Yas Island are expected to keep developers and contractors busy over the next few years, and while 2010 will likely post some challenges for the sector as uncertainty in the global market remains, it also presents signifi cant op-portunities in Abu Dhabi, where fundamentals remain strong.

Taking centre stageAs a result, Abu Dhabi is now in pole position to assume a dominant

role in the aff airs of the region, and its recent bailout of Dubai suggests it is now ready to fl ex its fi nancial muscle. “From the market viewpoint, Abu Dhabi is now in the driver’s seat, and all eyes are watching to see how it and the UAE Central Bank will manage the fallout from recent events,” asserts Moubayed. “Abu Dhabi’s bailout indicates that the management of Dubai’s debt crisis, and the adjustments to its growth model, will be part and parcel of the reconfi guration of power-sharing arrangements among the diff erent emirates and the wider process of strengthening the UAE federation.”

TRANSPORT IN ABU DHABI

April 2009 saw the Department of Transport’s unveiling of the Surface Transport Master Plan (STMP), which looks forward to the year 2030. Given rapid population growth – which averaged six and seven percent between 2005 and 2008 – the emirate is eager to support the next wave of urban development.

Road congestion extracts a heavy toll on Abu Dhabi’s economy in both urban and rural areas and, as a result, the government is prioritising

projects like the widening of the Mafraq-Ghweifat highway, the corridor from Abu Dhabi to the western border with Saudi Arabia. Within the capital, the Department of Transport hopes that the introduction of the urban public transit system will take a signifi cant number of vehicles off the road. In a style typical of the emirate, the STMP calls for environmentally friendly public transport.

As air traffi c steadily increases, so has the capacity of the Abu Dhabi International Airport and other airports overseen by the Abu Dhabi Airports Company (ADAC). The emirate’s main airport, unlike other major

international hubs, has not seen a decrease in passenger traffi c over the past few years and the government is investing accordingly: about half of the planned US$6.8 billion worth of expansions have already been completed.

Major changes are afoot at the emirate’s ports as well. Under the auspices of the Abu Dhabi Ports Company (ADPC) and the Department of Transport, the emirate is preparing to shift operations at the main port at Mina Zayed to the massive Khalifa Port in the new industrial area at Taweelah currently under development.

Finally, in a fi rst for the UAE, the federal government created an inter-emirate transport network in March 2009, setting in motion a long-discussed plan to connect all seven emirates via rail. The US$3 billion railway project will eventually connect with the larger 1940-kilometre rail development that aims to connect all six countries of the GCC. As of mid-2009 Abu Dhabi seemed undeterred by the global credit crisis and was pushing ahead with its wide-scope development plan, ensuring that the emirate will be able to more effi ciently handle future growth and a larger population.

Source: Oxford Business Group



In fact, many commentators feel that Abu Dhabi will use Dubai’s recent debt standstill as an opportunity to push its own agenda of greater centralisation of the UAE. “Abu Dhabi’s support for Dubai in the current fi nancial crisis is selective and not unconditional,” explains Woertz. “It has shown that it is ready to practise tough love and force a restructuring of Dubai’s business entities that are currently not viable or might not fi t into its own and the UAE’s overall development plans. Speculation about trade-off s is increasingly shift ing from rumoured secret buyout arrangements that are impossible to verify to a power shift to Abu Dhabi within the federal structure of the UAE.” Woertz thinks the payoff s for Abu Dhabi’s bailout might be political rather than fi nancial. “Abu Dhabi could demand a strengthening of federal authority, while Dubai would need to relinquish certain sovereign rights, such as control of customs, which so far remains on the level of individual emirates,” he says.

A more tightly knit federation would have other benefi ts, too. For one thing, the UAE needs increasing unifi cation of policies and standards for its ambitious development drive. It also needs substantially improved statistics – which so far are oft en not available in a timely, complete and consistent fashion. Like elsewhere, there will need to be more regulation of capital markets, while a unifi cation of the stock markets in Dubai and Abu Dhabi could strengthen the position of the UAE as a niche player in international capital markets. Meanwhile, urban development is increas-ingly intertwined with people living in one emirate and working in the other and coordinated planning will be required, especially in the fi eld of transport networks and railroads – a point echoed by Moubayed. “Great-er federation will also be refl ected in growing support for countrywide integrated infrastructure networks that will constitute a non-negligible part of project works across the UAE, such as the recently announced national railway system,” she says.

Not over yetIt’s clear that in the next few years we can expect to see consider-

able changes in the way the UAE is run, with Abu Dhabi – always the traditional heart of the country but oft en eclipsed by the brighter lights of Dubai in recent years – taking the lead. But even so, Abu Dhabi will need a strong Dubai if it is to make a success of its centralisation eff orts.

Al Raha Beach has been dubbed the new gateway to Abu Dhabi. It will be a waterfront city and home to the emirate’s new World Trade Centre building,

residential areas and a central business district. The island will accommodate 120,000 residents and, in a bid to encourage foreign investment, will be one of the fi rst designated areas where non-nationals can invest in leasehold property in Abu Dhabi. Al Raha will be split into four distinct districts: Al Zeina, Khor Al Raha, Al Seef and Al Dana. Al Zeina is described by the developers as the ‘garden city’ and will be located at the island’s quieter eastern end. Villas and apartments will front a beach and the community will feature a retail arcade, shops and cafes. Khor Al Raha, at the eastern mouth of Al Raha Beach’s Grand Canal, will have restricted public access and cars there will be kept to a minimum. Buildings will be tiered from three to 14 fl oors and will have sea views. Al Bandar will be an island set around a marina with moorings for resident’s boats.

For those wanting to live in a livelier area, Al Seef will feature a vibrant residential, commercial and hotel district. Three islands offshore will provide facilities for watersports. Meanwhile Al Dana, formed around a circular marina, will be built as a series of semi-circular zones that will increase in height. Al Dana’s marina will also be the main transit stop for water transport. There will be several other districts within the development, including the cultural district, Al Shaleela, which will feature galleries and art studios as well as a media museum. Al Razeen, the ‘Arabian Water District’ will be made up of secluded villas on an island parallel to Al Shaleel and will be connected to the mainland by a series of waterways and bridges. A sophisticated public transport network will be developed to ferry people around Al Raha Beach, including a light rail system with 14 stops, a bus service, catamarans, ferries and water taxis. Road traffi c will be minimised with the central boulevard roads, leading straight into underground parking areas for each precinct. Although it is a short distance from Yas and Saadiyat Islands, there will be plenty of entertainment on Al Raha itself, including a 300,000-square metre shopping and exhibition centre, two marinas and several parkland golf courses.

Al RAHA BEACHDeveloper: Aldar Properties

Date for completion: 2019



governance rules and mechanisms for their implementation. “Such rules would have avoided excessive leverage across many Dubai Inc. entities, and allowed for a better pricing of risk,” suggest Moubayed. “By the same token, the recent episode brings to the fore the importance of having solid and well-tested insolvency frameworks and legal and institutional mechanisms to protect creditors’ rights. It also highlights the need to im-prove the regulatory framework governing real estate markets, in order to curb speculative fl ows that may be conducive to an asset bubble.”

Channelling resources to develop sectors that are less vulnerable to cyclical downturns and global turmoil is something else that Abu Dhabi will need to consider, inasmuch as it needs to devise a clear strategy for fi scal and debt management and build a track record of implementation that will earn greater credibility amongst investors and creditors.

Where next for the UAE?So despite the global economic crisis and Dubai’s recent debt

troubles, there are signs of optimism for the UAE. Dubai-based market

And many in the industry, while conceding the emirate faces signifi -cant challenges, believe it is too soon to start writing Dubai off just yet. “Th ere is a real need to get back to basics, for sure” asserts MAG Group Chief Executive Offi cer Mohammed Nimer. “We need to focus on solid market fundamentals as opposed to sentiment – that’s the true path to recovery.” But despite recent setbacks, he maintains that Dubai is still an icon for business. “Among the reasons for optimism are the fact that the city has the best infrastructure in the UAE and remains the primary hub between East and West,” he explains. “Dubai also has the most di-verse fi nancial sector in the region, as well as being a focus for tourism and retail. Furthermore, the benefi ts that Dubai off ers in terms of free zones and 100 percent ownership for foreign companies should not be discounted. For example, the Jebel Ali Free Zone is now playing host to some 6000 fi rms.”

Moubayed agrees. “Dubai has many strengths that will help it re-cover,” she asserts. “It possesses a state-of-the-art infrastructure and is able to attract a skilled and productive labour force from around the world given its open societal model. It is by the far the most advanced trade hub in the region, off ering high quality transport and logistics ser-vices between East and West, and has also forged a strong brand for itself as both a tourist destination and a fi nancial centre. One must also not forget Dubai’s fast-growing economic and fi nancial relations with the rest of the Gulf and MENA economies, as well as Asia’s emerging eco-nomic powers (notably India and China), which will open opportunities that Dubai can and will harness in the medium-term. Most importantly, Dubai’s position within the UAE and the support it gathers from Abu Dhabi constitute a critical factor that will help Dubai slowly recover as it goes through its restructuring process.”

She maintains that Abu Dhabi has a stake in ensuring that Dubai’s exit strategy from its current woes be as smooth as possible in order that it contributes to a reduction in risk premiums across the UAE as a whole. And Abu Dhabi’s rulers would be wise to learn the lessons – both good and bad – from the Dubai experience if the emirate truly has aspirations of building sustainable and successful growth. For one thing, the crisis confi rmed the critical need for greater transparency and accountability in the conduct of business and government aff airs, and stronger corporate

Located just 500 metres off the mainland, Saadiyat Island is set to transform Abu Dhabi into one of the cultural capitals of the world. It will feature two of the world’s

most prestigious cultural landmarks, the Guggenheim Abu Dhabi and the Louvre Abu Dhabi. The latter has been designed by the Pritzker prize-winning architect Jean Nouvel and will be located at the heart of Saadiyat Island’s Cultural district. Even more spectacular in design, and the centrepiece of the District, will be the Guggenheim Abu Dhabi, which has been designed by Frank Gehry. It is made up of several conical-shaped buildings and incorporates a twist on the UAE’s traditional cooling wind towers. The Guggenheim will feature 13,000 square metres of permanent and temporary exhibition space and will be the largest museum in the cultural district. Extensive work has gone into creating a sustainable infrastructure for Saadiyat Island, which includes a storm water drainage system, sewerage systems, electrical grid stations and a water supply and reservoir systems. This will support not only the millions of visitors that are expected to visit the island every year, but also the 160,000 residents that will live there permanently.

The island will be split into six districts; Al Marina, featuring berthing for 1000 boats; the Cultural District with museums and galleries; Saadiyat Park, a mainly residential area with waterfront villas and apartments; Saadiyat Beach, a tourist area with nine kilometres of natural beaches and a golf course designed by Gary Player; South Beach, a family beach resort; and The Wetlands, which will feature a championship golf course and parkland. In total, the project will cost a massive US$27 billion to build and it is expected to attract 1.5 million visitors a year by the time it is completed in 2018.

SAADIYAT ISLANDDeveloper: TDIC

Date for completion: 2018



intelligence fi rm Proleads sees some 3398 civil building projects worth US$1.35 trillion still active in the Gulf region, 853 of them in the UAE alone with a total project value of US$661.4 billion. And while a signifi -cant portion of the region’s major projects have been cancelled or placed on hold, market analysis shows that nearly 75 percent of all announced projects in the region are still progressing. “Projects are always put on hold, even during boom times, but from our cash fl ow projections for the industry, we see the UAE construction market beginning to stabilise at current levels and showing some signs of recovery during 2010,” says Emil Rademeyer, Director of Proleads. “Th ere is still a lot of liquidity in the market in this region, and it’s one of the few places in the world – like Brazil and China – where this is still the case. As a construction player, you need to be in places like this.”

Rademeyer’s view is supported by a recent report from HSBC that suggests business sentiment in the region over the last three quarters is becoming more confi dent (although it remained a long way below the

THE WAY FORWARD FOR DUBAI

The current restructuring process within Dubai Inc. is a great opportunity for the emirate to look back at its past achievements and reassess its strategy moving forward, believes Alia Moubayed of Barclays Capital.

“Dubai needs to reconfi gure its sources of growth by focusing on its own comparative advantages and embracing a different fi nancing model,” she explains. “Excessive reliance on leverage, and speculative/rent-seeking activities in the real estate sector will not be sustainable, nor can they generate the productivity gains necessary to support a healthy economic growth trajectory in the long-term. Limiting the sources of growth to sectors that are highly vulnerable to cyclical downturns is a risky proposition.”

Moubayed feels Dubai is best placed to capitalise on its logistics infrastructure. “With access to a talented pool of capital and the ability to develop high value-added productive sector activities, the emirate should further integrate into international supply chain production and distribution networks, as we saw Asian countries do in the 1990s,” she continues.

In addition to this strategic rethink, an easing of restrictions aimed at improving the quality and availability of information that fi nancial markets need to operate effi ciently is a must. “Greater transparency in the conduct of business and government affairs and better disclosure both at the level of the public and the private sector is essential,” she says. “In particular, improved frameworks for setting and implementing fi scal and debt management policies, bankruptcy laws, and an effi cient judicial system able to deal with business disputes are reform elements investors will be looking for. The ongoing restructuring process offers the opportunity to accelerate such reforms, and is a fi rst test that will be critical for shaping markets’ perception of risk in Dubai and anchoring expectations for the recovery path over the longer-term.”



exuberant mood of 2007 and early 2008). “If I were to characterise the mood of the region’s business people, I would say they are cautiously re-alistic,” confi rms Simon Vaughan Johnson, HSBC’s head of commercial banking for the MENA region. “2009 was a diffi cult year for the GCC economies, but there is a feeling that 2010 will be a year of improvement, tempered by a realism of expectation.”

Th e ability of cities in the Middle East to thrive in the decades ahead and accommodate urban growth issues such as demographic and popu-lation shift s, the globalisation of capital markets, the provision of ad-equate housing and infrastructure, technology changes, environmental preservation and land conservation will be a key determinant for success. And as the new decade dawns, it is Abu Dhabi rather than Dubai that is showing the way forward.

ABU DHABI: ADDRESSING THE CHALLENGES

Given the rapid pace of change from a new country to a world-class city within just 60 years, Abu Dhabi will inevitably face challenges.

• Quickly transforming the economy: Abu Dhabi’s current strength is derived from its oil-and gas-based economy. To achieve genuine economic diversifi cation into other high growth sectors will take time and will require major transformation of the city’s population, skills base and business clusters

• Improving transparency: Establishing a legal framework and a business environment comparable to other developed economies. Progress is being made but there is continued work to be done to establish a legal regime that will sustain high levels of foreign investment

• Achieving balanced population growth: Abu Dhabi’s population is small with a comparatively low proportion of UAE nationals and a large, relatively transient expatriate population. Abu Dhabi needs to continue to attract and retain the best talent to fuel its economic growth whilst managing social integration

• Enhancing city competitiveness: While Abu Dhabi has major advantages including a low-tax environment, a strategic location and an emerging quality lifestyle offer, it needs to continue to develop its global marketing initiatives to attract foreign investment. At the same time, it needs to ensure lower costs for the occupiers of real estate

• Complementing Dubai: Whilst Abu Dhabi has some signifi cant strengths relative to Dubai, the ultimate success will come from the two emirates converging to become the dominant force, as the MENA region increases its global signifi cance

• Controlling land release: It takes longer to develop and diversify the economy and grow the population than to construct new real estate developments. Inevitably this leads to a short-term imbalance of demand and supply which needs to be actively managed to keep prices competitive whilst avoiding damaging boom-bust real estate cycles

The Etihad Towers under construction in Abu

Dhabi. When fi nished, the fi ve-tower project

will feature a shopping mall, offi ces, apartments

and a fi ve-star hotel

Q i



URBAN EVOLUTION

As Abu Dhabi undertakes its 2030 Urban Structure Framework, which has been developed by the Urban Planning Council to opti-mise the city’s development, infrastructure has become an increas-ingly essential part of the transformation. In essence, Plan Abu Dhabi 2030 sets out a roadmap for sustainable urban evolution to create a socially cohesive and economically sustainable community

that preserves the Emirate’s unique social heritage. And as Aldar is Abu Dhabi’s leading property development, management and investment company, the plan and its guiding principles are central and critical to the entire development process.

Talal Al Dhiyebi, Director of Planning and Infra-structure for the fi rm, explains that creating develop-ments that are truly integrated and ‘future-proofed’ means that infrastructure considerations for 2030 and beyond, “must be at the very heart of what we do”. And to that end, Aldar’s approach to planning and developing infrastructure involves high quality real estate, catering for a wide range of customers, across the spectrum of property types and sizes, for the long-term benefi t of Abu Dhabi. “We are committed to delivering communities – integrated and sustainable developments that meet the demands of a growing and developing population,” says Dhiyebi. “In terms of specifi c infrastructure planning, this is very much a part of the detailed Master Planning carried out on our developments. Aldar ensures that its infrastructure is in line with the latest sustainability and Estidama guidelines. And this is done by utilising

Undertaking multibillion-dollar civic projects to help develop Abu Dhabi into an international business magnet and tourist destination, Aldar Properties’ Talal Al Dhiyebi reveals the fi rm’s outlook for 2010.

Planning

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Al Raha BeachEventually home to 120,000 residents, Al Raha Beach is a mixed-use

master development in a sunny waterfront location. Stretching over 11 kilometres, 11 precincts are designed to appeal to various clients; some feature quiet family villas while others are more vibrant with up-market apartments in lovely districts offering retail outlets along with galleries, restaurants and cafes. Residents also have the ideal opportunity to enjoy the beaches and all kinds of marine sports. A central business district pierces the skyline, where iconic offi ce towers and residences are set around an impressive circular marina – home to the new World Trade Center building.

the latest management tools to ensure that the level and quality of the infrastructure is equipped to handle future expansion.”

With experience that spans every type of project, from commercial and cultural to retail and residential, Dhiyebi explains that working on such a variety of development projects is a challenge in itself, particu-larly given the sheer scale of some of the projects. At Yas Island, for example, Aldar recently delivered all the ele-ments required for the inaugural Formula 1 Abu Dhabi Grand Prix, including Yas Marina Circuit, Yas Marina and seven hotels plus all the infrastructure requirements to cater to not only the fi rst stage of the project but also future elements that will include the world’s fi rst Ferrari theme park, the Middle East’s fi rst Links golf course, and beyond that commercial and residential developments.

As part of this project, Aldar delivered a major sec-tion of a new highway connecting Yas Island to the heart of Abu Dhabi and was responsible for the delivery of a 23-kilometre section that including 22 highway bridges, 17 entry/exits and four underpasses, as well as a light rail transit bridge in preparation for the future transport re-quirements of Yas Island. “Delivering to a fi xed deadline and coordinating the sheer volume of people working on the project was the main challenge we faced,” reveals



Dhiyebi. “With 68 diff erent contractors and close to 50,000 workers involved, this project required logistical organisation of a military precision – keeping communi-cation channels open was vital in this process.”

Beyond project delivery, Aldar is working to im-prove and innovate approaches to project management as well as ensure that the region’s cultural heritage is maintained in the face of all the new developments. “We have expanded our project teams to include all stake-holders from an early stage in order to fully engage them throughout the entire design process,” explains Dhiyebi. “Project managers attend corporate level strategic plan-ning sessions in order to get acquainted with the organisation’s long-term goals and understand how to implement these at the project level.”

Dhiyebi goes on to explain that the culture of the UAE plays an integral part in the planning of all Aldar developments, and that the company works closely with the Abu Dhabi Authority for Culture and Heritage (ADACH) to ensure that the cultural aspects of the development are integrated at the master planning stage through a Preliminary Cultural Review (PCR) pro-cess. Th e redevelopment of Central Market is an excel-lent example of how Aldar integrates UAE heritage with architecture into a modern development, says Dhiyebi. “Th e site is historically and culturally important, being

the location of the original Abu Dhabi souk and this permeates through all elements of the redevelopment; this is particularly true of the new souk, which em-bodies the heritage and architecture of the original, albeit in a modern setting. Examples of this lie in the ornate external mashhrabea screens, creating a pow-erful visual impact, whilst serving a practical cooling eff ect; the colonnades with spill out areas for tenants; central squares that bring a meeting point and sense of community to the local area; a strong mix of ten-ants arranged to provide concentrated uses; winding internal streets to enhance the sense of discovery; roof gardens, high ceilings, ornate timber, bronze fi nishes and water features.”

Tightening the beltWhile no-one has been immune to the global

economic crisis, Abu Dhabi was and is particularly re-silient. Dhiyebi believes that the underlying economic strength of the emirate has been a major factor, but as the leading developer in Abu Dhabi, the visionary

approach to urban development that is Plan Abu Dhabi 2030, means that the organisation are working towards long-term strategic goals. “Despite the economic crisis our mission remains the same: Aldar has a mandate to build the nation and that means focusing on creating communities where local emirates and expatriates alike can create their lives and those of their families,” states Dhiyebi. “Aldar is a fl exible business that responds rap-idly to changing market demands and as such this has led us to adapt some of our development to cater to a broader range of customers, allowing for easier access to property ownership for new segments of the population.”

Dhiyebi goes on to explain that the company’s strong position allows it to meet all current and potential fur-ther commitments as well as chart a clear and confi dent course through the prevailing turbulence, whilst ac-tively preparing for future success. Indeed, back in April 2009, Aldar CEO, John Bullough, said that it would be around six to nine months before any major improve-ment would be seen in the market. While Dhiyebi doesn’t

“With close to 50,000 workers involved, this project required logistical organisation of a military precision”

Opening in 2010, Ferrari World Abu Dhabi is set to be the world’s largest indoor theme park


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able communities that meet the needs of current and future generations, and balance economic, environ-mental and social requirements. And as an increasing number of companies are championing the importance of sustainability, Dhiyebi explains that Aldar is continu-ing in it’s quest to bring a green focus into its design and development processes and reduce the environmental impact of large infrastructure projects.

Dhiyebi goes on to reveal that Aldar are endea-vouring to incorporate the principles of sustainable development throughout the key stages of development; from conceptual master planning, through to detailed design and onto operation and management of assets and facilities. “We recognise that this is a labour and time intensive process, but we feel we are starting to see the fruits already,” he says, before adding, “For ex-ample, through our formalised Development Control Process we are engaging Aldar’s multi-disciplinary teams to ensure technical, commercial, environmental and social aspects are taken into consideration at each development stage. We are also supporting the Urban Planning Council’s Estidama initiative and seeking to use the draft guidelines that they developed to inform our design, where possible.”

Th ere is no doubt that sustained innovation is also critical to the industry’s growth and development, par-ticularly when improving green concepts, yet many fi rms

wish to make predictions on the state of the market he does concede that Abu Dhabi will continue to remain attractive because of the underlying fi nancial strength of the economy, the planned and controlled approach to development and the plan for diversifi cation away from oil dependency.

“Abu Dhabi has always been a great believer in in-frastructure projects and with the comprehensive devel-opment programme in place – Abu Dhabi 2030 – many infrastructure projects have already been launched such as the Sheikh Khalifa Freeway, Yas Southern Tunnel, Salam Tunnel, Al Raha Beach Interchanges, Mid-Field Terminal at Abu Dhabi International Airport and the new port at Khalifa Port & Industrial Zone – and we can expect to see many more in the years to come,” says Dhiyebi.

Sustainability and innovationWhile Aldar is continuing to roll out a high number

of projects, the continuing objective is to create sustain-

Central MarketDesigned by Foster + Partners, the former trade hub

combines traditional charm and modern architecture culminating in three towers. The new Central Market will dominate the prestigious downtown neighbourhood with an integrated mix of up-market retail, business, residential and leisure facilities.

Yas IslandLocated on the North East side of Abu Dhabi’s mainland, Yas Island

is approximately 7.5 kilometres long by 6.5 kilometres wide and offers 32 kilometres of waterfront. An unrivalled destination with over 20 hotels, three theme parks, a Super Regional mall, golf courses, six marinas, commercial and residential developments, the fi rst phase of development was completed in 2009.

“Abu Dhabi has always been a great believer in infrastructure projects”

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are understandably wary of unproven techniques and ap-proaches. Not so at Aldar. Dhiyebi says that innovation in infrastructure is essential to creating development that will stand the test of time. And, using Yas Island as an example, says that the implementation of world-class and environmentally friendly infrastructure systems not only benefi ts the operation of current facilities, such as the hotels and Yas Marina Circuit, but also the future phases that will open over the coming years.

“For example at our Yas Island development we have installed two state-of-the-art systems to benefi t both cur-

rent and future users. Th e fi rst is a natural gas network that consists of an intricate 28 kilometre network of polyethylene and steel pipelines with a future capacity in excess of 60,000 m3/hr to cater for all current and future developments on Yas Island.” Indeed, the clean burning natural gas is used to supply energy for cooking and hot water and is the preferred fuel of choice for the many new restaurants now open at the island’s seven hotels, says Dhiyebi. Th e system will also cater to residents at Aldar’s Al Raha Beach development following the completion of an extension.

Th e second state-of-the-art system is an Envac vacuum waste handling system, explains

Dhiyebi. Waste is transported at an aver-age speed of 75 km/h through a sealed

underground network of pipes to a central collection point, located ap-proximately three kilometres away, where it is sorted automatically. As well as the environmental benefi ts

of waste separation and recycling at source, the Envac system can also

help reduce traffi c volume, provide a cleaner living and working environment

and reduce operational costs. “Th is is the fi rst vacuum waste handling system in

the world to service a major motorsports circuit – the system can handle up to 30 tonnes of waste per day, de-posited at any one of the 36 inlet points currently locat-ed within the Yas Marina Circuit paddock, Yas Marina and the seven hotels. As with the gas network, the Envac system has been designed to cater for all future phases of the Yas Island project.”

While there is no doubt that Yas Island was Aldar’s most high profi le project in 2009, the developers have also delivered projects including Al Raha Gardens, a major residential project, Al Muna School, the third Aldar Academy and high quality offi ce developments like Mamoura. Looking forward into 2010, Dhiyebi hopes to continue this track record of delivery with the completion of aspects of the major residential and commercial projects such as Al Raha Beach – a major waterfront development – and Central Market – a major redevelopment of the traditional commercial district of Abu Dhabi – as well as the completion of the HQ pre-mium offi ce building. At Yas Island there will be the addition of Yas Yacht Club, Yas Links golf course and Ferrari World Abu Dhabi ahead of next year’s race. “In total, we are going to deliver 3500 residential units and 140,000 square metres of commercial space in the next 18-24 months,” says Dhiyebi. “Consequently 2010 is going to be a very important year and one in which there will be lots of activity coming to fruition.”

HQVoted ‘Best Futuristic Design 2009’ by the Building Exchange Conference,

HQ represents the a striking addition to the Abu Dhabi skyline. Part of the Al Raha Beach project, HQ provides fl exible, functional and open-plan offi ce accommodation built to international Grade A specifi cation. Set upon an elevated peninsula affording spectacular views of the city, canal and sea, HQ’s location provides an unparalleled working environment.

vacuum Dhiy

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HQ provides

fl exible, functional

and open-plan offi ce

accommodation

built to international

Grade A specifi cation

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Amere 20 years ago the US market was dominat-ed by a process technology which used classify-ing tanks (horizontal trajectory classification)and dewatering screws for the classifying and

dewatering of construction sand products. Contrasting thisto Australia, sand washing was based almost solely onpumps, sumps and cyclones; European producers (specifi-cally in the Netherlands) were evolving a new design of plantusing hindered-settling classifiers in ‘fractionation plants’often known as ‘Recipe Plants’ – this design splits the sandproducts into three or four discrete fractions e.g. 4.25 mm x2 mm, 2 mm x .5 mm, .5 mm x .3 mm and .3 mm x 75 μm.These fractions are stored and are re-blended to create mul-tiple, accurately graded, final products.

In 1998, this Recipe Plant technology was finally accept-ed in the US with the first installation of a four-fraction plantin central Florida; this was the most technically sophisticat-ed plant of its type anywhere and was used in a fine, dunetype sand deposit where glass sand was a primary productand multiple construction and industrial sands were needed.The plant was unique in that the operating software moni-tored dredging conditions, blended the fractions, monitoredincoming feed mass and storage-levels of the fractions, andprovided prompts to the plant operator when fractions wereat high or low levels actually providing suggestions on possi-ble alternative products based on feed and residual fractions.This reduced downtime and maximised production of highdollar value products.

This plant produced excellent results, based on productquality, product consistency, final-product mix (14 differentproducts), reduced cement usage (reports of >USD $1.10/M3saving in cement), but most importantly deposit yield. Oversubsequent years, several more plants of this design were in-stalled, but more recently with the move to more and moremanufactured (crushed) sand and fewer permits issued for nat-ural sand, this technology has somewhat stagnated for the con-struction industry but remains active in the industrial/specialtysand (frac sand) market where the same principals of fraction-ation are used. For certain types of deposit and certain markets,the Recipe Plant technology is still very valid.

In the late 1990s, plants based on dewatering screensand cyclones started to make inroads particularly for themanufactured sand market where the main requirement was

to adjust the bottom end (<75μm) of the product gradation.These plants grew in popularity because the recovery of us-able fractions in the ~150μm size was vastly improved overdewatering screws and the resultant dewatering screen prod-uct was much drier (around 10 percent lower moisture forany given sand fraction). In later designs, the combination ofvariable screen aperture, divided decks, cyclone geometrychanges and other adjustments allowed for more flexibilitythan normally associated with such a simple concept.

Today, for natural construction sand applications, clas-sifying tanks are still being used where a middle fraction (e.g.300μm x 600μm) requires adjustment. However, these plantshave become more hybridised with the use of cyclones (for

desliming/dewatering) and dewatering screens for finalproducts; even in manufactured sand there has been acrossover in technologies. A good example is a 1000tph washplant in Texas, US, where cyclones, classifying tanks and de-watering screens were combined to produce a manufacturedsand for both specification concrete and mason sands.

It should be remembered that the equipment once con-sidered ‘new’ in the construction sand industry (particularlyhindered setting classifiers) was used, modernised andproven for over 40 years in the minerals industry. The initialreticence in construction sand industry was often explainedby ‘not wanting to be the ‘first’’. Producers can have confi-dence that the hybridised equipment and process designshave a proven background; however, the plants are, as withmost things, only as good as the people providing the tech-nology and the back-up service. n


ASK THEEXPERT

Hybridising US sand washingJohn Best reveals how the sand washing industry has movedforward in the last two decades and why the hybridised approachhas a proven background and strong future.

John Best is the General Manager of the Aggregates Division ofMcLanahan Corporation. Starting in 1974, he has been activelyinvolved in the design, application, selection and operation of hydro-classification and dewatering equipment in the mineral andconstruction aggregate industries in Australia and North America.

“Producers can have confidencethat the hybridised equipmentand process designs have aproven background” John Best

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tal sustainability, technology and social responsibility – play increas-ingly integrated roles in the planning, execution, delivery and legacies of programme and project management work.

Firstly, environmental sustainability is no longer the idealistic vision of an environmentally sensitive CEO. Th e current environment is forc-ing a change in business values. Visionary organisations are recognising they cannot depend solely on their fi nancial returns for ongoing success. Th ey know a smart customer will make ‘buying’ decisions based on the organisation’s environmental and social footprint as well. Th is requires innovative project management capabilities that establish sustainable, socially responsible and fi scally prudent programmes that will become essential in looking to add quantifi able value to their organisations.

Sustainability considerations vary considerably by sector, but nearly all industry sectors have reported at least some of these impacts in recent years. Th e recent spike in global energy prices brought sustainability to the forefront of nearly all projects, and the complexity of bio-additives such as ethanol create a tension between energy needs and food supply. As society reacts to address climate change, project managers are likely to be faced with ever increasing megaprojects to meet energy demands as well as new population centres and new transportation systems.

Secondly, from a technology perspective, it is clear that IT has already become and will continue to be more tightly integrated with innovative project activities through the use of tools such as virtual networking, surface technology and the mobile internet. Projects will be even more distributed and involve virtual teamwork. Th e information conveyed is the same, but the way in which it is conveyed has evolved and will continue to evolve as technological advances alter the way we share and communicate information.

New tools will be developed that will allow the project team to

It was 40 years ago that the Project Management Institute (PMI) came to life through the vision and dedication of a small group of working project managers. Four decades on we fi nd ourselves in the 21st century, with a wholly diff erent landscape for the project management profession to the one that existed 20-30

years ago – and also to the one that will exist in 20-30 years time.If we look back to the 1980s for example, the main trends in project

management were limited to publications on human resources, team building and leadership. In 1984 PMI launched its fi rst certifi cation pro-gramme and in 1996 project management started to develop increasingly organised ideas and processes – as evidenced by the publication of the fi rst edition of the Guide to the Project Management Body of Knowledge, currently in its fourth edition. Fast forward to today and we can see that there has been a signifi cant move towards more project-based work as organisations begin to realise the value in using project management to implement their goals and strategies.

So what can we expect from project management in the future? Cer-tainly there will be an increase in the breadth of project types that will appear. Th e emergence of megaprojects that run across multiple markets and in multiple languages – such as Masdar, the zero carbon city in Abu Dhabi – will compound project complexity, leading to a growth in demand for multicultural and multi-lingual capabilities.

Moreover, we will also see three overarching factors – environmen-

The shifting sands of the project management landscape

Gregory Balestrero offers his thoughts on how the project management industry is changing – and what it could look like in the future.

PROJECT MANAGEMENT

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simulate virtually every project management decision, built using ad-vances in technology used for the current generation of games, adapted and enhanced to apply to all situations that might arise in the typical project. Th e soft ware development genius behind games such as Grand Th eft Auto and Nintendo’s Wii Fit will be unleashed on proj-ect management’s simulation development to produce platforms to train and enable project managers to fully understand decision ramifi cations.

Finally, social responsibility will dra-matically impact human resources in global supply chains. Global suppliers are focusing on the workforces of suppliers, and evalu-ating them according to rigid and strict guidelines. As project professionals, the leader will have to be rigorous and vigilant with the supply chain and be ready to make decisions accordingly. It is clear that respon-sibility for the entire supply chain and its social and environmental impact will fall squarely on the shoulders of the project leader.

It is also important to acknowledge that the under-standing of what constitutes project success is changing. In future, judgments on project success will include an even broader set of criteria than they do today and will span the entire business lifecycle, rather than just the project lifecycle. Th is wider approach leads us to look at how business strategy will become an increasingly dominant aspect in

this fi eld – the awareness that project management can be linked directly to strategy, environmental and social responsibility, and innovation is evolving and will continue to do so. Project management is rapidly moving from a professional capability to an enterprise competency.

As a profession, project management will continue to be an experiential discipline, best learned by practice, cre-

dentialing, mentoring and job shadowing. Train-ing, consulting and mentoring will play a large

role in developing the skills of future project managers, but there will be a greater focus

on a keener understanding of the relation-ship of their projects to business value, more sophisticated governance abilities and better communications skills. Much of the training will be simulation-based

and will be embraced by the generation of project managers that grew up with com-

puter games, iPods and mobile phones.Th e project management community is

poised for a period of extraordinary productivity, effi ciency and integration due to technological advances,

and even greater changes will come as a result of globalisation, collaboration and innovation in the industry as it takes its place fi rmly in the 21st century.

Gregory Balestrero is President and CEO of the Project Management Institute.

Construction companies are showing little interest in project management despite the need for cost control during the downturn and the urgent requirement for on-site safety. “There is a big misunderstanding, especially in the Middle East region, about the importance of project management and education in general. I know many people who will agree with this,” says Mounir Ajam, CEO of project management consultancy and training fi rm Sukad. “Some people view it as a bureaucracy and they don’t see that proper project management will help them improve effi ciency, reduce costs and increase value for their project over the long-term.”

Quality and safety is expected to suffer for the next couple of years and construction companies are unlikely to invest in project management,

continues Ajam. “Obviously, in a fast-track environment, people want to produce buildings very quickly and usually the fi rst thing they sacrifi ce is safety and quality. If people want to cut costs they usually do so by cutting corners.”

Ten to 15 years ago, there wasn’t a single university that offered project management, which has lead to limited skills in the fi eld. However, the situation is getting better: “Usually the people who practice project management are technical people, for example business analysts,. These people are technically trained and then all of a sudden they are asked to manage a project with no prior experience. This situation is improving and universities are starting to offer training in project management.”

Source: www.constructionweekonline.com Written by Sarah Blackman on December 8, 2009

Interest in project management remains low

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THE BIG INTERVIEW

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Given the building (not to mention fi nancial) ex-cesses witnessed in the emirate over the last few years, it is refreshing to hear a Dubai-based senior executive at a major construction fi rm extolling the virtues of a measured approach to construc-tion. And that is exactly what Ziad Makhzoumi,

Chief Financial Offi cer at UAE contracting giant Arabtec, believes has enabled his company to weather the worst of the storm.

Since it fi rst opened its doors for business in 1975, the fi rm’s suc-cessful execution of a vast array of major projects has forged its reputa-tion as one of the industry’s most respected players. Today, its diverse portfolio spans the sectors of high-rise developments, hotels, residential, commercial and industrial, airport developments, stadiums, villa com-munities, mixed developments, entertainment and off shore oil and gas installations. Drawing on a multinational workforce of over 70,000 employees, as well as state-of-the-art plant facilities and equipment, Arabtec is uniquely qualifi ed to tackle even the most complex and iconic of projects – including the recently completed Burj Dubai, the world’s tallest building, on which it was the main contractor.

Indeed, Arabtec shrugged off a diffi cult year that included ongoing payment disputes with developers and controversy over living condi-tions at its construction worker camps (claims vehemently denied by the fi rm) to fi nish 2009 strongly with a rise in its share price and the signing of several new contracts in locations such as Russia, Saudi Arabia and North Africa. And with a sound fi nancial base in place, Makhzoumi hopes for more progress in 2010.

Obviously the last 12 months have been tough for everybody in the industry. What have been your key areas of focus over that period – both as a company, and in your role as Chief Financial Offi cer?Ziad Makhzoumi. Well, there are two issues. We were planning for a downturn from the end of last year. Around the end of the fi rst quarter

Building confi dence

Crisis? What crisis? With the rest of the UAE reeling in the wake of Dubai’s recent debt concerns, Arabtec’s charismatic CFO Ziad Makhzoumi is betting on his fi rm’s

sound fi nancials to see it through the downturn and beyond.



of 2008 we expected things to get worse, and we started planning for them then. But, like most companies, no one could have predicted how fast it would hit, how severe the crisis was going to be, and what impact it would have. Nonetheless, we’re in reasonable shape for two reasons. First of all, we concentrated on managing our cash – our receivables and payables – very well, and are trying to balance those as much as pos-sible. We talked to our banks and confi rmed that there wouldn’t be any restrictions on the movement of cash or extra credit facilities – not that we needed any. So we prepared ourselves from the point of view that you have to be liquid to be able to meet your fi nancial obligations. We talked to our suppliers and we came to an agreement with them in preparation for harder times, and we also talked to the developers and other par-ties about payment terms. So that was a function of my role as CFO to manage the present situation and the expected downturn.

On the other hand, we knew that Dubai was going to come to a standstill for many reasons. We have a big backlog of work that will keep us going for another two years here, but we’re lucky in the sense that we’re not looking for more work in Dubai. We knew we wouldn’t get any more major projects for the foreseeable future, and we had in fact already taken steps to expand our business during the previous year in

Qatar and Abu Dhabi, and we have long been planning for a move into Saudi Arabia. We had previously delayed our expansion there because the Saudi market was not as open as it is now and we were too busy on the numerous projects we were working on in Dubai, but now the timing is perfect for that move. So, these are the two things that really helped us in coping with the disaster that hit the market.

Do you think the slowdown in the property market has allowed developers and contractors to refocus on the infrastructure side of things?ZM. I’m sure it did. Th e margins were higher on the residential side be-cause people wanted their projects fi nished yesterday and were ready to pay a premium to get things done quickly. Th ey wanted the cash to build bigger, more expensive projects, and that led to the frenzy that caused the prices to go up. At one stage, we were working on many sites seven days a week, three shift s a day. So I think it did lead many fi rms to focus on the residential sector.

Now everybody thinks they can get into infrastructure. It is not easy, however; you need to be qualifi ed for the job and you need to be specifi ed by the government, as most infrastructure work, unless it’s a

As Dubai’s construction industry continues to falter, Arabtec has strengthened its position by enhancing its portfolio in alternative markets.

Okhta Social & Business CentreSt Petersburg, Russia

Situated in St Petersburg, the old imperial capital of Russia and its second biggest city, the project comprises a 400-metre high tower taking the shape of a fl ame (resembling the logo of its client, Russian gas giant Gazprom), three podium buildings as well as massive underground structures and special external works. The tower will feature offi ce space for the client and its subsidiaries, leisure and entertainment facilities, as well as a library and sports centre.

Nation TowersAbu Dhabi, UAE

Located on the Abu Dhabi Corniche seafront, the award-winning Nation Towers is a mixed-use development project covering a total built-up area of over three million square feet that is expected to be commissioned by the end of 2011. It features a 64–storey residential tower, a 50-storey luxury hotel and offi ce tower and a retail podium. A sky bridge at the 48th level will connect the two towers while an underground tunnel will link the tower to a beach club.

Lamar TowersJeddah, Saudi Arabia

The SAR2 billion Lamar Towers project is an important strategic high-rise luxury project on the Jeddah Sea Front Corniche consisting of two towers of 60 and 68 fl oors respectively, and incorporating residential and commercial units as well as a shopping mall. The main investor in the project is Zahran Real Estate Company while the main developer is Cayan Investment & Development Company. The project represents a joint venture with Al Saad Contracting.

NEW HORIZONS


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private development, is government-backed. You can’t just go in as a foreign company and say, ‘I want work’. It doesn’t happen that way. You cannot go in if you’re not specifi ed in Abu Dhabi and bid for work. You have the same issue in Saudi Arabia. So it’s not as easy as just moving the people over from residential to infrastructure projects, because you need the right background skills and qualifi cations. But having said that, there was defi nitely a movement towards a greater focus on infrastruc-ture and the concentration is on that sector now. Oil and gas projects are also seeing a renaissance. When the price of oil was less than $30, lots of countries held back on spending on maintaining/upgrading their oil and gas projects, off shore platforms and so on. Th at is moving again, so we see a lot of potential in that, too.

Obviously, fi nancials are having a huge impact on the way construc-tion fi rms are operating through this downturn. So how do you see the role of the CFO changing, and how are you effecting that change at Arabtec?ZM. Th e CFO can no longer be just a bookkeeper. Th ey have to be a plan-ner, they have to be a strategist, they have to be a supplier of resources. Money is a commodity, it’s not something that grows on trees, so you have to manage it exactly the way you manage your stock, exactly as you manage your receivables. People assume it’s virtual, but it’s not. It’s physically something that can make things better or worse.

We are going in the right direction. We do have more sophisticated fi nancial systems that probably were not needed two years ago, but that have put us on a sound fi nancial footing. Now we are expanding, we have to prepare to export that control system to other countries and deal with taxation, import duties, etc. that we didn’t face before. Th at is the chal-lenge.

Th e CFO also has to act as an advisor or a Chief of Staff , to tell the board and the CEO whether a project or a decision is viable. Not just because of regulatory reasons, although of course that is one important dimension, but also in terms of what you can aff ord and what you cannot aff ord; you need to advise the board on the best way of achieving your goals as a company. So the role of the CFO has to go beyond just historic data reporting. It has to be about planning, it has to be about control, it has to be about governance. It has to be all these issues that we are talking about. Th at’s how I see it.

Do you think it will also involve a greater knowledge and under-standing of the technical and engineering sides of the business, and how they impact on the fi nancial side?ZM. Defi nitely. Th ese are business issues and project-related issues. I believe a CFO has to have more actual hands-on business experience and knowledge, and not just behind-a-desk experience of business. We are a public company. I have to communicate with the media, so not only do I have to be a very good numbers man, I have to be a good communicator and I have to be a strategist. Because running in parallel to the com-mercial strategy is the fi nancial strategy, and you cannot implement one without the other. In this climate – in any climate – there should be no such thing as blank-cheque management. We have to manage our bal-ance sheet. So, it’s not just an accounting function anymore. It’s more of a leadership function, a specialist function, a creative function, to

The tower has been designed to manage the effects of wind and seismic movements, with a super-structure made up of high-strength concrete supported by large reinforced concrete

mats and piles. The 80,000 square feet foundation slab and 50-metre-deep piling are waterproofed and feature cathodic protection. The steel bars that reinforce the structure weigh a total of 31,400 tonnes, and if laid end-to-end would stretch more than a quarter of the way round the world. The concrete used is equivalent to a 1.5-metre wide pavement over 1200 miles long, and is equivalent to the weight of 100,000 elephants.

Primary materials of the exterior cladding system include refl ective glazing, aluminium, textured stainless steel spandrel panels and vertical stainless steel tubular fi ns that accentuate the height and slender design of the tower.

The structure also poses a number of challenges in terms of energy effi ciency. At peak cooling time, for example, the tower will require 10,000 tonnes of cooling per hour, equivalent to the capacity provided by 10,000 tonnes of melting ice in one day. Meanwhile the tower’s water system will supply an average of about 946,000 litres of water per day, the building’s peak electricity demand is roughly equivalent to 360,000 100-watt bulbs all operating at the same time, while its condensate collection system will provide around 15 million gallons of supplemental water a year, equivalent to nearly 20 Olympic-sized swimming pools, which will be pumped into the site’s irrigation system for use on the tower’s landscape plantings.

An icon in the makingBurj Khalita is the centrepiece of Emaar’s Downtown Burj Dubai, a $20 billion, 500-acre downtown development billed as the most prestigious square kilometre on earth that has provided a number of major construction challenges.


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be some clarity in terms of what-if scenarios. And there are some cases that will test the system that we want to see the outcome of; hopefully it’ll be positive because it’ll add to the image of Dubai as a fair and open and transparent place to work, to live and to do business.

You also mentioned about the importance of people in the construc-tion business. So how are you really driving that culture of people development?ZM. I’ll give you an example. If you pay $90 million for a jet plane but you don’t have a pilot, it’s just a very expensive piece of junk. So you have to have the right people who will take your assets and maximise their revenue. Yet in many businesses – not in Arabtec, because we value our people very highly – people are not considered an asset. Th is is a mistake. People are the most important asset you have as a company, because it is them that implement the strategy; aft er all, you can’t do everything on your own. We have 70,000 employees, so we can’t go in and make decisions for each one of those workers. Th ey have to make those deci-sions on how to build the buildings, how to deliver work on-time, how to

be safe. We want to ensure that they follow procedures and so on, but unless you train them well and you work with them and incentivise them in a way that will produce that, you will not achieve your aims.

And we believe we’re one of the better companies. I’m sure we can always improve.

be able to cope with the challenges and obstacles and fi nd ways around them. In some cases, CEOs have not faced such a crisis before, and it is a fi nancial crisis, nothing else. And unless you have that knowledge, you have a problem.

On that note, there’s been much in the news recently about various disputes between contractors and developers. What has been your experience with that issue in the past 12 months, and how have you managed that process to minimise the impact?ZM. Of course, when things are going well no one gets angry or goes into dispute. And when things are bad, one of the ways of resolving that dispute is go for arbitration or litigation of some sort, in the hope that an offi cial body will arbitrate and try to resolve the issue. And those types of incidents have gone up in the last year or so, because people are panick-ing about getting their cash – if you don’t get paid, you can’t pay your employees or your suppliers. Your suppliers might then sue you or your workers might go on strike, and then you’re in a diffi cult position.

I think some of the most recent events highlight the fact that we pos-sibly need more clarity on regulation, or even more regulation. I’m not a person who likes more red tape just for the sake of it, but there needs to

These are three very different markets in the sense that their dynamics are different to Dubai. For one thing, Dubai is more dependent on foreign investors buying property. In addition, the scope and the ambition of the projects in

Dubai is so huge. It has the world’s tallest building. It has a metro where no one else in the region has. They’re talking about building a rail system from scratch. They are already building a new airport, extending the seaport, and so on. And it even has clusters of new islands that have redefi ned the shape of the coastline.

Abu Dhabi is different. The government there is more conservative in its views. Abu Dhabi’s population is growing and there is a shortage of dwellings there, so building affordable housing is increasingly important. A few years ago, people who used to live in Abu Dhabi would come to Dubai, but now it’s the other way around; they live in Dubai and travel to Abu Dhabi. Rates are still higher in Abu Dhabi, because there is a housing shortage, but what is different is that demand is coming not only from external investors or buyers, but also from the people who actually live and work there. So that more conservative attitude to investment has helped. Abu Dhabi is also one of the biggest producers of oil in the world, so they have an income that can support those projects and that expansion. Plus, the infrastructure work that they’re doing is helping. If you look at Abu Dhabi, there

ROOM TO GROW

Ziad Makhzoumi outlines Arabtec’s

expansion plans for Saudi Arabia, Qatar

and Abu Dhabi.

“In this climate there should be no such thing as blank-cheque management”


ment team. And we do talk to them: sometimes they say thank you and sometimes they complain, but we’re always open. Sometimes they have a genuine grievance, and sometimes they don’t. It’s like a big family, and there are brothers and sisters and cousins; not everybody is happy with everything all the time, and there’s jealousy, there’s all sorts of disputes. But there’s also respect, and we try to keep that culture going. We’re always improving, and I hope we can always get better at what we do. And as I said, there are bound to be some mistakes made when you are trying to please 70,000 people. You learn from it, and you hope that it will not happen again.

And so, going forward, what will be your key areas of focus in the short term?ZM. As a company we have to keep the momentum going and maintain our current business, while at the same time looking at expansion into other areas – be that geographically or in diff erent sectors – which we are doing. We need to excel in certain areas that we’re very good at to ensure that we keep that uniqueness about us, that we deliver quality in every-thing we do. As a CFO, I need to make sure I support that expansion and give it all the resources I can. It’s not only people; on a strategic level people are extremely important, but to implement the strategy success-fully you need resources, and one of them is money. And that’s my job.

We’re expanding outside Dubai. And we’re going to areas where they’re many years behind Dubai, like Libya, Algeria and Russia. Th ese are new economies that are oil and gas dependent. Th ey need the infra-structure and they need the skill, so I think for the coming 10 years we’re quite well set. Hopefully, by then, we’ll have new strengths and new skills and new opportunities, and we’ll create new sectors.

are many projects. There are six hospitals that we are aware of being built. You’ve got two museums that are being built. You’ve got universities being built. There’s also the expansion of the airport, the seaport, the new downtown that they’re talking about. So, the new UAE construction market is Abu Dhabi – and how fast or how slow that grows is a function of how fast the government wants to go. And of course, that will be triggered by the surplus of cash generated by oil prices.

Saudi is a completely different story, because they do not build at all for foreigners. Very few people are going to buy a holiday home in Saudi. One the other hand, it’s a very big population and a very big country, and is in greater need of infrastructure development. And it’s not necessarily just roads and airports, although they’re looking at renovating both. We’re talking about universities. We’re talking about developing more opportunities for a sector of society that wasn’t previously as active: women. The government also wants to be a centre of excellence for information technology, so they’re pushing that in Jeddah. You’ve got the development of the economic cities that are happening. So, the market there is completely different, and in theory, it will be much bigger than the whole of the GCC put together. We think that Saudi will be, eventually, the biggest market for us – or any contractor in the GCC.

Qatar is in a unique situation in that is has gas, and is the third biggest producer in the world. Again, they are trying to emulate Dubai, but I think that is going to slow down as a result of the current confi dence in the market. I don’t think growth there will be stopped, but it’ll be slowed down. So, instead of fi nishing projects in two years, they might fi nish in four or fi ve years. As far as we’re concerned it doesn’t matter, because somebody has to fi nish those projects and we are there to help them. And plus, with all the infrastructure work that they need on the gas side, there will be plenty of work.

North Africa is also big for us. Libya, we think, is a very important market. We’re pursuing some projects there. Algeria is a very big market. Egypt has always been interesting, but only if there is a specifi c project where we have a competitive edge; we can’t compete on price because the locals will be cheaper. We have projects in Syria and I think, again, that’s a very interesting market for us. We have a project in Jordan, but I think that will be affected by the economic recession and the political situation in the area. Plus we have a major project in Russia, which we were invited to bid for and were awarded the project because of our experience and reputation. So, we have a brand name. We have credibility. We have a very good product and service that we can build on, and that was basically our strategy for extending our operation outside Dubai.

We’ve been in the press recently for the wrong reasons – unfairly in my view, because following all the negative publicity we invited the press to visit our labour camps and they came and saw that much of the stuff mentioned in the programmes was untrue, incorrect and out of context. However, this doesn’t mean we cannot improve. We are always improv-ing. We follow the labour laws and go beyond them. But, we also need guidance. And when you’re growing as quickly as we are – up to 70,000 people from less than 20,000 four years ago – you’re bound to miss some things and not get everything perfectly right.

As a result, we always review our processes, and we always talk to our people. My staff have an assessment meeting every three months. We talk and discuss targets. Th ey have access to me whenever they want. We have a hierarchy, accept our responsibilities and are very active in putting things right. Our CEO, Riad Kamal – who is a brilliant and vi-sionary leader, as well as a great communicator – is trying to push that culture all the way down through the organisation. We are close. But, we also accept that everyone must take individual responsibility for what happens in the organisation.

So you have quite an open culture in terms of lines of communica-tion between members of the management team, but what about communication between senior management and those people on the lowest rung of the corporate ladder? Is there an opportunity for those workers to have a voice?ZM. Th ere is an offi cial process for that, of course. But in addition to that, every month we go and visit the camps and have dinner with our workers. For instance, we had a big Indian night last month where there were 5000 people, including myself and other members of the manage-




MANAGINGRISK

PART OF THE PROCESSIs risk management finally being fully embedded in the way projects areplanned and managed? Faithful+Gould’s John Cowling explains why hebelieves the industry has come a long way in a short time.

John Cowling ED_7dec10 15/01/2010 16:14 Page 52

Without doubt, enhanced collaborationacross project teams and disciplines istransforming the construction industry –and nowhere is this being illustrated moreclearly in the Middle East region than atFaithful+Gould. Whilst the company – asubsidiary of Atkins – is globally recog-

nised in the construction industry for cost management and quantity survey-ing services, the firm also offers additional value-added services includingproject and construction management, strategic facilities management, assetmanagement, risk and value management and sustainability. John Cowling,Head of Risk at Faithful+Gould, believes this depth of service is one of the keysto the firm’s success. “Whenever I require assistance, such as an enquiry out-side my remit, I know I have this comprehensive knowledge base I can call onfrom across the broader global AtkinsGroup,” he explains. “I can receive very posi-tive, rapid and accurate responses from acrossthe worldwide Atkins business, which com-prises around 16,000 staff.”

Risk management is one area that hasbenefited from this more collaborative ap-proach. Faithful+Gould sees integrating riskmanagement into organisational processes asan important part of any company’s continu-ous improvement cycle; often clients have aneed to integrate risk management with valuemanagement and value engineering, becausethe two dovetail really well together. And asthe market matures, Cowling believes there issignificant potential for clients to further en-hance their regional capabilities through theapplication of risk management systems, toolsand techniques.

For many people, managing projectsmeans managing risk. What kind of ap-proach do you take to risk management, and how do you embed thatinto the project management aspect?John Cowling. Firstly, it must be said that Faithful+Gould has risk manage-ment embedded as a key component of our project management process.However, we also offer complete consultancy services across entire client en-terprises. We are grateful that many of our clients consider the benefits thatflow from implementing a risk management framework in enhancing theirexisting business processes and decision-making process. We often talk interms of the concept that risk management enables you to operate with ‘youreyes wide open’.

When our clients commence a project with their eyes wide open theyusually have a clearer understanding of the issues, resulting in more informeddecisions being made and a lesser likelihood of falling into the normal sort ofproblems or issues that you might otherwise encounter. We find that as theexpatriate community often has a higher turnover of personnel then perhapsin other more established parts of the world, it is more important to have ro-bust processes in place to ensure that there will be a legacy of continuity with-

in the client’s operation. It’s very important to get these processes embeddedearly throughout the organisation as the benefits have potential to extend be-yond current projects – and by integrating lessons learnt into their processes,their continuous improvement cycle continues, which adds further value totheir organisation.

So it becomes a cultural element as opposed to just a project manage-ment element?JC. Exactly. A large part is about change management, and managing the risksinherent in changes to an original project plan. People have been using riskmanagement on their projects for centuries, from the building of the pyra-mids and the aqueducts in ancient civilisations, to the building of the Burj AlArab. They all applied risk management in their processes. It’s just that in re-cent years we’ve developed more sophisticated models that produce more

consistent results. These make it easier to de-termine the likelihood and impact of negativerisks, and what we could do subsequently totransform these threats into opportunities. Forus here at F+G, it’s about how we can do it bet-ter, as well as making it easier and more user-friendly. Our client-focused philosophy is formaking risk management more of a processdriven and scientific model that produces tan-gible results. This ensures that collaboratively,with our clients and stakeholder, we improveconsistency.

Now, obviously, the last 12 months havebeen tough. Have you seen attitude to riskchange during that period?JC. I look at the construction industry in the lastfew years as a bucket full of holes, but instead ofbeing filled with water it’s been full to the brimwith money. But the water or money level nevergot down as far as the holes because no matterhow many holes you had, there was so much

money pouring in with the pace of development that it really didn’t matter.Well, now it matters. Now, I find clients looking for ways to ‘plug the holes’,and one of the tools they can use to do this is to employ risk managementwhich proactively assists them to more efficiently use their resources.

Clients are much more receptive to the concept of managing risk nowthan they were perhaps two or three years ago. They’re saying, “We need towork smarter, not harder – we need to also stay one step ahead of the rest.”And that’s what I see as being the opportunity right now. Our risk manage-ment philosophy has always been ‘think, plan, do.’ When we enhance our‘thinking and planning’ stages, we significantly enhance the efficiency of the‘doing’ stage.

So really, managing the risk has become a way to drive value and reducea lot of those inefficiencies?JC. That’s right. Recently in discussions with a client we were evaluating risksin their supply chain and procurement. As they were sourcing their sanitary-ware from an international firm outside the region, we had identified several


John Cowling


The idea of sustainability has been around for a while. What challengesdo you think need to be overcome for sustainability to become part ofthe fabric of everything we do as an industry, rather than as a standalonetopic in its own right?JC. It’s interesting. From a risk point of view, if governments regulate the needfor sustainability then it becomes part of the project objectives. And it will as-sist in reducing some of the risk, because right now there’s a lot of discussionabout whether or not to include sustainable thinking and specifications inyour design, and how far to go in terms of implementing standards, of whichthere are many.

Design standards are, in part, still in the development phase in certainemirates and once all standards are fully enforced, design teams will have nooption but to embed sustainable solutions into their designs. This is a goodexample of where a perceived threat can be turned into an opportunity as in-novation in sustainable solutions may impact on the desirability of complet-ed projects. A perceived restriction can be turned into a positive outcome interms of environmental impact, commercial return and brand desirability.Once financiers, clients, developers and designers grasp this opportunity, thechallenges may be mitigated somewhat.

How much do you think the region is really embracing the idea of sus-tainability? Given the huge development that’s taken place there overthe last 15 years, do you think Dubai, in particular, has missed a trick bynot embedding the concept of sustainability into all its processes froman earlier stage? JC. It would be inappropriate and unfair to focus solely on Dubai in terms ofthe idea of embracing sustainability, as over the last 15-year period the im-plementation of sustainability varies broadly across both the developed anddeveloping world. What is clear from our experiences in this region is thatsustainability, facilities management and asset management have become farmore embedded into design team solutions. There does seem to be a positiveshift in thinking towards whole-life appraisal rather than the previous normof the short-term view.

Many currently consider the financial cost of sustainable or ‘green-friendly’ items as somewhat prohibitive. Once the cost of such items signifi-cantly reduces, then the implementation of sustainability will increase. Froma risk perspective, the benefit of a greater focus on sustainability is that we willhave less risk attached to the supply of energy, because we’ll use more renew-able energy techniques, energy-saving processes and materials. Over the long-term the application of sustainable infrastructure will actually reduce risksassociated with utilities, which is a positive outcome.

Our in-house sustainability experts are working with several large re-gional clients to determine the cost benefit ratios attached to a number of sus-tainable applications, which in turn often leads to life cycle modelling toensure the most cost efficient solution is implemented.

Do you think it’s still the case that if people are given the option of spec-ifying a sustainable product or a cheaper product, then they’re still goingfor the cheaper product? I mean, I guess it’s particularly pertinent in thecurrent climate.JC. It really depends on how people perceive cost and whether a developer, forexample, is going to retain the management of the completed asset. Obviouslythere is the one-dimensional financial cost consideration but this needs to be

project risks that included disruption to the manufacturing process, currencyfluctuations, and transportation / logistical concerns, all of which could cause de-lays and increase costs. As we considered how we could mitigate these risks, andbalance the function of the required items versus costs, we discovered that therewas a local manufacturer who could directly supply the specified quality andquantity within a 30-minute drive. We had effectively mitigated the risks associ-ated with the potential impact of currency fluctuations and the potential impactof transport delays. At the same time, we identified how the client could save a sig-nificant amount of his budget, which also allowed him the opportunity to usethese funds elsewhere. An additional benefit was that this allowed the client to in-crease his percentage of locally manufactured materials assisting with the localeconomy, one of the key drivers of the overall project.

This is one example of why we at F+G prefer to embed risk managementwith value management (value engineering), as they are not standaloneprocesses and their integration into a project process can have significant ben-efits for the project as a whole. We believe risk management is about seekingopportunities for solutions.

Our clients often ask us for assistance to further empower their person-nel through training and the provision of processes and tools, such as a user-friendly risk register that includes a reporting capability that enables theirproject teams to track and monitor their progress. In many instances theseadditional services provide our client’s teams with extra competencies thatenable them to achieve enhanced management skills.

Now, this region is renowned for the pioneering nature of the projects it un-dertakes; they’re daring and ambitious, both technically and in terms oftheir scale and scope. And obviously, the industry as a whole needs thoseinnovative approaches in order to grow and to develop further. But, havingsaid that, many firms are understandably wary of embedding innovativenew processes if they’re not proven; they’re wary of jumping into the un-known. So, how do we balance that risk/innovation equation – or better still,take risk out of the innovation process altogether?JC. When we initiate a project, often in a workshop together with the clientand their major stakeholders, we’ll look at project objectives, stakeholderengagement, issues and a whole range of defined criteria. This process ef-ficiently assists us all to define the project specifications and provides uswith an accurate overview of what the client actually needs and wants – forexample, whether they desire their project to be perhaps iconic or purelyfunctional. We find it critically important to thoroughly understand ourclient’s needs, and understanding what our client wants to achieve throughthis specific project. Communication has to flow across all aspects of the pro-ject, and is essential to assist in the mitigation of potential risks.

As the market matures, particularly within this region, clients and devel-opers are increasingly looking for best practice, world-class methodologies.With the publication of the recent ISO 31000, the new international standardfor risk management, many industry leaders not only recognise that risk man-agement is a standard international best practice, they also demand that riskmanagement processes be implemented in their businesses.

This region thrives on innovation and new ideas, and often once wedemonstrate how implementing a risk management system delivers tangiblebenefits, such as assisting as a tool for measuring the likelihood of success forinnovative options, our clients immediately understand how these processesprovide them with greater comfort when making early stage decisions.



balanced against the social and environmental savings that can be had. A‘cheaper’ option in financial cost terms can in fact be the more expensive op-tion over the whole life cycle and we see more organisations investing ingreater strategic long term planning and modelling.

Society as a whole can have a great impact on the built environment ifthey direct their choices towards developments that can demonstrate‘green’ credentials. If we, as a society, strive to make our choices based onstrong sustainable principles, the built environment and those responsi-ble for it will have to rise to that challenge.

The client’s vision for the project isparamount. In our workshops, defining andconfirming with a client what their objec-tives are is key to defining the terms and di-rection of the project. We’ve been called into help on projects that were experiencingdifficulty both with programme and budget– yet when we facilitated a risk and valuemanagement workshop with the client andtheir major stakeholders and defined theclient’s objectives, we achieved a moment ofclarity for everyone in the room. Suddenlyyou could see all the different stakeholderscomprehending what the client wanted andneeded from the project, and then weworked with all the participants to ensurean agreed course of action to ensure theproject would have a greater opportunityfor success. We find these moments excep-tionally rewarding as we are actively assist-ing clients in achieving their goals andobjectives.

When client objectives include sustain-ability parameters, then we can ensure thatall stakeholders understand their deliver-ables and thus we can ‘plan, design and en-able’ accordingly. If the client’s objectivesdon’t include sustainability, then obviouslythose considerations become less importantin the overall delivery of the project.

What are the biggest challenges the re-gion faces in terms of its future devel-opment? JC. One of the great regional challenges in-cludes transportation, both domestic andinternational. Many of the countries in theregion are experiencing tremendous growth inpopulation which demands a corresponding in-crease in their role as a major hub for people andfreight to move in and out of the region. Whilst trans-portation is going to be a huge challenge, the GCC rail proposals will ad-dress several of these issues. Currently, the UAE is leading the region, withDubai one step ahead in the opening of the Dubai Metro.

What opportunities does the transportation sector present to contrac-tors and construction firms within the region?JC. The opportunity for the F+G/Atkins group is certainly to participate inworld-first infrastructure projects, to do things that haven’t been done be-fore and to be instrumental in delivering a tangible benefit not only forgovernment, but also for the community. Within the F+G/Atkins groupwe’ve had the opportunity to be involved in major transportation projectsacross the region, including the Dubai Metro here in the UAE, theMakkah Metro in KSA and the Gautrain in South Africa. We’re also ac-

tive in a broad range of coordinated ser-vices covering planning, infrastructure,utilities and buildings across a number ofmarket sectors. These all provide us withthe opportunity to provide tangible bene-fits to local and global communities. Wecan proudly state that what we haveachieved has actively improved people’slives. We all work collaboratively togetherand the opportunities for everybody areamazing. There are a considerable numberof regional mega projects still being con-structed, which equates to considerableopportunities and rewards for all con-cerned.

And as the risks come down, those pro-jects become more attractive.JC. Our aim with project risk management isto assist our clients to identify and managethe likelihood and the impact of threats tothe project. When we reduce either the like-lihood or the impact – or preferably both –then effectively we are making the projectmore attractive to our client, their investors

and their customers. We encourageour clients to engage in ourprocesses – to identify, analyse,evaluate and control or mitigatetheir risks. Once we have mitigatedthose risks, they invariably find thatthe potential for cost overruns orproject delays have also been re-duced. With these demonstrable

tangible benefits of risk management,not only does our client reduce the risks to

their project or business, they’ve also openedup avenues for greater opportunity and greater suc-

cess. It’s the F+G/Atkins formula – to take enormous plea-sure in assisting our client to achieve greater success, as everybody

wins. We aim to have our processes embedded in our client organisation’sculture and processes to ensure their greater success – not just for this projecttoday, but for their projects of tomorrow. Our risk management philosophyis really about assisting our clients to plan for success. n


Risk management: a definitionRisk is defined in ISO 31000 as the effect ofuncertainty on objectives (whether positive ornegative). Risk management can therefore beconsidered the identification, assessment andprioritisation of risks, followed by coordinatedand economical application of resources tominimise, monitor and control the probabilityand/or impact of unfortunate events ormaximise the realisation of opportunities. Riskscan come from uncertainty in financial markets,project failures, legal liabilities, credit risk,accidents, natural causes and disasters as well asdeliberate attacks from an adversary. Several riskmanagement standards have been developedincluding the Project Management Institute, theNational Institute of Science and Technology,actuarial societies and ISO standards.

Methods, definitions and goals vary widelyaccording to whether the risk managementmethod is in the context of project management,security, engineering, industrial processes, financialportfolios, actuarial assessments, or public healthand safety. The strategies to manage risk includetransferring the risk to another party, avoiding therisk, reducing the negative effect of the risk, andaccepting some or all of the consequences of aparticular risk.

Certain aspects of many risk managementstandards have come under criticism for having nomeasurable improvement on risk, even though theconfidence in estimates and decisions increases.


Sustainability was significant to the Atlas Copco Group long beforethis area became a popular business trend. A significant part of thedesign phase in new product development is paying close attentionto reducing the environmental impact of our products – the belief

being that there is always a better way of doing things. And from a corporateresponsibility perspective our aim is to providethe best products and services to our customers,with the minimum negative impact to the localcommunity and environment.

From the point of view of sustainability,Atlas Copco’s vision is to become and remainfirst in mind for its key stakeholders. This visionis also the driving force of the group’s sustain-ability strategy, and the objective is to be a goodcorporate citizen in each market. As such, AtlasCopco is committed to making a positive impactwithin its sustainability framework: through theeconomic, environmental and social dimensions,and through the pride among employees in thegroup’s values.

For the fourth time, Atlas Copco has beenselected as one of the 100 most sustainable com-panies in the world. By and large, the group’s pro-duction units are ISO14001 certified andsuppliers are encouraged to have an environ-mental management system.

Locally, Atlas Copco Services Middle East has engaged with the com-munity through a career development programme under the STEP PRO-GRAM banner, to develop local Saudi people within our aftermarket businessarea. They participate in a training programme designed to provide all thenecessary skills to become certified compressor and generator service techni-cians – potentially furthering progress in career paths and reducing relianceon foreign resources.

The environment has been a key concern in developing new products.Atlas Copco products have their main impact on the environment, not whenthey are produced, but when they are being used through the energy requiredto operate them. Atlas Copco works to reduce this impact already in the de-

sign phase of its new products and in continuous product development.The Atlas Copco Group’s main environmental impact is related to CO2

emissions during the use of the products. Atlas Copco’s products and solu-tions are continuously improved in regards to customers’ demands relatingto quality, costs and efficiency, as well as in regards to ergonomic, environ-

mental and health and safety aspects. The Atlas Copco products sold into

the Middle East meet or exceed the latestEuropean norms related to noise and ex-haust emission levels. We have a local re-sponsibility to the community and itsresidents, and therefore we offer only theEuropean norm products. The benefitsare not only to the environment andlocal community, but there is also thebenefit of increasing our customers’profitability through more efficient solu-tions in their processes – either by reduc-ing the operational costs, or increasingtheir productivity, or both.

The Copenhagen Climate ChangeConference has brought worldwide at-tention to the effects of our actions onthe world’s climatic changes. AtlasCopco believes that it is our responsibil-ity to take actions to address this prob-lem, from local to global levels. Our hopeis that our customers, and potential cus-tomers, appreciate the benefits of ourproducts to save their profits while at thesame time helping to save the planet. �


INDUSTRYINSIGHT

Michael Sagermann is the Regional BusinessLine Manager, responsible for the PortableDivision product lines, with Atlas CopcoServices Middle East. With 16 years’experience within the Atlas Copco Group,having worked in sales and productionfacilities in Canada and Belgium, Sagermannis presently based in Bahrain.

321 Community engagement: for example, our

Water for All programme of providing assis-tance to develop clean drinking water accessin regions where potable water is scarce

Re-engineer internal processes: for example,ISO 14001 in all production processes, suppli-er evaluations and HIV/Aids programmes

Re-engineer the larger environment: for ex-ample, launch innovative products that shapethe regulations and push the industry toadapt to new standards

Sustainability in construction

Michael Sagermann underlines theimportance of sustainability at the Atlas

Copco Group and reveals how the company islooking to improve sustainability through

product development.

The three dimensions of sustainabilityAtlas Copco has grouped its main sustainabilityactivities in three dimensions:

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As development projects have become larger and more complexover the last three or four decades, the incidence of disputesand their complexity have both increased. Whether the dis-putes flow from inadequacies in briefing, inadequacies in the

procurement processes or inadequacies in the management of the con-struction process itself, they are often so complex that few, if any, individu-als can comprehend a dispute entirely.

Dr Imad Al Jamal, Vice Chairman of the UAE Contractors Associationand a leading expert in contract development, mediation and arbitration, be-lieves the increasing number of contractual disputes within the constructionindustry call for more simplified, straightforward and clear contract docu-ments with clearly defined time limits on actions, decisions, determinationsand responsibilities with regard to employers, contractors and engineers.

“The game has changed drastically over recent years with the adventof the computer age, privatisation, the need for more qualified experienceand the fact that specialised contractors are having more input into thedesign, construction and implementation of engineering projects,” ex-

plains Al Jamal. “What is needed is the introduction of design/build con-tracts and engineering procurement contracts that clearly define the de-sign and consultancy role of the contractors and the need for a specialistpractical expertise and knowledge in an ever expanding and complex en-gineering world.”

Since its establishment in 1913, many in the industry have looked tothe International Federation of Consulting Engineers (FIDIC) for guid-ance in the field of contracts preparation and development. But Al Jamalbelieves tackling the latest developments in the construction industry re-quires both greater clarity and the active involvement of the contractingindustry. “FIDIC in its early stage of development relied heavily on legalterminology and phrases that contained substantial ambiguities and un-certainties and couldn’t be implemented easily by engineering profes-sionals,” he explains. “However, the present economic situation – and theproblems and disputes arising as a result – require a more affirmative andsimplified approach, as well as concise documents to deal with the divid-ed and overlapping lines of contractual, legal and financial responsibili-

With the complexity and volume of contractual disputes on the rise, is a new approach tocontract resolution needed?

DISPUTERESOLUTION

Resolving contractor differences

UAE CONTRACTORS ED:7dec10 15/1/10 15:58 Page 58

out the tension that is usually experienced dur-ing the construction stage.”

Both parties to any dispute should refertheir claims to the panel 30 days prior to itsofficial meeting date, which will give panelmembers ample time to study and verify doc-uments, as well as the various claims andcounter claims from each party. The panelwill then have the responsibility to analyseand resolve the dispute, and provide any rec-ommendations and judgment within 30 cal-endar days from the convening date. “Thepanel’s decision should be firm and bindingfor both sides, with no room for further re-course to litigation or other dispute resolutionmethods,” says Al Jamal. “This should beclearly stated in the contract.”

He believes such an approach would con-tribute towards minimising and avoiding the“snowballing nature” of expected disputes andproblems that arise during the practical execu-tion of the contract between the parties.“Dealing with engineering disputes from theoutset is essential in order to ensure thesmooth running, completion and handover ofthe engineering contracts,” he says. “What ismore, the expense involved in setting up atime-bound arbitration committee is minorcompared to the heavy costs involved in ordi-nary arbitration and legal proceedings, wherean open-ended time span is often experienced.It will reflect positively on completive pricingand contribute towards progress and prosper-ity in the construction, real estate and other re-lated industries. And it will have a positiveimpact on the economy and development ingeneral, with a greater confidence within theindustry that prices quoted by suppliers orcontractors are not inflated in order to meetdelayed payments due to disputes.”

Of course, some disputes are unavoidable,but adversarial behaviour in resolving the dis-pute is usually counterproductive, especiallywhen it is complex: it delays the execution ofremedial measures, increases legal costs, cre-ates adversaries and thus wastes resources un-necessarily. It also saps the energies of theparties in dispute unnecessarily, diminishingtheir ability to function effectively in the fu-ture. As such it is essential that we create an at-mosphere of openness and cooperation withinthe construction industry – and this is whattime-bound arbitration hopes to achieve. �

ties and duties on the part of all participants.”For one thing, he believes that the heavy

use of vague and improper terms such as ‘assoon as possible’, ‘as soon as practicable’ and‘within reasonable time’ should be completelyomitted and replaced with clearer and moreconcise timeframes, bearing in mind the pre-cise and calculated nature of engineering andconstruction contracts.

Secondly, he feels that the active partici-pation of contractors would enhance the stan-dards and knowledge needed in variousadvanced and complicated engineering fields,and could potentially reduce the number ofdisputes arising in the first place. Indeed, withmany major contractors establishing their ownin-house engineering and design arms, con-tractors are often able to provide expertise andknowledge in terms of planning, design, con-struction, completion, testing, handover,maintenance and operation of projects that iswell above the standards and expertise of someconsultants. As such, the exclusion of contrac-tors from the preparation of and involvementin FIDIC task forces and committees designedto tackle contractual disputes (traditionally in-fluenced by consultants and legal experts to alarge extent) must be addressed. “We needhands-on experience with the day-to-dayproblems and practical implementations of theprojects rather than a purely theoretical ap-proach,” explains Al Jamal.

Even so, disputes will always arise, and themajor dilemma for most contractors and sub-contractors is resolving disputes arising from orduring their works in a cost-effective, timely andcontrolled manner. Yet Al Jamal feels that cur-rent dispute-resolving procedures such as legalaction through the courts, arbitration, concilia-tion and other such techniques are failing toachieve the desired results. Instead, he proposeswhat he calls a ‘time-bound arbitration’ approachto dispute resolution that requires an ongoing ar-bitration panel to be formed at an early stage andmeet regularly during the construction period toresolve any issues.

“The formation of the TBA panel shouldbe carried out during the tender stage or at thetime of the contract/subcontract agreement asnegative attitudes, bad feelings and tensions donot exist at this early point,” he says. “This willmake it easier to agree on qualified and compe-tent arbitrators in a short time period and with-


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Speedy resolution of disputes if andwhen they arise

Drastic reduction in time spent onlitigation and ordinary arbitration

Reduction of correspondence, filing,cost and time involved in followingup disputes over long periods

Prevention of minor disputesdeveloping into major andcomplicated problems that will bedifficult, expensive and time-consuming to resolve

Completion of all works withminimum disputed items, whichreflects positively on relationswithin the construction industry

Prevention of cash flow problemsfor smaller contractors due towithholding of large sums ofmoney by the main contractor orowner because of lengthy andcostly disputes

Relieving the judicial system fromthe burden and time of handlingcontractual and specialised disputes

Enhancement of relations betweenclients, contractors, sub-contractors,suppliers and consultants

The advantages of the time-boundarbitration approach include:

TIME-BOUND

ARBITRATION

UAE CONTRACTORS ED:7dec10 15/1/10 16:12 Page 59


lead to fewer oil changes. And this mitigates the higher purchase price and improves the economy of the entire system. Furthermore PANOLIN ECLs show superiority over min-eral oil based lubricants under extremely hot operating temperatures.

What features and attributes should manu-facturers and construction companies look for when selecting lubricants for their ma-chinery? Do any particular considerations need to be taken into account in order to choose the right solution for the job?PL. Manufacturers are designing machinery and components with permanently increased performance, which requires specifi c lubri-cants. Nevertheless the technical functionality is not the sole requirement, the need of the construction company to use a lubricant with a better environmental profi le and a greater

life span has to be taken into account when specifying lubricants. More and more OEMs off er the alternative to use ECLs instead of the classic mineral oils.

Construction companies should evaluate whether or not to use ECLs instead of mineral oils. It is important that they seek advice from a lubricants specialist. It might take a bit more time to assess the situation on a job site and to talk to the authorities, however, this can pre-vent a disastrous failure to the environment and/or to the machine.

Can you give us an example of how your products have been successfully applied in hot regions? What benefi ts did your lubri-cant solutions bring?PL. We have numerous customers operating dredges and excavators in extremely hot re-gions, where the temperature during daytime is 35-45°C (95-115°F). One customer was forced by the authorities to use an environ-mentally friendly hydraulic fl uid. At fi rst they did operate an excavator with a lubricant from a global oil company based on natural canola oil. Th e hydraulic tank temperature got so high that they had to stop the machine for an hour daily in the early aft ernoon. Furthermore they had to do a complete oil change every 500 operating hours. When they changed to PANOLIN ECL they did not have to stop the machine and the oil change was unnecessary for the remaining duration of the job.

What challenges do companies in the con-struction industry face in terms of their lubrication requirements, and how has the lubricant industry responded to these chal-lenges?Patrick Laemmle. It is not obvious but lubri-cants can have a huge impact on the construc-tion business and therefore on all stakeholders in and around the construction industry. Every construction company must be competitive in three diff erent aspects: economy, technology and environment.

Economy: It is the target of every com-pany to have a certain profi t. Only this profi t enables the company to make investments and therefore guarantees the continuance of the business. Th is economical success is based on hard work in combination with technology and environmental factors.

Technology: Only the right technology guarantees effi cient work and contributes to the target of the company – economical suc-cess and sustainability.

Environment: We are facing many chang-es in our business world today, due to both a natural progression and the globalisation of the last few decades. No company can ignore the environment; only respect for the environ-ment contributes to the sustainability of the business. Global trends such as reducing the exhaust emissions of heavy diesel engines in construction machinery are important for the construction industry as well as ensuring a re-duced impact on the environment in general.

How can a lubricant assist to achieve these goals? PL. PANOLINs top tier ECLs (environmen-tally considerate lubricants) combine several advantages. Th e good biodegradability and low toxicity reduce the negative impact on the environment, though do not pollute. Th e synthetic base oils in combination with excel-lent additive systems provide longevity and

EXECUTIVEINTERVIEW

PANOLIN’S Patrick Laemmle examines the latest trends and developments in the lubrication sector.

A line of defence

Patrick Laemmle is co-owner and Board Member of PANOLIN AG. When he joined PANOLIN AG he soon took over the responsibility for the production unit and later on for the R&D team. Today he is mainly responsible for technology and exportation within PANOLIN AG.

A TRIPLE WINThere are thousands of customers operating machinery with PANOLIN ECLs. They benefi t from a triple win situation:

EnvironmentPANOLIN ECLs demonstrate good biodegradability and very low eco-toxicology

TechnologyPANOLIN ECLs reveal excellent high temperature stability and good anti-wear performance

Economy PANOLIN ECLs reduce cost by enabling the machine operator to extend oil drain intervals and reduce the downtime of their machinery

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In the rush to chase the speculative dollars of foreign investors eager to make a profi t from property, a lucrative – and just as importantly, more sustainable – sector of the real estate market has been largely ignored in recent years. Th at’s the view of First Bahrain, an innovative development company operating out of Bahrain and Kuwait that is dedicated to achieving sustain-

able returns for all its stakeholders through a demand-driven investment approach. “We’re a regional real estate development company,” explains Amin Al Arrayed, the fi rm’s General Manager. “Our focus is on demand-driven investments, and as such we focus on investments that are really driven by the needs of the local economy. We don’t focus so much on for-eign investment.”

It’s an approach that has helped First Bahrain successfully weather the recent economic crisis – a storm that has seen many of its fellow real estate competitors struggle. “You have to be selective in terms of the type of projects you enter into, primarily due to the market conditions,” says Al Arrayed, explaining that there are three main elements to the fi rm’s strategy. “Th e fi rst is we don’t undertake projects that require a lot of ex-ternal fi nancing; we make sure that our funding is suffi cient to complete the project. Th is sets the parameters for the second part of the strategy, which is that the projects that we go for are typically smaller or phased, so we don’t undertake a massive project in one go. Instead we break it into smaller, more manageable pieces that we can complete on-time and on-

budget before moving on to the next one. Th e third part is that we don’t have a sell-bias on our projects. We don’t necessarily look for exits before completion, and we’re quite happy with yield income over exit returns. So for example, if we were to build warehouses or residential units we could rent those out and still make the kind of returns that would satisfy us, as opposed to needing a quick sale.

Together I think these strategies have worked well for us.”

First Bahrain’s fl agship project is its $45-million logistics and warehousing devel-opment, Majaal, located within the Bahrain Investment Wharf. Since its launch in Oc-tober 2009, the development has received a wave of interest from businesses, both local and international, looking for integrated and

modern storage solutions with value added services. Majaal off ers a prime location, situated within the Salman Industrial City, and is in close prox-imity to the major transport links of Khalifa Bin Salman Port and Bahrain International Airport. Construction work on phase one of the project – which will deliver 130,000 square feet of secure and cost eff ective stor-

Local projects: a new approach to development?Identifying supply gaps and addressing those needs may sound like an obvious development strategy, but it’s not one that’s been much in evidence over recent years.

REAL ESTATE FOCUS

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age space to its tenants – was completed earlier this year, and Al Arrayed believes its achievement of on-time and on-budget construction puts the company in a good position to execute on projects over the year ahead.

“I think Bahrain may have been a little bit less impacted than some of its near-neighbours like Dubai, which really were at the forefront of the freehold, off -plan model of development,” he says. “In Dubai, the majority of the projects were traded many times before they were completed and there was a lot of infl ation built into the system. We saw that happen here to a much lesser extent, and while there are some projects that are clearly having dif-fi culty being completed due to lack of funding (either because of defaults on the part of investors in the project or because of the lack of bank fi nance), there are also a lot of very sustainable projects. We’re happy that we chose to make the warehousing seg-ment our fi rst foray into development. For us, it’s worked out very well.”

For Al Arrayed, the key to First Bahrain’s success has been its focus on meeting unmet needs. “It’s less about the diff erence between local demand and external demand, and more about the diff erence between real demand

and speculative demand,” he explains. “What you have now is a situation whereby a lot of the speculation has disappeared and a lot of the specula-tors are no longer in the market, and the only thing left is local demand-

driven projects. Th at suits us just fi ne, because that was the only sustainable form of demand anyway. Our strategy has been to identify supply gaps in the market and address those.

“For example, when we found that there was a shortage of SME warehousing in Bah-rain, we came up with a proposition that would fi ll that gap, and that’s the way we structure our projects. It’s looking at the market, identifying supply gaps and then coming up with projects to meet those needs, as opposed to continuing to build projects that cater to a segment that really no longer exists.”

Al Arrayed feels that liquidity is going to be the key challenge for those real estate devel-opment companies looking to complete proj-

ects over the next few years. “A lot of them were overly dependent on bank fi nance and their ability to sell units before they complete,” he explains. “Th ey will struggle, and I know that a lot of delays have happened because

many of them aren’t able to secure the cash fl ows necessary to continue with their projects.”

He believes a tighter regulatory framework across the region would go some way to addressing the problem

of project fi nancing. “Th ere needs to be some kind of regulation to make sure that the money that is collected from investors is utilised for its intended purpose,” he says. “It’s currently very diffi cult to make sure that

the money you paid towards your fl at goes toward the actual completion of your fl at. So if a developer is going

to announce Project A, we need to make sure that the money that’s been collected for that purpose is used for the

completion of Project A, rather than for Projects B and C. Lack of regulation in this area has led to developers taking too many risks and

not being held accountable for their ability to live up to their promises.”As for the next 12-18 months, Al Arrayed is bullish on prospects for

both his fi rm and for Bahrain as a whole. “Within the real estate sector we’re very positive on the potential in the warehousing and logistics sector,” he says. “For us, we see that as a growth area. Infrastructure is another area where we think that there is room for growth, particularly in terms of the expansion of private and public sector partnerships. Govern-ments are going to be playing a much bigger role going forward in terms of development, so the more that they can combine their eff orts and align their interests with the expertise of the private sector, the better. We see a lot of opportunity there.

“Our view is that the region still has a lot of potential,” he concludes. “We’re looking at Saudi Arabia, we’re looking at Oman, we’re looking at Abu Dhabi. We are looking for areas where we feel the fundamentals are strong, and we’re looking for like-minded partners to help us. It’s a very disciplined approach to growth, based on the liquidity that we have. If you don’t have the money to build it, don’t build it. It’s as simple as that.”

Bahrain Investment WharfMajaal is a warehousing and logistics facility located on a 716,000 square foot plot in the Bahrain Investment Wharf, providing more than 429,000 square feet of warehousing space. Designed by the international engineering fi rm Tebodin Consultants & Engineers, the project will be developed in three phases with the fi rst phase completed earlier this year. The general contractor is Abdullah H. Al Darazi Company and Baker Wilkins & Smith has been appointed as cost consultants.

To meet an increasing demand from small and medium enterprises for comprehensive modern warehousing facilities, the warehousing space will be divided into individual units of approximately 2500 square feet each with an option to combine units to accommodate larger tenants’ needs. The development aims to bridge an existing gap between quality of the space and level of services provided in Bahrain’s warehousing property market.

In addition to the physical warehousing space, the development will boast a range of services that caters to the needs of its tenants, including 24/7 security service, state-of-the-art ICT provisions, assistance on effi cient design and use of space, and a range of value added services.

with theirH

regiof refs

thact

to amoney

completionl

Majaal will provide

429,000 square feet of

warehousing space

Amin Al Arrayed

First Bahrain.indd 63First Bahrain.indd 63 15/1/10 16:22:4915/1/10 16:22:49

In developing markets, a pre-perceived con-ception is dominant regarding products and theirusages. Customers are used to basic products thatserve their needs, not recognising the potential

they have in advancing their usage and the as-sociated products. That perception is based

on the assumption that a better product ismore expensive than a basic one. The

users are often unable to realise the valueadded they receive that transcends be-

yond financial value and overlooks thesavings they accomplish. Even withequally priced products, users resistchange and drive the market tomaintain the same basic productmix. That cannot be more evident

than in the construction material sector, partic-ularly cement. Cement is one of the products thatare continuously used in the Middle East by manyindustries. The diversity of cement product devel-opment available in the world is significant, offer-ing customers customised products for their exactneeds. Nevertheless, the Middle East market tendsto use Ordinary Portland Cement for all uses, whenthere are much better suited cement products.

To realise the investment’s objectives, organ-isations need to reshape and develop their sur-roundings. This can be accomplished on a

complete sector level rather than through individ-ual efforts. Titan Cement Egypt has taken the stepsto pioneer the market development to assure thatcustomers are using the appropriate product andthat the investment is at its full potential.

To accomplish such an objective, TitanCement Egypt has spent extensive time under-standing the true needs of the market and how ituses cement. Conducting extensive market re-search and segmenting the Egyptian marketbased on the usage and perception proved to beone of the most efficient investments made.Understanding our customer has provided uswith the keys to developing the whole market.The Middle East customer has proved that dif-ferent regions in the world operate differentlyand developing the market has to come fromwithin and not be enforced by how more devel-oped regions operate. Building our market un-derstanding, Titan Cement Egypt has been ableto utilise every aspect of marketing to share withthe market the reward of a diversified productmix. We truly managed to change a genericcommodity into a sophisticated product thatcustomers demand.

Titan Cement Egypt selected from theworld’s best cement products and provided theEgyptian market with the ideal product mix.The product mix has been an extended successthat managed to stimulate the consumer to ex-plore a developed product versus the currentmarket offering. One of the key success factorsthat contributed to Titan Cement Egypt is theclose relation with the supply chain cycle. Theextended reach to our customers’ customers hasopened a channel of communication thatproved invaluable to all relevant parties. The re-lationship Titan Cement Egypt has developedwith the key market influencers has been in-valuable in shaping the industry.

Finally, the Middle East is a lucrative market,but definitely not an easy one to master. There ismuch work that needs to be done and more to belearned. Giving and taking from the market is tostrongest key to success. n

Commodities to productsMedhat Stefanos explains why understanding thecustomer is key to sales success.


TROUBLESHOOTER

This is my first year working within a

marketing department in a

commodity industry. I find it

extremely challenging to support our

sales department with effective

marketing; most of the tricks I

know don’t seem to be effective?

What is the key to penetrating the

minds of the Middle East consumer?

Ostergard, Jordan

Medhat Stefanos says:

The Middle East market today hasgrown to become one of the world’smost appealing markets. Everydaynew investment is injected in the

Middle East to the slowly developing markets.Heavy industries are moving to developing re-gions as a result of labour and fuel costs, not tomention the normal growth in such regions.

Architect Medhat Stefanosis currently residing asGroup Commercial Directorof Titan Cement Egypt. For25 years, Stefanos has beenof the founders and shapersof the construction industryin Egypt.

Titan troubleshooter Ed_7dec10 15/01/2010 16:24 Page 64

Titan AD.indd 1Titan AD.indd 1 12/1/10 13:28:2012/1/10 13:28:20

Adding a gloss to the construction industry


Emphasising the value of quality is the key concern for both paints and coatingsmanufacturers and applicators alike in the Middle East region.

COATINGSFOCUS

Olsson explains that there are a number of specific types of lucrativecoating work in the region. The first is in the oil and gas/petrochemicals in-dustry, where big companies such as Saudi Aramco, GASCO, ADNOC andBorouge have excellent specifications for coating and fireproofing developedafter the American and European standards drawn up over the last 20 years.“The specifications are prepared by educated technical service engineers inoilfield services,” he says. “All paint manufacturers must be vendor-approvedand pre-qualified, and even specific products need to be approved and testedby the end client. Applicators also need to be vender-approved, and prove thatrisk assessment and safety are integral parts of their approach.”

The other key area for the use of coatings is in infrastructure develop-ment. “Special projects such as Yas Island and Ferrari Experience, as well asmajor infrastructure developments such as bridges, are always specified andproject managed by big international companies,” he explains. “Therefore theuse of specifications, quality inspection and documentation is really taking offin this region. Mostly the paint specification comes from the structural con-sultants in America or Europe, and then as local applicators we recommendwhich system to use after considering local environments and conditions.”

According to recent research from Frost & Sullivan, theMiddle East’s paints and coatings industry is set to reach$2.7 billion by 2014 spurred largely by investment inlarge-scale infrastructural and industrial projects. But en-suring such paints and coatings solutions are both fit-for-purpose and properly applied will be vital if contractors

and end-clients are to reap the rewards of technology innovations in this area.Jorgen Olsson is Coatings Manager for the Steel Works Division at

Amana Contracting, the regional leader in the design-build of industrial andcommercial facilities with over 1500 buildings constructed across the region. Hehas been working in the region for the last 13 years and as such is well-placed tocomment on how the coatings industry has matured over that time. He feels thatalthough price is still important, the region is increasingly looking to quality asit seeks to deliver world-class structures and developments. “The cost of bothpaint and supplier have obviously been a huge concern during the last year giventhe economic situation – especially in Dubai,” he says. “Nonetheless, oil and gasfirms and specified infrastructure companies are still willing to pay for qualitypaint and applications as they know the cost impact of a breakdown onsite.”

The coating work at Masdarrequires the use of modern water-based products with no VOCs

PaintsCoatings ed_7dec10 15/01/2010 16:22 Page 66


Amana is now coating for three main contractors at Ferrari Experience,including 60-minute fire proofing of the main structural steel. Most of thestructural steel for clients (usually consultants) in this region is recommend-ed to use a high durability coating designed for environments classified by ISO12944-2 as C5-1 very high corrosivity (Industrial).

Olsson believes a key concern in this region is that the quality of localpaint products and application is poor. He observes that some small localcoating companies have been found to paint directly onto raw steel (com-plete with the mill scale) and without cleaning the base material first. “Thisis not good practice and quality suffers as a result,” he says. “Naturally suchpractices are cheaper than preparing the surface correctly, and for an un-trained or absent client all he sees is the bottom line. In addition, the coat-ed item may be hidden from view during service so any deterioration is notnoticed until it is too late.”

In contrast, professional companies have codes of practice to which theywork, and employ trained and internationally certified inspectors who con-trol all aspects of the coating process from cleaning the base material to mon-itoring all the parameters during the coating process to ensure the client getsthe best possible result. “Naturally, doing the job right first time saves moneyin the long-term, because maintenance is reduced,” says Olsson. “In additionthe larger paint suppliers prefer to recommend professional applicators, be-cause whenever there is a problem with the coating the first to be blamed isthe coating manufacturer rather than the applicator.”

Despite such concerns, there are still some owners and contractors forwhom the initial cost is key. “They believe that the building should lookgood when handed over and very little thought seems to be given to thecost of long-term maintenance,” says Olsson. “It is almost as if the ownersconsider that the laws of chemistry do not apply and corrosion will not takeplace, or perhaps they anticipate that the building will be sold before anyexpensive maintenance is required.”

Olsson believes that most of the time, poor quality comes down to lackof know-how regarding coating. “There are many civil engineers but hard-ly any NACE or SSSP certified coating inspectors,” he says. Such ignoranceas to the importance of paints and coatings can be witnessed in the sadstory of one of the largest steel suppliers in the Middle East, which invest-ed $4.6 million in a new fabrication shop two years ago but failed to pro-vide any investment for a complementary paint shop. “All the steel theyfabricate is coated out in the open area,” exclaims Olsson incredulously.

Alongside this quality drive, Olsson believes the other major develop-ment to hit the region is that of sustainability. “Going green with paints andapplications is a big trend right now,” he says. “I completed the USGBC’sGreen Building Design: The LEED Implementation Process certificationin October and the market for green building is going to be big over thecoming years. For example, Amana is doing coating and fire proofing for

Built half on land and half on water, Yas Hotel provided amajor paints and coatings challenge

The Yas HotelLocated between the coast and city of Abu Dhabi and Dubai,Yas Island has a range of world-class hotels, theme parks, golfcourses, shopping malls, apartments and villas that are allbeing developed alongside the new Yas Marina Formula 1Circuit – including the Yas Hotel, one of many infrastructureprojects developed to support Abu Dhabi’s bid to become theworld’s premier motor racing destination.

From the outside, the LED colour-changing steel andglass gridshell, which mimics the throw of a local fishingnet, can be seen for miles, while the impressive interiordesign makes the hotel a truly iconic structure. The newFormula 1 circuit even runs through the centre of thebuiding. But the unique location of the structure – builthalf on land and half on water – provided a major challengefrom a paints and coatings perspective.

It was vitally important that the coatings chosen toprotect the structural steel offered the owners superiorcorrosion protection. With an extensive track record inprotecting hotels around the world from corrosion,International Protective Coatings supplied a three-coatsystem, using the proven anti-corrosion abilities of Interzinc52, the barrier protection of Intergard 475HS and thedurable aesthetics of Interthane 990, to offer extendeddesign life and limit the need for future maintenance.

Masdar City in Abu Dhabi. Masdar is a major development not just forAbu Dhabi but internationally, he says. Lessons learned here will be im-plemented worldwide.”

The coating work at Masdar requires the use of modern water-basedproducts with no VOCs. In addition to the materials used, Olsson explainshow new green procedures are also being developed to minimise the impactof the work on site. “For example, there will be minimal packaging materialsand recycling of containers to reduce the overall waste. For the operators andlabour, care is taken to provide the most eco-friendly coveralls avoiding dis-posable plastics. Even non-working activities are considered – disposabledrinking cups are banned and each man is provided with his own re-usablemess kit, to be carried in fabric, re-usable bags and not in plastic bags fromlocal supermarkets. Masdar is not just about products and working methods,it is a whole new way of thinking that is being pioneered here in Abu Dhabi,”he concludes. n

“Going green with paints and applications is a big

trend right now”

PaintsCoatings ed_7dec10 15/01/2010 16:23 Page 67

With its scorching temperatures and arid environment, the Middle Eastpresents a number of challenges in terms of operating conditions forcontractors and developers. What are these challenges, and how canthe selection of the correct coatings solutions help the constructioncommunity improve the longevity and reduce the maintenance re-quirements of its structures?Nick Crowther. The Middle East is one of the harshest environments forpaint systems in the world, making the specification and application of agood quality system more important than ever. As the largest paint com-pany in the world, AkzoNobel invest heavily in research and development,introducing products offering a longer life to first major maintenance andhence a lower lifetime cost. By specifying the correct system early on, anarchitect or engineer can set a benchmark for the requirements of the pro-ject. Utilising products such as our patented Acrylic Polysiloxane, whichoffers four times the gloss and colour retention when exposed to UV lightthan that of a traditional polyurethane, will lead to the desired cosmetic ap-pearance of a system lasting for years longer whilst also offering extendedcorrosion protection.

IMPROVING THE INDUSTRY


MENA Infrastructure invites a panel ofexperts to debate the issues aroundcoatings challenges, recentregulations and sophisticated newsolutions in the paints industry.

ROUNDTABLE

Nick Crowther is Business DevelopmentManager for the International Paintbusiness unit of AkzoNobel in the MiddleEast. He is a NACE-qualified coatingsinspector and regularly works witharchitects, engineers and consultants onhigh-profile projects in both theinfrastructure and heavy industry markets.

Birgit Genn has been responsible for GlobalMarketing/Business Development atHeubach Group since 2006, with her roleexpanding in 2009 to include Sales. Shehas worked in the coatings/pigmentindustry for more than 10 years, holdingvarious technical and marketing positionsprior to becoming a member of the seniormanagement.

David Page is CEO of Tech Traders Inc. anddeveloper of Insulaad insulating additivesand paints. In 1995 Page applied to and wasaccepted to participate in a NASATechnology Exchange programme, andworking with United Technologies Pagespent over two years in the development ofthe ‘thermally reflective’ paint additive.

THE PANEL

Paints RT_7dec10 15/01/2010 16:21 Page 68

IPC AD.indd 1IPC AD.indd 1 5/1/10 15:46:505/1/10 15:46:50


Birgit Genn. Heat is indeed a challenge in terms of operating conditions forcontractors as higher temperatures reduce the pot life of coatings, which canlead to a reduced processing latitude influenced by the kind of coating system,fillers and pigments. Extensive application work in cooperation with leadingresin suppliers has allowed us to provide optimised solutions even to such re-gional requirements.

Improvement in the durability of pigments has been one of the major re-quirements over the past few years due to climate conditions. Our latest prod-uct innovation of IR-reflecting pigments is a step further to enhanced shelflife, as well as proving a reduction of the heat build-up that can be correlatedwith decreased energy consumption. Due to the significant reduction in sur-face temperature, thermal degradation of the coatings is reduced. In addition,temperature differences between day and night, direct sunlight and shadowedareas etc. will also be evened out. As a consequence thermal warping becomesless pronounced.

David Page. The biggest issue in the Middle East is the high temperature and theassociated energy costs that are connected with a buildings cooling demands. AllInsuladd products have been designed with this environment as its main target.Insuladd paints reduce the BTU heat loading on a building in the Middle East 40percent to 50 percent – more than the white reflective coatings currently mar-keted and used in this area. This is a critical difference for the consumer since theuse of Insuladd products affords the consumer the simplest and most cost effec-tive methods to reduce energy costs associated with air conditioning.

Recent regulations (such as the EU Commission’s VOC Directive andREACH legislation) and standards (like LEED) have lent a greater focus toenvironmental considerations and sustainability in the development ofpaints and coatings. How is your firm addressing the requirement for agreener R&D and procurement focus?BG. In the past, numerous pigments were available that gave optimum per-formance but which no longer meet today’s stringent ecological require-ments. Heubach’s R&D and procurement focus started addressing theserequirements decades ago by replacing the carcinogenic chrome-based an-ticorrosive pigments and introducing zinc phosphates, the first chrome-free corrosion protection pigment, followed by ortho- and polyphosphates,representing the technically most sophisticated anticorrosive inhibitors intoday’s market.

We have also worked intensively on lead and chromate replacement inthe past and are now able to offer a full portfolio of economical and ecologi-cal solutions comprising specially designed highly opaque inorganic yellowpigments to combine with high performance organic pigments, rounded upby easy dispersible, strongly dust reduced hybrid pigments to achieve highlysaturated, highly durable and cost effective alternatives.

In addition our HEUCOTINT pigment preparations for architecturalpaints are in compliance with current regulatory requirements (APEO andVOC-free) and do not contain any substances that are under discussion as re-gards to future regulations.

DP. Insuladd products have always been manufactured with the environmentin mind. All Insuladd products are very low VOC or in some cases zero VOC.Insuladd products were ‘green’ long before the word became a buzz-word forenvironmentally friendly products.

All of the materials that go into the manufacture of Insuladd products aswell as the manufacturing process itself are continually scrutinised to ensurethat Insuladd products stay at the cutting edge of both thermal and ‘green’technology.

NC. We continue to focus on incorporating a strong sustainability com-ponent throughout the entire value chain. This starts with market re-search and continues right through to sales and marketing. By applyinginnovative chemistry, our R&D teams seek to develop solutions that de-liver the performance required by customers while improving the eco-ef-ficiency when it comes to product design, manufacture and ultimatedisposal. This would not be possible without a progressive sourcing andprocurement policy in which we work in partnership with suppliers toensure business integrity and help us to deliver sustainable value to ourcustomers.

On the manufacturing side, we continue to optimise our manufacturingprocesses, thereby improving yields and energy efficiency. In sales andmarketing, we also work closely with customers to develop long-term sus-tainable solutions. We use eco-efficiency as a measure of our products, inother words, that is greater value for lower environmental impact.Currently, close to a fifth of our revenue comes from products that aremore eco-efficient than rival products. By 2015, we aspire to increase thisfigure to 30 percent of our revenue.

Developing ever more sophisticated new technologies and solutionsis only one part of the challenge facing paints and coatings manu-facturers. The other is raising awareness as to the value of such solu-tions among end-users. How do you approach this, and what uniquechallenges does product promotion pose in a region such as theMiddle East? DP. Consumers in the Middle East have become used to ‘white reflectivecoatings’ as they are the most marketed/advertised type paints and coat-ings in the area. Insuladd marketing and advertising is being used to edu-

“The biggest issue in the Middle East isthe high temperature and the associatedenergy costs that are connected with abuildings cooling demands” David Page

“In this region, it is critical that alllevels of the contract chainunderstand the importance of thepaint system to the success of theoverall project” Nick Crowther


Insulaad AD.indd 1Insulaad AD.indd 1 5/1/10 15:46:035/1/10 15:46:03

A customised solutionThe Burj Khalifa is the latest project in theMiddle East to benefit from a revolutionarycoatings concept. To complement the28,261 aluminium-cladding panels thatmake up the exterior of the tower and itstwo annexes, the tower required the use ofa metallic matt power-coated finish. TrineFinnevolden, General Manager of JotunPaints UAE, explains that for this uniquerequirement Jotun developed a speciallyformulated bonded metallic product.

The 2684 feet spire also requiredattention and Jotun was able to provide aglass flake reinforced polyester coating thatprovides outstanding resistance toabrasion, water and most chemicals.“Building the world’s tallest tower is atremendous feat that requires the highestquality materials and the expertise ofconstruction innovators. This project hasbeen a perfect opportunity for us tohighlight our best-of-breed paint productsand solutions,” says Finnevolden.

Jotun’s industry-leading Jotashieldbrand was used for the tower’s 120,000square metre basement car park because ofits excellent adhesion and moistureresistance features, protecting concreteagainst salts and carbon dioxide. Inaddition, 26 custom colour shades ofemulsion and enamel paint were used in allinteriors of the Burj Khalifa, covering anarea of 700,000 square metres.

cate the consumer that there is a major difference between the white reflec-tive coatings currently in use in the Middle East and the ‘thermally reflective’Insuladd products – which as testing has shown is close to 50 percent moreenergy efficient equating to substantially less heat influx into an Insuladdpainted structure as opposed to that which is painted with the current prod-uct offerings in the Middle East.

Raising the consumers awareness of the immediate – as well as long-term– benefits of using Insuladd thermally reflective coatings in the Middle Eastis our current number one priority.

NC. In this region, it is critical that all levels of the contract chain understandthe importance of the paint system to the success of the overall project.Paint accounts for a very small percentage of the total project cost, how-ever if things go wrong, the costs involved can spiral. Educating the in-dustry about the importance of the paint system doesn’t just relate to the


paint itself. In the vast majority of cases a failure will occur due to incor-rect or poor application.

This brings us back to the importance of all levels of the contract chainunderstanding these potential issues, from the architect or engineer specify-ing the correct systems to the main contractor using skilled labour.

BG. The success of innovative pigment and pigment preparation technolo-gies always requires close cooperation with the coating formulators and theircustomers to prove the value of such innovation in the end-applications. Thequestion is always how to attract the end-user and how to increase the aware-ness of, for example, innovations which follow the green concept. Besides thestandard promotion tools, which spread the message of benefits of the newproducts, the status of legislation is and has been one of the major driving fac-tors for the acceptance of innovative and greener technologies as seen in a lotof countries around the world.


Heubach AD.indd 1Heubach AD.indd 1 5/1/10 15:45:405/1/10 15:45:40


But to foresee the future needs of our customers in the different regionsand to translate the special requirements in a market and time oriented R&Dproject in order to sustain the future competitiveness of our customers are thechallenges of tomorrow. This will require a high degree of customisation andthe highest level of innovation to provide value-added products.

The combination of functionalities such as IR-reflecting, protection, ther-mo-chromic, and other kinds of indicating properties with the basic propertiesof pigments, such as durability and colouring whilst meeting increasing envi-ronmental awareness, product safety requirements, constantly increasing pro-duction efficiency and productivity to compensate for escalating raw materialsand declining market prices will continuously drive our industry in the future.

DP. Consumer education is the biggest challenge. Once the consumer betterunderstands the thermal dynamics that take place when Insuladd productsare used they will better be able to easily understand the far greater benefitsthis unique product line has over that presently marketed and used in the re-gion. The second biggest challenge is to better integrate Insuladd productsinto the local and regional building codes and construction methods as an en-hancement to the standard insulation practices in use in the region. n

What do you see as the most significant driver of the paints and coat-ings industry in this region over the next few years, and what is thegreatest challenge to its future development?NC. Over the past year, the market has seen some dramatic changes, and manylarger potential projects widely talked of in the media now seem less certainto proceed, at least in the near future. However, one upside to the slow downwe have seen recently, is the drive for higher quality, better thought out pro-jects. Earlier we talked of the importance of raising awareness of paint systemsto end-users. This is made easier with good quality, long-term projects un-dertaken through a partnership of quality companies. This is what I see as thefuture for the construction industry we supply to, and hence also for us. Thegreatest challenge will be changing attitudes to this more long-term focus onprojects, creating iconic yet sustainable buildings and infrastructure.

BG. New developments in the field of pigments and pigment preparationsmust nowadays match more and more demanding economical and ecologi-cal requirements. The ever-growing demands concerning functionality com-bined with the broadest possible range of colours has always been of primeconsideration in our product developments.

“The success of innovative pigment andpigment preparation technologies alwaysrequires close cooperation with the coatingformulators and their customers to provethe value of such innovation in the end-applications” Birgit Genn


Tel: 1-800RUST-007 EFAX 1-201-548-5100WEBSITE: http://rust007.com

Advanced PP AD.indd 1Advanced PP AD.indd 1 15/1/10 09:02:2415/1/10 09:02:24


Th e fl exible nature, hydrophobing capabilities and superior bead-ing properties of silicone resins enable them to be tailored to fi t dif-ferent applications and emulsifi cation in architectural coatings. Th eir superior water repellency and weatherability make them the products of choice for paint or render applications. For example, Dow Corning IE 2404 Emulsion provides an industry-proven way to improve water

resistance and increase moisture vapor permeability of architectural paint and facade render formulations. Th e hydrophobic properties of silicone resin emulsion Dow Corning IE 2404 helps prevent water from penetrating the coating by binding directly with inorganic materials in the paint. Th is is especially useful on water-sensitive substrates such as masonry, plaster and insulation where moisture can damage the material or lead to mi-crobial growth.

Reduced maintenance and cost: Selecting the right materials for the right application not only strengthens the longevity of the structure, it also helps building contractors improve overall productivity and cost ef-fectiveness. Choosing materials that can stand the test of time saves contractors time and money required to constantly repair and maintain a structure that uses less durable materials.

Sustainable, more energy effi cient structures: In addi-tion to lower cost and longer lasting buildings, Dow Corning building materials protection products are also contributing to more energy ef-fi cient structures by reducing heat loss from evaporation of absorbed water in untreated materials and enhancing the thermal conductivity of the structure.

Localised technical knowledge to fi t specifi c needs: Leveraging its proven performance silicone technology and construction and chemical expertise, Dow Corning works with customers to supply the next genera-tion of durable building materials and global resources.

To learn more about Dow Corning solutions for the building materials protection market, visit www.dowcorning.com/buildingmaterialsprotection

INDUSTRYINSIGHT

For more than 60 years, architects, building consultants, con-tractors and construction material providers around the world have turned to Dow Corning for its expertise and silicon-based, performance-enhancing materials and additives. From low-

VOC water repellents, anti-stain coatings and various mortar, cement and dry mix additives to hydrophobic treatments and resin products, silicon-based materials from Dow Corning off er a vari-ety of protective enhancing treatments and solutions for the construction industry, including:

Improved material strength, durability and weather-ability: Compared to other substrates, silicone off ers a unique structure comprised of organic and inorganic polymers that are able to resist a variety of environ-mental forces, including ultraviolet rays, rain and snow. Silicone sealants were used in the construction of the world’s tallest building structure, the Burj Dubai, in the United Arab Emirates. Dow Corning experts worked closely with structural engineers to ensure the building could withstand the high wind loads and extreme tem-peratures in the region.

Extended material surface life: Maintenance engineers are increasingly turning to silicone-based sealants and water repellents to protect and repair bridges and road-ways. Dow Corning provides chemical treatments that slow the erosion of concrete bridges, supporting joints and roads that are oft en generated by chlorides. Treatments are easy to apply and dry at a relatively quick rate to reduce water penetration to the substrate material and are oft en used as post-treatments to protect against corrosion, ef-fl orescence, freeze-thaw damage and water penetration.

When the Colorado Department of Transportation needed to reseal joints along I-70 in Glenwood Canyon, US, Dow Corning products pro-vided easy to install, cost-eff ective solutions that continue to be used by transportation authorities throughout the United States.

Preservation of building aesthetics and versatility: Everyday exposure to water, oil, stains and sunlight can take a toll on the aesthetic appeal of a structure over time.

Idil Yurdakul Peker, Major Market Leader at Dow Corning, is leading the building assembly and building material protection markets in the EMEA region. She holds a bachelor’s degree in Civil Engineering from Istanbul Technical University, MSc degree in Structural Engineering from Bosporus University and a MBA degree from Bilgi University in Turkey.

PROTECTIVE SOLUTIONSIdil Yurdakul Peker explains how silicon products suit every

market need in the coatings industry.

Dow Corning.indd 76Dow Corning.indd 76 15/1/10 16:39:3315/1/10 16:39:33

dow corning AD.indd 1dow corning AD.indd 1 16/2/10 15:02:0216/2/10 15:02:02

ASK THEEXPERT

Building material suppliers the worldover are increasingly desperate todemonstrate their eco-credentials asthose involved in procurement and

specification narrow their shopping lists to itemsthat can be seen to be pro-planet. This is not justabout sustainability and reducing carbon output.It is also about providing eco-friendly productsthat are practical, inherently healthy for peopleright now as well as in the future, cost-effectiveand energy saving.

Nutshell Natural Paints are pioneers in thisarea. The product range delivers all the require-ments of traditional paints, stains, colour washesand varnishes, but without any of the environ-mental downsides and potentially harmful chem-ical cocktails contained in acrylic and solventbased products.

Nutshell paints are water-based which can beenhanced by using pigments manufactured in theUK using only naturally sourced renewable in-gredients including oils, herbs and minerals. Theyare microporous, biodegradable and offer a radi-cal alternative to paints manufactured with vinylresins and petrochemical solvents. They containno VOCs – which can pose serious health issuesincluding headaches and sore throats, as well asdamaging plant life.

Paints that claim to be VOC-free may not ac-tually be free from other damaging ingredientssuch as formaldehyde, acetone or ammonia. Inthe case of Nutshell natural paints, they are.Nutshell products are virtually odour free. Roomspainted with Nutshell Emulsions don’t have to bevacated or aired. They are emission neutral andallergy free.

The paints are especially appropriate forpublic places such as nurseries, schools, hospitalsand even Olympic villages, all places where ahealthy environment is essential. Even the pack-aging is recyclable furthering the brand’s repu-tation for environmentally positive policies andemphasising its holistic view of all the issues in-

volved in sourcing materials, manufacture, ap-plication and disposal, i.e. the whole life span ofa product.

Insulate The use of non-VOC paints is becoming

more established amongst specifiers andNutshell’s products are ticking all the rightboxes for them. However, new product devel-opment is now enhancing the benefits of usingthese products. Using nanotechnology, Nutshellhas launched a new thermal insulating paintthat offers thermal radiation reflection. In otherwords, used internally or externally the paintwill reduce heat loss from inside a living spaceby reflecting up to 92 percent back into theroom resulting in lower energy requirementsand money saving.

In addition, applying Nutshell’s thermal in-sulating paint will also reduce the amount ofheat able to penetrate from outside by 92 per-cent, keeping cooled environments cool, re-ducing the work load on air conditioningsystems and doing its bit to cut the world’s car-bon output. The remarkable characteristics ofthermal insulating paint are the result of a spe-cialist additive consisting of nanoparticles thatare widely available but cannot be used in tra-ditional solvent-based paints. Nutshell is theonly natural paint manufacturer to offer aproduct with the additive pre-mixed.

There are other benefits, too. The nanoparti-cles are water repellent further increasing thermalinsulation qualities. The additive also helps toreduce temperature variation and protectsagainst condensation and mould. Along with aproprietary paint and varnish remover,Nutshell’s thermal paint is the company’s onlyproduct to contain traces of VOCs, however,the tiny amount is 20 times below the EuropeanCommission 2010 limit

As a business, Nutshell set out to provide paintand related products that are sustainable and healthyand this has been achieved in a way that contributesto environmental well-being as well as offering animmediate impact in terms of personal health andcost-saving. Industry’s collective goal should be toconvince more people to embrace pro-planet atti-tudes and environmentally positive consumer be-haviour by offering products that not onlycontribute to long-term eco-aspirations, but haveimmediate and practical benefits in terms of im-proving health, reducing energy requirements andsaving money. n

The green light for natural paint solutionsMichael Back, Managing Director of Nutshell Natural Paints, offers his advice

for demonstrating eco-credentials in the paints and coating industry.


For more information please visitwww.nutshellpaints.co.uk

Michael Back is the Managing Director of Nutshell NaturalPaints. Back is also responsible for the research anddevelopment of new environmental and energy savingtechnologies, as well as for increasing the internationalawareness of Nutshell Natural Paints and finishes.

“The use of non-VOCpaints is becoming more

established amongstspecifiers and Nutshell’s

products are ticking all theright boxes for them”

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Tell us a bit about Kansai Paint and why it has been relatively less active in the MENA region.Ameer Hamza Hassan. Kansai Paint was established in 1918 in Japan and has grown to become Japan’s largest and the world’s seventh largest paint company. Kansai currently has op-erations in more than 40 countries of the world. It is focused on developing leading-edge coat-ings technologies and products in a wide range of categories that include automotive OEM and refi nish, decorative and industrial products. Kansai Paint has remained focused on markets with large automotive production where it now enjoys leadership positions. With the establish-ment of a dedicated company to develop the Middle East, Central Asia and Africa markets, Kansai is moving to address the gap created by its absence from this region; Kansai is now off ering the full range of its products in these markets covering all major categories.

Kansai Paint Middle East is a relatively new venture. What has led Kansai Paint to es-tablish a company in the Middle East? AHH. Th e growth of the MENA markets over the last few years has necessitated the creation of a dedicated operation that focuses exclu-sively on these markets. Kansai Paint Middle

East (KPME) is the regional company that is in turn establishing subsidiaries in all the key markets of the region to develop sustainable market positions. KPME was formed in March 2008 and has already established three sub-sidiaries, two manufacturing plants and sales channels into 11 countries of this region.

What are Kansai’s key strengths and how do they enable you to differentiate in an already crowded market?AHH. Kansai’s fundamental business philoso-phy is to ‘contribute to society by providing value added products and services that satisfy our customers’. We strive to continuously im-prove our off ering of products and services through a very strong R&D platform where

environment conservation is central to any new design feature. Kansai’s history and con-tinuous focus on strong R&D has enabled it to meet the challenges of delivering innovative solutions to our customers.

R&D is one of Kansai’s core competencies – what new technologies are you bringing to the market?AHH. Kansai has recently introduced some leading technology based products; examples would include ‘ALES SHIKKUI’ – an eco-friendly plaster coating for interior fi nishes. Similarly another product – Aqua Zola Coat – a multi-pattern, multi-colour aqua-based coat-ing for exterior and interior has been launched in the market.

In the auto refi nish segment, Kansai has introduced its PG Hybrid range, which off ers a saving on material usage, higher productiv-ity (less spray time) and meets environmental regulations. Th e superiority of this system has been widely acknowledged by leading auto-motive manufacturers and it is fast replacing conventional solvent-based systems across the workshops in Asia and the Middle East.

In protective coatings, a one-coat New Forte DX product has been launched in the Middle East market. Th is is a high build sur-face tolerant epoxy giving unmatched applica-tion productivity and long term durability on a wide range of substrates.

There is undoubtedly a drive towards green-er technology in the paints and coatings sector. What role do environment friendly technologies play at Kansai? AHH. Kansai Paint is designing products with reduced environmental burdens through-out the lifecycle of the coating material and coating fi lm. As a company fully committed to the preservation of the environment, we follow a proactive approach where higher than mandated standards are voluntarily set by the company. Our approach is about pro-ducing eco-friendly products and in Japan we achieved an eco-product ratio of 60 percent in 2009 and have set ourselves a very challenging target of 65 percent for the current year.

Innovative solutions in the paint marketIn an exclusive interview, Kansai Paint’s Ameer Hamza Hassan reveals how the company have established themselves in the MENA region and why the sector is going green.

EXECUTIVEINTERVIEW

Ameer Hamza Hassan is the Chief Executive of Kansai Paint Middle East. He has over 25 years of varied experience with leading multinationals including American Express and ICI with whom he has undertaken assignments in Asia Pacifi c and the Middle East.

“Th e growth of the MENA markets over the last few years has

necessitated the creation of a dedicated operation that focuses exclusively

on these markets”

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in the


CONSTRUCTION

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When the US subprime mortgage sector im-ploded – driven by excessive leverage and inadequate regulation – it led to a much broader fi nancial crisis for the world econ-omy. It was only a matter of time before the bubble burst in the MENA region: specu-

lative investment, based on off -plan premises that failed to materialise, plus a dip in oil prices led to a knock-on eff ect on the region’s real estate sector, which has since meant access to funds has become increasingly diffi cult and the fundamentals of supply and demand forgotten.

However, while Dubai has been left increasingly resembling a giant construction site, Saudi Arabia could potentially become an oasis for the real estate and construction sectors. One of the few markets to wit-ness demand despite the global economic slowdown, the kingdom is in desperate need of aff ordable housing. In fact, current estimates by CB Richard Ellis (CBRE) predict that Saudi Arabia is currently facing a shortage of around two million homes and that the kingdom will need an additional 1.4 million additional homes in the next decade to meet the rising demand from a growing population, which is projected to hit 33 million in the next 10 years. And with 35 percent of residents currently under the age of 14, the shortage will soon see a much tighter squeeze as more potential homeowners hit the market.

Supply and demandTh e large gap between supply and demand is attributed to the higher

prices of property. As the real estate sector has commonly focused on the high-end and luxury part of the market, it’s unsurprising perhaps that middle-income, or aff ordable housing, has become the most underserved accommodation segment in Saudi Arabia. CBRE research indicates that the higher prices of property have resulted in 60 percent of people being unable to aff ord their own homes. According to market experts, aff ord-able housing represents a huge untapped market for developers as the demand for housing is only likely to pick up.

Jones Lang LeSalle’s MENA House View 2009 report concurs with other research on the subject concluding that the greatest opportunities to increase the number of developers and investors in Saudi Arabia can be found in the aff ordable housing sector. John Harris, Head of KSA for the consultants, believes that a number of developers and investors will take advantage of this. “We know a number of local family groups are looking at the market, looking at what’s aff ordable, trying to defi ne what the consumer wants at an aff ordable level and putting strategies together to create development to meet those needs,” he says. “We also know that some of the local groups are setting up joint ventures with overseas de-velopers and investors, who perhaps have some experience at developing aff ordable communities.”

Facing a housing shortage of two million, Saudi Arabia is in dire need of middle-income and affordable housing – could this sector prove to be the saviour of the market? By Rebecca Goozee



“However, Qatar and Abu Dhabi will probably not focus on aff ordable housing as much – these are markets with relatively small populations and a fairly high per capita income profi le.”

Abu DhabiOver in Abu Dhabi, Mohammed Al Mubarak, Chief Commercial

Offi cer at Aldar responsible for sales, leasing and property and asset management, explains that all development must be considered within

the context of Plan Abu Dhabi 2030, an Urban Structure Framework created to optimise the city’s development through a 25-year programme of urban evolution. He reveals that be-cause of the long-term plan, the company’s focus has not changed signifi cantly as a result of current market conditions.

Th at said, in February 2009 it was announced that Aldar was changing the strategy at its Al Raha Beach development, placing a greater emphasis on low-cost housing. Al Mubarak plays down what he calls ‘minor changes’ but agrees that certain areas have been modifi ed to provide a greater mix of hous-ing options. “Once complete Al Raha Beach will be an 11 kilo-metre, mixed-use mini city in its own right and consequently you expect to see diff erent areas for diff erent individuals of diff erent means,” he explains. “While our approach is very much a long-term one, in line with Plan Abu Dhabi 2030, we will always monitor market conditions and, where appro-priate, take action.”

Al-Falah, another Aldar development, will be a master

planned community focused around aff ordable housing for UAE na-tionals, providing around 5000 homes for middle-income families. Located to the east of Abu Dhabi International Airport and the Abu Dhabi-Dubai highway it has been designed as a practical and sustainable community that moves away from the typical grid design approach. It is hoped that the design will encourage community gathering through a number of open parks that connect the residential, commercial and leisure elements. “We are very proud to play our part in building sus-tainable communities to cater to the growth needs of Abu Dhabi,” adds Al Mubarak.

Th e report goes on to identify four key priorities that need to be addressed to provide suffi cient aff ordable housing to accommodate the Kingdom’s young and fast growing population, namely: providing more home fi nance; improved community planning; use of innovative building techniques to reduce construction periods and deliver lower cost units; and, new business models with greater cooperation between the govern-ment and major private sector developers. Why are these criteria so im-portant in order to provide suffi cient aff ordable housing? “If you look at other countries, these issues have usually been addressed,” answers Harris. “It’s pretty hard to do something truly aff ordable in a developing country unless you’ve got all four developed. Engineer-ing is very important – you need to be able to build – and in order for projects to be feasible, you need to be able to build quickly. You also need to be able to devel-op to a high quality, so that people have confi dence in them. Low costs are also important and a lot of the way construction is done, particularly on a small scale, is not cost-eff ective to do things on a piece-by-piece base. Th en, in the business models, again, the government in Saudi Arabia has been leaving the private sector to try and address aff ordable hous-ing. But unless there is some kind of public-private partnership or some ability to reduce the cost of the land or something like this, it’s going to be tough.”

Investors expect Saudi Arabia to be the fi rst market in the MENA region to recover from the current downturn, mainly because of two factors that have existed in the rest of the Gulf: speculation by retail in-vestors and end users and banks lending signifi cant multiples above the loan base. Th ese factors did not exist in Saudi Arabia. Th e banks are conservatively regulated and the amount of lending was limited to 90 percent of the deposit base, which was a big help. Coupled with the fact that consumers had not extended their balance by speculating in real estate has meant that the sector has stayed pretty solid.

“Saudi Arabia fares quite well in most categories, whether it’s hous-ing or even commercial space, because they didn’t build and the excess of construction can get absorbed pretty quickly. We also see Abu Dhabi and Qatar recovering sooner than some of the others,” explains Harris.

Future Price Expectations

-90% -50% 10%-30% 50% 70%-70% -10% 30% 90%

Saudi Arabia

(-sentiment) Net Balance (+sentiment) Net Balance

Oman

Levant

Qatar

Bahrain

Kuwait

Abu Dhabi

North Africa

Dubai

Source: Jones Lang LeSalle Investor Sentiment Survey, April 2009

Expected Timing of Market Recovery

0% 20% 50%30% 70% 100%80%10% 40% 60% 90%

Saudi Arabia

3-6 months 12-18 months6-12 months 18-24 months

Oman

Levant

Qatar

Bahrain

Kuwait

Abu Dhabi

North Africa

Dubai

Source: Jones Lang LeSalle Investor Sentiment Survey, April 2009



In addition Neil indicates that commercial offi ce and retail proper-ties in Dubai can expect to see further signifi cant declines in rentals and property vales. Landlords will have to off er extremely attractive features and quality amenities to attract clients and despite this he says, millions of square feet of space will continue to remain unoccupied, particularly older buildings, that may off er Grade A space, that will lose their attractiveness as newer and better quality buildings off ering superior facilities come on the market.

Indeed, with weak demand and further volumes coming on to the market in 2010 and 2011, stability may only be achieved in late 2012 in the offi ce space sector. “In the future we could see more redevelopment opportunities emerging in the older parts of town, such as multi-storey car parks, pedestrian link ways, the refurbishment of building and a virtual moratorium on commercial development once the building phase ends,” suggest Neil.

So while commercial offi ce and retail properties continue to decline it seems Saudi Arabia’s aff ordable and middle-income housing sector could certainly prove to be one of the strongest performing real estate markets in the MENA region over the next 12-24 months. “It’s going to be tough, I think, for the private sector to deliver housing that the bottom 50 percent of the society can aff ord, but I think over the next two years we’re going to see all of this work and discussion bearing fruits for these Saudi housing markets,” concludes Harris.

Affordable?Charles Neil, CEO of Landmark Properties, one of the leading real

estate fi rms in the Middle East, believes that standard quality develop-ments are certainly becoming increasingly aff ordable from both a rent-ing and buying perspective. However, he maintains that there are still few, if any, projects that can be considered truly ‘aff ordable’ housing in the sense that they are priced for low-income individuals and families. “We do think this will change,” admits Neil, “especially as the cost of construction has come down. According to our own index, the cost of construction has declined by 35-40 percent since the peak in July 2008.”

Neil goes on to explain that there has also been an increase in home loan fi nancing recently, although the impact on the market has been minimal due to income levels slipping and the risk of redundancy higher due to the global economic crisis. “We’ve seen an increase in the percent-age home loan fi nancing deals from around 17 percent at the beginning of the year to approximately 30 percent of purchases being covered by mortgage fi nancing currently.” However, the volumes are much lower

then they were a year ago and at these levels the commercial and retail banks are able to cope with demand, but unable to increase volumes due to limitations they face with liquidity ratios.

“Another factor holding back the growth of loans is the high level of interest rates being charged, and potential home-owners simply cannot aff ord to take on mortgages at the rates currently being off ered, which generally vary between eight and 10 percent, combined with the tight conditions being imposed by the banks. With income levels being lower and the risk of people losing their jobs higher, the credit risk for banks is higher than it was and it is unlikely we are going to see any major increase in loans in 2010,” says Neil.

Neil goes on to explain that he does not see average housing prices rising signifi cantly until 2011 at least. He says the bottom of the market will be reached by 2009 and in 2010 expects to see housing prices re-maining fl at overall before beginning to rise in 2011 as economic activity begins to grow. “While we expect average prices to decline at this time, we are seeing prices stabilise and even increase in some developments or for specifi c buildings. We have seen the bottom in a few segments of the market – mainly higher quality residential projects in completed or nearly completed master developments like the Marina, JBR, Emirates Living – Springs and Meadows – and Arabian Ranches,” says Neil who goes on to explain that there will be further declines in some areas. “In developments of standard quality, those projects that have under-deliv-ered on the promised quality, projects with additional supply coming online and projects currently in poor locations or master developments far from completion will also decline.”

Key criteriaTo meet the affordable housing challenge, Jones Lang LaSalle has identifi ed four sets of criteria that need to be addressed to provide suffi cient affordable housing in the Kingdom:

• Home fi nance: Increasing the level of home fi nance is critical for the development of affordable housing. The approval of the much awaited mortgage law will also give a much-needed boost to the market.

• Community planning: An affordable housing format has to be appropriate and acceptable to the local population. Community planning needs to be improved to create a better balance between utility and social preferences.

• Engineering: Project costs can be reduced by applying innovative building technologies and economies of scale. Such practices will improve affordability and increase the supply of lower cost units. Initiatives by a Saudi institution to develop an integrated building system will certainly result in higher construction quality, reduce project cycle times and ultimately higher affordability.

• Business models: Innovative business models need to be adopted involving greater cooperation between the government and major private sector developers. Currently, there are hardly any public private partnerships (PPPs) in the Kingdom’s housing development initiatives.

“While our approach is very much a long-term one, in line with Plan Abu Dhabi 2030, we will always monitor market conditions and, where appropriate, take action”



the ATS will change over from standby synch power supply back to mains supply. Th e gen-sets will be commanded by the ATS controllers to cool and shut down when required.

Th e second system is set up so one mains is feeding the load and the second mains

acts as standby. If the prior mains gets the fail com-mand, standby will feed the load and if the second also experiences failure, then the standby power generation will start running and synch on dead bus aft er what the BTB will close feeding the load from standby power. If one of the mains is restored, the BTB will open and the restored mains will feed the load and the standby power will cool down and stop.

Reliability of operation is an inherent and essential part of modern electronic

control systems ensuring that business critical applications like hospitals and banks benefi t from an embedded ‘guarantee’ built into the design of each standby control system.

A good example of a highly reliable con-trol system can be found at the King Fahad Hospital in Al Baha City, Saudi Arabia, where a recent upgrade saw the replacement of the old distribution panel with a new control solution installed by ComAp Systems Saudi Arabia. Th e complete system was tailored to the needs of the hospital and programmed to deliver continuous power in the event of failure. Th e two systems operated in the following way:

Th e fi rst system is pro-grammed so that when one, two or all of the ATS(s) ex-perience AMF, a command from the synch system is sent to start over, synchronise and get ready to supply the failed ATS(s). Th e mains breaker is tripped and the ATS bus breaker will close to the load providing the power supply from the standby synch switchgear. Th is will start a load sharing process and start or stop the number of working gen-sets upon load demand. When the failed ATS(s) are restored,

Today, modern electronic con-trol systems provide a seamless interface between mains power, building load and stand by provi-

sion utilising highly tailored system design, programming and installation to meet the specifi c requirements of the building. Typi-cally, UPS systems provide a short-term solu-tion to power loss, taking load between the mains going off and the generating starting, synchronising and coming onto the grid. However, complete reliability is delivered through the selection of a suitable control system that uses the latest electronic com-munication technology to manage this criti-cal event eff ectively by monitoring multiple power supplies simultaneously and synchro-nising diff erent sets to the mains without the need for human intervention.

From the moment the power’s lost, these systems immediately attempt to start the gen-erator – trying at least three times if required before deciding how much load to give each generator, dependent on the building load at the time. Th e system is then capable of moni-toring the load and changing the confi gura-tion to ensure full load is delivered reliably and consistently.

ASK THEEXPERT

Reliability is a vital factor in the specifi cation of control systems for automated power management systems in built applications like hospitals, banks and call centres, claims ComAp’s Martin Malek.

Reliability in automated power control

Martin Malek is the Managing Director of ComAp Systems Group. He’s worked in the company since its inception in 1991, and now looks after one of the ComAp divisions – ComAp Systems Group. The company designs, produces, supplies and commissions, control systems, complete switchboard and switchgear solutions and related systems for the power generation market.

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What do you see as the biggest challenges in the HVAC industry over thenext few years?Gary Douglas. The major challenges for the HVAC industry in the next fewyears are the market shift towards renewable energy resources, higher energyefficient machines and the banning of certain refrigerants. Power consump-tion has always been an issue when talking about air conditioning in theMiddle East. It is known that more than 60 percent ofa building’s energy consumption is spent on air condi-tioning. With the current shift towards renewable en-ergy resources and the demand for high efficiencymachines, the AC industry will have to go through sig-nificant technology advancements to satisfy currentmarket needs in the coming years.

Refrigerants is another critical issue in the HVACindustry. Refrigerants currently used in the HVAC in-dustry will either have a high global warming potentialeffect or ozone depletion effect, or both. Countriesworldwide are continuously working on regulationsthat minimise, phase out or ban certain refrigerants toeliminate the negative effect on the environment. Thisalso means that major technology changes in the HVAC industry will be re-quired, but true direction unknown to date.

Tony Cull. The HVAC industry faces a number of challenges to meet cur-rent economic, environmental and social concerns. Here are three repre-sentative examples. Firstly, the recent economic meltdown has broughtcost issues to the fore, and both the capital and running costs of HVAC sys-

tems are under scrutiny. Secondly, never before have we been made soaware of the irreversible damage the human race is doing to the environ-ment, and the corresponding need to reduce energy consumption and car-bon emissions. Finally, the environmental conditions inside a buildingmust be healthy and comfortable to maintain occupant well-being and helpthem to perform to their potential.

We at Monodraught are designing and manufacturelow energy products that help to meet the all three exam-ples by being cheap to run and maintain, having a low im-pact on the environment and by helping to provide ahealthy and comfortable indoor environment.

There is a growing focus on sustainability andgreener construction in the Middle East, in partic-ular seen in the increase of LEED practices. How isthis being translated into the HVAC sector? Whatis your company working on in terms of sustain-able products?GD. As an EPC contractor for District Energy Systems,we are not directly involved in building construction

and thus, LEED practices. However, in all of our projects, system efficiencythrough minimising utility consumption (such as power and water) is alwaystop of our agenda. Our engineers are fully aware of LEED and other sustain-ability standards and are applying them when possible to reduce energy con-sumption and increase efficiency. In the near future we will be seeing similarstandards to LEED for industrial buildings such as District Energy Plants.

As for the effect of greener construction on HVAC, it has simply led to re-

Vital ventilation


ADC’s Gary Douglas and Monodraught’sTony Cull discuss the key opportunities inthe HVAC sector.

HEAD TOHEAD

“The current markettendency is moving

towards the utilisationof renewable energy

resources andenhancing system

efficiencies”Gary Douglas

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duced load demand and more efficient use of cooling capacities in buildings.Overall, this reduces capital cost for HVAC systems and utility consumption.

TC. A hot climate is not one to be colonised and controlled, but experiencedand lived within sustainably, and so air conditioning should not be used tosolve the problems caused by architectural inadequacies; glass may be aes-thetic but it is not a suitable façade material in any cli-mate. Middle Eastern buildings have long beennaturally ventilated and so it seems sensible that archi-tects return to vernacular principals to create buildingsthat reflect local culture and heritage, and impact light-ly on the environment. Therefore, it is encouragingthat LEED practices are increasing in the Middle East.Buildings that are built according to its guidelines con-sider the sustainability of the site, water efficiency, en-ergy consumed, atmospheric emissions, materials andresources employed, indoor environmental quality,and innovation in the design process.

Accordingly, Monodraught has developed a rangeof sustainable products that apply traditional solutions used in vernacular ar-chitecture in a way that is compatible with modern requirements. For exam-ple, the Monodraught Windcatcher is a roof mounted natural ventilationsystem that employs tried and tested principals widely seen in Middle Easternvernacular architecture. It channels a controlled quantity of fresh air into aroom from roof level, whatever the wind’sdirection, and without mechanical assis-tance. The Windcatcher provides a flow offresh air in a room that raises the opera-tive temperatures and gives greater op-portunity for thermal adaption.

Furthermore, the Sola-Boost uses theWindcatcher technology in coordinationwith a solar powered fan to guaranteeventilation on sunny days. Both systemsare intelligently controlled by a patentediNVent demand-control system that usesa combination of internal temperatureand carbon dioxide concentration tomaintain good indoor air quality andthermal comfort.

The current global economic crisis iswithout doubt affecting the infrastruc-ture industry in the Middle East. What do you perceive as the key op-portunities in these challenging times for the HVAC sector?GD. The current economic crisis returned serious competition on value tothe market place. Today, clients are studying the value addition from usingone company over the other more seriously. In our industry, this means high-er demand for creativity and an ‘out of the box’ approach to projects, whichis stimulating the future designs. These are opportunities for companies thatare built on sound bases. It is the sustainability of a competitive price forHVAC systems while providing high quality, high efficiency products thatpresents today’s challenge.

TC. Heating, ventilation and air conditioning are considered by some to beeveryday commodities that can be taken for granted, and essential for the well-being of the population. Whilst this is certainly true for heating and ventila-tion, air conditioning is facing the toughest challenges to its credibility. Airconditioning systems are sometimes associated with prosperity, and status, andare used to convey these attributes and not because they are necessary for the

comfort and well-being of a building’s occupants, orbecause they are the most energy efficient approach.

Although there are many proponents of an air-conditioned indoor environment who cite their con-tribution to personal freedom and increasedproductivity in some regions of the world, air condi-tioning does not always bequeath an indoor environ-ment that is satisfactory for occupants. In fact, whencompared against buildings that are naturally venti-lated using wind and buoyancy forces, occupantsoften perceive the indoor environment to be better ina naturally ventilated building and report fewer symp-toms of sick building syndrome (SBS). For many peo-

ple air conditioning has come to be viewed not as a solution to discomfort andSBS symptoms, but as part of the problem. Therefore, Monodraught believesthe key opportunity for the HVAC sector is the application of natural and lowenergy ventilation systems to modern buildings.

What new developments can we expect to see from you over the nextsix to 12 months?GD. As I mentioned before, the current market tendency is moving towardsthe utilisation of renewable energy resources and enhancing system efficien-cies, on that line, we are diversifying into providing EPC solutions for renew-

able energy systems (we are currentlyworking on a major solar air conditioningproject). We are also looking at the com-bined heating and cooling and power en-hancement projects.

In addition to diversifying in our EPCsolutions, we are also expanding geo-graphically into other countries in the re-gion. Our aim is to position ourselves asan EPC provider of energy solutions in theMENA region.

TC. Monodraught has always sought to ex-plore, develop and create innovative low-energy building services solutions. Bymaximising naturally available energy fromthe wind and the sun, Monodraught prod-ucts are helping to build for a better future.

In the next six to 12 months, Monodraught is looking to develop itsWindcatcher and Sola-Boost products to meet the demands of a MiddleEastern climate. For example, in very hot climates, it is accepted that untem-pered supplied air may not be appropriate and so Monodraught is actively in-vestigating passive cooling techniques for the Windcatcher and Sola-Boostnatural ventilation systems. �


Tony Cull has been withMonodraught for 20 years,initially as a design engineer, hethen became the TechnicalDirector in 1989. Monodraughtwas acquired by VKR Holdingsin 2007, in April 2009 Cullbecame Managing Director.

“The key opportunityfor the HVAC sector is

the application ofnatural and low energyventilation systems to

modern buildings”Tony Cull

Gary Douglas has over 30 yearsof experience in operationsmanagement. He spent themajority of his career inAustralia. Douglas relocated tothe UAE in 2002 as a GroupDirector in one of the largestFMCG companies in the UAE. In2008, Douglas joined ADC asthe General Manager in Dubai.

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SPECIALFOCUS

The MENA region is home to six percent of the global population, but currently has access to less then one percent of the planet’s renew-able freshwater reserves

– with an average of only 1400 cubic metres of renewable water resources per capita, the region is far below the World Bank average of 8500. Indeed, the region also consumes almost 80 percent of the fresh water it has, which is in stark contrast with regions such as Latin America where countries consume only about two percent of the volume available.

With such short supplies many countries in the region supplement the growing need for potable water with the desalination of seawater. Countries like Kuwait, Saudi Arabia and the UAE in particular depend on desalination for potable water requirements. Th is heavy usage leaves little room to accommodate an expand-ing population, which in turn means it is vital that the region learns to manage its existing water resources more effi ciently, take advan-tage of new technologies and improve on its relatively young and underdeveloped systems.

“Th ere is no question that the water and wastewater side in Saudi Arabia, and even in Dubai, is undeveloped,” says Eric Jankel, former

h MENA

It is vital that the Middle East region learns to manage its existing water resources more effi ciently, but will the region overcome critical challenges and harness new infrastructure and technology to vastly improve its underdeveloped water systems and processes?


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The growth of desalination

The global desalination market is growing at a record rate. The total capacity of plants now online is 59.9 million m3/d, a 6.6 million m3/d increase on last year and representing the largest amount of desalination capacity brought online in a single year. Seven hundred new plants were commissioned around the world during the year – including the largest in the world, the 880,000 m3/d Shoaiba 3 project in Saudi Arabia – and there are now 14,451 desalination plants online, while a further 244 plants with a capacity of 9.1 million m3/d are known to be under contract or in construction.

The greatest increase has come from seawater desalination. Since November 2007, the installed capacity of seawater desalination plants has expanded by 29.6 percent to 35.9 million m3/d. To date in 2009, 4.6 million cubic metres per day of seawater desalination capacity was added, and demand for seawater desalination is forecast to grow dramatically.

CEO of Aqualyng Holdings. “Th e physical facilities and the treatment capacity are not at modern day standards. And there’s going to be quite a bit of work to bring the wastewater treatment systems up to those modern standards and apply wastewater reuse technologies and programmes to those networks.” Jankel, who has over 30 years’ experience in the water business, goes on to explain that in most cases each of the countries in the MENA region has made positive policy changes in the last two to three years. “In Abu Dhabi they’re privatising the wastewater system. In Oman they’ve brought in management contractors to improve service delivery and improve the technology. Even in Egypt they’re trying to get fi nancial backing for a new Cairo project. So there are certainly examples where there has been a change in direction and a momentum going forward to upgrade the standards of the systems,” says Jankel.

However, despite the huge desire to improve the water and waste-water systems in the Gulf region, there are still critical challenges to overcome. Specifi cally, the Middle East needs to fi nd ways to manage existing water resources more effi ciently. To move forward with this goal the region must improve and expand its focus on a number of issues, including increasing water reuse options, better water conserva-tion eff orts, more desalination project development and improved irri-gation modernisation. Ark Pang, Chief Development Offi ce for Kharafi National, believes that fi rstly, greater awareness and implementation of water conservation measures must be seen in the region in order to help preserve fresh water stocks. “It is oft en said that seawater is the unlim-ited reservoir and desalinated water will solve mankind’s water scarcity problem. On the fl ip side, municipal wastewater is also a highly reliable source of water and if properly treated should be a critical resource in the government’s overall water management scheme.”

Pang goes on to suggest water metering and a review of subsidised water tariff s in order to improve systems and services. Kathy Shan-dling, Executive Director of the International Private Water Associa-

tion (IPWA) agrees, saying that it is vital the region moves towards a full cost recovery for water services in order to achieve long-term, sus-tainable systems. She explains that this will involve the implementation of viable AMR systems to better ensure a more eff ective billing system, including the collection of payment for water/wastewater services rendered. Certainly countries in the region are increasingly seeing their governments turn to the private sector to meet their water and wastewater needs. Shandling believes that when the right partnership is created it can have a very positive impact – although there is a fl ip side to that – and a variety of public private partnerships (PPP) are being implemented throughout the region.

“Th ere is clearly a role that eff ectively structured public private part-nerships can play in addressing some of the various issues,” says Shan-dling. “PPPs can take the form of concessions, management contracts, corporatised local water companies and so on. A newer PPP initiative will most likely involve diff erent players – particularly the smaller and more specialised private companies. Th e new PPPs will more likely mirror strategic alliances or partnerships rather than the older, more traditional PPP model that outlines a broader and total outsourcing con-tract to one particular company.”

Desalination Even as the structure behind the infrastructure changes to make sys-

tems more effi cient with the introduction of PPPs and water metres for example, it is the technology producing the clean, safe water that is be-coming increasingly important. Th e UAE, for example, has virtually no sources of surface water, such as rivers, so desalination is the major source of water supply. According to Lisa Henthorne, immediate Past-President of the International Desalination Association (IDA), the world’s largest desalination plants, both online and in the planning stages, are those sea-water facilities located in the Middle East region. Th e largest production from an individual desalination installation is the Shoaiba 3 project on the west coast of Saudi Arabia, producing 880,000 cubic metres per day. Seven other commissioned or contracted plants have capacities in excess of 400,000 cubic metres per day. In addition, Ras Azzour, on the east coast of Saudi Arabia, has a planned capacity of one million cubic metres per day.“We tend to build these desalination plants in phases, adding on to facili-ties as demand grows,” she explains. “Th e Jebel Ali complex in Dubai is a good example, where an additional 600,000 cubic metres per day of capacity was recently contracted.”

“Th ere is clearly a role that eff ectively structured public private partnerships can play in addressing some of the various issues”


Case study: Jordan

In 2000, the government of Jordan set up the Aqaba Special Economic Zone (ASEZ) in the city of Aqaba. The institutional changes embedded in the establishment of the zone opened the doors for other signifi cant changes in Jordan, including some that were to affect the water and sanitation sector.

Prior to the zone being set up, central government agencies were responsible for developing and managing the port, the airport and the utility services, including water and sanitation. The law establishing the zone brought about a direct challenge to the status quo as it explicitly allocated this responsibility to the Aqaba Special Economic Zone Authority (ASEZA).

The opportunities opened up by the ASEZ law for entrepreneurs in economic and political organisations in Aqaba were also perceived by many as a threat to central government organisations operating in the city. Consequently, intense negotiations were held between the parties to fi nd ways to implement the law while protecting their respective interests. The corporatisation of water and sanitation services was part of these negotiations. The negotiating parties were the Ministry of Water and Irrigation (MWI) and the Water Authority of Jordan (WAJ) on one side, and ASEZA on the other.

The Aqaba precedent had ripple effects in the water sector, as it was a major factor in the corporatisation of Amman services. Aqaba’s services were corporatised in 2004 and Amman’s in 2007. In Aqaba, the government set up the Aqaba Water Company (AWC) to replace a local agency from the Water Authority of Jordan (WAJ), while in Amman the government created MIYAHUNA to replace LEMA, a private company operating under a management contract with WAJ.

“It’s critical for countries to be able to make progress in other areas of economic development. I can think of a number of sectors that won’t be able to develop properly if there is no good water service. Tourism, for one, in a country like Jordan is critical, and certainly so in industry of various sorts. So to us it is important that the international lending agencies and donor agencies continue to pay attention to the water sector reform,” says Jorge Segura, Managing Partner of Segura Consulting, the international consulting fi rm that was involved in the Amman water management project.

Seawater desalination represents a US$10 billion industry today, and is forecast to be worth some US$16 billion by 2020. Ac-cording to Henthorne, while the global economic downturn caused the rate of growth in desalination plants to slow somewhat in 2008-2009, population and economic growth, pollution of existing water resources and climate change continue to drive the need for new and reliable sources of water. “Desalination is one of the answers,” she says. “It continues to be an increasingly important part of global water solutions for the 21st century and for a better world.” Indeed, desalination is especially important to countries on the Arabian Gulf. Together, the countries of the Arabian Gulf – the

GCC plus Iraq and Iran – account for approximately 40 percent of the world’s desalination capacity. For example, IDA estimates that 95 percent of Dubai’s water supply is produced through desalination. At the same time, the unique confi guration of the Arabian Gulf – a semi-closed water body with limited fresh water infl ow from rivers – requires diligent attention to the potential eff ects of the process.In response, IDA has announced plans to form a task force to explore the environmental eff ects of desalination on the Arabian Gulf and recommend strategies to mitigate potential impacts. According to Henthorne, the task force is part of a larger initiative that IDA is orga-nising to examine best practices, as well as available and future tech-nologies; to address environmentally-related aspects of desalination such as energy consumption, safeguarding of marine life, and concen-trate disposal; and promote ways to mitigate potential environmental impacts of desalination around the world. “In many regions, includ-ing the Arabian Gulf, desalination is the only way to supply fresh, clean water to growing populations and economies,” she says. “IDA is committed to environmentally responsible practices in desalination, which has become an increasingly important part of the solution to water issues around the world.”

DecentralisationHowever, Jankel believes that while desalination has proved a

good solution to some of the water problems in the MENA region, many of the challenges seen in the water systems today relate to the fact that too many of these desalination plants use thermal technol-


“Even as the structure behind the infrastructure changes to make systems more effi cient with the introduction of PPPs, it is the technology producing the clean, safe water that is becoming increasingly important”

Continued opposite


ogy steamed from power plants, which means they are co-located with power station sites. “In the summer, the peak demand can be twice the base load demand in the winter, whereas the demand for water is relatively constant year-round. Th is poses some challenges and certainly increases the cost of water production in the winter months, when steam is produced simply for the purposes of desali-nating the water,” he says. Jankel goes on to explain that this is why reverse osmosis technology is one of the big trends in the region at the moment – it doesn’t use steam and doesn’t have to be co-located at a power plant site and is fundamentally a more cost-eff ective option. However, from an operational point of view, he highlights the advan-tages, including that companies have been using the thermal technol-ogy for 25-30 years, are comfortable with it and able to deal with the challenges it presents.

“Reverse osmosis is certainly more challenging and more diffi cult to operate on a day-to-day basis because of the pre-treatment system, so in some cases there’s been a willingness to take reverse osmosis and go forward, and in some cases there’s been a little bit of hesitancy to embrace the technology. However, where these real estate develop-ments are coming on like the Palm Deira, certain portions of the Palm are served by reverse osmosis plants as opposed to desalination, and likewise in the northern Emirates, basically the government has told developers you can go forward and build your project, but you will not be getting electricity and water form the public sources – you’ll have to make your own as part of your project.”

Th ese circumstances have led to a decentralisation of some of the systems taking place as a result. In many cases this has helped to promote wastewater reuse. Historically a wastewater plant would be out in the desert, away from the community, and the wastewater would be piped out to that plant, treated and piped back. However, with a decentralised system, out on one of the islands in Abu Dhabi for example, the treatment plant is close by as part of the island de-velopment, and then the wastewater can be piped back quickly and used eff ectively. “It makes the economics of wastewater reuse much more advantageous when the plant can be built close to the ultimate end-user of the reuse project,” adds Jankel.

Th e systems in the region are undoubtedly becoming more ra-tionalised, with effi ciency becoming a more important criteria, and likewise the technologies for both water production and for waste-water treatment more cost eff ective. In that sense the cost profi le is coming down and helping countries participate in a more rational framework for water production, supply and waste treatment, and in particular water reuse, which is a huge factor in the overall cycle of how economies and governments can effi ciently use the water re-sources available.

Jankel explains that the industry is set to remain fractured in the near future. Indeed, with the current system set-up, there are utility companies that own and operate the system, engineering companies that do the design work and then there are equipment suppliers who sell various technologies and equipment to the market. “However,” he says, “I do believe that the governments around the region are begin-ning to harness the private sector from both a technology and fi nanc-ing point of view, and that can only be a good thing.”

The corporatisation in Aqaba and Amman was a complex process, and the Aqaba Special Economic Zone faced strong opposition because it was perceived as a threat to Jordan’s centralised public administration. As such it involved high-level government offi cials, technical assistance, and disciplined and cooperative work among government agencies, USAID and consultants.

The government’s intention of providing excellent water and sanitation services posed substantial challenges; however, there are many lessons and recommendations that can be drawn from the water and sanitation services in Amman and Aqaba. Three broad themes seem to be of particular interest for potential reformers: the supply and demand sides of reform, political support and the disciplined approach to reform, and feedback loops.

Firstly, the demand for reform may come from inside or outside the water and sanitation sector. It is essential, therefore, that reformers remain continuously on the alert for events signalling that demand. Aqaba and Amman are examples of these external/internal sources of reform. Aqaba’s source appears to be from outside the sector, while Amman’s appears to be from inside. The impetus for reform in Aqaba came from the law establishing the economic zone because the law introduced the potential for broad institutional change with a direct impact on the water sector. On the other hand, Amman’s push for reform emerged from inside the sector in view of the role played by the experience of Aqaba water services, and the experience with the water and sanitation services in Amman under the management contract.

Secondly, reformers should engage and sustain strong political support for reform. They should also ensure the continuous involvement of high-level government experts and offi cials on a day-to-day basis. Aqaba and Amman are examples of this approach, through the creation of reform committees led by high-level government offi cials with a clear mandate and with easyaccess to the highest levels in government. Thirdly, reformers should also keep in mind that in the real world things frequently do not work as expected by decision makers. Public policies must be adapted when they fail or when circumstances change. This adaptability requires setting up systematic feedback loops helping to determine whether the reform is producing the intended results.

Source: excerpt from USAID report Reforming the Water and Sanitation Sector: Challenges in Corporatising Service Provision: The Case of Jordan



The water and wastewater sector expe-rienced rapid growth in 2008 fuelled by huge investments in infrastructure, but the global economic crisis is now expected to restrain market growth. What impact has the crisis had on the sector in your opinion?Tony Wynes. Th e restraint on the previously in-creasing growth of the infrastructure market is most likely to reduce the need for water and the amount of wastewater available for recycling. Th is will enable a period of analysis and envi-ronmental management planning to take place.

Water is vital for mankind’s survival and the eff ects of climate change must be taken into account. Th is is a time for refl ection and the preparation of revised environmental plans to determine each state and country’s total water requirement for personal con-sumption and the growing of food crops.

As the depth of the oceans increases, sea level landmasses will disappear. Th ose which survive need to estimate the amount of rain they will receive from the violent storms of climate change to feed the rivers, and build desalination plants to cover the rest. It is vital

to dam rivers and build reservoirs to ensure that there is a large enough reserve of water to overcome hot dry periods with no rain.

David Tomowich. As we all know, water is vital to survival and therefore proper treat-ment of water, including disinfection, is key to maintaining a healthy community, environ-ment and economy. Th e global economic crisis has been felt within the industry on a project level as some projects have been delayed or even cancelled due to funding re-prioritisation or lack of residential development and con-

With the water and wastewater market set to grow to US$1.87 billion by 2013, MENA Infrastructure asks a panel of experts for their opinions on the huge investments in infrastructure currently going on in the region.

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struction. Having said that, the water industry overall continues to grow since water is such a vital resource. Even during tough economic times there is usually a focus on infrastructure that includes developing the supply of safe reli-able water treatment.

Lisa Henthorne. I work predominantly in the desalination industry and we experienced some slowdown in growth in 2009 as a result of the economic crisis. In the last few years

our industry has experienced unprecedented growth – 27 percent compounded annually–however in 2009 we saw some project tender dates slip into 2010 and beyond. A few large desalination projects failed to reach fi nancial closure in 2009 and had to be resubmitted for fi nancing or shift ed from privatised to govern-ment-owned projects.

Th e planning and construction cycle is lengthy in the water and wastewater sector, so while we are slow to feel the impact of the eco-

nomic crisis upfront, we will continue to expe-rience it well aft er the actual crisis has passed.

What are the biggest challenges facing the water industry in the Middle East? How is your solution best placed to tackle these challenges?DT. Th e Middle East is experiencing unprec-edented growth that will naturally put a lot of strain on the existing infrastructure in place to treat water. A big challenge may be the plan-ning as well as having resources in place to keep up with the growth and demand for water and wastewater treatment – especially considering the water shortages already experienced in most middle-eastern countries. Another chal-lenge for the Middle East will be to put in place and enforce regulations that ensure minimum water treatment standards are being met during this period of rapid growth and beyond.

Trojan’s UV disinfection solutions have played an integral part in hundreds of reuse and water recycling plans worldwide. UV can easily be installed into existing wastewater or drinking water plants to increase levels of public health protection. In terms of meet-ing sustainability objectives, UV off ers a safe chemical-free approach to disinfection with an environmental footprint signifi cantly lower than alternative disinfectants or desalination.

LH. Th e Middle East has extremely limited renewable water resources. Desalination has enabled development of the region into a global fi nancial hub and premier supplier of fossil fuel that powers the world. But desalination plants are capital-intensive, time-consuming to construct and require considerable power to operate. WATER STANDARD off ers a solution that addresses these challenges by bringing a desalinated supply onboard a large ship to water-short cities or industrial areas in a timely fashion (approximately 18 months). We’re also equipped with our own power plant and fi nancing. We simply sell water to the customer – thereby reducing the traditional challenges inherent in tendering, designing, approving, constructing, fi nancing and operating a de-salination plant in the Middle East. One of the aspects of WATER STANDARD that I am most proud of is our dedication to protect the envi-ronment. Most of the WATER STANDARD intellectual property is associated with treat-

Lisa Henthorne is the Chief Technology Offi cer of WATER STANDARD and served as the President of the International Desalination Association (IDA) from 2007-2009. Professionally, Henthorne has more than 20 years of experience and has published more than 70 papers on desalination and membrane technology.

The PanelDavid Tomowich, who has been with Trojan Technologies since 1993, has worked in sales management in the US, Europe and now as the International Sales Director. He has worked on some of the largest UV disinfection applications including storm/wastewater treatment in Southeastern USA and drinking water systems for New York City.

Tony Wynes is Managing Director of Aquarius Marine Group, that he set up 37 years ago as a Diving Maintenance and Environmental Consultancy. This led him to invent and coordinate the design of the ‘Aquaerator’ which is patented in many countries. He was a Founder Member of the Environmental Industries Commission, inaugurated at the House of Lords in April 1995 and has worked with six major water companies.


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ing water from the sea in such a way that the marine environment is protected.

TW Th e biggest challenge facing the Middle East is following the huge infrastructure growth – is there enough water retained behind dammed rivers and large enough reservoirs to store at least a year’s water requirements? Trees can be planted on the windward side of these waterbodies that will help the world’s carbon footprint and reduce the eff ect of sandstorms.

Aquarius has spent 37 years innovating systems that improve the quality of water in reservoirs and our cutting-edge ‘Aquaerator’ is now the scientifi cally proved answer to many reservoir problems. Th ese include stratifi cation, which causes water below eight to 10m from the surface to be oxygen defi cient and have metals in suspension. Unfortunately few people realise that bed water has a higher density than surface water, thus the cheapest form of surface water aeration is provided by the wind. It is vital to place aeration and mixing devices on the bed, using the simple principle that it takes more energy and costs more to force air down from the surface, whereas a bubble plume from the bed rises naturally towards the surface. Our technology, fi nanced by a major EU grant, also rotates the bubble plume. Th is causes considerable additional entrainment by using an Aquaerator, which has no moving parts to wear out.

Governments in GCC countries have identi-fi ed municipal wastewater treatment as the priority area for multiple reasons including the achievement of the Millennium Devel-opment Goals. Where do you see the main growth opportunities in the water and wastewater sector and what are you doing in this area/s? LH. Desalination will continue to be a high growth area in the GCC countries but advanced wastewater reuse also represents a high growth opportunity in the water and wastewater sector in the region. Advanced wastewater reuse uti-lises the available municipal and/or industrial wastewater to produce a high-quality product water that can be used for economic-enhancing purposes. Presently, the GCC countries treat their wastewater to standards for use in green-belt irrigation but much is disposed in the sea. As advanced water reuse is less expensive than

In my view

Richard Menezes is CEO of United Arab Emirates-based Utico, a utilities company specialising in water, sewage, steam, power and related services for clientele requiring reliable, low-cost supply of utilities.

We do not provide luxuries, but the basic necessity for life. Water is life and we ensure it is provided

reliably and economically. Because there is a global crisis, people will not stop using less water proportionately unless many

industries close down altogether. There will always be some that are building.

However, building additional capacities for drinking water

during these times is required – this is a stimulant for growth, both as an

employment provider and as a service to industry and population as growth returns.

The trick as usual is to fi nd a balance through phasing, and also between supply and demand.

The biggest challenge to the water industry is to educate the government and consumers about policy and conservation respectively. Governments all over the world must change the way they look at water as a low-cost commodity. What they should do is to differentiate between commercial water supply and domestic supplies by charging more for large consumption from domestic consumers, while at the same time keeping a higher starting tariff for commercial consumers that comes down when their unit average consumption reduces.

This allows the government to reduce liabilities when they commit to long-term off-take agreements with water generation companies, which should not happen in the fi rst place. What should happen is that the government should act as a concession provider for an area and facilitate through policy and regulation that the water generation companies are not merely money and technology providers, but true service providers right to the point-of-use, including billing and collection. Risk can be mitigated in so many ways that the government doesn’t need to take all the risk. Another challenge is weeding out fast-track moneymakers in the water industry and accepting true service providers in the industry.

Building new capacities and conservation are the growth areas for the future. Water re-use happens when there is suffi cient fresh drinking water in the fi rst place – there is only so much that can be re-used. Conservation is another area where a service provider role should be included, through which the developer, regulator and consumer benefi ts. We are the only company servicing all these areas – the only true full service provider.

MENA is relatively a water-scarce area; however, the region is not alone in its water problems. Building capacities through seawater desalination as an alterative water source is an area of growth, and water re-use through treated sewage effl uent is another. There is also an increasing market for water purifi ers, which will help somewhat in overall technology development.


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A recent Frost and Sullivan report concludes that the water and wastewater market is set to grow to US$1.87 billion by 2013. What are your thoughts on the water and waste-water industry in the MENA region over the coming three years? What do you expect to see happen and what do you hope for the sector?TW. It is vital for the MENA region and the whole world to have environmental manage-ment plans for water and wastewater. Th is plan should be used as an opportunity to identify the systems that are the most energy effi cient in order to ensure the lowest carbon footprint.

I hope the sector will build reservoirs, lakes and dams on rivers to store the planet’s and human beings’ most vital commodity for the progression of life itself, water. Trees can sur-round the water to reduce the eff ect of climate change and sandstorms in order to become the oases for future generations.

DT. We expect to see signifi cant project-related activity including UV applications and signifi -cant growth and advancement in the fi eld of water treatment – especially as the economy rebounds and delayed projects move forward. We need to ensure there is proper design, vali-dation and application of technologies in any rapidly growing market to ensure a successful outcome. Industry leaders, regulators, consul-tants and end-users all need to play a role to ensure objectives are established and met.

I expect to see rapid growth in the water and wastewater treatment sectors in the coming years. My hope is that we see additional empha-sis on inherently greener technologies and that industry participants take an active role in the development and implementation of critical planning projects, policies and regulations that address water scarcity in the region.

LH. Due to the non-renewable nature of water in the MENA region, my hope for the future is that water becomes a truly valued resource. For this to occur, pricing must refl ect its value in order for the users to treat it with the respect it deserves and use it wisely. Th is renewed respect for water will trickle down to its environmental value, and we will be encouraged to consider the environmental impact of its production as well as the impact of the disposal of wastewater in the sea.

that each country or state is able to grow its crops and the population does not become ill through malnutrition or dehydration.

Aquarius innovation strategy has been to ensure that our products use as little power as possible and have no moving parts requiring maintenance. Th e various Aquaerator designs improve reservoirs, lakes, fi sh farms and fi sh-ery water quality.

DT. In the drinking water sector, Trojan is de-signing and providing ultraviolet systems that protect the public against potentially harmful protozoa, bacteria and viruses. To date, these drinking water installations tend to be on a smaller scale. We are encouraging the adoption of UV disinfection technology by larger facili-ties – the benefi ts to the cities and communi-ties are signifi cant. Regulations, installations and experience is available globally and can be drawn upon as needed in the Middle East.

UV disinfection has played a key role in the Middle East for over a decade and will continue to be a growth market. Th e demand for reliable technology and the use of best design practices needs to be a priority of regulatory agencies, consultants, the end-user and equipment sup-pliers alike. Meeting the demands of growing populations and addressing water scarcity will only be successful if new standards of treat-ment are formulated and adopted into future water treatment plans.

seawater desalination, it should be considered as a primary component of the water supply portfolio of the region.

WATER STANDARD is developing ship-based facilities to treat produced waste-waters generated by the oil and gas industry, to standards for reinjection in waterfl ooding oil and gas reservoirs. Our approach off ers a solution to the growing problem of disposal of these produced waters in an environmentally-sensitive manner, as well as creating a resource that adds value to the process of producing oil and gas.

TW. Municipal wastewater treatment is vital to improve the quality of life of the whole popula-tion and for increasing the overall water avail-able for recycling.

However, existing wastewater technol-ogy still has a high carbon footprint due to the electricity used to recycle it. Th us we have designed an Aquaerator that we consider will prove more effi cient by using less electricity. It is also removable from the bed for cleaning and replaced without the major cost of emptying the main operating tank. Th e prototype will be tested in early 2010.

Future environmental management plans need to show a main growth area in the water and wastewater sectors of building reservoirs and dams on rivers. Th is enables storage of vast quantities of raw and recycled water to ensure


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Surface of water above an AQUAERATOR at Doncaster ‘Lakeside’

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Bed water is a higher density than surface water, thus successful aeration and mixing require a device on thebottom. Our cutting edge, patented AQUAERATOR is the crescendo of 37 years Innovation, developed withan EU Grant €880,000 and scientifically proved to successfully aerate, mix and destratify Blagdon Reservoir,Barrow Reservoirs 1& 2 and Doncaster ‘Lakeside’, including manganese and algal reduction. OurEnvironmental Management Plans include water, bed silt testing and algal identification. The AQUAERATIONSystem achieves a smaller carbon footprint than our competitors and compliance with the EU WaterFramework Directive. The new Fishery AQUAERATOR is oxygenating bedwater at Cross Drove Fishery,Thetford and Avalon Fishery, Glastonbury.

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WASTEWATERFOCUS

The issue of reusing wastewater hasgained much importance in recentyears due to the steady increase ofpopulation on the one hand and the

sharp shortage of freshwater around the world onthe other. In several countries, reusing water hasbecome a fundamental part of the solution to thesevere shortage in water resources.

In addition to the sanitary, environmentaland economic benefits of reusing wastewater, italso plays an important role in mitigating pres-sure on other freshwater resources. However, thereuse of wastewater still lacks broad social accep-tance and is confined to limited fields in manycountries, creating an urgent need to carry outfurther studies and disseminate the advantagesinvolved in using such types of water – especiallyin relation to the aspects of health, the environ-ment and the economy.

The UAE government is working to con-serve water resources and to increase watersources by adopting a water rationalising policyfor household, industrial and agricultural pur-poses. We have also adopted a water tariff systemand modern irrigation techniques, and embarkedupon the construction of dams for replenishinggroundwater with rainwater and the building ofdesalination plants and sewage treatment plants.

The United Arab Emirates has paid specialattention to the sanitary drainage issue. In 1963the UAE set up the first sewage treatment plant inAbu Dhabi, with a production capacity of 3400cubic meters per day. To cope with the expansionof the urban areas and the spike in population,further treatment plants have been set up in the

different emirates since that time; they now num-ber 42 plants with a total capacity of 400 millioncubic meters every year. It is expected that treat-ed water quantities will increase in the near futureas new plants come on line and the sanitarydrainage nets are expanded in the different citiesof the country. They will operate efficiently in ac-cordance with the most modern techniques andmethods, with water being tertiary treated to en-sure conformity with international criteria.

The sanitary treatment plants have providedseveral benefits. They have turned our waste-water from a harmful environmental elementinto a beneficial one, provided an additionalsource of water at reasonable economical cost to theUAE (which suffers from scant water resources inview of its geographical location and the absenceof surface water streams) and consequently re-duces depletion of the groundwater.

The water issue, including the expandingfield of wastewater use, has attracted great atten-tion. The operational plan of the Ministry ofEnvironment and Water includes an evalu-ation study of the current situation with re-

gards to water resources and future demand.The plan and strategy for the water sector isalso being modernised in the national environ-mental strategy. Furthermore, the adoption ofgreen building standards will necessarily aug-ment the efficiency of water use and widen usesof wastewater in the buildings implementingsuch standards.

Despite the fact that treated wastewater inthe United Arab Emirates is only used for irri-gating forests, parks, green belts and somespecies of plants that are used as food for ani-mals, there are other fields in which such watercan be used – for example, the cooling industry,recreation and fire fighting. Treated wastewatercan even be used (at suitable levels) for irrigat-ing other species of plants.

Although it is unwise to resort to using highquality water for purposes that can be done withwater of lower quality, there are certain social andtechnological matters that need to be addressedbefore expanding the fields and purposes of usingtreated water. Such concerns should be dealt withearnestly on different levels, including the inten-sification of outreach programmes on the safetyof using treated wastewater in more applications,and harnessing the expertise of other countries inthis field. Although we believe in the importanceof increasing water re-use in the projects offorestation and green covers, we stress the neces-

sity of having the use of treated water con-trolled by clear environmental and

sanitary standards and stringent con-trol programmes to protect human

health and safety.Exchanging expertise, knowledge, sci-

entific research and the most modern tech-nologies being used in this field is of greatimportance in developing plans to use

wastewater as a basic part of integrated waterresources management. We believe that theprivate sector is our partner in this develop-ment process and has got a lot to offer. n

A surge in population and the relative scarcity of water in theMiddle East have made dealing with wastewater a highpriority for regional governments, as HE Dr Rashid Ahmed

Bin Fahad, UAE Minister of Environment and Water, explains.


HE Dr Rashid Ahmed Bin Fahad was speaking atthe WastewaterTech 2009 conference in Abu Dhabi.

MAKING A SPLASH

“The UAE government isworking to conserve waterresources and to increase

water sources by adopting awater rationalising policy for

household, industrial andagricultural purposes”

Wastewater ed_4August 15/01/2010 16:26 Page 106

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Urban waste management is one of the most essential aspects ofmodern living. With the growing ‘green consciousness’ amongglobal citizens, waste management has now taken an unprece-dented position at leading municipalities and communities

around the world. The rapid momentum of recycling efforts have furthered thecause for more sophisticated, humane, practical, cost effective and environmen-tally friendly methods for waste segregation, collection, transfer and disposal.

With the growing number of preplanned cities in development around theMiddle East, municipalities, communities, professional architects, consultants,engineers and other city builders are now actively researching the most versatile,modern and practical solution for waste management in any kind of urban orindustrial setup. A solution that combines all kinds of modern waste manage-ment technology, including modernised over-ground containers, state-of-the-art underground containers as well as semi-underground containers, thecollection system must be able to adapt to the various parts of the city including

high rise areas, villa localities as well as medium to low rise areas all with varyingpopulation density levels. The new system must also be designed understandingthe constitution of the waste in the region, which contains a lot of leachate or liq-uid waste. This is a cause of major concern among municipal authorities as theytry to prevent this liquid waste from leaking to the ground from existing con-tainer units. A mobile washing plant which can thoroughly clean and sanitisethese containers on a regular basis is also an essential part of the urban demandfor responsible waste management.

The young cities of the Middle East such as Abu Dhabi, Dubai, Doha,Muscat, Riyadh, Jeddah etc are now going through a rapid wave of modernisa-

tion especially in public infrastructure and the municipalities are actively seek-ing ways to replace the traditional standard DIN Lifting Mechanism, which in-volve either front loading, rear loading or side loading systems. This 40-year-oldsystem will slowly be replaced by revolutionary technology that will offer the citya much needed waste systems revamp. The change will be towards a more costeffective and long-term economical solution that can slowly be expanded to in-clude recycling and other green initiatives of the local authorities.

Blue Stream Environmental Technology, a decade old regional waste solu-tion provider has identified this growing trend and recently partnered with NordEngineering s.n.c, Italy to bring the NORD EASY SYSTEM to the Middle East.The NORD EASY SYSTEM is one such system that offers an integrated wastemanagement setup that includes a single person operated waste collection vehi-cle equipped complete with robotic lifting arms for emptying containers from thestreet on the truck mounted compactor. Nord’s ongoing contract with the city ofBarcelona has seen the implementation of 27,000 container units and over 55 col-lection vehicles and an adequate number of washing vehicles. The BarcelonaAuthorities are extremely pleased with the NORD System and are openly rec-ommending it to their sister cities across the Middle East and Europe. The systemis unique in the sense that it is one of the only systems to offer a completely inte-grated urban waste management solution, tailor designed for the region whichincludes all kinds of over-ground, under-ground and semi-underground con-tainer units collected with the same vehicle with all containers designed to holdup to 250 litres of liquid waste, and with a completely mobile state-of-the-artwashing plant. The system boasts one of the shortest collection times in the in-dustry with incredibly reduced container maintenance costs compared to currentsystems and since both the compactor and the washing unit are designed as rollon/roll off systems this is a blessing to the logistics issues of the municipality.

The Middle East is like no other place in the world and its waste manage-ment issues share quite the same story. Acustom designed solution for this regionis the need of the hour and any waste sys-tems provider with the ingenuity to com-prehend this can capitalise on thegrowing Middle East urban infrastruc-ture market. �

A fast paced evolution

Suvarna Jeetandra gives the low-down on the wastewater sector and explains the impact ofnew technologies on the growing Middle East urban infrastructure market.

INDUSTRYINSIGHT

Suvarna Jeetandra is Managing Director of BlueStream Environmental Technology L.L.C, UAE andEco N!rvana Technologies, India. With over 35years in the MENA region and a directinvolvement in the waste management industry,Jeetandra is an expert in urban environmentaldevelopment and civic waste infrastructure.

“With the growing number of preplannedcities in development around the Middle

East, municipalities, communities,professional architects, consultants,

engineers and other city builders are nowactively researching the most versatile,

modern and practical solution for wastemanagement in any kind of urban or

industrial setup”

BLUE STREAM ED:7dec10 15/1/10 15:29 Page 108

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TRANSPORTFOCUS


Dubai Metro.indd Sec1:110Dubai Metro.indd Sec1:110 15/1/10 15:56:4015/1/10 15:56:40

One of the world’s most advanced metro lines in the world and the fi rst urban metro network in the Gulf’s Arab states, the Dubai Metro is set to revolutionise the public transport system in the emirate. Serco’s Ramadan Abdullah, Director of the Rail Operations Department, explains the unique challenges and reveals the crucial role of technology for the network.

Dubai’s economy is based on fi nance, air trans-port, property development and tourism. How-ever, the rapidly increasing population and high number of tourists is causing severe traffi c congestion problems. Indeed, the population is forecast to grow by 6.4 percent annually to reach three million by 2017, and tourist num-

bers are projected to reach 15 million this year. Th e Dubai Municipality identifi ed the need for a rail system to relieve growing motor vehicle traffi c and support continuing urban development from research that started back in 1997 and came up with the Dubai Metro transport system.

When completed the Dubai Metro will have 70 kilometres of lines and 47 stations – including nine underground. Two lines are currently under construction – the Red and Green Lines – with three more in the pipeline. Fully integrated within the network operated by the Roads and Transport Authority, a body created in 2005, the masterplan includes 320 kilometres of metro lines by 2020 to cater to the expected 3.3 million population. Th ere are also plans for 268 kilometres of light rail tracks to act as a feeder system for the metro.

Ground works for the metro system started in February 2006, centred around the 52.1 kilometre Red Line, with a contract worth US$12 billion awarded in the August of that year to start building the Green Line. Th e Red Line has 29 stations, four of which are underground, although only 10 were ready for the September opening date, and it runs from Rashidiva to Jebel Ali, passing the American University of Dubai. Th e entire length is expected to take an hour to travel, with an estimated 32,000 passengers an hour. Th e 22.5 kilometre Green Line will have 18 stations running from Al Ittihad Square to Rashuduya bus station through Deira City Centre and Dubai Airport Terminals 1 and 3.

Trains run on elevated viaducts with the design and aesthetics devel-oped specifi cally to enhance the urban architecture along its corridor. In no location will tracks cross highways, ensuring full mode segregation. Al-though taxi, bus and water taxi feeder services are being structured to en-courage end-to-end use of public transport, the RTA is also creating three park and ride sites – the largest with 6000 places. A third-rail power supply was chosen to avoid the visual intrusion of overhead line equipment, and all stations, elevated and underground, will feature platform screen doors for passenger safety and to facilitate air conditioning.

In June 2007, Serco (operator of the London Docklands Light Railway) was named as preferred bidder for initial consultation and the system’s op-eration and maintenance. Th e UK£400 million fi ve-year contract, relates to the fi rst two lines as assigned by the RTA. Ramadan Abdulla, Director of the Rail Operations Department at Serco, believes that the introduction of the Middle East’s fi rst automated rail transport system has had a positive

impact on the emirate alongside the RTA’s full transportation system for the public, including taxis, buses, marina and modern road network. “Th e metro has meant that the residents of Dubai can move around much more easily and safely,” he explains. “In the near future – aft er opening the Red and Green Lines and the Tram Al Safooh network – the Dubai Metro will become the core public transportation system, as proved in the last three months with more than six million passengers using the service.”

Before the launch the Dubai Municipality Public Transport de-partment expected the metro to carry 1.2 million passengers on an average day, 27,000 passengers per hour for each line and 355 million passengers per year once both the Red and Green Lines were fully op-erational. It is also expected to provide transport for 12 percent of all trips within Dubai. And since Dubai inaugurated its metro network on September 9, 2009, the metro has served an estimated 57,000 pas-sengers per day. Indeed, aft er the fi rst month of operation – on a limited


Under constructionWith the Red and Green Lines currently under construction there are a number of other proposed lines on the drawing board:

Purple Line: 49 kilometres long the proposed line will run from Dubai International Airport to Al Maktoum International Airport along Al Khail Road. Construction started in 2009 and it is due to be operational by 2012. It will have about eight stations on the route, three with check-in facilities.

Blue Line: 47 kilometres long, the Blue Line will also run from Dubai International Airport to Al Maktoum International Airport, along Emirates Road. This was originally proposed with construction starting along with the Purple Line and completion in 2012, however, due to the recession it was taken under reconsideration and now has a deadline of 2014.

Yellow Line: In April 2008 the RTA announced plans for a Yellow Line, a light rail operation, although details about where it would run have yet to be released.

Red Line extension: An extension to the Red Line this will be 15.5 kilometres long and include six new stations, terminating at the border with Abu Dhabi. Dates for completion have yet to be announced.



Full speed aheadThe RTA is also addressing transport issues through a renewal and expansion of the bus fl eet, low-emission vehicles for taxi operations, and, most recently, the Al Safooh tram project. First announced in April 2008, the Al Safooh is yet another world fi rst for Dubai, featuring an open tramway of all stops equipped with platform screen doors, permitting full air-conditioning. Allowing for consistency with other RTA modes of transport, including bus shelters, air-conditioning adds to customer appeal in regular temperatures of around 40 degrees Celsius.

The full scheme is for 14 kilometres mainly following Al Safooh Road, linking Madinat Jumeirah and the Mall of the Emirates with Dubai Marina and the Jumeirah Beach Residence. Phase 1 will create a twin-track 10 kilometre line with 13 stops, with a standard platform length of 44 metres. Mainly at surface level, there will be some elevated track near the Marina. To encourage overall public transport use, interchange with Dubai Metro’s Red Line will be provided at three points.

Phase 1 of the project is due to start commercial services during 2011. Phase 2 would add a further 14 trams and four kilometres of line with another six stops.

Source: www.railway-technology.com

network – the actual rider-ship was 1,740, 578, equating to just under 60,000 passengers per day.

TechnologyTh ere is no doubt that cutting-edge technology had a huge role to play

in ensuring that the metro system has been successful its operation to date. Technology has played a part in tightening security in particular, with over 3000 CCTV cameras deployed at stations, depots and on trains, forming the core of the Dubai Metro safety and security regimes. Images from each camera deployed are recorded 24 hours a day, seven days a week. “In addi-tion to using CCTV and CCTV recording,” explains Abdullah, “the Dubai Metro also has a comprehensive integrated access control system are to ensure that only approved staff and personnel allowed to gain access to operationally sensitive areas, such as the control and power rooms.”

Abdullah goes on to explain that a wide range of intruder detectors are deployed across the metro to detect and advise the control room staff if individuals have entered a restricted area. “All these systems are inte-grated into a state-of-the-art control and command system. Th is enables important information to fl ow as and when required whilst at the same time providing Senior Operations Management within the RTA Rail Agency, together with Dubai Police Senior Offi cers, with clear and concise information at all times. Th e heart of the Control and Command Centre is

advanced communications, detector and video technology thereby ensur-ing that the Dubai Metro remains a safe and secure transport network for both staff and the public at all times.”

Occupying 10,000m2, the system’s control centre is at Rashidiya depot. Th e project’s signalling system is moving block and fully automated with in-cab signalling. Th e driverless, fully automated trains are fully air-conditioned and off er three classes of travel; the standard ‘silver’ class, a women and children only section, plus a fi rst –class ‘gold’ section. Th e fi ve-car sets are approximately 75 metre long, seating around 400 passengers, plus standing room.

Despite the main control room in Rashidiya not being fully ready for inauguration on September 9, which meant the back-up room in Jebel Ali was used to run trains on the fi rst day of operation, the fi rst three months of operation have run very smoothly in regards to operational aspects, says Abdullah. He explains that the rider-ship fi gures were excellent, particu-larly for the weekends and public holidays. “We faced a few tiny problems that were solved easily,” he admits. “One big problem, we had was when the passengers pushed the emergency button and stopped the service in mid-track, disrupting the service for a long time. Th ere was no actual emergency at the time but one passenger pushed the button by mistake. Otherwise, the operation in the fi rst three months was reliable.”

Abdullah reveals that the rest of the stations will be ready soon, despite recent disputes over contract payments, and will be launched throughout the second quarter of 2010, depending on the rider-ship demand and through the strategy that has been implemented by the RTA. “In addition, the Green Line will be ready in 2010 and we also predict the Green Line extension and Tram Al Safooh coming on line this year – in other words, there will be many projects that will be in operation this year, serving the residents of Dubai.”

Six million passengers in fi rst three months 11,675 passengers per direction per hour on the Red Line

518 buses will be in operation by April 2010

87 trains in the metro system

75 kilometres in total

47 stations

9 underground stations

5-car trains

3 classes; Gold, Silver, Women and Childen

2 transfer stations

Dubai Metro in numbers


Starrport AD.indd 1Starrport AD.indd 1 12/1/10 09:49:0812/1/10 09:49:08

TRAFFICMANAGEMENT

While the mature economies in the de-veloped world move towards creating integrated transport

policies, emerging countries are searching for ways to strengthen their transport infrastruc-ture through technology – and the Middle East is no diff erent. Due to an increase in traffi c congestion and growing road manage-ment costs, road building and development have now become critical needs in the region, forcing government ministries to fi nd alter-native ways of maximising the road network. Intelligent transportation systems off er just such a solution.

Caroline Visser of the International Road Federation details the benefi ts intelligent transportation systems can bring, both for travellers and the environment.


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“From a congestion and effi ciency standpoint, I would say that managing a road network today without an ITS infrastructure is unimaginable,” suggests Caroline Visser, Road Finance and ITS Pro-gramme Manager for the International Road Federation. “For road operators, it’s a vital tool and there are so many diff erent ITS applica-tions now – from monitoring and data collection solutions to see what’s happening on the road, to options to guide traffi c through dynamic signalling and travel information – that agencies can tailor the solution to meet their specifi c needs. I would say that road operators today are very much dependent on ITS for not only congestion management and demand management, but also road safety.”

While ITS is still largely a thing of the developed world, Visser explains that many emerging countries are implementing some in-teresting schemes too, such as those in Latin America, for instance, or South Africa, where much investment has been directed to ITS ap-plications in preparation for this year’s FIFA World Cup. India is also now embarking on an electronic tolling initiative, while a number of countries in the Middle East are exploring the possibilities aff orded by ITS. “While the developed world is currently ahead, emerging coun-tries are also developing ITS solutions more than in the past,” she says. “Th ere’s no reason why the Middle East should be any diff erent. Th ere’s defi nitely an opportunity there to make a greater leap in the technology being implemented because of all the experience already gained in the developed world, which could be used by the Arab region to introduce ITS at a more advanced level.”

Indeed, for Visser, research into the technologies themselves is no longer the main problem. She believes ITS technology is now at the stage where it can get the required results – provided the systems are imple-mented correctly. “It’s more about taking research results and making them deployable on a large scale,” she explains. “Today we’re at the stage that it’s more the implementation side that seems to be hampered.”

To address this concern, Visser’s team has set up an IRF working group dedicated to transport policies and their relationship with ITS. “Our feeling was that the positive impacts of ITS are sometimes over-looked. ITS is somewhat lacking in visibility, and it’s not usually a very sexy topic with politicians. So what we have tried to do with this work-ing group is raise the profi le of ITS with the high-level decision-makers – ministers, transport secretaries and their immediate advisors, the high-level civil servants responsible for policy decisions – fi rstly to generate enough budget for ITS research, but also to explain its ben-efi ts. We want to demystify it. ITS has a technology label attached to it, which can frighten some people, but in actual fact it’s a really wide-ranging concept. Th ere are so many applications and technologies that are encompassed in that single acronym. Th e technology is there, and it’s ever-evolving, so that shouldn’t be our main worry – raising aware-ness is now the key.”

And this is the core role of the IRF as a federation: to bring together stakeholders from all sides of the road development spectrum, from government ministries to transport agencies, from planning depart-ments to environmental parties. Its work encompasses the fi nancing of roads, network optimisation, environmental concerns and road safety – as well as ITS, of course. “Our mandate is to organise knowledge management activities and share best practice among our members,”


says Visser. “We work closely together with the network of national ITS associations and are also open to representatives from international institutions like the World Bank and the United Nations, who are now embarking on a number of ITS initiatives from a standardisation per-spective. We have close contact with the European Commission. So it is the IRF that brings together all these diff erent stakeholders to exchange best practices and share their knowledge.”

She believes there are currently a number of countries that par-ticularly stand out in terms of their use of ITS. “Each country has its focus, so I wouldn’t be able to give you a top three because it diff ers so much between countries and even regions. But the UK is doing some interesting things – I’m sure you’re aware of the London congestion charging scheme, but there’s also an active traffi c management project near Birmingham where they are using the hard shoulder of the mo-torway during peak hours and implementing all kinds of ITS applica-tions around it to help monitor usage to ensure it’s being used safely, to inform travellers of what is coming up, to tell them what the speed limit is, and so on.

“Emerging economies like South Africa, Brazil, Chile and India are also developing some interesting solutions. For South Africa, there’s an artifi cial deadline for ITS implementation because of the World Cup. For example, it’s now introducing electronic fee collections throughout the public transport modes, as well as a bus rapid transit system, which is quite challenging because there’s a lot of opposition from the taxi indus-try. Th ere are a lot of toll roads in Brazil and Chile, where they use elec-tronic tolling on a large scale. Th e Netherlands is another good example – a small country, densely populated, that doesn’t have room to expand the network any further. As a result, the Dutch government has already been forced to look into effi ciency gains on the existing road network for some decades. Th ey have invested a lot in incident management systems to clear the road quickly aft er incidents occur and to reduce congestion, and are also planning to introduce a national road-charging scheme, which adds another dimension to ITS. Heavy users will pay more and light users will pay less, while diff erent charges are levied between peak and off -peak hours. So there are many examples, but I think it’s important to point out that every country and region has its own context in terms of policy, but also in terms of needs and priorities.”

Alongside enabling more eff ective use of the road network itself, there is another area in which ITS can play a key role: that of promoting

“Th is is the core role of the IRF as a federation: to bring together stakeholders from all sides of the road development spectrum, from government ministries to transport agencies, from planning departments to environmental parties”



Different countries are approaching the subject of intelligent transport systems in different ways, but they all recognise that ITS is important and needs to be dealt with properly.

For instance, Dubai has created a division within the RTA focused specifi cally on developing ITS solutions that has really advanced the understanding of how to build greater intelligence into transport systems, within the emirate. Likewise in Bahrain there is a single agency charged with looking into potential ITS deployments. And then in Saudi, because it’s a much larger country, they’re actually linking together all the various ministries and government agencies involved in transport issues – the Ministry of Transport, the Ministry of Urban and Rural Affairs, the Ministry of the Interior, traffi c and environmental agencies, the border patrol – through a single coordinating committee. This committee is aimed at developing a common set of standards that each different constituency can use and that will contribute towards an interoperable ITS system from the initial deployment stage, in order to encourage interoperable ITS from day one.

So every country is dealing with it in its own way. But whatever the issues are, we need to tackle them in conjunction with the rest of the international community in order to try to fi nd common solutions. And what we’ve been trying to do in our organisation – in cooperation with entities such as the International Roads Federation – is develop what we are calling an ‘ITS roadmap’ to try to make it easier for people who are new to ITS to understand what ITS is and to better understand what type of solution is appropriate for which type of scenario. The idea of road and transport management needs to be considered in a much more holistic way so that the whole transportation network is developed with a greater focus on technology and operations.

So part of our work has been focused around looking at how a transportation network evolves, and while our work is still in progress, we’re already starting to form some ideas around that. It starts with the development of the road infrastructure itself so that your network serves all the areas it needs to. Then you start to look at things like network optimisation, which is where junction redesign and overpasses,

underpasses and bypasses all come into play to ensure you are getting the most out of that network. Once you’ve optimised your road infrastructure, the next step is to improve your public transport infrastructure. And then fi nally you get to look at areas like demand management. And of course, when you get to this stage, the information you’ve gathered starts to feed back – perhaps you’ll fi nd that you need to go back and do some more network optimisation or revisit your public transport schemes. It’s not just a one-way stream.

And so we’re starting to map where specifi c cities are in terms of this roadmap, and it’s important to note that different parts of the region are at different stages of development. In Dubai, for instance, they are basically at the end of their network optimisation stage and are now entering the public transport build-up phase. Cairo is increasingly looking at demand management. And then in the majority of the cities in Saudi, they are still doing the network optimisation element and spending a large amount of money actually redesigning the road network.

a green and more sustainable use of the road network. “Road transport doesn’t have a very good image in this regard,” acknowledges Visser. “It contributes to 74 percent of all transport CO2 emissions. Nonethe-less, many of our members are embarking, on a voluntary basis, on initiatives to reduce their own carbon footprint and to come up with innovations to make road construction, maintenance and operation greener. We have several initiatives within the IRF itself. We’re devel-oping a greenhouse gas calculator, which is an instrument that moni-tors emissions during the lifecycle of a road, and a tool that will enable members to calculate their emissions. ITS is helping because we think that traffi c management and congestion reduction – in which ITS plays a big role – is a very important way to make roads and road transport more effi cient and sustainable. Traffi c management systems combined with emissions monitoring have a high potential in contributing to this. Also, to a certain extent, road-user charging has a part to play as it rationalises the mobility demand. It will not be a miracle solution for

ITS: a regional perspectiveBy Mohammed Serroukh, Director of ITS Arab

addressing transport growth, but it might do something. For instance, it’s been proven in Stockholm, where they introduced user charging in the city a few years ago, that there have been substantial gains in reducing emissions.”

Encouraging a more sustainable approach to transportation is a key part of the IRF’s philosophy, particularly given rising traffi c vol-umes, but despite the huge strides taken in recent years it remains a signifi cant challenge. “We have not succeeded in decoupling economic growth from growth in transport demand, and we have to look at realistic options to handle this,” concludes Visser. “Rather than just extending roads to accommodate this growth, we need to look more to soft ware and mobility management in order to get the required ef-fi ciency gains. From our point of view, this will have a great impact on policy decisions because it will be all about the effi ciency of the trans-port networks in place. ITS and traffi c management can contribute to that, but maybe it is only part of the solution.”


Speedar Ad.indd 21Speedar Ad.indd 21 5/1/10 15:50:225/1/10 15:50:22


As 2009 drew to a close, safety was top of the agenda for the Abu Dhabi Department of Transport (DoT), with every road and highway

in the UAE Capital being independently as-sessed for potential causes of accidents in an emirate-wide Road Safety Audit due to be completed before the year-end.

Carried out by an independent and spe-cialised local and international expert team, the aim of the Abu Dhabi Road Safety Audit is to develop a set of road safety audit guidelines tailor-made for the emirate that will refl ect the current and future road network, spe-cifi cally the likely use of these routes and the impact of driving behaviour. Th e audit team was tasked with identifying and highlighting engineering and other physical measures de-signed to reduce the potential for and severity of road accidents, complementing existing road safety awareness and enforcement pro-grammes. On completion of the audits, a multi-government agency team made up of members of the Abu Dhabi Police, the De-partment of Municipal Aff airs and the DoT will work together to fi nalise the guidelines.

Over 200 checks will be carried out on each road during the audit process, covering elements like signage, visibility, road mark-ings, crash barriers, provision for heavy ve-hicles, pedestrian access, parking and more. All checks are due to be carried out twice – once in daylight and once at night – to ensure

TRANSPORTFOCUS

potential issues are noted under diff erent driving conditions. On completion of the audit, risks will be evaluated in terms of the likelihood of contributing to an accident, and the ease and cost-eff ectiveness of required works. Th ese fi ndings will then be assessed and acted upon by the DoT through a detailed implementation plan.

“Reducing the number of accidents and their severity on Abu Dhabi’s roads is of critical importance to the Government and the people of Abu Dhabi,” says HE Eng. Khalid Mohamed Hashim, Executive Director of the Land Transport Sector at the Department of Trans-port. “Th is DoT road safety audit is a valuable tool in the armoury of accident reduction. It is a quick and proactive approach to identify-ing potential road safety concerns across the entire emirate, providing ways in which these can be addressed to help save lives.”

In addition to examining existing traf-fi c routes across Abu Dhabi, the Road Safety Audit team will also be advising DoT during the design and development stages of future roads to maximise safe design practices. Th e audit team provides valuable insights during feasibility, design and build stages into any likely impacts of the ‘human element’ – how drivers, cyclists and pedestrians actually behave, rather than how they should behave according to the rules of the road.

Earlier this year, full audits were under-taken on two major routes: the E22, connect-ing Abu Dhabi and Al Ain; and the E30, the

Streets ahead

truck road running between these locations. Th e audit report identifi ed measures to help reduce the risk of potential accidents, includ-ing minor works like trimming vegetation obscuring road signs, to more pressing issues like repair of crash barriers. Th e measures recommended in the audit are currently being implemented by the DoT’s specialised road contractors.

Th e audits are part of a wider move to overhaul the emirate’s surface transportation infrastructure through the implementation of the Surface Transport Master Plan 2030. For over a year, the Department of Transport has been studying, analysing and identifying the current and future transport needs in the Abu Dhabi metropolitan region, Al Ain and the Western Region, as well as transport needs for inter-regional, inter-emirate and international passenger and freight movements, taking into consideration the Abu Dhabi government’s broader strategies and all relevant social and economic factors such as population growth, urban expansion, industrial development and the considerable rise of Abu Dhabi as a tourist destination and global hub.

“Th e Surface Transport Master Plan 2030 comes in line with Plan Abu Dhabi 2030 and aims to introduce a highly sophisticated transport network throughout the emirate of Abu Dhabi, and to take it to the forefront of globally acclaimed and modern cities and dis-tricts,” says HE Abdullah Rashid Al Otaiba, Chairman of the Department of Transport.

Abu Dhabi has launched an extensive audit of its road network in order to improve the safety of the emirate’s road users.

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Alupole combines both unparalleled expertise and vast experience in thedesign and supply of aluminium poles, steel poles and lattice towers forlighting, telecommunication, over-head high voltage power transmissionand substations up to 800kV.

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including Finite Element Analysis inorder to reduce the risk of compo-nent failure and provide measurablebenefits in terms of reduced materi-al, minimised re-work and betterstructural performance. Embracingscience-in-management in the formof supplier quality engineering(SQE), this reflects another strongcommitment from Alupole to quality

as we take our new ideas and designs to bring them into the real world.

Time and again, Alupole has proven that by leveraging on technologiesand customer-centric design, its efforts in research, prototyping and inno-vation have brought immense benefits to its customers worldwide.

For more information on how Alupole can assist in your projects, visit us at www.alupole.com or email us at [email protected]

Alupole (M) Sdn. Bhd.No. 63-2, 2nd Floor, Jalan PJU 5/21,The Strand Damansara, Kota Damansara,47810 Petaling Jaya, Selangor, Malaysia.Tel: +60 3 6142 3445Fax: +60 3 6142 3446

Pioneering designQuality delivered

Alupole quality management system complies with ISO 9001:2008 and iscertified by LRQA.

Our major projects in Middle East and North Africa:

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2) Dubai Sports City: Aluminium Street lighting poles 2009.3) Sharjah Electricity and Water Authority: Over 10,000 nos. Hot-Dip gal-

vanised Steel pole of 10m, 12m as well as 25 meter and 16 metermid-hinge poles for street lighting 2009.

4) Dubai Rugby Club: Floodlighting Poles 2008.5) Mubadallah, Abu Dhabi: Aluminium street lighting pole 2007.6) Etisalat: Self-Supporting Radio Towers of 40m, 50m, 60m, 80m, 90m,

100m, and 120m of Standard, Medium Duty and Heavy Duty loading2006.

7) Etisalat, Al-Kifaf, Dubai: Decorative Street lighting pole 2006.8) White Nile Petroleum Operating Company (WNPOC), Sudan: 66kV Mala

Transmission Line 2005.

Alupole has been in the MENA region for many years and we are wellpositioned to meet your requirements.

Alupole AD_14june 11/01/2010 15:18 Page 1


Optelecom’s Tariq Anwer, Alupole’sAlbert Lim and Telegra’s Predrag

Balentovi debate the issues aroundintelligent traffic systems.

ROUNDTABLE

FORCED R I V I N G

Transport RT_7dec10 15/01/2010 16:25 Page 120

Rising traffic levels and over-stressed transportation infrastructures arecreating a number of issues in major cities like Riyadh, Dubai andManama. What challenges do the governments of the Middle East facein terms of managing their road infrastructures?Tariq Anwer. The Middle East is expanding so rapidly that roads are con-gested almost as soon as they open up, and some of the main highways inmajor cities are infamous for having the highest number of traffic accidentsin the region. The road authorities’ biggest challenge is to try to cure this ever-increasing traffic headache and improve road safety. Consequently, intelligenttransportation systems (ITS) need to be properly and quickly implementedin Middle Eastern countries.

However, with ever-increasing road networks, the number of camerasrequiring monitoring in traffic control rooms is growing rapidly, and opera-tors cannot possibly be expected to responsibly supervise this abundance of cam-era streams. It is therefore imperative that intelligent video analytics are used tohelp operators with traffic management. By integrating video analysis technolo-gies into network video ITS installations, operators are able to competently over-see a large number of cameras in various places and positions.

Albert Lim. Over-stressed transportation is an inevitable result of rapid de-velopment in any country or region. Governments do their very best to plantheir road infrastructure. However, many times the demand for roads exceedstheir planned construction. There are two main challenges that governmentsin the Middle East face. Firstly, estimating and planning the demand demo-


Albert Lim graduated from ImperialCollege of Science and Technology, London,in 1988, majoring in Advanced Non-LinearFinite Element Analysis for pole structures.He has 21 years of experience in design,manufacturing and installation of poles upto 80m, telecom towers up to 127m andtransmission towers up to 800kV.

Tariq Anwer is the Regional SalesManager of the Middle East for Optelecom-NKF. As a 12 year industry veteran, Anwerhas extensive experience with videosurveillance and security systems andmarkets in the Middle East. Previously,Anwer worked for Group 4 Securitas andAl-Futtaim Engineering in the UAE.

Predrag Balentovi has been CEO ofTelegra since 2005. Balentovi started withthe company as an R&D engineer and wasa driving force in the company'stechnological and business development.In this role, he has also been a keenobserver of and participant in thedevelopments of the advanced trafficmanagement systems that have takenplace in the last 15 years.

THE PANEL


public that ITS found greater potential for its use. However, ITS in its newform with GPS is still very much in its infancy. There are still difficult issuesto be dealt with, such as the GPS requires line of sight and tall buildings or el-evated highways in urban areas tend to limit its use. Cost-effective solutionsto these limitations are needed. ITS solutions are finding their way aroundtheir limitations by combining different technologies; for example, the use ofin-vehicle communication where motorways merge, and the use of real-timevideo of roads on 3G mobile phones to check on traffic.

PB. Advanced tools built into modern systems, such as Telegra’s topXview,emphasise the integration of the various subsystems of urban and suburbantraffic: VMS and displays, emergency road telephones, LED lighting by theroad, video surveillance, video automatic incident systems, traffic counters,overweight and over the height detection systems, speed enforcement and soon. Various information from the road is enriched by new data that is ob-tained by various complex algorithms – an example is the early warnings onpossible traffic jams as a result of various incident detection algorithms.

The system, according to all of the data whether gathered directly from theroad or obtained by algorithms, calculates the current situation for the road or

graphics, which may result in either under-planning or over-planning the infra-structure. Under-planning results in traffic congestion and loss of productivetime for road users. Over-planning results in wasted funding in an area that couldbe otherwise used to build new roads or upgrade existing ones in other areas.

The second challenge is related to increasing the mix of transportationmodes. The main mode of transport in the Middle East is the car. However,governments try to relieve road congestion by having other modes of trans-port, such as improved bus services and the monorail. To have a paradigmshift towards more use of public service transportation is difficult in theMiddle East compared to other parts of the world.

Predrag Balentovi. With the rising levels of traffic two issues appear instant-ly: first and the most important is safety and the second one is time spent intraffic. The obvious choice would be to improve the road infrastructure andthat is, if at all possible, time costly, so governments should find a solution thatcan bring relief quicker and without big infrastructure upgrades. The imple-mentation of advanced traffic management systems is certainly an answer tothese challenges.

Intelligent transport systems are now recognised as critical componentsof local, regional and national transport strategies worldwide. How areITS solutions evolving to meet the challenges of congestion, safety andtransport efficiency?AL. Intelligent transport systems have been around for many years in variousforms. It was not until the advent of GPS systems being made available to the


“It is therefore imperative thatintelligent video analytics are usedto help operators with trafficmanagement” Tariq Anwer

“Advanced tools built into modernsystems, such as Telegra’s topXview,emphasise the integration of the varioussubsystems of urban and suburbantraffic” Predrag Balentovi


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section of the road and automatically reacts, or suggest a reaction – and reactionscan vary, from ramp metering algorithms to synchronising the traffic to runsmoothly. This kind of integrated and centralised system significantly increasesthe traffic safety and reduces the time the vehicle will spend in the traffic.

TA. Modern traffic management systems should be able to monitor thor-oughfares and remotely control traffic signals, speed limits and variable mes-sage, lane and speed signs, bridges and locks. It is also crucial that informationcan be easily shared with emergency service providers to take care of crisis sit-uations as quickly and effectively as possible.

The biggest trend in traffic management today is automatic incident de-tection (AID), which uses software algorithms in combination with networkvideo systems to collect traffic data and trigger alarms for specified events,such as stopped vehicles, speed drops, fallen objects and smoke. There is alsoan increasing demand for high-quality video recording and live viewing.

One of the most innovative solutions currently available on the ITS mar-ket is the Siqura TrafficServer, by Optelecom-NKF. It uniquely offers incidentdetection, traffic data collection and camera monitoring in a single field-hard-ened codec that is also capable of simultaneously streaming H.264, MPEG-2,MPEG-4, and MJPEG for viewing or recording purposes.

Which countries are displaying the greatest appetite for ITS technolo-gies? Can you give us any specific examples of countries/cities that areusing ITS successfully? Are you seeing any innovative approaches in othercountries that could be adopted in this region?PB. Various initiatives are coming out daily. Apart from the well known ITS mar-kets, there are some interesting examples of advanced ITS usage in a number ofcountries – outside the region, Croatia is certainly one of those. It is difficult toextract specific projects, as all across the region there are a number of great onesin progress or in planning. Countries like Qatar, Saudi Arabia, Bahrain, UAE andothers are striving toward and succeeding in building great and advanced ITSsystems.

TA. Due to their rapid developments, the UAE and Saudi Arabia have thegreatest potential for ITS technologies in the Middle East. However, it is theDutch that are the frontrunners in the realm of ITS. This is due, in part, to thefact that the Netherlands is one of the most densely populated countries of theworld. The Dutch Ministry of Transport, Public Works and WaterManagement (RWS) maintains five traffic management centres that monitorand control the country’s highways and waterways, including all the mainbridges, tunnels and locks. The traffic management centre in Rhoon, theNetherlands is probably the most high-tech traffic control room in the world.It even manages the transport routes going into and out of the Port ofRotterdam, which is one of the largest ports in the world.

AL. The very fact that the first ITS conferences in the Middle East were heldin Dubai and Manama in December 2007 and April 2008 respectively, goesto prove both UAE and Bahrain have the greatest appetite for ITS in the re-gion. It is not surprising, as both countries suffer similar traffic woes and bothcare enough for their road users to deal with this issue seriously. Althoughthere are many innovative approaches in countries that have matured ITStechnologies, such as the US, UK, Canada and Australia, it is best that simplefirst steps, taken by to implement ITS in the Middle East. Some very effective

first steps, which these pioneering countries, were to have camera visuals toautomatically control traffic lights in real-time to improve traffic flow, ratherthan relying on unintelligent timing control. Gantry display systems that warnroad users of dangers or congestion ahead can improve on safety and allowroad users to take alternative routes. High-speed, visual toll charge systemscan be very effective in controlling road usage during peak periods. Regulartraffic reports on the radio by other road users offer a very cost-effective so-lution for those planning their road journeys.

What do you see as the most significant driver of the ITS industry in thisregion over the next few years, and what is the greatest challenge to itsfuture development?TA. The economic, industrial and population growth in some parts of theMiddle East has been unparalleled in recent decades. This is the driving fac-tor for improving infrastructures and developing safe and secure traffic man-agement and surveillance solutions. Market research shows that the Middle Eastis one of the fastest growing markets for network video surveillance equipment.Since there is not a huge installed base of legacy systems, it is possible to imple-ment the latest technologies and innovations available in the ITS industrythroughout the Middle East. However, the availability of local expertise for de-sign and implementation of the latest network-based ITS solutions may proveto be challenging. Also, the initiatives taken by ONVIF and PSIA to create openstandards for the interfaces of network video products may be a big help in seam-lessly integrating various systems and vendors in the long run.

AL. The greatest driver in the next few years for ITS industries in the MENAregion would be the congestion problems faced by the most active cities. Thecomplaints from the public on worsening traffic flow conditions will be thegreatest influencing factor for governments to act to improve traffic condi-tions. ITS industries have great opportunities when governments start to re-alise that ITS not only relieves traffic congestion, but also increases safety fortheir road users. The greatest challenge in the future of ITS developmentwould be to discover and implement solutions that are cost effective. Many ofthe ITS solutions currently proposed are very expensive and would discour-age their use both by the governments and by the public.

PB. Regional governments motivated by the growing population and conse-quent growth of traffic have already identified the need to increase traffic safe-ty and reduce the time all of us spend in traffic due to congestion. The numberof projects will rise significantly in the next few years, thus creating a com-petitive and stimulating environment for further implementation and the de-velopment of even more innovative systems. The greatest challenge for theindustry is to constantly improve the conditions on our roads, adjusting tothe changing nature of the future traffic and keeping the pace with technolo-gy and future innovations. n

“It is best that simple first steps aretaken to implement ITS in theMiddle East” Albert Lim


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EXECUTIVEINTERVIEW

Why are road markings and signs important forimproving safe driving in the MENA region?Poul Svensgaard. Driving on roads especially atnight-time can be a challenge. US statistics show thatdriving at night-time increases the risk of fatal acci-dents almost three times, a figure that is probablynot too different from the MENA region. Roadmarkings and signs are important traffic aids inguiding the traffic safely and reducing the risks of ac-cidents. Wear and tear from traffic and sunlight willreduce the retroreflection from road markings androad signs over time, and they need to be main-tained or replaced before they lose performance.Only well maintained road markings and road signswill offer the maximum traffic guidance and safedriving conditions.

How is it possible to know when a road mark-ing or a road sign supporting safe drivingneeds maintenance or to be replaced?PS. Road markings and road signs have to bechecked at intervals to make sure they perform andprovide proper traffic guidance. If they do not meetthe performance criteria they need to be main-tained or replaced. Performance evaluation can be

done in different ways, but the only objective way isto measure the retroreflection using a retroreflec-tometer. A retroreflectometer is placed on the roadmarking or road sign and within seconds it will tellif the marking or sign meet the criteria.

Are there any standards supporting safe driving?PS. There are written standards available, themain ones normally referred to are the European(EN 1436, EN 12899) and the US (ASTM E 1709,

ASTM E 1710, ASTM E 2540) standards. A stan-dard first of all states how to measure retroreflec-tion from road markings and road signs. TheEuropean standards also provide guidance forminimum retroreflection levels for different typesof roads, road markings and road signs. Suchguidance for the US is located in the NationalStandards for Traffic Control Devices. It is myimpression that many countries in the MENA re-gion have not yet put standards in place for mea-suring retroreflection or guidance for minimumretroreflection levels, an area that would benefitfrom improvements, if more safe driving condi-tions are to be obtained.

Will improved performance of road markingsand signs alone provide safer driving condi-tions in the MENA region?PS. I have no doubt that high quality road mark-ings and signs will help improve safe driving – butit will not do it alone. Many other factors affectsafe driving like speed, quality of the roads, expe-rience and age of the driver (elderly people needmore light at night for safe guidance). The chal-lenge in the MENA region is to evaluate each pos-sible factor that may affect unsafe drivingconditions and decide which measures to under-

take to improve the situation. Making sure thatroad markings and signs perform well is one ofthe easiest and cheapest ways towards improvingsafe driving conditions. n

Poul Svensgaard explains the importance of road signsand markings and reveals why standards are key toimproving driving conditions.


Traffic management

Poul Svensgaard is Executive Vice President of DELTA’sLight & Optics division. Svensgaard has an MSC inElectrical Engineering and has studied at HenleyManagement College. He has held numerousmanagement roles within marketing and sales during hisprofessional carrier, as well as held executive positionswith global business responsibility.

“I have no doubt thathigh quality roadmarkings and signs willhelp improve safedriving – but it will notdo it alone”

Poul Svensgaard

Delta Ed_4August 15/01/2010 16:12 Page 126

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The business of aviation is constantly – and rapidly – evolving. What are the biggest operational challenges currently being faced by airports and airline opera-tors alike?Gordon Rosen. Th e biggest operational chal-lenge is keeping pace with that evolution. Th e search for effi cient, cost-eff ective answers is the key to success for airports and operators. Th is means the incorporation of technol-ogy to reduce expenses, maximise profi ts and assist in eff ective logistical management.

How is the advent of real-time data man-agement solutions enabling both airports and operators to achieve maximum pro-ductivity and effi ciency in their daily op-erations?GR. If you’re aware of operational movements in real-time, then your decisions are based on the most timely and accurate facts. Real-time data management allows you to compare the logistical and fi nancial costs of holding a fl ight versus baggage, mail or cargo mis-connects.

Have you been involved in any particularly interesting projects recently? What chal-lenges did these projects present, and how did you address those problems?GR. Yes, ASI was contracted by APS to im-prove interline baggage partnership opportu-nities for Los Angeles International Airport through the revolutionary integration of GPS, Wi-Fi and aircraft movement integration for a true track and trace solution.

Th e largest challenges were due to the fact that 43 airlines would be relying on APS for the successful tracking and transport of six million plus bags annually. Th e airlines didn’t know in real-time where the bags were, so we had to solve this costly problem.

ASI’s premier solution, InterBAG, provides real-time internet-based GPS information, airline movement messages, itinerary and bag-gage messages for intelligent decision support. Using real-time data from BSM, SIMM and MOV messages in conjunction with alert mes-saging, multi-directional communication and immediate data availability, we supplied APS with the tools and support to track every bag travelling to and from LAX.

A strong combination of scanned date for GPS monitoring, daily patrol by internal staff , accounting that allows for accurate billing to the appropriate airlines and service level agree-ments all work in tandem to optimise the customer expe-rience and the overall bag-gage transport process.

The MENA region is cur-rently undergoing rapid development, particu-larly with regards to its transportation systems; more than US$50 billion is currently being spent on expanding the aviation infrastructure in the GCC alone. Why is it important that technology providers such as ASI are involved in the development process to ensure airports continue to meet the needs of both today and tomorrow? GR. Technology providers, by necessity, have to develop answers that will work now and be adapt-able for the future. In 30 years of operation and over 250 installations, we’ve experienced hundreds of ‘important points’. We’ve seen

EXECUTIVEINTERVIEW

The business of aviationGordon Rosen, President of the ASI Group, explains how cutting-edge technologies are improving aviation solutions.

what has worked, and what has not, for the full spectrum of situations and environments the aviation industry faces.

By involving tech providers from the be-ginning, decision-makers can be assured that they’re looking at the complete picture and make their plans with assurance that they can be adapted as the future requires. In the long run, this could save airports billions of dollars.

Finally, what are your plans in the MENA region? How do you hope to capitalise on the phenomenal growth in passenger throughput numbers – and of course, the

attendant rise in baggage and freight?GR. Th e rise in passenger and baggage throughput – and the increasing amount of freight – means it’s more important than ever to rely on technology for cost-eff ective solutions. As with any logistical needs, the in-corporation of hard and soft technologies can drastically reduce expenses and maxi-mise profi ts.

ASI’s soft ware is already being used on every con-tinent and, to date, we’ve installed over 1500 modules around the globe. What’s more, our philosophy of on-going product development and improvement has always been based on industry

trends and customer feedback, so we’re able to adapt quickly and supply airports and opera-tors alike with the best product possible for the present and the future.

Gordon Rosen founded Aviation Software, Inc. (ASI) in 1981, functioning as its chief software architect until 2003. He has served on the boards of domestic and international airlines and FAA Committees and was invited to testify before the Offi ce of Technology Assessment congressional subcommittee as a certifi ed aviation technology expert.

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DD 9999 and the entire BS 5588 series (with the exception of BS 5588-1), which were with-drawn earlier in the year.

El-Chaar believes that the new BS 9999 will be useful for everyone in the industry as it brings earlier guidance up to date and pro-vides greater scope for designers, using fi re

engineering principles to expand the frame-work and provide extra freedom by taking into account the type of occupancy (and the nature of the occupants’ business). Th is will have a bearing on factors such as escape route lengths. “Th is will be helpful for everyone and we want to see it published in our region as soon as possible,” he says.

Ateïs’ catalogue of public address and voice evacuation products are strong adher-ents to British Standards – notably BS5839 part eight (Voice Alarms) – and Al Haddad says that the British Standard compliance in

ATEÏS Middle East was one of the sponsors of a two-day conference and masterclass in London recently to discuss the

ramifi cations of BS 9999:2008, a new Code of Practice for fi re safety in the design, manage-ment and use of buildings. Th e seminar set out to demonstrate that good fi re safety, design and management is critical to protecting life and property. It was agreed that ensuring fi re safety and business continuity while cutting costs becomes increasingly important in this challenging economic climate.

Among the delegates attending was Ateïs Middle East FZCO General Manager Hussam Al Haddad, who arrived accompanied by senior fi re offi cers and safety professionals from the UAE. Th ese included Mir K. Hussain, Senior Electrical Engineer, GA Architects, Abu Dhabi; Jamal El-Chaar, Head of Electrical Dept, ACG Architectural Consulting Group, Abu Dhabi; and Mohamed Ashraf Radwan, Senior Electrical Engineer, ADG Architecture & Planning Group, Abu Dhabi.

All agreed that it had been vital to have fi rst-hand experience of the new regulation from the outset, as the region is increasingly seeing the British Standards as representing the most important kitemark when setting safety standards. BS 9999 has now superseded

the GCC countries is fast becoming as impor-tant as the UL American National Standards. Hitherto it has been diffi cult to convert BS fi re standards to National Fire Protection Associa-tion regulations – however, the two men pre-dict that this is now set to change. “Until now the GCC has been BS-compliant in all areas except fi re,” believes El-Chaar. “Yet we feel BS 9999 is much clearer and contains more de-tails, and is easier to implement. New regula-tions take time to become established, and it’s the local authorities who have the power – but this is extremely comprehensive.”

As soon as BS 9999 is launched in the emir-ates, ACG Architectural Consulting Group, who conduct all their own risk assessments in terms of fi re, security and mechanical safety, will undertake their own local training.

El-Chaar praised Ateïs Middle East for their initiative in sponsoring the conference, and for leading a team from the region over to the UK. “I have been in the business for 21 years and I don’t think I have known anyone as helpful,” he says. “Th ey take a very responsible attitude towards safety and security.”

His views are echoed by Mir K. Hussain, who says he had been looking for specifi cs, “such as the distances between one detector and another, and between sprinklers” in BS 9999. “Th is new standard is easier compared

with NFPA from a practical point of view – in fact it’s far better, and needs to be made con-crete as soon as possible.”

GA Architects specialise in hospitality – notably the hotel industry – and Hussain says the requirement varies from application to ap-plication: “But this new standard will become adopted more quickly if we have someone lo-cally to support us.”

New safety standards are improving the fi re safety industry in the Middle East, says Ateïs Middle East’s Hussam Al Haddad.

LEADING THE WAY

FIRESAFETY

Hussam Al Haddad is the General Manager-ATEIS Middle East and Member of the International Standards committee and Business Development Solutions at the ATEIS Group. ATEIS is a leading voice evacuation, public address and professional audio manufacturer, with more than 35 years experience of worldwide innovation.

“Until now the GCC has been BS-compliant in all areas

except fi re”

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The UAE recently celebrated its 38th anniversary and those that were present during the celebrations will have surely felt the enormous national pride

that was emanated across the country. Quite rightly so, because the achievements over the last, almost four decades, in cross sectional development, whether industrial, commercial or residential, have been a parallel to the re-development of European countries that took place over the same period of time following the second world war. Th e only real diff erence is that the UAE was developing from scratch, and not re-building.

Th e result at the end of the 38 years develop-ment process is a harmonious, multi-cultural, modern metropolis. Many of the neighbouring countries are following suit, perhaps slower, but certainly with growing impetus. Th ere was a time, 15 years back, when the elements of de-

velopment were not at all cohesive with modern day fi re and safety issues – although regula-tions taken from abroad were theoretically in place, they were to a large extent, inadequately enforced. I have witnessed the continuous improvement and strength of enforcement of regulations in this fi eld.

Th is goes for the entire region, but particu-larly for the UAE. Drawing upon the experience of the rest of the modern world, the GCC coun-tries have skipped many steps along a 100 year (or more) long learning curve, in the fi eld of fi re and safety development.

Th e fact is that much of the state-of-the-art fi re and safety technology has been introduced into the endless stream of megaprojects that

showcase the regions development, by foreign consultants through specifi cation. Product and system supply into these projects has been served by foreign manufacturers through local agents, and the installation of the same carried out by regional contractors. Th e testing and

Life safety systems

Barry Bell, Senior Engineering Consultant and Managing Director for Wagner Fire Management, explains the importance of fi re detection and protection systems.

commissioning process of complex fi re and safety systems in equally complex buildings should be a long and comprehensive process, including recoverable and retraceable testing and commissioning documentation. In most cases, the manufacturer has to provide techni-cal assistance during this process because nei-ther the design consultant nor the installation contractor has the necessary knowledge or tools required to complete the process alone.

Th e importance of complete and accurate testing and commissioning of fi re and life safety systems in new buildings is vital for the safety of the intended occupants and protection of the investment. In my capacity as a building auditor in the UAE, for both new and existing buildings, I have reason to raise this issue to the regions developers, investors and design and manage-ment consultants that share responsibility for ensuring that this process is conducted to the highest possible standards.

We should be aware that when buildings are handed over and the occupied life cycle begins, the fi rst year of the building’s life is criti-cal in terms of risk. It is not until a building has survived a reasonable period without an event that we can be reasonably satisfi ed that there are no latent hazards related to poor installa-tion, faulty wiring, defective plant equipment or other similar construction and installation de-fects. When all the consultants, contractors and sub-contractors have left , facility management takes over. Th ird party maintenance companies are oft en engaged to handle fi re and life safety systems. We know that if a building has not been completely tested and commissioned, the maintenance companies are unlikely to become aware of defi ciencies until it’s too late.

It is unfortunate that many active mainte-nance companies in the region do not have the knowledge or the tools to service, maintain, test or repair complex fi re and safety systems. It is important to ascertain the qualifi cation and experience of maintenance companies in direct relation to the systems and equipment they assume responsibility for.

If fi re detection and protection systems fail to operate as intended because they were not tested and commissioned properly – this is obviously the time when defects are identifi ed and rectifi ed – the investors and stakeholders may experience an unfortunately early disaster involving large scale fi nancial loss.

ASK THEEXPERT

“Accurate testing and commissioning of fi re and life safety systems in new buildings is vital for the safety of the

intended occupants”

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Threats to society have been in existencefor as long as civilisation itself. So hasthe need to effectively respond and re-mediate them. As threats became

more varied and complex, attempting to keep pacewith effective response and remediation equipmenthas become a serious budget issue. Single hazard re-sponse systems no longer make sense and multi-hazard equipment is becoming the new norm.

Multi-hazard equipment provides responderswith tools to address a wide range of incidents. Theability to use a single unit to respond to a CBRN in-cident as well as suppress fire reduces the need tobuy multiple pieces of equipment and enhances theresponder’s ability to provide an effective responsein a situation where multiple hazards may concur-rently exist.

Consider an intentionally set fire intended tocover up an anthrax attack. While responders fightthe fire, they may be exposed and spread the conta-minant. If responders had multiple hazard equip-ment, they would have the flexibility to respond tothe multiple hazards at the scene. Using the samescenario, a responder could use a single piece ofequipment to contain the contaminant and beginthe decontamination process, rinse the unit’s tank,

refill it with a different formulation and use thatsame unit to suppress the fire. Consider the lives andmoney that could be saved. Such equipment andformulations are currently available.

Intelagard offers advanced Compressed AirFoam (CAF) systems. These systems are an excel-lent choice for initial response applications for anumber of important reasons: their ability to ex-pand on-board resources in the form of expandedfoam allows for maximum effectiveness per sizeand weight, with a corresponding significant re-duction in logistical support requirements,whether used for fire, decontamination or otheremergency response. The unique foam bubblestructure generated through Intelagard systems al-lows the foam to adhere to vertical and invertedsurfaces, and the durable foam blanket maintainsrequired wet contact time between the chemical,biological agent or virus and the decontaminant.

Depending on the situation encountered, thesystems will deploy fire suppression foams, chemi-cal/biological decontamination foams, and hazmatremediation foams. Compressed air foam, especial-ly in fire situations, has been found to be more ef-fective than water in knocking down fire. Less timeand less resources are required. When performing

decontamination operations, Intelagard systems arecapable of applying compressed air foam, air aspi-rated foam and liquid with simple control adjust-ments, in order to quickly and effectively switchoperational modes to match specific needs.

Intelagard’s portable CAF systems include theman-portable Macaw backpack, Merlin handcart,and SwiftCAF All Terrain Vehicle ATV systems. TheMacaw is powered by an on-board air cylinder, or bya direct hose feed from an air compressor. The sys-tem is capable of applying virtually any liquid-basedmaterial through an array of accessory nozzles, andcan expand foaming solutions up to 70 times. Macawunits are fully portable, comfortable to carry and arecurrently deployed by the US military.

The Merlin is a twin-tank, cart-mounted unitthat can expand solutions up to 70 times. The equip-ment case quickly detaches from the cart to be usedas a hand-carried drafting system for limited accesssites. Federally funded US Urban Search and Rescueteams use the Merlin for a umber of applications.

Turn your all-terrain vehicles into responseunits using the SwiftCAF ATV system. Do not letdamaged infrastructure or abandoned cars preventyour ability to respond. As with all Intelagard sys-tems, the units may be used for decontamination,fire suppression and hazmat remediation.

Large-scale systems are also available, in-cluding the Falcon Fixed Site DecontaminationSystem (FSDS). Deployed worldwide by the mil-itary, the Falcon FSDS is a large-scale truck andtrailer system capable of transporting and dis-persing decontamination formulas as well as stan-dard fire suppression foams.

Make multi-hazard response systems a part ofyour response plan – they are practical, economicaland efficient. �


PRACTICAL PREPAREDNESS Dennis Smagac, President of Intelagard, argues that multi-hazard response systems and equipment should be a part ofevery emergency response plan.

INDUSTRYINSIGHT

Dennis Smagac co-foundedIntelagard in 1991. His missionboth then and now is to save livesand property. Smagac continues to

advance and evolve cutting-edgemultiple hazard response

technology.

“Compressed air foam,especially in fire situations,has been found to be more

effective than water inknocking down fire”

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advantages, and the AeroTEM system can be quickly employed and has been credited with a number of mineral discoveries.

In this example, the AeroTEM survey is interpreted to produce a 3D model of the variation in the electrical conductivity of the ground. Th ese results are used to map the continuity, thickness and depth of the various layers across the survey area. A conductive shale formation in this area is very impor-tant in delineating the underlying sandstone (the reservoir rock), and is also an important element in defi ning the mining/extraction process for oil sands. Th e AeroTEM results also eff ectively map the distribution of ag-gregate resources at surface. Paleochannels are mapped as relatively resistive units with a very clear morphology and are important as sources of aggregate and water, and for plan-ning the oil sand extraction process.

Th e application of this technology is vir-tually limitless. In western Africa, AeroTEM was eff ective in locating and characterising conductive ground sinks for electrical trans-mission lines. In eastern Africa, AeroTEM was combined with the magnetic and radiometric methods for mapping potential gas seeps across a prospective licence area. Combining the appropriate EM technology with magnet-ics and radiometrics allows for the layering of information for a more eff ective and robust in-terpretation of the survey results. AeroTEM is currently being used in Yemen for the charac-terisation of the low velocity layer to improve the static correction of noisy seismic data.

Aeroquest’s history is proof of capable guidance, growing an innovative, full-service airborne geophysical company that provides service globally to multiple markets. Th e company as a whole has acquired and deliv-ered more than nine million line kilometres of high-resolution airborne geophysical data. And Aeroquest’s present is focused on further expanding and developing our technologies and services. From a high-resolution magnetic gradiometer to the helicopter-borne AeroTEM system to our frequency domain EM systems, the strength of Aeroquest’s product off ering is in its diversity and the ability to customise the survey systems and parameters to match the project requirements.

bar in the airborne geophysics industry, build-ing on its past successes and leadership in the industry. Th e UTS arm of the company was the fi rst to off er compensated, stinger-mounted magnetics on a helicopter for high resolu-tion, high accuracy magnetic mapping in any terrain. UTS continued to innovate, and de-veloped Ultra High Resolution Airborne Mag-netic and Radiometric (UHRAM) surveys. Th ese surveys off er the highest resolution data sets available from a fi xed wing platform and are delivered using purpose-built crop-duster aircraft capable of fl ying safely as low as 15-20 metres above the ground.

Aeroquest was also the fi rst to commer-cially off er helicopter-borne time-domain electromagnetic (HTEM) surveys. Th ese sys-tems have powerful transmitters that allow for mapping to depths of several hundred metres with great spatial resolution and detail. Th e AeroTEM system is well-suited to the delinea-tion and interpretation of both discrete targets and stratigraphy in many environments. Helicopter-based systems provide project managers with many technical and logistical

All projects, from those of a re-gional nature to those with a small footprint, benefi t from an understanding of the geology

OF the near surface. Airborne geophysical surveys off er mature, non-invasive technolo-gies that provide systematic, quantitative, rapid, cost-eff ective information about the near-surface in the project area. Modern airborne geophysical methods off er accurate, high precision, calibrated data sets, which measure the electrical conductivity, magne-tisation, natural radioactivity, topography and density. Th e correct combination of these methods for a given project will provide valu-able layers of information for integration and interpretation of the surface and sub-surface characteristics.

With a presence on every continent (bar-ring Antarctica), and as a public company focused exclusively on airborne surveying, Aeroquest International Group of Companies is uniquely positioned to deliver customised turnkey airborne services wherever a project is located. Aeroquest is focused on raising the

INDUSTRYINSIGHT

The more you understand about your project in the early stages, the better you are able to plan for and manage risk. Aeroquest’s Jonathan Rudd explains how airborne geophysical methods are helping improve information capture.

Improving data capture

Jonathan Rudd is Chief Geophysicist at Aeroquest Surveys.

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Emaar Hospitality has pledged to build a world-class fi ve-star hotel chain, The Address, in under a decade. How close is it to achieving this aim?Marc Dardenne. Emaar Hospitality Group launched Th e Address Hotels and Resorts a little over a year ago. Th is was shortly followed by the open-ing of its fi rst and fl agship hotel, Th e Address Downtown Burj Dubai to global acclaim. Response to the hotel has been strong and it continues to record robust occupancy levels. It has also become a social hotspot in Dubai with a range of restaurants including Neos, an impressive sky lounge on the 63rd fl oor. Its close proximity to Th e Dubai Mall, the world’s largest shopping and entertainment destination and direct views of Th e Dubai Fountain – the tallest performing fountain in the world – have added to its popularity. Some of the other key achievements for Th e Address Hotels and Resorts include assuming the management of Th e

Palace – Th e Old Town hotel in Downtown Burj Dubai – and signing international management contracts in Morocco and France to manage luxury resorts.

Th e Address Hotels and Resorts will operate Domaine de Lavagnac, a luxury resort developed by Residence De Lavagnac SARL in Languedoc-Roussillon, South of France. Scheduled to open in 2011, Domaine de Lavagnac is the fi rst fi ve-star tourism development in Languedoc and comprises a 17th century chateau that is being transformed into a 70-suite hotel located in close proximity to the Mediterranean coast. Th e Jnan Amar Polo Retreat in Morocco is a luxury retreat developed by SIAMA, a subsidiary of Azmi Abdelhadi (AAH) Group in Marrakech. Th e Address will manage the luxury fi ve-star retreat hotel and includes dining facili-ties, meeting venues, leisure facilities and business lounge as well as several luxury villas.

With plans afoot to establish a fi ve-star hotel chain in under 10 years, Emaar Hospitality Group has set itself an ambitious target. But as CEO Marc

Dardenne tells MENA Infrastructure, it has every intention of reaching it.

luxuryThe

collection

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Other milestones include the opening of our third property, Th e Ad-dress Dubai Mall in September and another property will open soon, Th e Address Dubai Marina.

What plans does The Address Hotels and Resorts have to expand its hotel portfolio globally and which parts of the world does it plan to target?MD. Th e Address Hotels and Resorts is part of Emaar Hospitality Group, the hospitality and leisure subsidiary of Emaar Properties. As one of the world’s largest property developers, Emaar is creating integrated lifestyle communi-ties across key emerging markets as well as developed economies. Emaar Hospitality Group and Th e Address Hotels and Resorts will support the hospitality and leisure aspects of these communities across the world as well as explore independent hotel development, management and operation contracts. Our development pipeline for Th e Address Hotels and Resorts includes Egypt, Lombok in Indonesia, Jordan, Saudi Arabia, Syria, Turkey, Budapest, Shanghai, London, Los Angeles and New York. We will continue to focus our development ef-forts in the Middle East and North Africa region, the Indian Subcontinent and South Asia. Th e Address has won many presti-gious international awards this year including: Hotel Business Lounge of the Year – Commercial Interior Design Awards 2008; Best Leisure and Entertainment venue – Commercial Interior Design Awards 2008; Best New Hotel – Arabian Hotel Investment Conference Awards 2009; Dubai’s Leading Lifestyle Hotel and Middle East’s Leading New Hotel – World Travel Awards 2009; Condé Nast Traveler Hot List 2009; Th e Palace – Th e Old Town ‘Dubai’s Leading City Resort’ – World Travel Awards 2009.

What will be the unique brand values of The Address and how will it differ from other luxury hotels in the UAE?MD. Th e three key diff erentiating factors for Th e Address Hotels and Resorts are: location, service and benefi ts. Th e brand defi nes itself by its ‘one size fi ts one’ approach whereby benefi ts to guests and service ex-cellence are priorities. For the convenience of guests, all check-ins are processed in the guestrooms upon arrival. In addition, complimentary wireless internet is available throughout the properties apart from a 24-hour fi tness centre and a 24-hour business lounge. Guests opting to stay in suites or club rooms can enjoy the innovative and convenient privilege of a complete 24-hour stay.

How high has demand been for Nuran, Emaar Hospitality Group’s serviced residences, and what plans are there to expand the chain?MD. Currently, we operate two properties under the Nuran brand, namely, Nuran Marina Serviced Residences and Nuran Greens Serviced

Residences. A third and fl agship Nuran serviced residence is planned in Downtown Burj Dubai. We are targeting the leisure sector in the GCC, which has earned us good results in the summer months.

How has demand for and development of luxury hotel develop-ments been affected by the global economic downturn?MD. We opened Th e Address Downtown Burj Dubai in the thick of the global fi nancial downturn. During this time we also won two interna-tional management contracts to operate luxury properties in addition

to opening another hotel this year. Demand for luxury hotels continues to be strong in Dubai, led by its robust visitor arrivals.

Does Emaar have any plans to enter the mid market hotel sector or will it remain exclusively in the luxury boutique hotel sector?MD. We are currently concentrating on en-suring the continued success of our fi ve star premium hotel brand Th e Address Hotels and Resorts as well as the successful launch of the fi rst Armani Hotel.

What are the biggest challenges you face as CEO of Emaar Hotels and Resorts in the year ahead?MD. One of the biggest challenges faced by

the hospitality industry is sourcing and retaining key staff as well as ra-tionalising and maintaining a high degree of resource use effi ciency.

Is Emaar Hotels and Resorts planning to form partnerships with any more international design brands? MD. Currently, Emaar is focused on the roll out of the Armani Hotels and Resorts.

About Emaar Hotels and ResortsEmaar Hotels and Resorts LLC is a subsidiary of Emaar Properties and was initially created as part of a joint venture project with the fashion designer Giorgio Armani. Its aim is to develop and operate hotel branded products at fi ve-star level that are internationally recognised as “lifestyle” oriented hotels.

The fi rst Armani/Emaar hotel will be in the Burj Khalifa where the company is also looking to develop and operate a collection of branded, mixed-use properties. Through the collaboration with Giorgio Armani SPA, Emaar Hotels and Resorts LLC is responsible for expanding Emaar’s profi le on a global basis by the creation of Armani Hotels, Resorts and Residences internationally.

Marc Dardenne

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Last month the real estate company launched its Heart of Europe devel-opment – a six-island, 12-site luxury holiday destination that will begin

construction on the island of Germany in the fi rst quarter of 2010, followed by plans for Austria, Switzerland, the Netherlands, Sweden and St Petersburg. When complete, Th e Heart of Europe will be home to 75 private holiday homes, six apartment buildings, six hotels, six lighthouses and six fl oating palaces as well as a diverse range of retail, entertainment and restaurant outlets.

While property prices in the emirate fell up to 50 percent last year, Kleindienst Group remains confi dent in the investment potential

Things looking up for The WorldGerman real estate company Kleindienst has announced plans to build luxury villas and hotels on six of the artifi cial islands on Nakheel’s The World project – despite the fi nancial woes faced by the Gulf emirate.

of Th e World given that it is one of the only sites dedicated entirely to holiday home ownership. “We have interests in industrial, commercial, hospitality and residential real estate, but Th e World is where we now see the strongest market potential,” explained Chief Executive Josef Kleindienst. “Tourist arrivals to Dubai have increased despite the economic slowdown in 2009, and worldwide the market for property ownership abroad has shown resilience, partic-ularly for luxury holiday home destinations.”

According to analyst reports, Germans alone will purchase 60,000 new vacation homes around the world in 2010. “We anticipate Th e Heart of Europe will attract interest from both off shore Europeans and residents of Dubai.

Investor enquiry levels are looking positive – we have already sold three villas ahead of our offi cial launch to market,” said Kleindienst.

Commenting on the launch of Th e Heart of Europe Marwan Al Qamzi, Group Manag-ing Director from master developer Nakheel, said: “Th e World is one of our most ambitious projects and part of the long-term vision of Dubai. Th e development is bolstered by the select group of developers on Th e World who have the skill to create developments consis-tent with the vision of the project and have the expertise and capital to deliver economically viable projects in a mature real estate market.”

Th e move is welcome news for Nakheel, one of the key subsidiaries of Dubai World, which is facing staggering debts of $59 billion. Th e company narrowly escaped debt default last month aft er payment was covered thanks to a $10-billion lifeline extended by neighbour-ing Abu Dhabi, and Kleindienst’s announce-ment came as Dubai World began talks with its lenders on how to restructure its $22 billion debt. Nakheel has already put several other larger-than-life Dubai projects on hold.

An aerial view shows a cluster of man-made islands,part of The World on December 21, 2009.

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IN THE BACK142

Strategy for Sustainability: A Business ManifestoBy Adam Werbach

More than ever before, consumers, employees and investors share a passion for companies that do well by doing good. So any strategy without sustainability at its core is just plain irresponsible – bad for business, shareholders and the environment. Th ese challenges represent unprecedented opportunities for big brands – such as Dell, Toyota and Wal-Mart – that are implementing integral, rather than tan-gential, strategies for sustainability. What these companies are doing illuminates the book’s practical framework for change, which involves engaging employees, using transparency as a business tool, and reaping the rewards of a networked organisational structure.

MENA Infrastructure says: Full of insight and wisdom, this is a valuable and thought-provoking read on implementing sustainability in your business.

An Introduction to Sustainable Transportation: Policy, Planning and ImplementationBy Preston Schiller, Eric C. Bruun and Jeffrey R. Kenworthy

Transportation is one area that is under scrutiny for its contribution to increasing our carbon foot-print. Written by three lecturers and experts in transportation policy and planning, this book explores sustainable transportation and development and suggests some innovative solutions regarding mo-bility management. It contains sections on policy-making and planning and compares and contrasts various modes of transport, from human-powered modes to motorised modes, including marine and air transport. Th e book also features many international examples and case studies, textboxes, graph-ics, recommended reading and end of chapter questions.

MENA Infrastructure says: A great introduction to sustainability in transport – an informative, au-thoritative and worthwhile read for all those interested in or intrigued by the subject.

Sustainable Construction: Green Building Design and DeliveryBy Charles J. Kibert

As industry attempts to review its construction practices and promote more sustainable buildings, this book provides a handy introduction to the design and performance of commercial and insti-tutional green buildings. Author Charles Kibert uses the book as a way of encouraging the reader to realise the ecological and economic benefi ts of green building. He uses the US Green Building Council’s Leadership in Energy and Environmental Design (LEED) set of standards to help explain these benefi ts.

MENA Infrastructure says: Ideal for anyone wanting to learn more about the theory, history, best practices and state of the industry with regards to green building.

On the shelfTaking an in-depth look at sustainability, MENA Infrastructure uncovers the best of this quarter’s book releases.

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From the people you hire to the products you sell, if you’re in business, we’ve got it covered...

Your World. COVERED

Find out more: www.menainfra.com

InfrastructureInfrastructure provides insight on how developers can achieve critical objectives by integrating leading-edge solutions across their operations – helping them to make informed decisions about technology and operations solutions for all of their areas of responsibility.

Next Generation PharmaceuticalApproximately 50% of new drug development fails in the late stages of phase 3 – while the cost of getting a drug to market continues to rise. NGP is written by pharmaceutical experts from the discovery, technology, business, outsourcing, and manufacturing sectors. It is committed to providing information for every step of the pharmaceutical development path.Available for: EU

Find out more: www.ngpharma.com

Next Generation Power & EnergyA poll of 4000 utility executives posed the simple question: what keeps you up at night? The answers were costs, new technologies, ageing infrastructure, congested transmission and distribution, viable renewables and inadequate generation capacity. Available for: US

Find out more: www.nextgenpe.com

Oil & GasCollaboration between Government and multinationals to ensure the energy supply is developing on two fronts. O&G is the defi nitive publication for stakeholders and service companies to read about the regional projects, technologies and strategies affecting their group.Available for: MENA, US, Russia

Find out more: www.ngoilgasmena.com

Business ManagementWhat business processes work? What are the proven, successful strategies for taking advantage of domestic and international markets?Business Management is about real, daily management challenges. It is a targeted blend of leadership and learning for key decision makers in government and private enterprise.Available for: US, Middle East, Russia

Find out more: www.busmanagementme.com

ALSO AVAILABLE FOR: US & EU

EU EditionionEU Editi

US Edition

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IN THE BACK144 AWAY ON BUSINESS11111444444444444 AAAAWWWWWWWAAAAYY OONN BBBBBBUUUSSSSSSIINNNNNNNNEEEEEESSSSSSSSSSSSSPHOTO FINISH144

DUBAI FOUNTAINSet on the 30-acre Burj Dubai Lake in the shadow of the world’s tall-

est structure, the $217 million Dubai Fountain promises to rapidly become one of the Gulf ’s must-see tourist attractions. Th e spectacular water feature – in true Dubai-style, the world’s largest – shoots water

jets as high as 500ft , equivalent to the height of a 50-storey building, is 900-feet-long and has fi ve circles of varying sizes and two central arcs. Th e beam of light from the Emaar-developed fountain can be seen from over 20 miles away and will be visible from space, making it the brightest spot in the Middle East – and quite possibly, the entire world.

Designed by California-based WET, creators of the famed fountains at the Bellagio in Las Vegas, the attraction contains over 6600 WET Superlights – the most advanced incandescent large fountain lights available today – and 25 colour projectors to create a visual spectrum of over 1000 abstract light and water combinations, artfully set to music.

Key facts• World’s largest dancing fountain• In sync with classical, Arabic and world music• 1.5 million lumens of projected light• Spray heights of up to 500 feet• 22,000 gallons of airborne water

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INFRA MENA 4

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