Mark Grogan, manager, contracts and quantity surveying at KEO International Consultants, has a freewheeling chat about his two decades in the UAE.
Mark, you arrived in the UAE several years ago. What was the construction industry like before the freehold boom?
I arrived in the UAE in December 1993, working on a government scheme to provide low-cost housing for nationals in the Northern Emirates. In August 1994, I moved to Dubai for what was one of the highest-value projects in Dubai at the time, budgeted for $60.98 million – the Trade Centre Interchange at the start of Sheikh Zayed Road – of course this was several years before the freehold boom in Dubai, and it was followed by Emirates Towers. I also worked on the Jebel Ali Golf course, the first private golf course in Dubai, built in 1997-98. I spent a little over two years in Abu Dhabi – it was the start of the retail revolution, working on the Abu Dhabi Mall, which was also one of the first construction projects let as a design and build contract.
When I joined KEO ten years ago, it was the time of the freehold boom with us working on five towers in JLT and Dubai Marina, which included offices, residential and hotel towers.
So what was the typical construction programme like then and now?
Looking back to my first project here, the Trade Centre underpass, it was on a reasonable programme stipulated by the client, the Roads Department of Dubai Municipality. With the arrival of the freehold boom, there was a drive by developers to turn things around quickly to maximise profit; this resulted in tight construction programmes. The other problem was a desire to build at a cost to maximise returns. A cost diagram shows a triangle of cost-quality-time; here we had situations that could result in the cheapest contracts to produce lower-quality buildings in the shortest time.
How did KEO fare during the boom and afterwards?
We actually did not do too badly during the recession and after, because we are a multidisciplinary practice. As we cover master planning to commissioning, as business in one division went down this was compensated by work in other divisions increasing. It also helped that our business is spread across the GCC and further afield. Even before the dip in Dubai, projects in Abu Dhabi, Qatar, Bahrain, Sudan and Malaysia were keeping the company busy.
As a quantity surveying professional, can you tell us how the profession has evolved in the region since you started?
In Dubai, things have changed for the better. For instance, the Roads Department of Dubai Municipality in 1995 directed that the Civil Engineering Standard Method of Measurement should be used to prepare the commercial tender documents for infrastructure works. This is an internationally recognised UK document that contractors welcomed with open arms, as it gives clear guidance on the pricing of items of work. More recently, Abu Dhabi and Muscat are now adopting the same standards as well.
However, on the building side, we are still using a document written in 1979 and unchanged since then. This was written for undeveloped areas around the world, which Dubai most certainly is not – you are seeing buildings here that are as complex as any in the world. Yet we still have a situation where, in terms of controlling cost, giving the client accurate cost information is difficult because we are using a document that does not really lend itself to today’s market. These are QS principles and not rules, which means they can be interpreted in different ways. Although they give guidelines, these are not as defined as the rules in a Standard Method/Rules of Measurements.
Tell us more about the evolution of the contractor’s role.
It has definitely evolved – but then again, it depends on the client. On the Atlantis resort, one of the early projects I worked on with KEO, the client, an international hotel operator, realised that the building was unique and he brought the contractors in very early on the project. We have seen contractors brought in early on other projects, but it is an exception rather than the rule. In Abu Dhabi, design and build procurement is now being implemented but has teething problems, as it is a new concept to the construction companies.
Bringing in contractors early on projects has the advantage of having their knowledge to improve constructability integrated into the design. The building should therefore be built more efficiently, in a shorter time and at more economical cost.
What is your overview of the state of the QS profession? Have fees and work opportunities increased?
Let’s face it – the profession is not one that attracts many people. Construction careers do not rate highly to some people. We have a very limited market from which we can hire QS staff. At the moment, there is a shortage of qualified quantity surveyors. While the UK and countries such as Sri Lanka, South Africa and Australia follow recognised courses of education, there are few institutes and these are often over-subscribed. If you are a 30- to 35-year-old QS professional now, you can almost name your price. All the GCC countries need people, but at the same time not everyone wants to come to the Middle East.
Quantity surveying is like project management, in that it can cover a multitude of responsibilities. An RICS qualification in the UAE is not recognised by the labour laws in the UAE, while a degree is (though in Oman they recognise that RICS qualification is equivalent to a degree). The UAE labour code has a category of a “construction costs calculator”. The RICS now has a MENA region office in Dubai’s Knowledge Village to promote the profession, so in the future the RICS qualification will be recognised.
Of all the projects you have been associated with, which have been the most memorable?
That is a difficult question to answer. Each project has its own challenges. One I worked on in Oman, a major redevelopment when it is finished, was master planned in 2007 and is memorable because of the time it has taken. The Trade Centre Interchange was built between 1994 and 1997 and it still works. If you look at the bigger picture, it was part of a farsighted plan by Dubai Municipality. The Qatayat Road interchange was under construction by Al Futtaim Wimpey (Carillion), the Wafi interchange was being built by Balfour Beatty, and Deira City Centre interchange was being built at around the same time. All these projects happened within the same span of four to five years.
Quantity surveyors are increasingly involved in value engineering, which many architects regard as a process that cheapens their design. What is your take on this?
Value engineering is another much misused and abused word. It is delivering the best value into a project, which is not necessarily about saving costs. In value engineering, you look at lifecycle costs. Put something cheap now and you pay for it later. We have one client who looks at lifecycle costs, because it is easier for him to get budget approval for lifecycle cost – but that is an international client. A lot of clients, particularly those who are building to sell (speculative projects), only look at the initial capital cost. When specifications are changed to simply reduce construction costs, it is not value engineering.