MIDDLE EAST

CONSTRUCTION HANDBOOK
2012

MIDDLE EAST
CONSTRUCTION HANDBOOK
2012
Middle East offices
Bahrain (Manama)
bahrainoffice@davislangdon.com
+973 17 588 796
Egypt (Cairo), North Africa
cairooffice@aecom.com
+202 2 750 8145
KSA (Khobar)
khobar@aecom.com
+966 3 849 4400
KSA (Jeddah)
jeddah@aecom.com
+966 2 653 1902
KSA (Riyadh)
riyadh@aecom.com
+966 2 213 8500
Kuwait (Kuwait City)
kuwaitoffice@davislangdon.com
+965 2 232 2999
Lebanon (Beirut)
beirutoffice@davislangdon.com
+961 1 780 111
Oman (Muscat)
muscat@aecom.com
+968 2 448 1664
Qatar (Doha)
dohaoffice@davislangdon.com
+974 4 458 0150
UAE (Abu Dhabi)
abudhabioffice@davislangdon.com
+971 2 414 6000
UAE (Dubai)
dubaioffice@davislangdon.com
+971 4 423 3690

1 DAVIS LANGDON

An AECOM Company

Global presence

Rich Middle East history

Industry awards

2 GLOBAL CONSTRUCTION CONSULTANTS

The bigger picture

13

Sector specialists

13

Cohesive solutions

13

AECOMs integrated services

14

Thought leaders

14

3 ECONOMIC ROUND UP

Country statistics 2011

19

Economic and construction overview

20

Construction trends and outlook

27

4 ARTICLES

Is this the dawn of truly integrated project delivery ?

35

Cost-effective carbon reduction

43

Development Management Creating a bankable scheme 48

Infrastructure: An unprecedented demand

54

Saudi Arabia: Social infrastructure development

60

Hosting global sporting events

65

Kuwait: Infrastructure in motion

69

5 REFERENCE Articles

Procurement routes

77

Middle East forms of contract

80

Building regulations and compliance

85

6 REFERENCE data

Exchange rates

95

International building cost comparison

96

Regional building cost comparison

Mechanical & electrical cost comparison

100

98

Major measured unit rates

102

Major material prices

104

Labour costs

106

Building services standards

107
110

Measurement formulae two dimensional figures

Measurement formulae three dimensional figures 111

Weights and measures

113

7 DIRECTORY OF OFFICES

Middle East

117

North Africa

121

Africa

122

Americas

124

Australia & New Zealand

125

UK & Europe

126

FOREWORD

Welcome to the sixth edition of

our Middle East Construction
Handbook. I hope you will enjoy
this years selection of articles,
reference information and cost
data.
As you may know, AECOM provides
over 60 professional services to clients across the Middle
East geography, on large, medium and smaller sized projects
and across all parts of the value chain. These services
include Front End Consultancy, Development Management,
Program Management, Project Management, Construction
Management, Contract Administration and Construction, to
name a few.
At each point in this value chain there is a critical
relationship between the disciplines of time, cost, quality
and Safety, Health and Environment (SH&E). AECOM is
ideally positioned to manage these services on behalf of our
clients. The provision of these services and disciplines may
be required individually, or through an integrated offering,
dependant on the drivers of a particular client or project.
This year, we see a huge opportunity in Development
Management creating a bankable scheme. Development
Management considers the overall performance of a project
when measured against key drivers. Key drivers will vary
from project to project but examples common to all projects
include risk, cost, time, quality and design. The projects
performance will guide decisions relating to how the
investors can achieve their desired returns, or whether other
stakeholders could be interested in participating, such as a
hotel operator or retailer for example.
Overall, the outlook for the region is positive as discussed
in the Economic Round Up section of this handbook, with
the drive to invest in education, health and sporting venues
expected to provide ample construction opportunity over the
coming years.
We hope you find the handbook of interest, assistance and
value to you, your projects and developments across the
region. As with previous years, we are seeking your feedback
to support our drive for continuous improvement
in everything that we do.
Mark Fletcher, Senior Vice President
Davis Langdon, An AECOM Company

DAVIS LANGDON

1
DAVIS LANGDON
An AECOM company
In 2010, Davis Langdon joined AECOM, a leading provider of
professional technical and management support services
for government and commercial clients around the world.
Listed as a Fortune 500 company, one of Americas largest
publicly traded companies, AECOM has over 45,000
talented professionals, including architects, engineers,
designers, planners, scientists and management
professionals, who serve clients in more than 125 countries
around the world.
Since AECOM was launched as an independent company in
1990, the firm has grown and diversified through corporate
expansion and acquisition activities that have significantly
broadened the companys business lines and geographic
reach.
In partnership with AECOM, Davis Langdon delivers
consultancy services as part of a complete end-to-end
offer, while Davis Langdons strong cost and project
management capabilities bolster AECOMs growing
portfolio of construction management services.

Global presence
With over 3,000 people in over 75 offices worldwide,
Davis Langdon can support long-term business needs
from both a local and global perspective. We have offices
in the following regions:
Middle East
Bahrain, Egypt (North Africa), Kuwait, Lebanon, Oman,
Qatar, Saudi Arabia and United Arab Emirates
Africa
Botswana, Mozambique, Nigeria and South Africa; Cape
Town, Durban, George, Pietermaritzburg, Port Elizabeth,
Pretoria, Stellenbosch and Vanderbijlpark
Americas
Boston, Honolulu, Houston, New York, Philadelphia,
Sacramento, San Francisco, Seattle and Washington, D.C.

1
Australia & New Zealand
Adelaide, Auckland, Brisbane, Cairns, Canberra,
Christchurch, Darwin, Hobart, Melbourne, Perth, Sydney,
Townsville and Wellington
UK & Europe
Azerbaijan, Birmingham, Bristol, Bulgaria, Cambridge,
Cardiff, Czech Republic, Cork, Edinburgh, England, Estonia,
France, Galway, Germany, Glasgow, Holland, Ireland, Italy,
Kazakhstan, Latvia, Leeds, Limerick, Liverpool, Maidstone,
Manchester, Norwich, Oxford, Peterborough, Plymouth,
Scotland, Southampton, Spain, Wales, Turkey, Ukraine
and Uzbekistan

Rich Middle East history

Our Middle East history is a commitment and legacy we are
most proud of. We are celebrating over 60 continuous years
of adding value to construction projects in the Middle East.

1
Industry awards
The consistently high standard of professional service
provided by both AECOM and Davis Langdon is recognised
throughout the construction industry, as evidenced by the
following prestigious industry awards:

Davis Langdon
Building
Project/Construction Manager of the Year
2004
World Architecture
Top International Cost Consultant
18 years in succession
Building
Consultant/Surveyor of the Year
1995, 1996, 2000, 2001, 2003, 2006, 2007, 2008 & 2009
Times
100 Best Companies to Work For
2005, 2006, 2007, 2008 & 2009

AECOM
Engineering News-Record
AECOM is ranked No. 1 on the magazines list of the top 500
design firms
Newsweek
AECOM featured in Newsweeks list of the Greenest
Companies in the US

10

GLOBAL
CONSTRUCTION
CONSULTANTS

11

12

2
GLOBAL CONSTRUCTION
CONSULTANTS
Davis Langdon has always seen itself as a forward-thinking
organisation and has developed a wide range of technical
expertise around the development of land, infrastructure
and buildings.
More recently, ambition has pushed us to think harder
about the context in which we give our advice. We believe
there are too many consultants who view a problem
as a technical issue, and therefore provide a technical
solution. In many cases this is simply giving the client the
expected, but such advice can have limited value.
The bigger picture
If we were to analyse situations where our advice has
been most effective, it is in the creative application of our
knowledge and experience. While our roots are in technical
delivery, our clients value the fact that our offer always
contains a strategic component.
Our ability to think big means we focus on the successful
delivery of the project in hand, whilst also appreciating our
clients goals and objectives from a broader perspective.
Our engagement with the bigger picture enables us to
operate beyond project level and support long-term
business strategies. It is this approach which makes us
the leading construction consultancy we are today.
Sector specialists
Where appropriate, we structure ourselves around our
clients sectors, to maintain a detailed understanding of
the dynamics influencing their different markets. Simply
put, clients have access to individuals who are experts
in their specific field. Our ability to offer specialists and
not generalists adds real value and sets us apart from our
competitors.
Cohesive solutions
We can support the challenges and opportunities our
clients face throughout the life cycle of a development,
from business and investment strategy at the
organisational level right through to operational
efficiency of the final built product.

13

2
Our core services of program management, project
management and cost management are augmented
by a comprehensive range of specialist services which
complement what we do at the core, reduce risk and add
value. We combine and tailor our services to support project
and business needs.
AECOMs integrated services
Davis Langdons project management, cost management
and consultancy services form a global capability within
the AECOM organisation, Program, Cost, Consultancy (PCC).
In addition to Davis Langdons Program, Cost and
Consultancy Services, AECOM offers a full suite of
integrated capabilities which includes Architecture,
Building Engineering, Construction Services, Design and
Planning, Economics, Energy, Environment, Government,
Mining, Oil and Gas, Program Management, Transportation
and Water.
We focus on identifying issues and encouraging our
people to find innovative solutions. This approach allows
our clients to assemble a business case which is well
considered, properly priced and has measurable outcomes.
Our people are our greatest asset and investing in them
is at the heart of our business. Through our recruitment
and development programmes we harness a range of
knowledge and skills to ensure our clients are working with
the best people for their projects. In addition to our project
delivery teams we employ management consultants,
economists and financial specialists to ensure we can
support all your needs.
Thought leaders
In an increasingly dynamic and fluctuating market, the
need, expectation and ability to capture, analyse and
disseminate big data separates leading consultancies
from their peers and provides predictive and best advice
to our clients. The best outcomes for our clients and their
programmes are reinforced with content and experiencerich industry best advice.
Data, information and knowledge is the core foundation
for a consultancy business, providing the content that
underpins our professional advice. As a leading consultancy
in the built, natural and social environments, we have over
45,000 professionals connected through our knowledge
network. This provides unparalleled data from which we

14

2
can determine and establish new trends, provide leading
advice and innovate in our end-markets with fresh products
and services for our clients.
This year will see the expansion of our digital solutions offer
to the market providing easier access to our knowledge.
We are therefore uniquely placed to anticipate and be
active in our support of our clients.

15

16

ECONOMIC
ROUND UP

17

18

19

0.9

2.7

2.0

Value of Construction Output*,

US$ billion

Project awards, US$ billion

Consumer Price Inflation, %

10.7

n/a

10.4

4.6

6,354

4.8

5.1

225.9

78.3

Cairo

995,450

Egypt

5.0

2.4

1.3

4.8

5,644

4.7

3.1

26.5

6.1

Amman

91,971

Jordan

5.3

59.2

19.0

4.4

23,826

4.7

3.7

434.6

26.1

Riyadh

2,149,690

KSA

4.0

13.4

2.5

1.9

37,849

5.0

2.0

131.3

3.6

Kuwait

17,820

Kuwait

4.0

1.5

5.2

13.3

15,193

3.9

7.5

39.2

3.9

Beirut

10,230

Lebanon

3.3

8.3

3.1

5.4

25,439

4.5

4.2

55.6

3.0

Muscat

212,460

Oman

-2.5

11.2

6.6

5.2

88,559

7.3

16.3

129.5

1.7

Doha

11,437

Qatar

4.4

1.5

1.8

3.1

5,208

5.0

3.2

59.3

20.6

Damascus

184,050

Syria

0.9

41.5

20.7

9.0

48,821

4.0

3.2

301.9

5.1

Abu Dhabi

83,600

UAE

*estimate only, excludes real estate.

All data are 2010 data unless otherwise stated.
Source: IMF and various national statistics offices.
Value of construction in Lebanon, Kuwait, Syria, UAE is calculated based on the share of construction in GDP in 2009 applied to 2010 GDP figures.

3.9

26,852

Construction Output, % of GDP*

GDP/Capita (PPP), US$

4.1

5.0

Real GDP Growth, 2011-2016

pa forecast

22.7

1.1

Manama

665

Bahrain

Real GDP Growth, %

GDP, US$ billion

Population, million

Capital City

Land Area, km2

Country statistics 2011

3
ECONOMIC AND
CONSTRUCTION OVERVIEW
Global economy: Volatility in the face of
new and old worries
In 2011, the global economy faced more political and
economic volatility than had been anticipated and this
uncertainty is expected to continue into 2012.
Supply disruptions in early 2011 and firm demand from
fast growing industrialising economies caused oil and
commodity prices to rise sharply during the first few
months of the year, raising the spectre of inflation.
The devastating earthquake and tsunami that struck Japan
in March disrupted supply chains around the world and
weighed on consumer sentiment and spending. At the
same time, a number of countries across North Africa and
the Middle East have seen, and are still facing, political
upheavals not seen for generations.
In addition, the 2008/09 global recession has left scars on
the world economy with the main legacy being the large
public debt accumulated by many Western economies,
most notably in Europe and the US.
The political drama in the US surrounding the extension
of the US$14.3-trillion federal debt ceiling or to face
a default rattled financial markets in summer 2011.
A last minute deal was made, but there still remains
uncertainty about the fiscal stability in the US, with
implications for global financial markets and the world
economy. Consequently, Standard & Poors ratings agency,
downgraded the US long-term sovereign debt rating the
first ever downgrade of the US which sent shockwaves
through markets. Meanwhile, the sovereign debt crisis in
the Eurozone continued to escalate over the course of 2011,
with more countries, including Italy and Spain, dragged into
the spotlight.
Global inflation escalated in the first half of 2011 due
to soaring commodity prices and accelerating demand
pressures in the emerging markets. Many of these fast
growing economies have embarked on monetary tightening
to cool their economies.
All of these events dented optimism about a sustained
global economic recovery and caused extreme asset
20

3
market volatility. In August 2011, fears of a renewed global
downturn culminated in global stock market crashes.
Reflecting this, the International Monetary Fund (IMF)
revised down global growth projections for the second half
of 2011. More positively, the IMF predicts this slowdown
to be temporary, as many of the growth drivers remain in
place, including loose macro-economic conditions, pent up
consumer and investment demand and strong corporate
earnings. The main theme of unbalanced global activity
continues; growth will be slow in advanced economies
that face fiscal and financial problems, while activity is set
to remain sound in advanced economies that do not face
such challenges. Looking ahead, there are downside risks
to growth, relating mainly to further escalation of the debt
crisis on both sides of the Atlantic, a slower US economic
recovery and overheating pressures in some key emerging
economies. In addition, there are a number of political and
economic wild cards that could further derail global growth
in the year ahead, including further political upheaval in
the Middle East and North Africa region (MENA), sudden
regime collapses, natural and environmental disasters, and
volatile commodity markets. Many of these events cannot
be excluded, but tend to catch markets and investors by
surprise if they happen.
Global construction stabilised in 2011, driven mainly by
public investment in infrastructure, though overall, this
was not enough to offset the continuing slack in private
construction in many key construction markets. An upturn
in private construction is still expected for 2012, but given
the current low investor confidence, a full recovery in
private demand may still be delayed.
Given the trends in the wider global economy, construction
growth will continue to shift towards Asia and other
emerging markets, including the Middle East, where
economic growth, rising populations, a widening middle
class and rapid urbanisation is putting pressure on
existing infrastructure. Construction in many developed
countries will be constrained by slower economic growth,
a requirement to cut large public debts and limited
population growth.
In 2010, the global construction industry was worth US$7.2
trillion and according to latest forecasts, the market is
predicted to grow to US$12 trillion by 2020. The emerging
markets share is expected to rise from 46 per cent today, to
55 per cent by the end of this decade. Asia, Latin America
and the Middle East will be the main construction growth
areas, with infrastructure as the main beneficiary.
21

3
Middle East: Politics driving economics
The impact of global factors on the Gulf Cooperation
Council (GCC) and wider Middle East is being felt primarily
through financial markets and oil prices. Consequently,
the region remains vulnerable to global risks which have
delayed a full recovery in private sector activity.
After a period of political turmoil earlier in 2011, relative
calm has been restored in the GCC. Regional stress points
remain in Libya, Syria and Yemen, while the GCC economies
have, generally managed to overcome investor concerns
through a combination of policy initiatives and, until
recently, increasing oil prices.
The widely divergent political picture within the region is
shaping the outlook for economic growth. In the postrevolutionary countries Tunisia and Egypt where
the old regimes were toppled in early 2011, interim
governments are seeking a new normality with the
outcome yet to be defined. Both economies are struggling
with the impact of the revolutions, most noticeably felt in
sharp falls in production, tourism and foreign investment.
Weaker economic performance is putting pressure on
public budgets, though the risk of fiscal pressures turning
into an economic crisis is being reduced by financial
support that the Western and Arab governments have
promised. Whilst the economies appear to be stabilising, it
is likely to take a while until growth returns to trend. Libya,
Syria and Yemen continue to face violent protest and a
return to the old order is difficult to imagine, though at the
same time it is highly uncertain what new order will emerge.
Jordan and Oman have limited financial resources and are
under pressure to sustain strong economic growth to create
enough jobs for their young and growing populations. Whilst
social unrest has largely been contained in both countries,
investment sentiment has still been hurt and the tourism
sector has decelerated, negatively impacting on economic
growth.
The outlook for the commodity-rich GCC states is more
benign as governments have the firepower to support their
economies, while high oil prices have improved growth
prospects. The strongest economic growth is expected in
Qatar, where expansion will be driven by high hydrocarbon
prices, a considerable amount of infrastructure projects
in the pipeline and a new focussed five-year development
plan. Saudi Arabia has weathered the regional political
turmoil remarkably well, and expansion in the Kingdom will
be driven by strong growth in the oil economy and public
22

3
spending. In addition to an already expansionary 2011
budget, earlier in 2011 the Saudi government announced
two additional spending plans worth some US$120 billion
(or 30 per cent of GDP), which included social transfers, job
creation programmes and capital spending pledges.
The UAE is benefiting from strong growth in the oil sector,
ensuring that public spending can continue, which is
important to support momentum in the non-oil economy.
Spared from any political turmoil, the UAE is the regions
safe haven and is repositioning itself as the pre-eminent
business and transport hub, boosting long-term growth
prospects. Dubai remains vulnerable as its real estate
sector has yet to stabilise, and this is also felt in Abu Dhabi.
More positively, both Dubai and Abu Dhabi are benefiting
from firm international trade and a strong tourism sector,
both of which will boost overall growth rates.
The political situation in Kuwait remains volatile caused
by continued stand-offs between the government and the
parliament, which is delaying the flow of public funds and
is weighing on private sector confidence. Consequently,
while high oil prices are boosting public finances and the
overall GDP growth rate, non-oil activity remains slow.
Within the GCC, Bahrains economy has been hit hardest by
political instability in 2011. Whilst the headline growth rate
is being buoyed by higher oil revenues, increased public
spending and a slow return of private sector confidence,
the economy is likely to under-perform its regional peers in
the near term.
The region certainly continues to face challenges with
demographic pressures, high levels of youth unemployment
and the need for economic diversification. As regional
growth will be relatively robust by global standards this
year and next, generating economic growth inclusive and
at a pace that will ensure a high level of job creation will
remain the most important challenge for the region in the
years ahead.
The medium term prospects for the region remain positive,
and most observers expect the Middle East to be among
the fastest growing regions in the years ahead. Factors
that will drive future economic growth and construction
investment remain in place; petrodollars, population,
policies, and pent up demand from historic underinvestment in key sectors, such as affordable housing,
education, healthcare, energy and water security.

23

3
Construction industry: High expectations
Headline economic growth in most of the GCC countries
has distinctly picked up this year as a result of higher
commodity prices. Private sector sentiment continues to
be relatively subdued in parts due to higher political risks.
Consequently, foreign capital flows have weakened and the
recovery in bank lending is mixed across the region.
Despite the announcement of large (additional) government
spending programmes, the projects pipeline has not
responded as quickly this year as had been expected.
Middle East news, data and analysis (MEED) data shows
that fewer project awards and a number of cancelled
projects have cut the value planned, or projects underway
in the GCC by US$378 billion in the first half of 2011
an 18 per cent drop since end 2010. After a general pick
up during the second half of 2010, the value of projects
awarded fell back by a fifth during the first half of 2011.
Within this, the value of construction and infrastructure
project awards across ten Middle East countries fell from
US$50.5 billion in the second half of 2010, to US$39.5
billion in the first half of 2011.

Government spending continues to dominate project

awards across the region, in particular, the areas of
transport (ports, airports, roads and railways), power

24

3
and water, and social infrastructure. Expectations are
that the second half of 2011 is to remain relatively slow,
as continued uncertainty flows through global financial
markets.
In Qatar and Saudi Arabia, capital spending is expected to
enter a new era of strong growth. The (additional) spending
programme announced in Saudi Arabia should, once
projects start to feed through, result in a general uplift in
activity. Progress has been slower than expected this year
with US$11.8 billion of construction and infrastructure
projects awarded in the first half of 2011, compared to
US$19.2 billion in the second half of 2010. The project
pipeline remains larger, with the value of projects planned
and underway at US$623 billion in August 2011 the
largest pipeline in the Middle East.
There has been much excitement in the Qatari construction
industry since the country won the right, in December
2010, to host the 2022 FIFA World Cup. Projects worth
US$100 billion-plus have been announced across the
whole industry, ranging from directly associated football
infrastructure (stadiums, venues, hotels and leisure
facilities) to an ambitious transport investment programme
that includes roads, expressways, and an integrated, highspeed rail, metro and light rapid transport system. Qatar
has also prioritised social infrastructure development, with
plans to increase the provision of education and healthcare
facilities. In addition, increased investment in new power,
water and sewage treatment plants are expected over the
coming years to deal with population growth. Contract
awards have picked up in the first half of 2011, with some
US$4 billion construction and infrastructure contracts
awarded double the level when compared to the second
half of 2010. With some US$228.3 billion projects planned
or underway, predictions are that Qatar will be one of the
fastest growing construction markets globally in the years
ahead.
In the UAE, the value of projects planned or underway stood
at US$621.7 billion in August 2011, compared to US$818.6
billion in December 2010, reflecting the continuing
challenging industry conditions in the country. Awarded
construction and infrastructure projects totalled US$8.8
billion in the first half of 2011, compared to US$9.7 billion
in 2010. According to MEED, contract awards in Abu Dhabi
have slowed markedly this year, whilst the 2011 federal
budget included a 6 per cent cut in spending. Public capital
investment should still support the industry going forward.

25

3
For example, the federal government has pledged US$1.6
billion in infrastructure development for the northern
emirates, while Abu Dhabi in driving forward industrial
development at its US$7.2-billion Khalifa Industrial Zone
Abu Dhabi (Kizad), to support the set objective of economic
diversification.
Political instability earlier this year in Bahrain has slowed
the flow of projects considerably, with the value of projects
planned or underway dropping 30 per cent to US$56.6
billion since the end of 2010. However, the government
appears committed to push ahead projects to revitalise
the economy. Consequently, Bahrain has seen an increase
in project awards during the first half of 2011. In Kuwait,
despite high expectations surrounding the announced
infrastructure development plan, the value of projects
dropped by more than a third this year. A number of big
projects have been shelved and this has been blamed on
the political paralysis between the government and the
parliament.

Overall, the region is expected to start benefiting from

the large government spending programmes in the latter
months of 2011 and in 2012. Provided that the political
environment begins to stabilise across the wider region,
market confidence should return and result in increased
private spending. Infrastructure spending has been one of
the key drivers of economic growth over the past decade,
and this trend is expected to continue going forward.

26

3
CONSTRUCTION TRENDS
AND OUTLOOK
All sectors of the construction industry in the Middle East
continue to grapple with present and future uncertainty.
The corporate and business unit levels of industry
organisations are being tested as a result of regional and
international events. Although there are geographic and
sector highlights, in the short term at least, we could be
forgiven for thinking that there is little to offer much in
the way of respite from the challenges facing the Middle
East construction markets. But there are clear reasons for
positivity over the medium to longer term: fundamental
requirements for social infrastructure still exist, largely as a
result of underlying population demographics, and the need
to meet these demands in the future will not dissipate.
Furthermore, the Middle Easts geographic location offers
excellent potential to capitalise on the newly-coined
South-South (HSBC, June 2011) trade route between Latin
America, Africa, Asia and the wider Middle East. Doubtless,
there will be construction sector opportunities as a direct
result of this trade and increased capital flows between
these emerging markets. Infrastructure investment will be
essential to facilitate and support these trade routes. In the
medium to longer-term, as HSBCs report rightly states, the
Middle Easts foundations in trading will once again act as a
spur to country and regional development.

Global events and regional effects

Effects of global economic events continue to be played
out and the construction industry often bears a very heavy
burden. Consequently, decisions to procure built assets
will be influenced by factors outside the control of client
organisations. Increasing scrutiny of the sanction decision
is understandable as lenders and clients themselves
remain cautious, aware that renewed global economic
volatility has to bring proportionally higher levels of
vigilance. Lending constraints, debt repayment and
activities to repair balance sheets amongst other things
will exert pressure on client organisations, with consequent
effects for market activity and built environment
procurement. Generally, the story of 2011 so far has been
one of project reviews and reduced workload in a number
of markets. Excess contracting capacity combined with
low input costs have not persuaded client organisations to
procure built assets in the volume expected, even though
this combination should be conducive to supporting the
27

3
financial viability of a development. Those organisations
with the ability to proceed with built asset construction at
this time will reap the rewards of very competitive pricing.

Market pricing
Comparatively benign conditions now prevail in those
markets that experienced the shake-up resulting from the
global events at the end of 2008. This precipitated a marked
slowdown in many construction markets in the Middle East
combined with significant falls in market pricing. Broadly,
changes in tender price trends reflect the adjustments
to market and sector activity in the region. A collection of
countries maintained capital expenditure and it was this
activity and momentum that ensured solidity for tender
prices in these markets, with some even providing the
opportunity for contractors to increase price levels.
Conversely, where market and sector activity have been
significantly affected, trends in tender prices have ranged
from a gradual drift downwards to notable falls in those
countries where industry volumes have been materially
impacted. Lower demand and excess capacity continue
to be evident although regional variations exist in view
of the different levels of government expenditure, and
also that of the private sector. In those markets that are
currently experiencing falling tender prices, any increased
momentum in negative trends depends in part on renewed
reductions in aggregate demand for construction.
For those organisations that are prepared or have the
ability to procure built assets, subdued tender prices
offer reasons to be cheerful. Parts of the contracting sector
have been unable to secure any marked increases in prices
due to reduced tendering opportunities, very competitive
pricing environments and the ability of client organisations
to continue to press for the best possible prices, often
through negotiation. Although input costs have fluctuated
to some degree in the last 12 months, recent softening of
tender prices is still evident. Moreover, there are signs that
this is extending to the wider GCC region as confidence is
tested by short-to-medium-term uncertainty, either due to
economic pressures, social unrest or a combination of both.
Market data on workload volumes shows that it is only
Iraq and Oman to some degree that has experienced
noteworthy increases in activity this year.
Contractors and their supply chains too have
experienced onerous trading conditions in the last two
years and current circumstances are not much improved.

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The ability of contractors to absorb commercial pressures
in the event of any pick up in key material prices is likely
to inflict renewed financial strain as prices charged for
construction work are driven lower. Continual bidding
without the surety of project sanction only adds to the
squeeze on finances, increasing non-recoverable costs.
Turnover and profit-starved contractors continue their
hunt for work in the region, although gaining a foothold in
some markets does require additional effort to overcome
higher barriers to entry. The financial mettle of contractors
and the industry supply chain is being tested to the full.
Looking ahead, the danger is that the industry loses
good skills, knowledge and capabilities. And it is not just
amongst contractors that this will prove to be an issue but
consultants too.

Looking ahead
Despite the challenges facing the industry, fundamental
requirements for social infrastructure still exist. Underlying
population demographics will translate into significant
levels of demand for construction services in these areas of
social building. The scale and extent of the grand designs
and developments of recent years are unlikely to return
in the near-term. History shows us that there is a close
correlation with the construction of tall buildings and
economic recessions shortly thereafter. Nevertheless,
sustainable levels of activity will emerge that are based
on fundamentally sound investments and sector-specific
demand.
Smaller projects will increase in number as a result of
tighter risk profiles and lending constraints. Changes in
workload activity will not be uniform across sectors or
across countries. Refurbishment and commercial fit-out
activity has seen considerable demand for services in this
sector. Understandably, businesses will seek to upgrade
existing commercial accommodation rather than consider
new-build activity. Moreover, a surplus of commercial and
residential accommodation in many GCC markets at very
competitive rates will entice end-users towards this space
solution.
The cost of capital and demand generated by social
necessity will be some of the key drivers leading to
renewed market activity. On top of this, regional unrest
and security concerns could prompt amendments to
published development strategies and long-term vision
documents, as regional governments seek to address
the demands of their populations. At the same time,
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governments must balance their expenditure against
income, and for oil-producing countries a large proportion
of this income is determined by the global price of oil.
There are as many forecasts amongst economists for the
price of oil to increase as there are for it to go down. It is
still the case for these countries that income therefore is
determined by events elsewhere in the world. One certainty
is that government expenditure acts as a central pillar of
construction activity in the Middle East, as governments
seek to implement the facilitators of economic growth
and related strategies for economic diversification.
Furthermore, there are clear links to private investment
on the back of public sector expenditure. Particular
markets are experiencing reduced volumes of government
expenditure and private sector investors therefore remain
cautious, mindful of the significant falls in real estate
prices over the past two years in many GCC countries.
Medium-to-long-term trends will evolve to create
regional construction demand. Assuming Saudi Arabias
latest spending plans remain largely unaltered which
maintains its construction momentum, Qatars World Cup
2022 investment programme kicks off and many of the
suspended projects in other GCC countries recommence
as developers attest, the prospect of a quicker pick-up
in tender prices becomes feasible. Increased confidence
and the psychology of pricing on the back of higher work
volumes will see prices increase accordingly, though
variation by market will remain. Any improvement in global
economic conditions in the short-to-medium-term will be
a bonus.
Additional considerations in respect of this pricing
transition include reduced contracting capacity in the
region as a result of strategic business reviews, a spike
in the volume of tendering activity and an increased
demand for professional expertise. But continued attention
to cashflows and finances may mitigate the speed of
construction on re-started schemes. Extended project
programmes should therefore create a steadier demand for
labour and materials and possibly offset any restart pricing
spike.

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Considerations for project success
Uncertainty increases the need for awareness and
monitoring. Some of the key issues to ensure active
management of projects include:
Entry and exit prices: Lower prices can be an
opportunity for clients but at the same time they
introduce risk. Too much focus on achieving the lowest
price should be counter-balanced by an acceptance that
higher transaction costs in post-contract administration
may follow.
Risk transfer: A willingness by contractors to accept a
wider transfer of risk in the hope of winning work will
stretch business fundamentals. In short, incentives for
contractors to maximise post-contract returns because
of excessive risk transfer should be minimised. It is not
only in hard financial metrics where incorrect transfer of
risk manifests itself project team morale can suffer
and this in turn affects project performance and quality.
Scenario planning: Uncertainty and volatility in markets
require greater attention to the assessment and
modelling of the financial viability of developments.
Risk management and removing sources of uncertainty:
Design completion, supervision, finding the right people,
procurement options and interface risks are all areas for
consideration.
Contractual provisions: With heightened risks related
to the supply chains financial standing, it is imperative
to include contractual provisions that ensure the
financial stability of the supply chain. Security can be
achieved through adequate warranties and performance
guarantees.

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ARTICLES

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Is this the dawn of
truly Integrated
Project Delivery?
Sir Edwin Lutyens, the major 20th Century British architect,
once described production information as a letter to the
builder, telling him exactly what you want him to do. In
1965, a Tavistock Institute report quoted a Royal Institution
of Chartered Surveyors (RICS) meeting from 1910, which
stated Architectural information is invariably inaccurate,
ambiguous and incomplete. By the 1940s, the impact of
this inaccuracy and ambiguity was valued at an additional
10 per cent to the construction cost. The UKs Building
Research Establishment (BRE) undertook research in the
1970s that led to the Coordinated Project Information
(CPI) initiative. This established codes of procedure for
production drawings, project specifications and the
common arrangement of work sections for building works
in 1987. By 1994, the Latham Report Constructing the
Team along with the subsequent Egan Report Rethinking
Construction (1998) and Accelerating Change (2002),
suggested that waste in the industry accounted for 25-30
per cent of project costs. At this time, the UKs Department
of Trade and Industry established a programme called
Avanti which sought to formulate a collaborative
approach between construction project partners. This led
to the creation of the construction industry membership
organization Constructing Excellence in 2003.
Within the design world, technology was also having a
direct impact. In the 1980s, Computer Aided Design (CAD)
programs were being released that reduced significantly
the need for draftsmen. Autodesk Inc. released its first
version of AutoCAD into the market using the DWG R1.0
format in 1982. This software was both affordable and
capable of being run and operated on personal computers,
thus allowing designers to do their own drafting work,
eliminating the need for entire departments. CAD sits
within a suite of activities known as digital product
development (DPD) that operates within the product
lifecycle management (PLM) process. It is used with other
tools, which can be integrated modules or standalone
products, such as:
Computer aided engineering (CAE) and finite element
analysis (FEA)

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Computer aided manufacturing (CAM) linked to
computer numeric control (CNC) machines
Photo realistic rendering/rapid-laser scanning
Document management and revision control using
product data management (PDM)
AutoCAD 2012 is the 26th version of the original software
product. It is joined by a number of other complimentary
solutions, Revit, and competing systems, including
Bentleys Microstation through bespoke design house
software like Gehry Technologies Digital Project, down
to Googles free SketchUp product which provides 3-D
modeling for everyone. 3-D design and software capability
are now commonplace, not only in media production and
other industries, but also within the built, natural and social
environments.
Integrated project delivery is an approach that integrates
people, systems, business structures and practices into
a process that collaboratively harnesses the talents and
insights of all participants to optimize project results. This
increases value to the client/owner, reduces waste and
maximizes the efficiency through all phases of business
case, design, fabrication, construction and operation.
The convergence of technology, culture and process has
given birth to the notion of Building Information Modelling
(BIM). Although relatively new to the construction industry,
3-D modeling in the sense of BIM, has been used in other
industries for a significant period of time.
With rapid growth in the uptake of BIM, the numbers of
designers, constructors and clients with direct experience
with BIM is growing significantly. As a minimum, savings
with 8-10 per cent of construction cost can be saved
through the elimination of conflicts, constructability and
reduced change orders. The true benefit of BIM across
the whole-life of the asset has yet to be realized though,
particularly has integrated with a facility management (FM)
strategy.
So apart from leveraging IT hardware and software, what
does BIM offer and is it the missing link in delivering truly
integrated project delivery?

BIM: The basics

BIM is set to revolutionalise building design and
construction to a point where many traditional functions
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effectively become obsolete. Most people agree that
BIM is introducing new ways of working for design and
construction teams and those who cannot or will not
adapt will fall by the wayside.

BIM is often thought of as a design tool similar to CAD.

In reality however, BIM or Information Modelling (IM) of
any asset, is founded on a set of shared, structured and
coordinated pieces of information whether in the
vertical built environment, or in horizontal infrastructure.
Once created, this information can be used by many
and all parties involved in that asset from its inception
through design, construction, operation and recycling.
The richer and more integrated with BIM, the greater the
potential benefit. Many applications can currently be
run and operated using BIM, including design drafting,
analysis, clash detection, manufacturing and construction
sequence simulation. Once operational, the asset BIM
model can also be used as the basis for monitoring,
managing the operation and maintenance, modification
and refurbishment of that asset, updated on a continual
basis over its lifetime. Indeed, with the integration and
use of rapid laser scanning/cloud point rendering, not
only will the digital design data be preserved and used
dynamically over the assets life, the as-built data can also
be captured, finally resolving the inevitable variances in
construction tolerance and use that occur between design
and construction.
These technologies therefore represent the next stage
in the development of 2/3-D CAD. They provide a step
change in the ability of design and construction teams
to structure and exchange information. The benefits go
beyond enhanced design coordination, reduced design
costs and improved communications and information
exchange across all players and disciplines in the project.

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By requiring different design and construction disciplines
to collaborate on the development of a sophisticated,
information-rich, digitally-based model, designs can
be developed and tested virtually and many potential
problems can be designed out or avoided completely. The
benefits are then not only in more efficient and effective
design and construction processes, but ultimately in better
assets that are more fit-for-purpose and meet their brief
requirements and design intent.

Conventionally, a good deal of design and construction work

is document-based. Information is communicated and
stored via a variety of drawings and reports that, despite
being stored and distributed in digital form, are essentially
unstructured and thus of limited utility. Not only is this
information unstructured, it is also held in a variety of forms
and locations, and there is considerable potential for data
conflicts and redundancy as well as risk to data integrity
and security. By providing an intelligent, digital structure
for project information (link back to CPI) and ultimately a
means by which it is held centrally in a single model BIM
opens up a wide range of possibilities for improvement.
These include better ways of generating, exchanging,
storing and re-using project data between different design
and construction disciplines through the life of the asset.
In this sense, BIM is as much a process of generating and
managing project data throughout the lifecycle of the
asset, as it is the digital model itself. That is why BIM is
sometimes referred to as BIM(M) Building Information
Modelling and Management.

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BIM essentials
The digital project model at the heart of BIM is usually
created by software using object technology. Objects
are essentially digital representations of physical
components or more abstract entities (eg spaces). In
the past, different software providers tended to have
their own ways of defining and handling objects, so their
systems and the information contained within them,
were not interoperable. Interoperability the effective
exchange of information is key to BIM. Because of that,
a good deal of work in the software industry has been
devoted to developing standard definitions for objects that
ensure they are interoperable across different systems
and tools. One such set of definition, called industry
foundation classes (IFCs), is becoming more widely used in
construction.
Objects are important because of the information and
data that they contain and attributed to that object. This
includes how they relate to other objects (parametric
information). Such information is not only dimensional, but
can relate, for example, to thermal performance, carbon
emissions, cost, repair and replacement cycles, and so on.
Objects are therefore the information-rich building blocks
of design and construction and can be used well into the
operating stages of projects. They can also be stored in
digital libraries and re-used and refined on other projects.

Key BIM benefits

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The benefits of BIM derive fundamentally from the way in
which all parties to the project can contribute to the central
data model, and all can draw information from it. It has
the potential to improve many functions, from checking
compliance with building regulations or codes, through
design, cost estimating, work scheduling, fabrication,
assembly and construction through to operations, FM
and even decommissioning and demolition. Significant
benefits are claimed for BIM, particularly when working in a
genuinely collaborative way using a single digital model of
the project totally integrated project delivery.
The following benefits of BIM include:
Design: Improved coordination of design and
deliverables between disciplines; improved project
understanding through visualization; improved design
management and control, including change control;
improved understanding of design changes; and
implications through parametric modeling.
Compliance: Ability to perform simulation and analysis
for regulatory compliance; ability to simulate and
optimize energy and wider sustainability performance.
Costing/Economics: Ability to perform cost analysis and
to check for adherence to budget/cost targets; ability to
understand cost impacts of design changes; improved
accuracy and transparency of cost estimates.
Construction: Reduction in construction risks through
identification of constructability issues early in the
design process; early detection and avoidance of
clashes; ability to model impact of design changes on
schedule and programme; ability to integrate contractor/
sub-contractor design input directly to the model.
Operation and management: Creation of an FM
database directly from the project (as built) model;
ability to perform FM costing and procurement from
the model; ability to update the model with real-time
information on actual performance, thus enabling
predictive analysis and pro-active asset management.
The financial impact of all these benefits, taken together,
could be considerable. A recent McGraw Hill report,
The Business Value of BIM in Europe, 2010, looked at
user perceptions of BIM in the UK, France and Germany,
concluding that the majority of users believe that they
are getting positive return on investment (ROI) in BIM, and
also that the business benefits of BIM have not yet been

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realized in full. In the UK, most discussions about BIM
still relate to its use during the design stages of a project,
sometimes referred to as little BIM. In other countries,
its implementation is more advanced, particularly in
Scandinavia, USA, Australia and more recently, South
Korea.
In recognition of the differing levels of development in
markets, UK-based BIM experts, Mark Bew and Mervyn
Richards, developed a maturity model in 2008 which has
been widely adopted by the industry.
BIM Maturity Model

Source: Bew and Richards 2008

The BIM maturity model shows how users can move from
use of un-coordinated CAD drawings through various
levels of technology and information-sharing, to reach the
ultimate objective of fully integrated project delivery. Each
stage in maturity represents an opportunity to increase
the effectiveness of information exchange and re-use.
The model helps to explain why the development of BIM
competence is so important in accelerating the realization
of BIMs business benefits.
Such a significant change in the way that assets are
conceived, designed, delivered and managed, does come at
a cost and therefore requires both public policy and market
dynamics, to facilitate the change.
In Singapore, the government provides assisted funding
through their Construction Productivity and Capability
Fund (CPCF) with a specific funding provision for BIM.
This is designed to support and encourage adoption with
assistance provided for improving business process,
training, consultancy, software and hardware costs for
firms registered to undertake business within Singapore.
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With a clear purpose to incorporate BIM into two levels:
Firm level scheme enhance business capability
around visualization, value-added simulation, analysis
and documentation; and
Project collaboration scheme support business
capability in BIM project collaboration to reduce
conflicts and expensive reworking of design,
construction and specification downstream.
Funding is provided up to a ceiling of US$105,000 per
business.
From 2015, the use of BIM will be compulsory on all UK
government projects, which form a part of a series of costsaving/efficiency measures for the public sector.

Davis Langdons role in BIM

Davis Langdon is a long-term investor, alongside
construction software developer Causeway, in the
development of specialist software, CADMeasure and
BIMMeasure, which automates many manual aspects
of the cost management service. We have completed
the development of BIM-compatible software which not
only integrates the BIM model database, but which also
creates automated links between the BIM model and the
clients budget plan. At this stage in the evolution of the
commercial and contractual models, we think this is the
optimum position for a cost and project manager to hold
commercially-sensitive data. However, as clients engage
more actively with BIM and applications and datasets
develop and mature, we will be prepared and positioned
to merge and attribute our own data, information and
knowledge into the objects thus enhancing the richness
and integration of the model and driving further benefits
from the creation and ownership of the asset.

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Cost-effective carbon
reduction
The construction world is still guilty of a large amount of
green tokenism, with projects wearing their environmental
credentials like a badge of honour. There are those that
have made the effort but seem to have got it all a little
wrong wind turbines that do not turn, green roofs that
shrivel under the sun, bicycle racks with no bicycles. And
at the same time, there are those that seem to disregard
issues like climate change and resource efficiency as
though they are someone elses problem. Of course
there are some that manage to find a subtle but important
balance of time, cost and quality whilst also balancing
social, environmental and economic drivers. These are the
projects that should be applauded.

C STEFFECTIVE
CARBON
REDUCTION
One of the failings of the sustainability movement has
been the over emphasis on the need to drive change on the
basis that it is the right thing to do. A change programme
driven through guilt or a sense of obligation (or unbridled
enthusiasm in many cases) will touch many people, but it is
not universal and will also leave many excluded. There has
become a link between sustainable design and the greater
good which for many, simply equates to a cost for which
there is no immediate or tangible benefit.

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At Davis Langdon, we are repositioning our approach by
introducing a new language to help find our clients better
solutions. Instead of focusing on attaining sustainability
credits on an artificial rating scheme, we want to focus
more on the business case. We want to help our clients
understand the real costs and business benefits so that
when a choice is made, it is done for the right reasons.
Of course, neither is it easy nor always appropriate to
consider all decisions in terms of cost and benefits, but
the more we do, then the more we will start to find better
solutions over the life of an asset. Probably the best place
for a business-led approach is when considering energy
and carbon, for which there are a few inescapable truths:
The rising cost of energy: Whilst beyond discussing the
drivers for energy costs and their subsequent rate of
change, few would disagree that we are expecting to see
long-term global increases in the cost of energy.
Building non-performance: The evidence is now
overwhelming to prove that buildings consume more energy
than their design standards (often 20 to 30 per cent more
than forecast). The grounds for this are complex, not least
because it is people that use much of this energy rather
than the building itself. If we are to drive down energy
consumption, we need to tackle these elements1.
Technological developments: Technology is rarely the
barrier it once was as we have tried and tested solutions
which we can pick from. Possibly more challenging is
picking your way through the myriad of potential solutions
to arrive at the optimum.
Climate change: Maybe it is a little strong for some to argue
that climate change is an inescapable truth, but many
now accept it and in doing so, we must accept the need to
adapt our buildings and our behaviours, to these changing
climatic conditions, or face the long-term economic and
social consequences.
In addition to the above, many governments around the
globe are putting low-carbon strategies at the centre of
their manifestos, resulting in a plethora of carbon taxes
and support packages each of which can dramatically
change the economic case for a low-carbon solution.
Energy and carbon could be seen as a risk. Do nothing on
your new and existing buildings and your annual operating
costs will increase. Conversely, take the right action and
there are investment opportunities which can deliver

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long-term savings. We encourage clients to see these as
investment opportunities, setting a hurdle Internal Rate of
Return (IRR) which this investment should meet.
With a focus on carbon and energy, we have identified seven
priority areas to focus on. Each of these areas presents an
opportunity to reduce risk, reduce cost and reduce carbon:
Financing: Ensuring taxation strategies are efficient and
all grant sources are maximised.
Energy supply: Optimising the energy supply strategy,
including low-carbon technologies.
Occupiers: Engaging with building users to educate and
inform about energy use and targeting long-term staff
retention (staff churn is often a very large business cost).
Workspace: Ensuring efficient space use, and ensuring
that the space is highly productive.
Transport: Ensuring low-carbon, high-quality, safe and
reliable access to and from the building.
Operations: Ensuring all Building Management Systems
(BMS) are optimised, effective data capture for
monitoring and continuous improvement (few buildings
are right first time), effectively procured and monitored
facilities management.
Construction: Ensuring that all of the above are
adequately considered in early design especially the
issue of future building use and adaptation.
FINANCING

ENERGY
SUPPLY

OCCUPIERS

CONSTRUCTION
TRANSPORT
WORKSPACE

OPERATIONS

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How does one turn these areas into the
best business opportunity?
Marginal Abatement Cost Curves (MACC) is a simple tool
we use to help visualise all of the variables in a simple
structure.
MAC curves compare the effectiveness (carbon saved) of
a measure with its cost effectiveness. They are a way of
representing a range of investment options that allow you
to prioritise and make informed decisions about which
measures to implement. They can be used when looking at
a programme of improvements on an existing building or
portfolio, or can be used to test different options on a new
scheme.
Features illustrated by the curve include:
Relative cost-effectiveness of measures.
Lifetime CO2e saved by each measure.
Likely scale of capital cost required to achieve a target
carbon saving.
Lifetime financial payback.
This becomes particularly powerful when you compare
investment options between different properties in a
portfolio. MAC curves help to answer the two key questions
of carbon reduction:
What should I do first?
What is the business case?

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In summary, we need to move the industry beyond a
checklist approach to low-carbon solutions. Instead, we
need to think about the long-term (whole life) costs and
benefits of different options to ensure these assets are
viable, efficient, attractive and sustainable buildings well
into the future.
Davis Langdon and AECOM are part of the CarbonBuzz consortium
developing a web-based tool that helps designers understand and
tackle the issue of energy non-performance. www.carbonbuzz.org

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Development
Management
Creating a bankable
scheme
Development management deals with the coordination
and management of the property development process, in
line with agreed stakeholder objectives which are defined
at the outset, to help define development use or land
enhancement, usually for profit and/or socioeconomic
reasons. Its success of this lengthy process depends on
the development managers skill and ability, to assess and
guide the project as it progresses and changes over time.
Development management considers the performance of a
project when measured against key drivers, which vary from
project to project. Examples common to all projects include
risk, cost, time, quality and design. A projects performance
guides decisions relating to how investors can achieve
their desired returns or whether other stakeholders could
be interested in participating, such as a hotel operator, or
retailer for example.
This Middle East market still remains very challenging
where revenues have declined and purchasers, tenants and
retailers, demonstrate more caution before committing.
Raising finance or investment for a developer and
purchaser/tenant alike, is one of the biggest issues and
the development manager helps address these concerns
on behalf of the stakeholders, through their network
of relationships. Enabling our clients to benefit from a
full understanding of all factors affecting the financial
performance of the project as well as driving the top team
mentality across the clients team in all that they promote,
culminates the creation of a bankable project in the eyes of
funders and investors to help drive development success.
Development management is often too closely linked to the
performance of the development appraisal itself, without
considering broader issues, which in the current market,
may actually support the viability of a project. However,
whilst the appraisal is the most significant part of the
process, the way in which the appraisal is informed is
equally as important, whilst guiding the wider team through
the stages in alignment with the overall development
vision. Appropriate planning, starting with the end in mind,
that links to the exit strategy for an investment, whether
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short or long term, is key to success. Many developments
are poorly planned and therefore destined for failure.

Development planning milestones

These stages transform a vision into a viable project:
1. Initiation
2. Development concept and due diligence
3. Feasibility study
4. Planning and finance
5. Implementation and construction
6. Lease/operate and/or sale
These stages often overlap to varying degrees and may
have to be repeated until a decision can be made that is
aligned to the investment criteria.

Developing a viable scheme

If the fundamentals are covered at the outset of a project,
this creates a strong foothold for developing a viable
scheme. These include assembling the professional team,
developing a high-level master programme, obtaining a
cost model of construction rates on a gross floor area
basis (developed as the design and appraisal progresses),
commissioning a market study and establishing revenue
streams.
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To continue on the right track, the following should be
considered throughout the development process:
Market demand and revenue streams where are
these coming from and who is the target market?
Establishing the best product/asset mix.
Operational and management structure for the asset life.
Establishing project key performance indicators (KPIs)
for the development. Internal rates of return, discounted
cash flow, net present value, yields and debt equity
ratios should all be determined at the outset. KPIs will
vary, depending on the performance of each asset and
the revenue and construction inputs.
Finance and funding strategy engage with
institutions, explore latest lending costs and
arrangement fees, identify which institutions are lending
and investing in this type of asset.
Construction methodology how will the asset be
procured and constructed?
Sustainability in design and operational costs.
Developing a phasing and delivery programme which has
realistic durations and income generation dates.
Generating a letting and sales programme and a date
that delivers the product to the market, thereby meeting
the projected absorption rates.
Establishing the legal costs associated with the
development, including setting up of special purpose
vehicles or specific investment options.
Finance-led design that is viable for the project
focusing on what the project can afford.
Capital values establishing the true revenues and
occupancy levels in order to ascertain the capital value.
Running a range to test sensitivities of the development.
Development strategy develop and hold or develop
and exit (three, five, seven, ten years or longer).
Establishing management companies for long-term
operation.
Setting in motion any pre-let activity in line with the
long-term leasing strategy.

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Developing the appraisal
The demand for property does not automatically exist.
Before embarking on a project, an initial understanding of
market demand is essential. Market research determines
the initial mix and asset uses for a site. Market research
also defines the end users requirements which form the
basis of the development process, informing areas, quality
standards and achievable revenues. Considerable skill lies
in using this information to deliver the right product at the
right cost and at the right time with an emphasis on:
Developing a project that will support economic growth
and diversification.
Taking account of social and cultural responsibilities as
well as commercial gains.
Identifying potential social economic impacts job
creation and community enhancement opportunities.
Stimulating long-term investment and growth.
Interconnectivity and a correctly positioned product
that complements the existing or proposed wider
developments.
Identifying utilities and transport strategies early,
setting in motion the implementation to meet the
proposed phasing plan.
Achieving cost-effective design, procurement and
construction.
Establishing the status of other third party
developments, thereby identifying competitors.

Davis Langdons expertise

Davis Langdon has strong global relationships at all levels
of the development supply chain, from financiers through
to contractors and subsequently end users. This enables us
to provide a holistic solution to development from business
strategy through to operation of the final built product
an approach which has not yet been seen in the Middle
East market.
Our aim is to agree KPIs with clients which align with the
fundamental success criteria for a particular project or
programme, and form a business partner culture where we
guide, inform and support, to ensure the right decisions are
made at the right time and by the right people.

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With lowering returns across the region and a drive for
quality from the end user, developers need to plan carefully
before committing. Tight funding means they also need
to understand the funding criteria required to support
development, while acknowledging that a feasibility report
is only theory, until actually delivered to the end user.
We specialise in every commercial aspect of development,
be it time, cost or quality related, helping to set and inform
the feasibility through our vast experience of delivery. We
bring global relationships with joint venture partners and
funders to the table, and align their investment criteria with
client KPIs where possible.
Our robust teams work alongside business partners
every step of the way, from the initial idea, through finance,
delivery and operation to ensure the delivery of viable
schemes.

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Infrastructure:
An unprecedented
demand
Good quality infrastructure is widely recognised as a
key contributor to the well being and growth in both the
economic and social fabric of our nations, throughout the
modern world.
Over recent years, infrastructure has been the backbone
of the global construction market accounting (on average)
for just over 50 per cent of construction output in most
countries around the world. The big question is, what does
the landscape for infrastructure look like for the next
decade or two?

The global construction market

The global economic downturn of 2008 thrust infrastructure
onto centre stage in the western world. Governments
channelled unprecedented levels of investment towards
infrastructure in the hope that their actions would act as an
economic stimulus for much needed future growth.
In the east and other parts of the globe, investment in
infrastructure continued largely unabated by the problems
experienced in the west as those nations looked to
secure their own economic growth and social well-being,
by putting in place the building blocks of well designed
infrastructure, albeit in response to very different demands
and drivers.
Looking forward, estimates show that construction output
will have grown by 70 per cent to US$12.7 trillion by
2020 and will account for 14.6 per cent of world output.
Infrastructure is forecast to increase on average, as a
proportion of the spend in some countries, to as much as 65
per cent of construction output.
There is not a consistent picture across the globe.
Unsurprisingly, as emerging markets such as China, Brazil
and India become more significant in their share of the
world economy, so does infrastructures share in the total
construction output by climbing among those emerging
markets. For developed markets in the west, infrastructure
is more likely to experience a steady pace, or perhaps a
modest decline.

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A forecast total of US$4.3 trillion will be spent on
construction across the Middle East and North Africa
over the next decade, representing growth of almost
80 per cent by 2020. Notably, Qatar will be the fastest
growing construction market globally with planned growth
accelerated by US$100-billion on rail, roads, water and
other infrastructure, including preparations for hosting the
2022 FIFA World Cup.

Sustainable infrastructure
As we look to the coming decades, there are perhaps four
significant trends and challenges that are leading to an
unprecedented level of demand for continued investment
in sustainable infrastructure:
Urbanisation: Population growth, particularly the rapid
rise in urban population growth, has led to forecasts that
70 per cent of the worlds population will live in cities by
2050, bringing significant challenges around energy and
transport infrastructure.
Decarbonisation and energy security: As natural
resources and deposits diminish, demand for and
consumption of energy increases. The requirement for
secure and sustainable sources of energy has never
been greater.
Provision of water and sanitation for all: Approximately
20 per cent of the worlds population do not have
access to clean drinking water and around 40 per cent
lack basic sanitation provision. Water conservation is
paramount.
Obsolescence: There are many examples around the
world, predominantly in developed countries, where the
existing infrastructure has gone beyond its useful life, or
where the technological advances made in recent years
have rendered the existing infrastructure obsolete. In
such cases, there is a pressing demand for renewal
often in the face of restricted funding.
What level of investment is required to respond to these
trends and challenges? The Organisation for Economic Cooperation and Development (OECD) estimates that around
US$2 trillion per annum needs to be spent on infrastructure
globally over the next 20 years.

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Will budget constraints limit
infrastructure in developed countries?
2011 has seen a switch in fiscal policy for many developed
countries burdened by the financial crisis. Many of these
countries have abandoned the stimulus funding packages
and have adopted austerity measures as an alternative.
The constraint on government spending is likely to last for a
number of years, which results in a sharp contrast between
developed countries and emerging markets.
A number of the emerging markets are enjoying the levels of
economic growth and population increase, putting demand
on infrastructure for new capacity. However, there is still a
basic supply and demand business case, which means
that we are likely to see major infrastructure projects
concentrated in the emerging markets and economies.
Perhaps the challenge most commonly shared by both
these developed and emerging markets, is the ability
for governments to raise the capital required for new
investments. There is perhaps, a unanimous agreement
that governments need to be involved in infrastructure
projects, whether it be on matters of policy, strategy,
financing or implementation.
Certain traits characterise most infrastructure projects.
Lead times to project completion are long, costly and often
require upfront expenditure long before any return on
investment is seen. Cost benefit analysis is often difficult
to assess on a typical business case or development
appraisal basis, as the benefit is generally to the economy
at large, and not only limited to a specific project.
For most governments, raising finance is a challenge
that will usually result in debt finance with income tax
or user charges to fund the investment being raised. It is
therefore not a surprise that an estimated 55 per cent of
infrastructure projects are privately funded, using vehicles
such as the Public Private Partnerships (PPP). Even less
surprisingly given the current fiscal policies, governments
around the globe are seeking to work in partnership with
the private sector, to meet future infrastructure funding and
project demands. This suggests that we will see an increase
in popularity of privately-funded schemes that might use
the PPP approach, or a variant to it.

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Driving better value solutions
Much has been done to identify areas in which costs can be
reduced and there are some common themes that can be
applied around the globe:
Function over form We are likely to see the perennial
debate of form versus function coming back to the fore.
Buzz phrases like more for less are common amongst
many governments and are all about better functionality
from spend. The reality is that we need to acknowledge for
the next period that the pendulum has definitely swung
towards function, and we need to embrace that as an
industry.
Cost benefit analysis To achieve better value, we need
to focus on scope that drives real or tangible output and
we need to set best practice measures and benchmarks
on output per US$ of spend. The size and scope of
an infrastructure project should be determined by its
contribution to business or economic growth, or to tangible
social well-being. We should make more use of the costbenefit ratio to allow informed decisions on prioritisation
and value for money assessments.
Greater efficiency in delivery For greater efficiency in
delivery, there are two key drivers to improvement. Firstly,
we need to eliminate waste, gaps and conflict in the team.
Too often we set up teams to work independently. We need
a move towards integrated teams and consortiums. We
are also going to see an increasing requirement for entire
teams to put equity into special-purpose vehicles, greater
use of incentivisation and pain/gain shares in contracts.
The second point is about re-evaluating processes to take
away unnecessary tasks and effort. The obvious area to
streamline is the procurement.
A whole life cost perspective We need better alignment
of build and operational requirements. We need to
bring energy, carbon, capital expenditure and operational
expenditure budgets and priorities in line at an early stage
so that we can really drive whole-life cost down, reduce
energy in use and improve value through the life of the
project.
Making use of technology Invest in technologies,
including Building Information Modelling (BIM) to improve
efficiency in design, promote compatibility of design,
enable interdependencies to be worked through at an
earlier stage, allow for more accurate design to reduce
waste and unnecessary space.

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A Middle East perspective
The Middle East is not immune to such fiscal challenges.
Despite the resource-rich economies of many of the
GCC and neighbouring states, recent social and political
events have had both a positive and negative impact on
infrastructure investment plans.
Around the region, governments are looking at large-scale
investments in both physical and social infrastructure as
a way of confirming their commitments to improving the
quality of life for all of their citizens.
In Saudi Arabia, an ambitious spending programme on both
social and physical infrastructure has been announced
across the country. Large-scale transportation, energy
and utility projects have been identified, funded and their
programmes, if anything, accelerated.
Latest reports have put Qatars estimated infrastructure
investment programme as part of its lead in to the FIFA
World Cup in 2022, at US$100-billion. The programme
encompasses every aspect of infrastructure delivery, from
major sanitation, energy generation, utility and telecoms
provision, to numerous transportation schemes. Many
of these were seen as being instrumental to the Qataris
successful bid to host the World Cup and an imperative
for hosting a successful event. One of the most ambitious
aspects of the programme is the establishment of an
integrated railway comprising of long distance freight
and passenger services, multiple metro lines and several
light rail transit schemes. With around 10 years to
design, construct, commission and implement many of
these schemes, Qatar probably has one of the greatest
infrastructure delivery challenges in the world.
The UAE has continued to see a number of its major
commercial, residential, cultural and leisure projects
downsized or postponed. Infrastructure projects have not
escaped this review but there remains a strong recognition
of the requirement to push forward with the development
of the nation, and the critical infrastructure to support
future development, and long-term economic growth and
diversification. Ambitious projects like the new National
Rail Network led by Etihad Rail is a classic example
of such a programme, with work due to commence in the
near future.
Oman and Bahrain have seen significant disturbances
through the Arab Spring and this has led to a refocusing of
efforts into public projects which are designed to have an
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immediate meaningful impact on the nations less wealthy
residents. It is no surprise that some of the first schemes
announced by new ministers involved major new public
transport initiatives, which will play a key part in achieving
this outcome.
Despite these challenges, GCC investment in infrastructure
will continue by taking a more balanced view of function
over form, greater focus on delivering measureable benefits
through the life of the asset and greater emphasis on
efficiency across the region.
(1) (2)

Global Construction 2020

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Saudi Arabia: Social
Infrastructure
Development
With the global downturn affecting construction markets
in the Middle East, Saudi Arabia is seen by many as a
potential panacea for shrinking order books and a large
opportunity for the region. Davis Langdon has established
offices in Saudi Arabia and offers an overview of the
countrys market.
Modern Saudi Arabia was formed in 1932, when Abdul Aziz
bin Abdul Rahman Al Saud united different regions of the
Arabian Peninsula into one nation. On 23 September 1932,
he was proclaimed king. The current ruler, King Abdullah,
became king after the death of King Fahd in 2005.
Forming 80 per cent of the Gulfs land mass, Saudi Arabia
dwarfs its regional neighbours. The country is split into
three main areas: the central region which is dominated
by Riyadh, Saudi Arabias capital and commercial hub; the
Western Province which houses the holy cities of Makkah
and Madinah and the historic gateway city of Jeddah on
the Red Sea coast; and the Eastern Province which is
an industrial area but also houses the headquarters of
Saudi Aramco in Dhahran. The Eastern Province is linked
to neighbouring Bahrain by the 25 kilometre King Fahd
causeway.

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In August 2010, the Saudi government announced a
US$385-billion development fund for the following four
years, its largest ever and 67 per cent greater than its
investment in the previous four-year period.
Most sectors are very active:
Education
Over half of the Saudi governments US$38-billion
development pot for 2010 to 2014 has been earmarked
for human resources, with controversial plans to overhaul
the Kingdoms education system. There are 610 schools
planned, costing US$40-billion.
Healthcare
The burgeoning population will require new healthcare
facilities. There are currently 12 new hospital or health
facilities planned costing US$18.6-billion, over and above
the 120 hospitals that are currently under construction
providing around 26,700 additional beds. Once completed,
these facilities will provide significant business and job
opportunities for the healthcare and medical sectors.
Housing
An estimated 250,000 to 300,000 homes are needed each
year between now and 2014. Current high-end mega
projects include many new projects; Emaar Properties
19,000-unit Jeddah Hills and Dar Al Arkan Real Estates
US$13-billion, mixed-use residential, hotel and retail
complex in Jeddah. With a million new homes needed
in a few years, there could be opportunities for modular
specialists at the affordable end of the market.
Industrial
Industrial developments are seen as the key to the
countrys economic diversification. According to MODON,
the Saudi Industrial Property Authority, 75 square metres of
land will be developed on industrial estates between 2010
and 2015.
Hotels
A healthy sector due to the governments strategy of
increasing tourism in the Kingdom and the influx of foreign
firms whose expat workers require accommodation.
Airports
The airport sector is already busy, with projects at every
stage from feasibility through to construction. The General
Authority of Civil Aviation has said that it will spend
between US$10-billion and US$20-billion on developing
and upgrading airports by 2020, with the private sector
expected to chip in up to US$10-billion.
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Ports
The Saudi Ports Authority recently announced that the
Kingdom is envisaging an investment of US$8-billion
on modernising and equipping all of its ports, with more
investment hopefully forthcoming from private investors.
Rail
Huge plans to create new links within Saudi Arabia and
with neighbouring countries include the Haramain Railway,
a high-speed line linking Medina, Mecca, Jeddah and King
Abdullah Economic City, the North-South railway and the
Land Bridge.
The drive for development stems predominantly from
Saudis current youthful demographic profile. The oil boom
in the 1970s allowed significant investment in social
infrastructure and medical facilities which resulted in rapid
population growth during this period.
Top proven world oil reserves at January 2010
Rank
Country
(bbl)


1
Saudi Arabia
262,600,000,000

2
Venezuela
211,200,000,000

3

Canada

175,200,000,000

Iran

137,000,000,000

Iraq

115,000,000,000

Kuwait

104,000,000,000

United Arab Emirates

97,800,000,000

Russia

60,000,000,000

Libya

46,420,000,000

10

Nigeria

37,200,000,000

11

Kazakhstan

30,000,000,000

12

Qatar

25,380,000,000

13

United States

20,680,000,000

14

China

20,350,000,000

15

Brazil

12,860,000,000

16

Algeria

12,200,000,000

17

Mexico

10,420,000,000

18

Angola

9,500,000,000

19

Azerbaijan

7,000,000,000

20

Ecuador

6,510,000,000

Source: Central Intelligence Agency (CIA) Country Comparison Oil proved reserves

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The current population is reportedly growing at 2.5 per
cent per year, resulting in a potential doubling in the next
28 years if the current growth rate is sustained. 40 per cent
of Saudi nationals are under 20 years of age and 70 per
cent are under 30 years of age. These people will want an
education, a career and a home to live in and potentially
own. Some estimates calculate a demand for double
the number of current homes over the next 15 years
estimated at nine million new homes. The drive to build
homes will be boosted further when mortgages are allowed
for the first time, under a new law coming into effect
shortly.
Saudi Arabia population forecast
Nationality:

Saudi Arabian or Saudi.

Population (July 2011 est.):

26.1 million (20.5 million Saudis,

5.6 million foreign nationals).

Annual population growth rate

(2011 est.):

1.536%.

Ethnic groups:

Arab (90% of native pop.), Afro-Asian

(10% of native pop.).

Religion:

Islam.

Language:

Arabic (official).

Education:

Literacy-total 78.8% (male 84.7%, female 70.8%).

Health:

Infant mortality rate (2011 est.) 16.16 deaths/1,000

live births. Life expectancy: male 72 years, female 76
years.

Work force:

7.3 million, about 80% foreign workers (2010 est.);

industry 21.4%; services (including government)
71.9%; agriculture 6.7%.

Various economic cities are underway, as follows:

King Abdullah Economic City, Rabigh (US$27-billion to
US$50-billion)
If the governments plans are realised, when completed
in 2025 this vast new city 130 kilometres south of Jeddah
will be the size of Washington, D.C., 168 square metres.
Authorities hope it will provide a million jobs and host a
population of 2 million people. The seaport, which will be
the biggest in the region, and huge industrial park are the
key to attracting private investment, which has been slow
to materialise. It will also boast waterfront resort areas and
a central business district.

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Jazan Economic City (JEC), Jazan (US$27-billion to US$30billion)
In a remote area in the southwest corner of Saudi near
Yemen, 725 kilometres south of Jeddah, on the Red Sea,
Jazan (often referred to as Jizan) is one of the countrys
poorest cities, with little industry and high unemployment.
Jazan Economic City (JEC) hopes to secure 100,000 jobs
and a population of 300,000. With two-thirds of Jazan
Economic Citys 100 square metres area earmarked for
industry, one of its biggest selling points to date is that
it has secured the government-run oil company Saudi
Aramco which is going to build a US$7-billion refinery there.
Malaysian engineering group Malaysia Mining Corporation
(MMC) and the Saudi Binladin Group (SBG) won a 30-year
contract in late 2006 to develop JEC and attracted US$26billion in investments from Saudi, Chinese and Malaysian
firms, though details were not given.
Ground broke for basic infrastructure in 2009. Reuters
reported June 2010 that the government had allocated
US$1.6-billion to build 6,000 homes for people displaced
from the border area after a two-month conflict with Yemen
Shiite rebels.
Knowledge Economic City, Medina (US$7-billion)
Situated in the second most holy city of Saudi, the focus
for Knowledge Economic City, launched June 2006, is
meant to be residential and religious tourism combined
with knowledge-based industry such as IT, health and
education. The 4.8 square metres city aims to create 20,000
jobs and be home to 50,000 people. The first phase will see
the development of villas and apartments, schools and
colleges, museums, hotel and retail space. It is worth noting
that only Muslims can work in Medina.
In the continued worldwide downturn, Saudi Arabia offers
huge opportunities as it forges ahead with its social
infrastructure developments.

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Hosting Global
Sporting Events
In December 2010 it was announced that Qatar will host the
2022 FIFA World Cup. Five candidates presented their bids
to stage the 2022 edition of the worlds greatest sporting
event, with Qatar being successful, making it the first Arab
state in history to host the World Cup. More recently it has
been publicised that Qatar has also bid to host the Olympic
and Paralympic Games in 2020. This article explores the
impact of hosting a global event and looks at challenges
faced in hosting such events in the Middle East.

Global event legacy

While winning the right to host global sporting events such
as the Olympic and Paralympic Games and World Cups stirs
a great deal of national pride, another equally important
outcome is the long-term benefits that the hosts can enjoy.
Global events can be a springboard for regeneration and
development and have the potential to enrich a nation
both economically and socially. There is a delicate balance
though which rests in the sustainability of the economic
and social development of the host nation at the conclusion
of the event.
The 1992 Barcelona Olympic Games, for example, were the
catalyst for major urban regeneration. Barcelona witnessed
frantic building activity as a result of the Olympic
candidature, with an increase in the housing and land
prices, and a huge urban transformation that entailed the
conversion of a considerable amount of industrial land into
service or housing plots.
The spotlight is currently on the masterplan for the London
2012 Olympic Games which includes the regeneration of
the East of London. As one of the most disadvantaged
areas of the English capital, it will benefit immensely
from hosting the 2012 Olympic Village and the bulk of
the competitions. The facilities and venues have not
been designed as an enclave, but as a normal piece of
the city and after the games they are planning to create
opportunities for education, cultural development, training
and jobs.
However, not all host nations have experienced a positive
outcome after such events. In 2004 more than 9-billion
was spent to bring the 2004 Olympic Games home to
Athens, yet today the majority of venues lie unused and
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falling into disrepair. Cash was spent with abandon, and
the price is still being paid. Greece did not plan for the post
Olympics.

Testing long-term viability

There is obvious excitement following Qatars selection to
host 2022 FIFA World Cup, but those tasked with delivering
the event must test the long-term viability of each
programme and question:
How does the vision for the event investment correspond
with Qatars long-term needs and objectives?
Which financing models best apply?
How will it be sustainable environmentally,
economically and socially?
What is the real legacy?
What are the projected whole life costs?
How will procurement occur?
What kind of governance should be put in place?
To bid to host the 2020 Olympic and Paralympic Games,
applicant cities have to formally apply to the International
Olympic Committee (IOC). The bidding and award process
lasts for two years and, during that time, Qatar will need to
prepare its bid book and consider:
How to best score against the IOCs evaluation criteria.
What impact hosting the 2020 Olympic and Paralympic
Games would have on hosting 2022 FIFA World Cup
in terms of location of venues and non-competition
venues, transport and energy infrastructure, scheduling
of construction works, logistics of ensuring enough
labour, materials and major plant is available for both
programmes, governance and political considerations.
How to integrate 2020 Olympic and Paralympic Games
into Qatars National Vision 2030.

Global events in the Middle East

Whilst many outside the region consider the 2022 FIFA
World Cup in Qatar to be the first global sporting event held
in the Middle East, the region has a rich history of hosting
major events.

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Qatar hosted the 15th Asian Games in 2006 recognised
by the IOC as the worlds second largest event behind the
Olympics following Tehran for the Middle East in 1974.
Abu Dhabi in the UAE hosted the FIFA Club World Cup in
2009 and 2010. The Asian Football Confederation (AFC)
Asian Cup has been hosted by Qatar, Iran, Kuwait, UAE,
Lebanon and most recently Qatar again in January 2011.
In addition, Bahrain and Abu Dhabi in the UAE have been
hosting the FIA Formula 1 Grand Prix since 2004 and 2009
respectively.
That said, the FIFA World Cup in 2022 will be a truly huge
event, larger than any other in the region to date. The World
Cup is the most prestigious sporting competition in the
world.
His Highness Sheikh Hamad bin Khalifa Al Thani, the Emir,
has set out his vision for Qatar that goes far beyond the
hosting of this major event and includes an ambitious
capital investment. Qatar is flying the flag for the Arab
nations that will enhance its reputation and globally
create a true insight into the culture of the Middle East.
A reported US$64-billion is going to be invested of which
around US$5-billion is related to the stadiums and training
sites, indicating the immense expenditure required on
infrastructure.

Use of facilities after a major event

Major events are often blighted by poor post tournament
use (under-use) of the venues. It is essential that the legacy
plan, business and design factors are agreed at the time
the vision is produced. A strong legacy can be achieved by
ensuring a successful club or organisation takes residence
post event.
One of the most successful examples of this was the
conversion of the City of Manchester Stadium (now Etihad
Stadium) from Commonwealth Games athletic mode, into
football mode, with Manchester City Football Club as the
main tenant. An athletics legacy has been maintained by
the use of the warm up track with circa 5,000 capacity,
and the area has been regenerated with a well used and
frequently populated sports city at its heart.
In terms of Qatars legacy, one of the main objectives is to
develop academies for training and education. Many of the
facilities will be targeted at this market in the long-term, as
well as serving to boost local sporting capabilities. However
where there is a lack of demand after the event in Qatar, the
legacy plan includes demountable stadiums that can be
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fully or partly dismantled, and used elsewhere in the world
for a variety of purposes.
Legacy also needs to consider the wider community and
that is where master planning for a socially and
economically sustainable future is crucial. London is
confident it will achieve this through its 2012 Olympic
masterplan.

Our sector expertise

Davis Langdons sports and venues specialist group offers
an international team who have been involved in the
delivery of a number of high-profile global sporting events
in the Middle East. These include recent and future
Commonwealth and Olympic Games and football
World
Cups.

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Kuwait: Infrastructure
in motion
Kuwait is in the process of reforming. The countrys
four-year National Development Plan (NDP), endorsed
by the National Assembly in 2010, focuses on developing
the non-hydrocarbon sector, including plans to overhaul
infrastructure, boost private sector activity and reduce
dependence on oil. With liberal economic policies and
openness to international investment, Kuwait aims to
become a regional hub for transport and services. Against
this background, the Kuwaiti construction market presents
our business with genuine opportunities for engagement in
a diverse range of sectors.

Implementing a national vision

Hit by the Iraqi invasion in 1990/91, another conflict in Iraq
from 2003, and the 2008/09 global financial and economic
crisis, Kuwait has not had the best of fortunes in the past
two decades.
2011 marks a double anniversary for Kuwait 50 years
since its emergence as an independent country, and 20
years since liberation from the Iraqi invasion. This year may
also prove a major turning point for the Kuwaiti economy
and its construction sector.

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Today, Kuwait is heavily reliant on its oil revenues and
whilst the importance of hydrocarbons will certainly not
diminish in the years ahead, the government sees economic
diversification as a matter of national importance, crucial
for setting the stage for Kuwaits long-term growth. Against
this background, the Kuwaiti parliament in February
2010 approved one of the most ambitious reform and
development plans in the Middle East. The NDP 2014 is part
of Vision Kuwait 2035, which aims to transform Kuwait into
a regional finance and transport hub a logical aspiration
given Kuwaits strategic location at the head of the Gulf.
The NDP 2014 sets out investments across oil and non-oil
sectors, including energy, transport, housing, healthcare
and education, with a spending total of US$105-125-billion.
One of the main elements of the NDP 2014 is to boost
private sector activity, primarily through various reforms
and incentives to stimulate private investment. Half of the
planned investments are anticipated to come from the
private sector either as direct investments through build,
operate and transfer (BOT) schemes, or Public Private
Partnerships (PPP).
On the hydrocarbon side, Kuwait Petroleum Corporation
(KPC) plans to spend some US$340-billion on upstream
and downstream projects over the coming two decades,
which will breathe new life into the industry, creating fresh
opportunities for investment.
Kuwaits energy and power generation sectors provide
significant opportunities, given strong energy demand,
growth and historic underinvestment. Capital investments
in the past have been hindered by bureaucracy and political
stalling over privatisation, however, a new set of laws are
intended to boost the flow of private schemes, by making
it obligatory for all power schemes larger than 500 mega
watts, to be developed as Independent Water and Power
Projects (IWPPs).
Kuwaits location at the head of the Gulf provides a
natural advantage to serve as a regional transport hub,
despite neighbouring countries heavily investing in their
transport and logistics infrastructure over the past years.
The National Transport masterplan maps investment
requirements until 2035, within which the NDP 2014 sets
out more than US$23-billion to improve Kuwaits transport
infrastructure.
Boubyan, Kuwaits largest island, is located in the northeastern part of the country and is separated from the
mainland by the Subbiya Channel. The Boubyan Seaport
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Project is one of the most important projects in the
plan and will be the Northern Gulfs largest port. Apart
from the port itself, infrastructure projects include the
construction of a highway linking the port on Boubyan
Island with the Subiyan-Iraq road on Kuwaits mainland,
and the construction of a railway line to the north of
the highway. One of the most important projects is the
ongoing expansion of Kuwait International Airport (KIA), by
expanding the airport terminal capacity from six million
passengers per annum, to 20 million passengers per annum
by 2030, turning KIA into a major regional passenger and
cargo hub.
Another key infrastructure development is the expansion
of the road and rail network, and the implementation of
a mass transport system. The proposed US$7-billion for
Kuwait City Metro is fundamental to the countrys transport
plans. The metro will comprise of four lines, each of which
will be tendered as a separate PPP contract. Rail plans
include the US$10-billion national railway network that will
eventually form a section of the Gulf Co-operation Council
(GCC) railway network.
Housing is another major focus of the NDP. Local demand
for housing is driven by the constitutional right of Kuwaiti
nationals to receive housing when they marry. Kuwaits
public authority for housing welfare has a waiting list
of 100,000 housing applicants, and a further 65,000
applications are expected by 2014/15. To deal with this,
the housing authority is implementing a US$8.6-billion plan
to build and allocate between 50,000-75,000 residential
housing units by 2015.
Kuwait has a substantial higher education building
programme, with some US$5-billion of university building
projects being planned or under construction. The
programme is centred on the US$3-billion Sabah al-Salem
University at Shadadiyah, 20 kilometres west of Kuwait
city. Meanwhile, the healthcare sector is focusing on new
hospital construction. The healthcare development plan
sets out construction of eight public hospitals by 2016 and
investments are planned in medical facilities and health
centres.
Whilst the investment plan creates exciting opportunities
for the construction supply chain, there are some concerns
regarding Kuwaits capacity to meet ambitious goals.
Kuwaits construction sector is still small by regional
standards, accounting for just 2 per cent of GDP. This
compares to approximately 9 per cent of GDP in the UAE,

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5.2 per cent in Qatar or 4.4 per cent in Saudi Arabia.
Historically, construction growth has been hindered by
political deadlock, particularly between the executive and
parliament, which has held up many public projects, and
bureaucratic red tape resulting in significant delays to
the procurement and execution of projects. More recently,
private sector companies have struggled to allocate
required funding for projects as banks are unwilling to
finance them.

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However, the political willingness to push through the
programme is evident with approval of new legislation, to
help the private sector attract foreign investment, including
a privatisation law and capital markets and labour law.
The Partnerships Technical Bureau (PTB) a new governing
body has the mandate to promote build operate transfer
(BOT) and PPP schemes. The PTB identifies priority projects and
aims to boost private sector involvement. There are currently
over 30 PPP projects being developed under the PTB in Kuwait,
with the most significance in the Middle East. Already in 2010,
the PTB has had a catalytic impact on construction activity,
providing greater impetus for projects by speeding up the
bidding process.

Our history and future involvement

Davis Langdon has maintained a time-honoured relationship
with the Kuwait market, originally founding an office within
the country during the 1980s.
Following the events that occurred during the early 1990s
and more recently in neighbouring Iraq in 2003, we have
re-established a local presence within the country in support
of our global reach, local delivery strategy, through provision
of comprehensive consultancy services throughout the
Middle East.
Commitment is critical when developing successful business
relations in Kuwait and we as a company are demonstrating
our commitment to Kuwait by achieving our ambition to
become partners of choice.

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74

5 Expand and empower the energy sector

8 Improve dynamics of the labour market

11 Protect the environment and fostering green

development

4 Promote a sound and sustainable fiscal position

7 Develop a niche financial centre

10 Build a stronger healthcare system

Policy Targets

Political system

2 Improve access to land

People

1 Reduce red tape

Economy

5 Pillars

International positioning

12 Build a cultural haven, promoting leisure, sport

and media

9 Upgrade the education system

6 Regional transport centre

3 Create fair and equal opportunities in the market

Cultural environment

Transforming Kuwait into a financial and trading hub for investment, in which private sector leads economic activity fuelled by the spirit of
competition, and raising the efficiency of production under a supporting institutional State agency, establishes value, preserves the social identity,
achieves balanced human development and provides appropriate infrastructure, improved legislation and encourages business development.

Kuwait Vision 2035

REFERENCE
ARTICLES

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76

5
PROCUREMENT ROUTES
Most clients and construction professionals can name
at least one project that failed to be delivered on time, to
budget, or to the quality levels expected. All clients embark
upon their developments expecting them to be built to an
established quality level with the risk rightly managed by
their professional and contracting team. In reality though,
which other multi-million or, in terms of the Middle East,
multi-billion dollar business goes from having no staff or
expenditure, to the final delivery of a unique product as
quickly as the construction industry? This is why identifying
the right procurement process, systems and approach is
fundamental to achieving the development goals set
by clients.
To use a simple analogy a new model of car priced in the
market at US$50,000, will have gone through a significant
amount of planning, refining and design very early in the
development process, the cost of which will be in excess
of the US$50,000 asking price. Within the construction
industry, the luxury of rolling out thousands of the same
structure in advance of the final version does not exist,
which is why it is crucial that construction professionals
seek to understand and define what made a project
successful. In doing this, we can all come to understand
which procurement methods should be followed and why
it is important to consider the structure and process for
delivery right from the outset of the development.
Over its significant history, Davis Langdon has developed
procurement strategies for the delivery of buildings that we
know work and provide successful outcomes to achieving
client expectations. New and existing developers have the
opportunity to learn from this knowledge and maximise
the value from their time, cost and quality mix, whilst
adhering to a process that increases the likelihood of their
building being successfully procured. Studies conducted
with our key clients who regularly undertake development
work, identify that buildings can be delivered for 12-15 per
cent less cost when procured correctly, with no impact
on quality or time. Another finding relating to correct
procurement was that buildings are also more likely to be
completed on time and meet quality expectations.

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Finding the right procurement approach
Which funding strategy, funding partner, team behaviours,
attitudes, communication channels, budget and
programme delivers the best approach and how can we
best combine these to lead clients to ultimate success?
Davis Langdon offers important early advice to help
determine the correct procurement approach that will
add the most value throughout the building process. This
considered understanding of our clients time, cost and
quality requirements, assists us greatly in maximising
the value that we bring. Several procurement strategies
that are regularly adopted are listed below, but the real
challenge is mixing the right approach to an individual
clients requirements.
Traditional lump sum: The entire building design,
produced by the clients consultants, is completed
prior to the appointment of a contractor. The contractor
commits to a lump sum price and a completion date for
the final design prior to appointment. The contractor
assumes responsibility for all financial and programming
risks whilst carrying out the construction, and the client
takes responsibility by accepting the risk for the quality
of the design and the design teams performance.
Accelerated traditional: As above, but procured in
the market place before the design is fully complete
(normally 80-85 per cent designed), leaving simple
elements of the building to be procured once the
contractor has been appointed. It is important to
understand the way in which a client procures the
remaining elements of work under this approach and to
design out those areas that carry inherent risk early in
the process. It may also involve the procurement of an
early works package for enabling and/or piling works.
Two-stage: A contractor is invited to become part of the
project team right at the outset of the design process,
usually by way of a pre-construction fee. The team
designs and procures the project on behalf of the client,
until such time that a second stage lump sum offer can
be agreed, which should be prior to construction starting
on site. An understanding of the original appointment
and the subsequent framework under which the second
stage is agreed are the important aspects of this
approach.
Design and build: Detailed design and construction are
both undertaken by a single contractor in return for a
lump sum price. Where a concept design is prepared
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by a design team employed directly by the client before
the contractor is appointed (as is fairly common), the
strategy is called develop and construct. The contractor
commits to a fixed price for completing the design
and the construction by a given date, prior to his
appointment. The contractor can either use the clients
design team (if the develop and construct strategy has
been adopted) to complete the design or use his own
team. With design and build, it is important to design
out or specify in detail those parts of the building the
client wants to see perform a particular function or
provide a certain visual impact.
Management contract: A contractor is appointed early
to tender and let elements of work progress by trade
or package contracts. The contracts are between the
management contractor and the trade contractors,
rather than between the client and sub-contractors.
The management contractor in theory assumes
responsibility for the financial (and programme) risks for
the works, but in reality this is normally diluted by the
terms of the contract, so his liability is similar to that of
a construction manager.
Design, manage and construct: Similar to the
management contract, with the contractor also being
responsible for the production of the detailed design or
for managing the detailed design process.
Private finance initiative: A detailed and complicated
form of procurement used predominantly for public
services when the private sector feels it is advantageous
to design, build, finance and operate a particular service
or building type. It is becoming more popular in the
Middle East as a way to limit public sector spending
whilst meeting the demands of a growing population.
Davis Langdon has been involved with private finance
for over 20 years, successfully completing many projects
worldwide and using this global knowledge to benefit
clients locally.
Engineer, procure, construct or turnkey: This form of
procurement places risk in the hands of an engineer,
procure and construct (EPC) or turnkey contractors who
offer a complete design, procurement and construction
solution to a client. In theory, the clients role is to turn
the key of the building and begin operation. Many of the
large utility companies procure work in this way, bringing
high levels of certainty from the supply chain helping to
achieve critical benefits over the long-term.

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5
MIDDLE EAST FORMS OF
CONTRACT
This article considers the different forms of contract used
in construction across the region.

Bahrain
Government work in Bahrain is undertaken using a bespoke
suite of contract forms which were issued in 2009.
Private developers predominantly use the current FIDIC
Conditions of Contract for Construction, the 1999 edition of
the red book, which is well understood in the local market
but often heavily amended for specific use.
Most of the work completed in Bahrain is under a
traditional lump sum form of contract, where the design
is completed upfront and a price agreed with a contractor
before work begins on site. However, many of the new
developments are looking at faster procurement routes
to adapt to market difficulties that are prevalent within
the Middle East. Progress is slow as Bahrain has a limited
number of contractors with the capacity and capability
to undertake large-scale projects. Historically it has been
difficult for new contractors to enter the Bahrain market.
Design and build and two-stage procurement are in use
across the Kingdom but are not considered to be the
industry norm. As more international private developers
have started working in Bahrain with time constraints as
their main driver, the market has adjusted to accommodate
this demand. Design and build contracts, however, are not
routine. This is largely due to the Committee for Organising
Engineering Professional Practice (COEPP) restrictions
on contractors undertaking in-house design which
necessitates the novation of the clients architect or a subconsultant appointment.

Lebanon
Construction contracts in Lebanon are generally based upon
the International Federation of Consulting Engineers (FIDIC)
forms of contract. Some large-scale developers in Lebanon,
as well as the Lebanese Government, have promoted the
development and use of bespoke forms of contract, tailored
to each client. Such contracts generally use the FIDIC 4
red book form as a basis, amended to a greater or lesser
degree depending upon the risk profile of each client.

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5
In the public sector, all works are procured on a remeasurement basis. The private sector, however, uses
either fixed price lump sum or re-measured contracts.
It is worth noting that there is no standard method of
measurement of building works for Lebanon and the RICS
Principles of Measurement (International) for Works of
Construction (POMI) is widely used.
Design and build contracts are not yet popular in Lebanon.
Both arbitration and litigation methods are available for
dispute resolutions in the private and public sectors.

Oman
Public works in Oman are undertaken using a bespoke
government contract known as the Standard Documents
for Building and Civil Engineering Works, 4th edition, 1999.
The document is based on early FIDIC contracts with the
4th edition containing only minor changes from the previous
3rd edition, 1981. The most important change is that the
contract is now printed in Arabic. The Ministry of Legal
Affairs is in the process of preparing a new edition but its
launch date is yet to be published.
The Standard Document facilitates both a re-measurement
and lump sum contract dependant on choice of clauses,
and is based upon a fully completed design, specification
and bill of quantities. The RICS Principles of Measurement
(International) are the most widely used method of
measurement.
Infrastructure projects have their own method of
measurement, as detailed within the Ministry of Transport
and Communications document, Highway Design
Standards.
Oman Tender Board laws require all government projects to
utilise the Standard Documents on every project, without
amendment. The only current exception to this law is the
new Muscat International Airport project which has been
let on a series of heavily amended FIDIC yellow book
design and build contracts.
In addition, the Tender Board facilitates all government
tenders, centrally, through the tender board process. Only
Royal Office and Royal Court of Affairs projects are exempt
from this process although they do go through a similar
internal tender process.
Standard Documents are commonly used by private sector
clients in the local market, particularly for small-to81

5
medium sized contracts. Private clients tend to prefer the
3rd edition, as this is written in English, but varies only in a
minor way from the Arabic 4th edition preferred by the
government ministries. International and private sector
clients with large project contracts, US$150 million-plus,
commonly use an amended version of the FIDIC red book.
Whilst some of the larger integrated tourism developments
have used a design build form of contract, design and build
as a procurement route is not routinely used.

Qatar
In Qatar, the most common forms for building works are
those issued by the Public Works departments through
the Ministry of Municipal Affairs and Agriculture (MMAA)
and the Qatar Petroleum Company (QP). These are
lump sum contracts, generally using bills of quantities
or specifications and drawings. These contracts are
onerous and slanted towards the client, but are usually
administered in a reasonable manner.
In the private sector, similar contractual arrangements
are adopted. However, there are now some construction
projects being let using cost plus or design and build
arrangements, although these are usually for smaller scale
fitting out or highly specialist works.
The last 12 months has seen an increase in the number
of FIDIC-based contracts being implemented for both
private and key public sector clients. In addition, in some
very long duration contracts, the government is beginning
to introduce a price adjustment mechanism to allow
compensation for fluctuations in market prices.
Before any contract is awarded, there are commonly a
number of rounds of negotiation, during which the price
and other contractual terms can be modified to respond to
a reduction in contract price.

Saudi Arabia
Construction contracts in the private sector are generally
based on FIDIC forms of contract and are amended to
suit the particular conditions for each project. Employers
prefer lump sum versus re-measured contracts, and
normally exercise great control in the administration of the
construction process by imposing various restrictions on
the engineers (consultant) authorities under the contract.
All contracts are subject to Saudi Arabian laws where
Islamic Sharia is the prime source of legislation.
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5
Litigation and arbitration are both available for resolution
of disputes in the private sector.
Within the public sector, however, construction contracts
are based on the Standard Conditions for Public Works,
which are amended to suit particular projects. These
conditions are generally based on those given in the
FIDIC Conditions of Contract for Works of Civil Engineering
Construction, but with greater control given to the employer
for the administration of the contract.
All public work contracts are let on re-measured basis
and subject to the Saudi Government Tendering and
Procurement Regulations, as issued by Royal Decree M/58
dated 4.7.1427 AH.
Disputes are referred to the Grievance Board and will not
be dealt with under arbitration, unless a Special Council of
Ministers Resolution is issued.

UAE
Construction contracts in the UAE are predominantly based
upon the FIDIC forms of contract. The growing number
of large-scale developers and major repeat clients in the
region has led to the development of bespoke forms of
contract, tailored to each individual client. Such contracts
generally use the FIDIC 4 red book form as a basis,
amended to a greater or lesser degree depending upon
the risk profile of each client. This also applies to works
procured by Dubai Municipality. Abu Dhabi Municipality,
however, bases its contract on a modified FIDIC 3 form,
taken from the 3rd edition of the FIDIC Conditions of
Contract for Works of Civil Engineering Construction.
Contracts based on the 1999 red book are now starting
to be used in the UAE, but in general the market remains
firmly rooted in the FIDIC 4 form.
Civil works contracts within the UAE are mostly procured
on a re-measurable basis, whereas building works will
generally be based on a fixed price lump sum.
However, there are exceptions. More and more clients are
procuring projects using a fast-track approach and will
therefore incorporate a re-measurable element, reflecting
those parts of the design which are incomplete at tender
stage.
Design and build contracts are used on some major
projects, but this procurement route is not yet
commonplace.
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5
The increasing tendency for clients to demand a fast-track
approach to projects does require a greater design input
from the contractor, but this requirement is not always
formalised in the contract wording itself.

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BUILDING REGULATIONS
AND COMPLIANCE
This article outlines the procedures for obtaining building
permission across the region.

Bahrain
Procuring a municipal building permit in Bahrain is done
through a three-stage process:
Stage 1: Seeking the preliminary building permit
This is preliminary permission sought from the Municipality
of Bahrain.
To complete the application, it is generally sufficient to
include a simple outline plan or cross-section to indicate
overall heights and an area statement. The main authorities
involved at this stage are the municipality, the Physical
Planning Directorate and the Roads Directorate.
Stage 2: Informing the various Directorates
This should be done in writing to the Town & Village
Planning Directorate, Roads Directorate, the Civil Defence
and Fire Services Directorate, the Electricity Distribution
Directorate (EDD), EDD Damage Protection and Control
Unit, the Sanitary Engineering Operations and Maintenance
Directorate, the Water Distribution Directorate and Batelco.
The initial contact should be made through the Central
Planning Office (CPO) of the Ministry of Works.
Copies of the title deeds must be submitted at this stage.
All relevant information and documentation is given to each
of the above directorates, until the final building permit is
in hand.
Stage 3: Obtaining the final municipal building permit
This is the third and last stage and is processed through
each of the directorates in specific sequence. All
documents, drawings and municipality forms must be filled
in and submitted together with the appropriate fees for
each directorate.
Municipal charges must be paid for the following elements:
1. Site sign board.
2. Insurance on the site sign board.
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3. Insurance for Construction Contract (refundable).
4. Fee for occupying road.
If the Environmental Affairs Department is involved in the
process, they will charge a reviewing fee.

Lebanon
Obtaining a building permit in Lebanon requires various
procedures and approvals from the Order of Engineers and
Architects, the Urban Planning (Development) Department,
statutory authorities and the local municipality. The time
needed to obtain these approvals is typically between
six and twelve months. In general, the procedures and
documents required for obtaining a building permit are the
same throughout Lebanon, except for the cities of Beirut
and Tripoli where the Urban Development Department is
located within the individual municipality. The following is
a general outline of the steps needed to obtain a building
permit:
Stage 1: Obtaining Ifadat Takhteet Wa Tasneef
The following documents must be submitted to the Urban
Planning (Development) Department:
1. Real Estate Registry (Ifedeh Ikarieh) from the Real Estate
Department in each Mohafaza.
2. Official Land Survey (Kharitet Masaha) from the
Cadastre Department.
3. Receipt Wasel Takhteet Wa Irtifak from the
municipality.
Stage 2: Appointing a registered civil engineer or an
architect from the Order of Engineers and Architects to
finish the permit file
The engineer must submit the following documents:
1. Three copies of the contract agreement between the
owner and the appointed engineer.
2. Four copies of the preliminary design drawings.
3. A written undertaking from the appointed engineer to
submit the execution drawings.
4. A contract with other engineers involved in the project.
Following no objection from the Order of Engineers and
Architects, the appointed engineer or the owner must
pay them the building permit fees to enable them to

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present the building permit file to the Urban Planning
(Development) Department.
Stage 3: Appointing a Chartered Land Surveyor to prepare a
topographic drawing of the land
The appointed Chartered Land Surveyor must prepare a
topographic drawing of the land illustrating the different
levels of the plot and register this at the Syndicate of Land
Surveyors.
Stage 4: Submitting the building permit file to the Order of
Engineers and Architects for their approval
The appointed engineer must submit an application
which includes a copy of the building permit file for power
connection to Electricit du Liban (EDL) and for other
statutory authorities depending on the region in which the
building is located.
Stage 5: Study of building permit file
1. Submit and register the full building permit file to the
Urban Planning (Development) Department. They will
inspect the property and plans to ensure they conform
to construction laws and regulations and then issue
clearance for the building permit.
2. The Urban Planning Department calculates the building
permit taxes depending on the area of the building and
the region in which this building is located.
3. On approval by the Urban Planning (Development)
Department, part of the calculated building taxes need
to be paid to the Order of Engineers. The building permit
file is withdrawn from the Urban Planning Department
and registered at the municipality.
4. On approval of the buildingpermit by the mayor, the
owner shall pay the building permit taxes to the
municipality and the Ministry of Finance.
Stage 6: Obtaining the building permit
The applicant collects the building permit from the
municipality. The appointed engineer is allowed to apply
at the Order of Engineers and Architects for a letter of
commencement of works following the submission of the
execution file.

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Oman
The following is a general outline of the procedure for
obtaining a building permit in the Sultanate of Oman but
there are many further obligations and procedures to be
completed within each of the stages. It is generally the
responsibility of the lead consultant to obtain the building
permit, although all applications must be signed off and
submitted by locally registered consultants.
Stage 1: Submitting concept design/master plan stage
application
The applicant submits a Concept Design/Master Plan
application to the Ministry of Housing - Directorate General
of Planning for approval of the proposed usage. At the same
time utility requirements are identified and indicated to the
relevant utility providers. If the project is tourism related,
further approvals are required from the Ministry of Tourism
and the Supreme Committee for Town Planning.
Stage 2: Obtaining No Objection Certificates (NOCs)
No Objection Certificates are obtained from various
governmental and municipal departments, including, Royal
Oman Police, Security Department, Traffic Department and
Civil Defence, Ministry of Environment, Municipality Road
Department, Ministry of Transport & Communications,
Civil Aviation, and many more project-specific ministry
departments, e.g. Ministry of Education if the project is a
school or university.
Stage 3: Submitting a building permit application
The full building permit application, including all NOCs,
is submitted to the relevant municipality or statutory
authority.
Stage 4: Obtaining building occupancy certificate
Upon completion of the building works, it is the
responsibility of the construction contractor or lead
consultant to obtain the occupancy permit. This is achieved
by having the building permit signed off, effectively closing
it out. To obtain this closure, the contractor must obtain
certificates and signatures from various government
departments, including Civil Defence, Food and Hygiene,
etc, prior to presenting these to the municipality or
statutory authority for final approval.

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5
Qatar
Compared with many countries, the planning and building
approval process in Qatar is relatively clear and structured.
Land ownership, other than by Qatari nationals and the
state, is still extremely limited. The key process in securing
development rights is obtaining a land title or pin number;
since without it all other permits and applications cannot
be commenced. Once the land is secured, the project
masterplan is submitted for approval to the planning
department and local municipality offices.
Stage 1: DC1 approval
General overviews and strategies for the utilities and
primary infrastructure are submitted to the relevant
utility companies for comment. During this process each
department usually issues a series of reference numbers
which are then used as the file number for all future
submissions. The culmination of this round of submissions
is the DC1 approval.
Stage 2: DC2 approval
As the design develops, a second round of submissions is
made to the same utility departments for final approval.
In addition, a submission is made to the Civil Defence
department who reviews the fire and life safety aspects of
the project.
Depending upon the scale and nature of the project,
separate traffic studies may be required and these would
be submitted to the Road Affairs Department for approval.
Stage 3: Building permit
Once the DC2 approval is secured, a further set of standard
forms are circulated with a consolidated set of documents
for final signing and approval. These documents constitute
the building permit.
As a general guide, the whole process usually takes at least
80 days, depending upon the quality of the submission,
although in practice it often takes much longer due to
comments from different departments and progressive
design revisions.
During the whole of this process, it is not advisable to revise
or modify any submission as it may delay the approval
process.

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All submissions have to be either in Arabic or bilingual
and endorsed by locally registered and approved design
companies. International companies cannot make these
submissions by themselves.
There are some parts of Qatar which are exempt from the
building permit approval process, but these are generally
related to the oil and gas production facilities.
Recently, a number of revisions have been made to the
design standards of buildings, in particular high-rise
structures. These address issues such as fire safety, refuge
areas, the use of lifts in the event of fire, and the nature and
extent of faade glazing.
All fit-out projects are being brought under the control of
the regulatory departments, in particular Civil Defence,
and all such works are now required to be submitted for
approval prior to commencement. This submission must be
made by a registered local consultant and failure to do this
can significantly delay the approval and permitting process.

Saudi Arabia
Obtaining a building permit requires various procedures
and approvals from the main municipality, the branch
municipality and the fire department. Obtaining these
approvals typically takes between three to four months
depending on the nature of the building.
The following is a general outline of the steps needed to
obtain a building permit:
Stage 1: Obtaining letter from the main municipality
A letter from the owner is submitted to the main Riyadh
municipality, along with a copy of the land deed. The
municipality checks the masterplan of the area to ensure
the suitability of the plot for the construction of a building.
The municipality then writes a letter to the branch
municipality of the area where the plot is located. This
process takes five days and does not incur a charge.
Stage 2: Obtaining preliminary location permit from branch
municipality
The owner submits a copy of the letter obtained previously
from the main municipality to the branch municipality,
requesting an inspection of the plot to ensure that the plot
length, width and total area are as indicated on the deed.
The branch municipality then issues an approval to use the
land. This process takes five days and does not incur
a charge.
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Stage 3: Obtaining approval from the Fire Department
The branch municipality writes to the fire department, or
Civil Defence, to obtain its approval of the plan submitted
by the owner for the fire-alarm and fire-fighting systems.
The fire department approves these plans and sends them
back to the municipality. This process takes ten days and
does not incur a charge.
Stage 4: Obtaining a final building permit
The branch municipality issues a building permit and sends
it to the main municipality for approval. The owner can
collect the permit from the main municipality after one to
three months. The cost of this permit is SAR 1,200.

UAE
The following is a general outline of the procedure for
obtaining a building permit in the UAE, but there are many
further obligations and procedures to be completed within
each of the stages. Building permit application stage 3,
for example, requires no less than 15 different forms,
documents and separate approvals to be submitted as
part of the application.
It is the responsibility of the construction contractor or
lead consultant to obtain the building permit, although
all applications must be signed by locally registered
consultants.
Stage 1: Submitting preliminary application
The applicant submits a preliminary application to the
relevant municipality or statutory authority and pays a
deposit.
Stage 2: Obtaining No Objection Certificates (NOCs)
No Objection Certificates are obtained from various
governmental and municipal departments including Civil
Defence; Fire Department; Drainage; Communication;
Water and Electricity; Civil Aviation; Oil and Gas, Coastal
and Military.
Stage 3: Submitting a building permit application
The full building permit application, including all NOCs,
is submitted to the relevant municipality or statutory
authority.

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Stage 4: Obtaining building permit
On approval, the applicant collects the building permit and
applies for a Demarcation Certificate.
Stage 5: Obtaining building occupancy certificate
Upon completion of the building works, it is the
responsibility of the construction contractor or lead
consultant to obtain the occupancy permit. This is achieved
by having the building permit signed off, effectively closing
it out. To obtain this closure the contractor must obtain
certificates and signatures from various government and
quasi-government departments, including Civil Defence;
Food and Hygiene; Criminal Investigation Department
(CID), etc, prior to presenting these to the municipality or
statutory authority for final approval.
Davis Langdons Project Management team is experienced
in the procedures for obtaining building permits across the
region and are able to oversee this process.

92

REFERENCE
DATA

93

94

2009

0.37-0.39

3.66-3.68

0.36-0.38

3.51-3.66

0.27-0.30

3.73-3.75

44.4-47.2

0.69-0.71

5.24-5.75

1432.2-1543.4

Range

Source: Oanda.com

3.67

0.39

Omani Rial

0.29

Kuwait Dinar

UAE Dirham

3.75

Saudi Riyal

3.65

47.46

Syrian Pound

0.38

0.71

Jordanian Dinar

Bahraini Dinar

5.60

Qatari Riyal

1524.3

Egyptian Pound

Average

Lebanese Pound

Local currency to US$1.00

Exchange Rates

0.39

3.67

0.38

3.65

0.29

3.76

47.27

0.71

5.59

1519.4

Average

Half Year 2010

0.37-0.39

3.65-3.67

0.36-0.38

3.50-3.67

0.27-0.31

3.69-3.77

44.4-46.5

0.70-0.71

5.32-5.70

1447.2-1511.7

Range

0.39

3.67

0.38

3.64

0.29

3.76

48.25

0.71

5.74

1512.1

1/7/2010

95

96

3410

3940

High Quality Low Rise

High Quality High Rise

2450

3070

- High Rise

2640

3820

- Medium Rise

- High Rise

High Standard Offices

1950

- Medium Rise

1350

- Low Rise

Average Standard Offices

COMMERCIAL (shell & core only)

Basement Car Parking

710

3220

Podium Car Parking

2820

Medium Quality High Rise

London,
UK

Multi Unit Low Rise

RESIDENTIAL

Building Type

3200

2800

2900

2500

2000

2400

2000

4500

4100

3700

2400

New York,
USA

2300

2100

2800

2300

1700

2100

1600

4200

3700

3500

2300

Los Angeles,
USA

International Building Cost Comparison (US$/m) Q2FY11

2340

2180

2100

2020

1940

1310

770

2785

2705

1695

2060

Singapore

960

740

730

640

515

450

375

935

720

740

590

Manila,
Philippines

2640

2580

2175

2140

2100

1770

985

2370

3690

2145

2770

Hong Kong

1285

1160

960

850

775

465

460

1005

850

565

535

Beijing,
China

3270

2700

3050

2250

1830

1410

1090

3660

2720

2360

2040

Sydney,
Australia

1210

1160

880

800

720

520

445

1595

1360

865

785

Joburg,
South Africa

1640

1460

Heavy Industrial

Attached Offices

4090

n/a

5 Star/Luxury

5 Star/Resort

GBP

0.61

EXCHANGE RATES

Mid Year 2011 US$1.00

1.00

USD

1700

1500

6000

4800

n/a

4800

2400

1600

1900

1100

1.00

USD

1600

1500

7300

5100

4600

4600

2200

1400

1700

1100

1.24

SGD

2260

2500

n/a

2500

3470

3470

2585

n/a

1375

1130

43.50

PHP

660

850

1020

1130

1700

1410

1100

525

420

380

7.80

HKD

2640

2275

3110

2540

n/a

3320

2615

1595

1245

1140

6.47

CNY

1295

1100

1190

1005

n/a

1940

1180

n/a

n/a

n/a

0.94

AUD

1890

1410

3300

2450

3660

4050

2450

1720

850

680

2.20

ZAR

1110

905

2085

1665

5590

3610

2430

750

525

500

These rates (US$/m2) are indicative and represent competitively tendered prices for a typical specification building of the type stated. Local market expectations
and building requirements are addressed in the rates. Location factors should be applied to account for geographic variations within each country. Large fluctuations in exchange rates can create short-term anomalies in costs. Included: service installations and preliminaries. Excluded: external works and services; tenant
fit-out; fittings, furnishings and equipment (FF&E); professional fees; land acquisition costs; financing costs; Value Added Tax (VAT) or similar, where applicable.

2170

Regional Shopping Mall

District Centre

n/a

3410

District Hospital

RETAIL (shell & core with public areas finished)

1970

District Medical Centre

HEALTH (excluding FF&E and medical equipment)

2220

3 Star/Budget

HOTEL (including FF&E)

1060

Light Industrial

INDUSTRIAL

97

98

1350

- High Rise

- Medium Rise

1400

1200

- Medium Rise

High Standard Offices

1000

- Low Rise

Average Standard Offices

COMMERCIAL (shell & core only)

850

1800

High Quality High Rise

Basement Car Parking

1500

High Quality Low Rise Apartments

700

1300

Medium Quality High Rise

Podium Car Parking

1200

n/a

Beirut, Lebanon

Medium Quality Villa Compound

Affordable Housing

RESIDENTIAL

Building Type

500

1200

1250

1150

1000

800

600

1700

1400

1400

1250

Riyadh, KSA

Regional Building Cost Comparison (US$/m) Q2FY11

755

1370

1785

1370

1015

650

725

2000

1600

1370

1150

Doha, Qatar

1185

1185

1110

985

790

650

1625

1310

1305

1240

520

Manama, Bahrain

1195

n/a

1090

1040

780

650

n/a

1510

n/a

1430

715

Muscat, Oman

1400

1500

1250

1050

850

550

1800

1450

1350

1000

700

Abu Dhabi, UAE

- High Rise

1600

District General Hospital

1340

1175

2700

1995

1505

1225

3420

3575

3350

2100

1200

1050

925

2475

1440

1260

2465

3250

2660

1890

850

730

650

n/a

1305

n/a

1352

1092

2275

2470

2210

1560

830

730

570

n/a

1750

1275

1400

3290

3410

3130

2400

1010

870

650

2300

These rates (US$/m2) are indicative and represent competitively tendered prices for a typical specification building of the type stated. Local market expectations
and building requirements are addressed in the rates. Location factors should be applied to address geographic variations in each country. Included: service
installations and contractors preliminaries. Excluded: external works and services; tenant fit-out; fittings, furnishings and equipment (FF&E); professional fees;
land acquisition costs; financing costs; Value Added Tax (VAT) or similar, where applicable.

1200

1500

District Centre

Regional Shopping Mall

RETAIL (shell & core with public areas finished)

3000

2950

3000

HEALTH (excluding FF&E and medical equipment)

5 Star/Resort

2650

1650

2750

3 Star/Budget

5 Star/Luxury

1600

1000

1100

HOTEL (including FF&E)

Attached Offices

900

800

1000

700

2250

Light Industrial

n/a

1750

Heavy Industrial

INDUSTRIAL

- Super High Rise

99

100

343

369

437

130

161

High Quality Low Rise Aparts

High Quality High Rise

Podium Car Parking

Basement Car Parking

322

343

- Medium Rise

- High Rise

369

416

- Medium Rise

- High Rise

High Standard Offices

296

- Low Rise

Average Standard Offices

COMMERCIAL (shell & core only)

302

Medium Quality High Rise

Beirut, Lebanon

Medium Quality Villa Compound

RESIDENTIAL

Building Type

Riyadh, KSA

478

416

416

354

343

172

156

510

426

406

322

Mechanical & Electrical Cost Comparison (US$/m2) Q2FY11

Doha, Qatar

720

575

480

410

370

245

225

530

415

365

315

670

590

n/a

340

320

300

120

730

680

440

340

Manama, Bahrain

n/a

510

n/a

340

320

160

135

n/a

390

n/a

320

Muscat, Oman

580

550

450

410

360

240

130

540

450

410

280

Abu Dhabi, UAE

364

494

426

n/a

290

425

325

1150

1150

1050

495

365

335

350

470

420

1250

1000

870

580

410

400

310

440

325

n/a

940

n/a

n/a

360

420

360

550

520

1170

880

820

410

440

480

These rates (US$/m2) are indicative and represent competitively tendered prices for a typical specification building of the type stated. Local market expectations
and building requirements are addressed in the rates. Location factors should be applied to address geographic variations in each country. Included: subcontractor preliminaries and main contractor mark-up. Excluded: incoming service utility lines and connections; site distribution networks; associated builders work;
and Value Added Tax (VAT) or similar, where applicable.

348

426

District Centre

n/a

Regional Shopping Mall

RETAIL (shell & core with public areas finished)

District General Hospital

HEALTH (excluding FF&E and medical equipment)

728

676

754

5 Star/Luxury

5 Star/Resort

832

416

276

3 Star/Budget

HOTEL (including FF&E)

Attached Offices

322

312

416

229

296

Light Industrial

Heavy Industrial

INDUSTRIAL

101

102

kg

Structural Steel in Trusses

Hollow Concrete Block Partition

(200 millimeters (mm) thick)

1.2

kg

kg

Reinforcement in Beams

25

200

Formwork to Side and Soffits of Beams

Precast Wall Panel Architectural with Sand

Blast Finish

Structural Steel in Beams

20

Formwork to Slab Soffits (under 5 metres

(m) high)

130

29

3.75

3.75

125

Concrete in Walls (32 megapascals (Mpa)

35

115

Imported Structural Fill

Concrete in Pad Footings (25 megapascals

(Mpa)

Concrete in Slabs (32 megapascals (Mpa)

16

Foundation Excavation

15

Beirut, Lebanon

Unit

Basement Excavation

Description

Major Measured Unit Rates (US$) Q2FY11

13

13

11

30

1.2

200

32

32

125

125

115

Riyadh, KSA

206

28

28

185

195

180

25

13

11

33

3.56

3.56

1.37

Doha, Qatar

30

1.2

205

20

20

135

135

128

13.5

Manama, Bahrain
7

21

169

16

15

104

104

105

10

Muscat, Oman

22

1.1

180

26

26

118

118

109

13

15

Abu Dhabi, UAE

Ceramic Tiles to Walls

Average Quality Marble Paving on Screed

Anti Static Carpet Tiles to Office

and Admin Areas

65

130

35

10

32

50

750

300

60

160

35

35

51

615

440

69

151

33

22

50

548

247

39

160

53

48

52

535

220

61

98

26

34

91

520

270

40

170

29

35

41

484

250

These rates (US$) are indicative and represent competitively tendered prices for average specification works of the type described. Location factors should be
applied to address geographic variations in each country. The rates are exclusive of contractors preliminaries (site establishment, scaffolding, hoisting etc) and
Value Added Tax (VAT) or similar, where applicable.

Average Quality Steel Stud Partition

(with single layer plasterboard each side)

Suspended Mineral Fibre Ceiling

Aluminium Curtain Wall System

(including structural system)

Paint on Plasterboard Walls

Aluminium Framed Window

(6.5millimeters (mm) clear glass
commercial quality)

103

104

Grade 20 Ordinary Portland cement (OPC)

Tn

Tn

High Tensile

Mild Steel

REINFORCING STEEL

Grade 50 Ordinary Portland cement (OPC)

Grade 40 Ordinary Portland cement (OPC)

READY MIXED CONCRETE

19millimeters (mm) thick Aggregate

AGGREGATE

Sand for concreting

SAND

Tn

Tn

In Bags

Unit

In Bulk

ORDINARY PORTLAND CEMENT

Description

Major Material Prices (US$) Q2FY11

890

870

74

88

97

17

22

94

103

Beirut, Lebanon

88

60

70

75

14

12

78

690

690

Riyadh, KSA

Doha, Qatar

83

808

850

90

96

100

32

22

77

800

800

80

90

100

25

20

80

95

Manama, Bahrain

774

800

60

72

79

11

11

65

78

Muscat, Oman

830

765

61

65

70

15

12

71

70

Abu Dhabi, UAE

Softwood

Litre

Petrol Premium 95

1.2

0.88

550

1600

1700

0.16

0.07

432

732

1400

0.25

0.27

767

1125

1507

10

18

0.27

0.27

395

790

1300

20

0.30

0.38

504

891

1040

0.47

0.79

461

922

1226

These cost rates (US$) are indicative and represent supply-only costs of the materials listed. Location factors should be applied to address geographic variations
in each country. The rates are exclusive of Value Added Tax (VAT) or similar, where applicable.

Litre

Diesel

FUEL

Tn

Hardwood Meranti

TIMBER

Mild Steel Grade 50 to BS 4360

STRUCTURAL STEELWORK

100 millimetres (mm) thick

200 millimetres (mm) thick

HOLLOW CONCRETE BLOCKWORK

105

106

Day

Day

Day

Day

Day

Day

Day

Day

Mason

General Labourer

Crane Operator

Heavy Machinery Operator

Dump Truck Driver

Plumber

Electrician

Foreman

8000

4000

100

32

32

30

50

55

20

30

35

27

27

Beirut, Lebanon

90

65

70

55

65

25

25

50

50

50

45

13000

5000

Riyadh, KSA

88

55

55

50

66

66

27

44

44

40

40

12330

6850

Doha, Qatar

11130

5250

132

87

75

59

75

84

46

50

58

58

29

Manama, Bahrain

66

47

47

35

52

52

26

39

47

39

39

11050

3900

Muscat, Oman

11000

5000

82

49

40

49

55

55

22

33

28

32

32

Abu Dhabi, UAE

These rates (US$) are indicative and represent an all-in unit cost for each of the disciplines listed. Location factors should be applied to address geographic
variations in each country. Included: wages, salaries and other remunerations prescribed by local labour legislation; average allowances for costs of employment;
recruitment; visas/permits; paid leave; travel; accommodation; health and welfare. Excluded: overtime working; contractor mark-up for overheads and profit; VAT
(Value Added Tax) or similar, where applicable. These cost rates should not be misinterpreted as contractors daywork rates.

Month

Day

Carpenter

Construction Manager

Day

Steel Bender

Month

Day

Concreter

Site Engineer

Unit

Description

Labour Costs (US$) Q2FY11

12 (*)

10 litres (*)

Fresh Air Supplies

(*) litres per second per person

Ventilation - Water closet (WC) (Extract)

(*) air changes per hour

22oC, +/-2oC

22oC, +/-1oC

Heating and Air Conditioning

Internal Criteria (degree centigrade)

3-10 (*)

12-16 litres (*)

Fan coil units,

Variable air volume (VAV),
downflow units

Single sex 1 person to 12m

using 70/30 (*)

1:7/m

1:10-1:15/m

75-80%

UAE Specification*

Fan coil units,

Variable air volume (VAV),
Direct expansion (DX) ,
constant volume

Form of Air Conditioning

Single sex 1 person to 12m

using 70/30 (*)

1:7-1:12/m

Occupancy Standards - Dealer

Occupancy Standards - Toilets (*)

male/female ratio based on
120% population

1:10-1:14/m

70-80%

Bahrain Specification

Occupancy Standards - Typical

Net: Gross Ratio (Typical)

Subject

Building Services Standards

10 (*)

12-16 litres (*)

22oC, +/-2oC

Fan coil units,

Variable air volume (VAV),
VAV with re-heat,
Direct expansion (DX),
constant volume, plate
heat exchangers

Single sex 1 person to 12m

using 70/30 (*)

1:7-1:12/m

1:10-1:14/m

70-80%

Qatar Specification

10 (*)

12-16 litres (*)

22oC, +/-2oC

Fan coil units,

Variable air volume (VAV),
VAV, downflow units

Single sex 1 person to 12m

using 70/30 (*)

1:7/m

1:10-1:15/m

70-80%

Oman Specification

none stated

12-16 litres (*)

22oC, +/-2oC

Fan coil units,

Variable air volume (VAV),
VAV, displacement, chilled
ceiling/beam

Single sex 1 person to 14m

using 60/60 (*)

1:7/m

1:12-1:14/m

80-85%

Lebanon Specification

107

108

60-215 w/m

none stated

Internal Heat Gains Equipment load (Dealer)

Supplementary cooling allowance

(e.o/% area)

NR 40

15 w/m

35 w/m

400, 800 or 1,500 w

per desk

none stated

Acoustics - Common Areas

Primary Power - Lighting

Primary Power - Typical

Primary Power - Dealer

Primary Power Upgrade

(e.o power/% area)

NR 35

25 w/m

Internal Heat Gains Equipment load (Typical)

Acoustics - Offices

15 w/m

Bahrain Specification

Internal Heat Gains Lighting load

Subject

25 w/m, 25% area

800 or 1,600 w
per person

25 w/m

12 w/m

NR 40-45

NR 30-35

25 w/m, 25% area

45 w/m

15 w/m

12 w/m

UAE Specification*

none stated

none stated

30-40 w/m

12-15 w/m

NR 40

NR 30-35

none stated

none stated

15 w/m

12-15 w/m

Qatar Specification

none stated

none stated

25-30 w/m

12-15 w/m

NR 40

NR 30-35

none stated

none stated

15 w/m

12 w/m

Oman Specification

20-25w/m, 20-25% area

none stated

15-25 w/m

12 w/m

NR 40-45

NR 35-38

25w/m, 25% area

none stated

12 w/m

12 w/m

Lebanon Specification

80% loading with 35

second waiting interval,
handling 15% in 5 minutes.
Population density 1:14

none stated

none stated

none stated

350-500 lux,
Uniformity Ratio 0.8

UAE Specification*

80% loading with 30

second waiting interval,
handling 15% in 5 minutes.
Population density 1:14

150 lux

200 lux

250 lux

500 lux

Qatar Specification

80% loading with 30

second waiting interval,
handling 15% in 5 minutes.
Population density 1:14

215 lux

215 lux

200-270 lux

400-500 lux,
Uniformity Ratio 0.8

Oman Specification

none stated

none stated

none stated

300-500 lux,
Uniformity Ratio 0.8

Lebanon Specification

80% loading with 30

second waiting interval,
handling 15% in 5 minutes.
Population density 1:14

* Specific to the Emirate of Abu Dhabi. Excludes implications of new building code regulations for the emirate due to come into effect in 2012.

80% loading with 35

second waiting interval,
handling capacity of 11%
to 17% in 5 minutes.
Population density 1:12

215 lux

Passenger lifts Capacity and waiting times

215 lux

Lighting - Plantrooms

200-270 lux

Lighting - Stairs/Circulation

Lighting - Water closets (WC)

400-500 lux

Bahrain Specification

Lighting - Office

Subject

109

6
Measurement Formulae Two Dimensional Figures
Figure

Area

Perimeter

Square

4a

Rectangle

ab

2(a + b)

ch

a+b+c

r
d
where 2r = d

2 r
d

ah

2(a + b)

h (a + b)

a+b+c+d

Approximately
ab

(a + b)

Triangle

Circle

Parallelogram

Trapezium

Ellipse

Diagram

Hexagon

2.6 x a

Octagon

4.83 x a

Sector of
circle

rb or q r
360
note b = angle q r
360

110

Segment of
circle

S-T
where S = area of sector
T = area of triangle

Bellmouth

3 x r
14

6
Measurement Formulae Three Dimensional Figures
Figure

Surface Area

Volume

6a

2(ab + ac + bc)

abc

bd + hc + dc + ad

hcd

Cylinder

2 rh + 2r
dh + d

rh
dh

Sphere

4r

4/3r

Segment
of sphere

2Rh

Pyramid

(a + b) l + ab

Frustrum
of a
pyramid

l (a+b+c+d) +
(ab+cd)
[regular figure only]

Cube

Cuboid/
rectangular
block
Prism/
triangular
block

Diagram

/ h (3r + h)
/ h (3R - H)

1 6

1 3

/ abh

1 3

h/3(ab + cd +
abcd)

111

6
Measurement Formulae Three Dimensional Figures
Figure
Cone

Frustrum
of a cone

112

Diagram

Surface Area

Perimeter

rl + r
dh + d

+ R + h (R+r)

/ r h
/ dh

1 3

1 12

/ (R + Rr + r)

1 3

6
WEIGHTS AND MEASURES
Metric Measures and Equivalents
Length
1 millimetre (mm)

= 0.0394 in

1 centimetre (cm)

= 0.3937 in

= 10 mm

1 metre (m)

= 100 cm

= 1.0936 yd

1 kilometre (km)

= 1000 m

= 0.6214 mile

Area
1 square centimetre (cm2)

= 100 mm2

= 0.1550 in2

1 square metre (m2)

= 10 000 cm2

= 1.1960 yd2

1 hectare (ha)

= 10 000 m2

= 2.4711 acres

1 square kilometre (km2)

= 100 ha

= 0.3861 mile2

Capacity/Volume
1 cubic centimetre (cm3)

= 0.0610 in3

1 cubic decimetre (dm3)

= 1000 cm3

= 0.0353 ft3

1 cubic metre (m3)

= 1000 dm3

= 1.3080 yd3

1 litre (litre)

= 1 dm3

= 1.76 pt

1 hectolitre (hl)

= 100 litre

= 21.997 gal

Mass (Weight)
1 milligram (mg)

= 0.0154 grain

1 gram (g)

= 0.0353 oz

= 1000 mg

1 kilogram (kg)

= 1000 g

= 2.2046 lb

1 tonne (t)

= 1000 kg

= 0.9842 ton

USA Measures and Equivalents

USA Dry Measure Equivalents
1 pint

= 0.9689 UK pint

= 0.5506 litre

USA Liquid Measure Equivalents

1 fluid ounce

= 1.0408 UK fl oz

= 29.574 ml

1 pint (16 fl oz)

= 0.8327 UK pt

= 0.4723 litre

1 gallon

= 0.8327 UK gal

= 3.7854 litre

113

Imperial Measures and Equivalents

Length
1 inch (in)

= 2.54 cm

1 foot (ft)

= 0.3048 m

= 12 in

1 yard (yd)

= 3 ft

= 0.9144 m

1 mile

= 1760 yd

= 1.6093 km

1 int. nautical mile

= 2025.4 yd

= 1.853 km

Area
1 square inch (in2)

= 6.4516 cm2

1 square foot (ft2)

= 144 in2

= 0.0929 m2

1 square yard (yd2)

= 9 ft2

= 0.8361 m2

1 acre

= 4840 yd2

= 4046.9 m2

1 sq mile (mile2)

= 640 acres

= 2.59 km2

Capacity/Volume
1 cubic inch (in3)

= 16.387 cm3

1 cubic foot (ft3)

= 0.0283 m3

= 1728 in3

1 fluid ounce (fl oz)

= 28.413 ml

1 pint (pt)

= 20 fl oz

= 0.5683 litre

1 gallon (gal)

= 8 pt

= 4.5461 litre

Mass (Weight)
1 ounce (oz)

= 437.5 grains

= 28.35 g

1 pound (lb)

= 16 oz

= 0.4536 kg

1 stone

= 14 lb

= 6.3503 kg

1 hundredweight (cwt)

= 112 lb

= 50.802 kg

1 ton

= 20 cwt

= 1.016 tonne

Temperature Conversion
C = 5/9 (F 32)

114

F = (9/5 C) + 32

DIRECTORY
OF OFFICES

115

116

7
MIDDLE EAST
Kingdom of Bahrain
Davis Langdon, An AECOM Company
Al Saffar House
Unit 21, Building No. 1042
Block 436, Road 3621
Seef District
PO Box 640
Manama
Kingdom of Bahrain
T: +973 17 588 796
F: +973 17 581 288
Office E: bahrainoffice@davislangdon.com
Contact: Clarke Morton-Shepherd
E: clarke.morton-shepherd@davislangdon.com

Kingdom of Saudi Arabia (Al Khobar)

AECOM Arabia Ltd
Al Khereji Business Centre, Level 1
King Faisal Road
PO Box 1272
Al Khobar 31952
Kingdom of Saudi Arabia
T: +966 3 849 4400
F: +966 3 849 4411 / 8494422
Office E: khobar@aecom.com
Contact: Andy Ritchie
E: andy.ritchie@aecom.com

Kingdom of Saudi Arabia (Jeddah)

AECOM Arabia Ltd
7th floor, Bin Sulaiman Center
Al Rawdah Street
PO Box 15362
Jeddah 21491
Kingdom of Saudi Arabia
T: +966 2 213 8500
Office E: jeddah@aecom.com
Contact: Andy Ritchie
E: andy.ritchie@aecom.com

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Kingdom of Saudi Arabia (Riyadh)
Davis Langdon, An AECOM Company
PO Box 58006, 4th Floor, Tower 4
Tatweer Building
King Fahd Road
Riyadh 11594
Kingdom of Saudi Arabia
T: + 966 1200 8686
F: + 966 1200 8787
Office E: riyadh@aecom.com
Contact: Andy Ritchie
E: andy.ritchie@davislangdon.com

Kuwait
Davis Langdon, An AECOM Company
PO Box 29927
Safat 13160
Kuwait
T: +965 2 23 22 999
F: +965 2 23 22 990
Office E: kuwaitoffice@davislangdon.com
Contact: Adam Ralph
E: adam.ralph@davislangdon.com

Lebanon
Davis Langdon, An AECOM Company
Floor 1, Chatilla Building
Australia Street
Rawche, Shouran
PO Box 13-5422
Beirut
Lebanon
T: +961 1 780 111
F: +961 1 809 045
Office E: beirutoffice@davislangdon.com
Contact: Muhyiddin Itani
E: dll.mi@cyberia.net.lb

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Oman
Hanscomb, An AECOM Company
PO Box 434
Al Khuwair, Postal Code 133
Muscat
Oman
T: +968 2448 1664
F: +968 2448 9491
Contact: Chris Beasley
E: chris.beasley@aecom.com

Qatar
Davis Langdon, An AECOM Company
Salwa Commercial Complex Building
1st Floor, Behind Al Seal Building
Salwa Road
PO Box 3206
Doha
State of Qatar
T: +974 4458 0150
F: +974 4469 7905
Office E: dohaoffice@davislangdon.com
Contact: Steven Humphrey
E: steven.humphrey@davislangdon.com

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United Arab Emirates
Davis Langdon, An AECOM Company
Level 7, Building 54
Dubai Healthcare City
PO Box 7856
Dubai
United Arab Emirates
T: +971 4 423 3690
F: +971 4 423 3691
Office E: dubaioffice@davislangdon.com
Contact: Steven Coates
E: steven.coates@davislangdon.com
AECOM
Al Jazira Sports & Cultural Club
Muroor Road, 4th street
PO Box 43266
Abu Dhabi
United Arab Emirates
T: +971 2 414 6000
F: +971 2 414 6001
Office E: abudhabi@aecom.com
Contact: David Barwell
E: david.barwell@aecom.com

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NORTH AFRICA
Egypt
Ground Floor, Corner Road 23 / El Sharifa Dina Street
Building 13
Maadi
Helwan
Egypt
T: +20 2 2750 8145
F: +20 2 2750 8146
Contact: Chris du Toit
E: chris.dutoit@davislangdon.com

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AFRICA
Botswana
Davis Langdon, An AECOM Company
Plot 127, Unit 10
Kgale Court
Gaborone International Finance Park
Gaborone
Botswana
Mailing address:
PO Box 201855
Gaborone
Botswana
T: +267 390 0711
F: +267 395 7550
Office E: admin@davislangdon.co.bw
Contact: Fred Selolwane
E: fred@davislangdon.co.bw

Mozambique
Davis Langdon, An AECOM Company
Rua D Estvo de Ataide No 38/48
Sommerschield 1
Maputo
Mozambique
T: +258 21 490 696/7
F: +258 21 490 699
Office E: admin@davislangdon.co.mz
Contact: Charle Viljoen
E: charle@davislangdon.co.mz

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Nigeria
Tillyard Nigeria Ltd, in Association with Davis Langdon,
An AECOM Company
Fourth Floor, 241 Igbosere Road
Lagos
Nigeria

Mailing address:
PO Box 2167
Lagos
Nigeria
T: +234 (0) 1 764 4272
F: +234 (0) 1 815 6558
Contact: John Tuffrey
E: john.tuffrey@tillyardnigeria.com

South Africa
Davis Langdon, An AECOM Company
3rd Floor MPF House
Sunnyside Office Park
32 Princess of Wales Terrace
Parktown, Johannesburg
South Africa
Mailing Address:
PO Box 1642
Houghton, 2041
T: +27 11 666 2000
F: +27 (0) 86 650 0711
Office E: info@davislangdon.co.za
Contact: Indresen Pillay
E: indresen.pillay@davislangdon.co.za
Also at: Cape Town, Durban, George, Pietermaritzburg,
Port Elizabeth, Pretoria, Stellenbosch and Vanderbijlpark

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Americas
USA
Davis Langdon, An AECOM Company
301 Arizona Avenue
Suite 301
Santa Monica
California 90401
USA
T: +1 310 393 9411
F: +1 310 393 7493
Contact: Nicholas Butcher
E: nbutcher@davislangdon.us
Also at: Boston, Honolulu, Houston, New York, Philadelphia,
Sacramento, San Francisco, Seattle and Washington, D.C.

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AUSTRALIA &
NEW ZEALAND
Australia
Davis Langdon, An AECOM Company
Level 45, 80 Collins Street
Melbourne, Victoria 3000
Australia
T: +61 3 9933 8800
F: +61 3 9933 8801
Office E: melb@davislangdon.com.au
Contact: Mark Beattie
E: mbeattie@davislangdon.com.au
Also at: Adelaide, Brisbane, Cairns, Canberra, Darwin,
Hobart, Perth, Sydney and Townsville

New Zealand
Davis Langdon, An AECOM Company
Level 10, Citigroup Centre
23 Customs Street East
Auckland 1010
New Zealand
Mailing Address:
PO Box 935
Auckland 1140
New Zealand
T: +64 9 379 9903
F: +64 9 309 9814
Office E: auck@davislangdon.co.nz
Contact: Chris Sutherland
E: csutherland@davislangdon.co.nz
Also at: Christchurch and Wellington

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UK & EUROPE
Central Eastern Europe
AECOM
141-143 Calea Floreasca Street
3rd floor
District 1
Romania
T: +40 (0)21 316 11 66
F: +40 (0)21 316 11 68
Contact: Alan Baker
E: alan.baker@aecom.com
Also at: Bulgaria, Czech Republic, Estonia, Latvia and
Ukraine

CIS
AECOM
Moscow 29 Serebryanicheskaya nab
109028
Russia
T: +7 495 783 7360
F: +7 495 783 7361
Contact: Alan Baker
E: alan.baker@aecom.com
Also at: Azerbaijan, Kazakhstan, Turkey, Ukraine and
Uzbekistan

Ireland
Davis Langdon, An AECOM Company
24 Lower Hatch Street
Dublin 2,
Ireland
T: +353 1 676 3671
F: +353 1 676 3672
Office E: ireland@davislangdon.com
Contact: Paul Mitchell
E: paul.mitchell@davislangdon.com
Also at: Cork, Galway and Limerick

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United Kingdom
Davis Langdon, An AECOM Company
MidCity Place
71 High Holborn
London WC1V 6QS
United Kingdom
T: +44 20 7061 7000
F: +44 20 7061 7061
Contact: Steve Waltho
E: steve.waltho@davislangdon.com
Also at: Birmingham, Bristol, Cambridge, Cardiff, Edinburgh,
Glasgow, Leeds, Liverpool, Maidstone, Manchester,
Norwich, Oxford, Peterborough, Plymouth and Southampton

Western Europe
Davis Langdon, An AECOM Company
Calle Serrano 98 2nd Floor
28006 Madrid
Spain
T: +34 91 431 0290
F: +34 91 576 9211
Contact: Jon Blasby
E: jon.blasby@davislangdon.com
Also at: Germany

Full contact information is available on our global website

www.davislangdon.com
www.aecom.com
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www.aecom.com

US$25.00
DL30017 (2012) | Designed in-house by AECOMs PCC business development team