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As the construction boom has maintained its level of investment, the strain being placed on contractors through conventional methods of procurement and operating in the emirate has required a major re-think. Dispensing with the traditional ‘us and them' attitude, contractors have started to pursue agreements that offer shared responsibility and greater transparency with developers.
While recently a number of developments have focused away from traditional contracts - Aldar recently formed a joint venture with contractor Laing O'Rourke on the $18 billion Al Raha Beach project, of most interest is the proliferation of design and build contracts.
Though popular in other parts of the world, this form of contract is steadily becoming more notable in Dubai, offering a reduction in overall cost, earlier completion and occupancy and elimination of the traditional liability gap through a straightforward procurement model. Dubai Festival City is being built entirely under this contract by Al Futtaim Carillion.
Simon Buttery, operations director, Al Futtaim Carillion says: "With projects where the client's main aspirations are cost certainty and passing as much risk from himself to the contractor as early as possible, then design and build is the best route because what he is looking to do is take on responsibility of the design and manage that for the lifetime of the project."
There are other benefits, adds Buttery: "We can say if you do it this way it will be cheaper and quicker so we can provide benefits much earlier so there are big advantages to a client going design and build."
This approach has taken hold in the UK, with 90% of all its work following design and build, and Buttery expects a similar pattern to be taken up here, with more contractors following this route. "It is becoming more popular. We are finding more clients are looking to go into this form of procurement, and is definitely something you will see more and more of in this market."
There is a caveat here. According to Buttery, the client influences this decision, depending how much control they wish to forgoe. A traditional contract, for example, offers the client far more control over his designers as he is managing and paying for them himself and therefore able to guide them to what he wants. Therefore bespoke, one-off projects - such as a grand mosque for instance - would be better implemented by a traditional contract as it affords close control by the client.
