Builders' oasis

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Balfour Beatty is also the biggest player in Britain’s lucrative public-private partnership market — it has won 27 contracts including four in the last year.

A different market

As the UK construction industry contracts, Balfour Beatty has seen its Dubai order books swell. After winning a high-profile contract to extend the Dubai Creek three years ago, it has since bagged a clutch of major orders that has seen its Dubai workforce soar to 16,000 ­- almost half the total number of employees listed in its annual report.

Among its current contracts are two interchanges being built for the massive Dubai Waterfront project that are worth more than US$280m, a US$118m order to build the Trump Tower on Dubai's Palm Island and a US$74m contract to develop a hotel in a Formula One development under construction on Yas Island in Abu Dhabi.

Other projects that the firm has won include a new Novotel hotel complex to be built close to Dubai's famous Mall of the Emirates, and the mechanical and electrical works on the University Hospital in Dubai.

Other British construction companies have also been buoyed by Dubai's thriving building industry.

Carillion, the second-largest UK construction company, won orders worth US$2.2bn from Dubai and Abu Dhabi in the first half of the year alone. It now hopes to double its revenues from the region next year.

While the sheer number and size of projects on offer in Dubai must be a big attraction for Balfour Beatty at a time when the UK industry is suffering, an added attraction is the better margins available in Dubai where there is too much work to handle for the relatively small number of international contractors licensed to operate in the emirate.

"Margins are better but you have to compare like with like," says Tyler. "We operate in lots of different markets and they reflect risk in the main as well as the available resources that get tied up. So while our margins may be higher, they're risk-adjusted."

Market return

Balfour is also the biggest player in Britain's lucrative public-private partnership market - known in the building industry as PPP, where contractors help fund, build and operate infrastructure that includes schools, hospitals and roads.

Balfour Beatty has won 27 such deals including four in the last year - among them a US$200m college in Singapore and a US$410m housing contract for the US Air Force.

The PPP market is debt-driven and the paralysis in global credit markets has brought the sector to a grinding halt in Britain - although Tyler believes it is a temporary interruption.

"In the short-term, there really isn't a project finance market there. Plain and simple," he says.

"It would be a daft time to do any deals right now, but the market will come back."

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