By Jamie Stewart
In today’s high pressure construction market, it pays to be one of the GCC's biggest contractors.
In today's high pressure construction market, it pays to be one of the biggest contractors in the business. Jamie Stewart speaks to Al Habtoor Leighton MD David Savage.
David Savage is managing director of Al Habtoor Leighton, one of the GCC's biggest contractors. He is a relaxed but to-the-point Australian, embodying two of the character traits of his homeland.
His office feels like a place where things get done, without distractions. The walls are free of the usual glossy images of past projects and future plans. When you have responsibility for a workforce of 30,000 people, the last thing you need is to be distracted.
Our overall buying power gives us strength.
Contractors fight a constant battle to get the job done on time and on budget in the face of supply shortages, soaring material costs and staff retention problems. All these factors, and many more, burden firms in what is a high-pressure environment.
It helps, therefore, to be one of the biggest names in the GCC. The Al Habtoor Leighton Group formed when UAE-based Al Habtoor Engineering merged with Australia's Leighton Holdings last September.
Despite some contractor's concerns over labour shortages, the biggest challenge for Al Habtoor Leighton lies in providing somewhere to accommodate its immense workforce.
The firm employs enough labourers to fill a rather large town. It helps, therefore, to build rather large towns, in order to give the workers somewhere to live.
"Despite labour shortages, we are in a pretty good position because we have a large labour force," says Savage.
"At the moment we are finding more pressure not on finding labour, but on finding somewhere to house them. Camps are in short supply, so the accommodation issue is really our biggest restriction at the moment."
The firm prefers to house its labour on-site. "Whether or not we can build a labour camp within the project has become a key component of each new opportunity we look at," says Savage.
"If we can then it gives us and the project an advantage, because labour is a lot more productive."
A productive workforce is the key to meeting construction deadlines. You can have all the materials you need, but this means nothing if you don't have the hands to build with. Talking of materials, Savage says Al Habtoor Leighton does not experience many of the problems that smaller firms encounter.
"We are a big buyer in the market at the moment so we have access to a very deep supply chain," he says. "Many products, such as structural reinforcements, concrete and aggregates are under pressure. But our overall buying power gives us strength to manage that."
Al Habtoor Leighton is currently engaged in a broad range of major projects. Savage lists Dubai Properties' Business Bay Executive Towers, the Esplanade Project, which is a major project behind the Mall of the Emirates, and the Jafza Convention Centre in Jebel Ali as among the most prominent.
The firm was also recently awarded the high-profile contract by Dubai-based developer Nakheel and the US-based Trump Organization to build the Trump International Hotel and Tower Dubai on the Palm Jumeirah along with Murray and Roberts. Despite the workload, the projects are generally running to schedule.
Clients do not come much bigger than Donald Trump. But Al Habtoor Leighton is also set to begin construction of a platinum-Leed standard building, on behalf of a very special client: itself.
"We are about to commence our own 19-storey headquarters building in Dubai's Jumeirah Village area, which we intend to build to platinum standard, for two reasons," Savage explains.
"One, to show the market that it can be done, and that we know how to deliver it, and two, to show our commitment to sustainability."
We often hear that, for a developer to take the plunge and finance the premium required to build to platinum Leed standard, it must take interest in the life-span of the building.
Al Habtoor is doing this by inhabiting the building itself. Though there is a premium on construction, the firm will save this amount many times over through the hugely reduced operating cost.
This saving is compounded by the high cost of energy at present, a price which is showing no visible signs of falling any time soon.
As Savage discusses the firm's new headquarters, a photographer enters his office and begins snapping away at the man himself. Will this be enough to distract him from the task in hand?
"Is he with you?" Savage asks not batting an eyelash. No, he is not with me. It would appear that having a man burst into your office and start taking photographs of you is nothing unusual when you are the MD.
So, just another day for the straight-talking Australian. When you are juggling the fortunes of 30,000 staff, hundreds of millions of dollars worth of projects, a new HQ, and the flagship development of both Nakheel and the Trump Organization, you do not have time for distractions.