Survive the crisis: five top tactics for developers

Limitless MEA commercial head Ezzat Ragab

Limitless MEA commercial head Ezzat Ragab tells us what developers can do to stay on top

I believe the economic slowdown is not a bad thing at all, but a golden opportunity for Dubai to start anew. In order to survive these tough market conditions, I’ve listed five essential strategies that developers must adopt.

1. Pick the right contracting strategy
We need to go back to traditional procurement methods that have proven to be the most effective and risk free. Why do we rush to tender before we complete the design? To compile a tender package, we should at least complete the design development and have enough construction details to issue the tender package.

We should forget about (most of) what we know, and start thinking out of the box – we’ve been saying this for a while but no one does it. There has to be a different route of procurement, such as alliance contracting, which makes the relationship between the contractor and the employer stronger as one entity.

With Alliance contracting we can form a procurement committee that consists of representatives from both parties and they should work together towards developing and achieving a realistic budget.

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FEATURED COMMENT I agree with your advices, Mr. Ragab. I hope to meet you again. bye Mario Frau   2 Comments Read more comments »

2. Re-negotiate all existing contracts
With the dramatic drop of raw materials costs, fuel costs, and labour costs, all the old contracts must be re-negotiated with the current market value in mind. The way we should do this is to make an alliance with contractors and the consultants and get them involved in each step in the re-evaluation process.

3. Design to a budget
Most of the international consultants that have designed projects in Dubai have let go of the budget factor. Do all buildings have to be iconic and will this really help the industry? Agreed, the competition is tough in Dubai and one would want to stand out from the crowd, but budgets have to be kept in mind.

Previously, many architects focused on the fanciest and most sophisticated designs which required the most expensive materials rather than focusing on the functionality of the building.

When it comes to products, developers often get in their own way, sticking only to products they know. Yes, it’s risky experimenting with products, but if you want to achieve great designs, you need to try new concepts. The leap doesn’t even have to be significant.