A year of success
As winners of two awards at the first MEP Awards that took place last month, Drake & Scull reflects on the past year and tells Facilities Management Middle East its plans for the future.
It is safe to say 2007 proved lucrative for Drake & Scull. Embarking on a number of district cooling projects, namely in Dubai Investment Park (DIP) and Motor City, the company also found time to heavily invest in industrial water and power. Ending the year on a high, Drake & Scull's achievements were highlighted in December at the first MEP awards, where it collected the awards for Contractor of the Year and Medium MEP Project of the Year.
"2007 was a very good year for Drake & Scull. We were overjoyed to win two MEP Awards, I just wish we could have had a bit more time to prepare for the submission, because we didn't really put through our pride and joy and biggest projects. This includes district cooling at Dubai Festival City and Jumeirah Beach Residence," says Qais Saleh, strategic planning director, Drake & Scull.
"The industrial water and power segment of our business in particular, is going really well. We have recently signed a big project in Saudi Arabia and another in Bahrain," he adds.
The Jumeirah Beach Residence project in particular caught the eye of many industry insiders. When Drake & Scull was the awarded the contract, it was the largest district cooling plant in the world. This mantle alone is a sharp indication of the scale on which the company operates.
Its traditional MEP services also progressed at a fast pace during 2007. "We delivered the Shangri-La hotel in Abu Dhabi in a record seven months, from walk-in to walk-out. The client was very happy," notes Saleh.
Looking to build on last year's success, Drake & Scull have high aspirations for the coming 12 months. Of global interest, the company hopes to deliver the Golden Mile on The Palm, Jumeirah. Stretching over one mile long and with a total of 10 buildings, tenants are expected to move into the unique luxury complex before the last quarter of 2008.
"The property boom in Dubai is crystal clear to everybody - there is plenty of business to go around. A sign of a leading contractor is one who can afford to be selective and attracts high profile clients who know what they are paying for. We have been very selective and on average respond to one in five enquires as we do not want to stretch our resources too far," explains Saleh.
It is possible to go and sign another two or three billion dirhams in work right now, everybody is hungry for a contractor to work on site.
With such fierce demand, Drake & Scull have been proactive in ensuring it has personnel to match the scale of their projects. The company admits this has proved a challenging task, having struggled to find mid-level technical staff. With technical resources continuously becoming more expensive, Drake & Scull has adopted a long term planning process.
While the obvious rings true - the faster a contractor takes on staff, the faster it can take on work - Saleh is quick to point out this can ultimately affect the standards of operations. With this in mind, the company has adopted a stringent integration process for its personnel.
"Integration is important as it is essential that new staff follow your way of doing business. I believe that planning for growth in the long term is the best way forward. We cannot go and sign multiple large projects without having the workforce to support it," says Saleh. "This is why over the next three months we will be phasing in approximately 2,000 additional workers."
A staggering figure, Drake & Scull has expanded its recruitment platform in order to fulfil the quota. With most workers deriving from the sub-continent, the company has also branched out of traditional recruiting areas to obtain technical resources. This includes South-East Asia, Malaysia, Thailand and Singapore.
"Historically, we have always had a great number of British and Arabic workers but the competition is now so tough to both recruit and keep them. While they are always a preferable choice, we have ventured out into other regions which also have renown engineering practices," points out Saleh.
Alongside recruitment, Drake & Scull identifies inflation as another potential pitfall for the MEP contracting world. Highlighting the inflation in commodities, the company in particular notes the effect copper prices has upon operations.
"Right now, the price of copper has stabilised around US$7000 per tonne but in the past it has been constantly up and down. For MEP, copper is around 10% of the cost base so this has a significant impact," he adds.
The contractor has also learnt to become flexible over supply times having become aware of the shortage of capacity deliveries from major suppliers. "For example, if you want to order chillers, lead times are now around 16 to 18 weeks. In the past, this could be achieved in six or eight weeks, but the suppliers are now all working to capacity," Saleh adds.
Accelerated contract schedules are as common in Dubai as traffic, a fact Drake & Scull has approached with reservation. Citing an example where a potential client requested a district cooling station up and running in less than 12 weeks, the company acknowledges that the unfeasible is sometimes asked for in such a line of business.
"Developers have unrealistic expectations and are running on tight schedules. They don't realise how long the material takes to arrive if they want it before a certain date," says Saleh. "Another problem is that 75-80% of these clients don't have finalised designs which means designs are changing as we are building. This leads to variations and delays to the project which contractually makes our job harder. Contrary to the beliefs of the market, it also costs us a lot in terms of money and management time."
To counter this, Drake & Scull sometimes offer advice on a design and in the case of district cooling jobs, actually carry out the design and as well as the construction. The company also has firm views on how relations with FMs can increase a project's prospects. "A lot of developers only employ the FM provider when the building has been completed. They need to do this at least three to four months prior to delivery to make sure the commissioning happens as the clients needs," he concludes.