5 Minutes with Mohammed Tahaineh, Damac Properties
Mohammed Tahaineh, senior vice president (commercial) for Damac Properties talks to Construction Week about the challenges of construction procurement
1. What does your role involve?
My role at the company is broadly divided into three segments. Firstly, it’s related to project procurement, which involves working on every aspect of a development right since its inception, heading to execution and tendering work. That involves procurement of a concept consultant, lead consultant, creating packages for contractors, and so on. This is my main role at Damac. Additionally, I also look into contract details to ensure all grey areas are avoided or cleared out at an early stage to avoid disputes with contractors later, in order to avoid project delays. Furthermore, I also handle overall procurement for Damac, which includes looking after the requirements of our corporate section, such as facilities management, vehicles, and so on.
2. How do you ensure you are picking the right firm to work on your project?
We have prequalification processes in place to make sure we are picking the right company to work on our projects. It also depends on the project’s procurement strategy; we start with picking the project consultant, who gives you the concept for the project. Next on the list is the lead consultant, following which other consultants are picked. Contractor procurement begins once the total procurement strategy is in place. Understandably, we look for experienced parties to work on the project – for instance, if we’re building a hotel, we’ll look for consultants and contractors experienced in the hospitality sector. Damac’s in-house technical team prepares a list of firms, based on their strengths and weaknesses, which can be on our invitation list. It’s our way of making sure our projects provide high quality.
3. Is there a distinction between international and local construction firms?
Not really. You can’t say international is always better than local, because it isn’t a proven fact. Eventually, it depends on the qualifications of the firm. Damac is established across the Middle East, and we have good contacts everywhere, which means we have knowledge about which firms are good at their job. At the end of the day, if we find a firm to be technically and commercially suitable, in that it is capable of fulfilling the project’s demands with high quality products and at a good rate, then we will pick that firm.
4. Do you find suicide bidding a common occurrence in the Middle East?
We have a good database of construction firms in the region; we also know how much a project should ideally cost in terms of the building materials, and level of work involved. When you have a database like that, you know what range your project’s bid fits in. For contractors or consultants to win a bid, naturally, their bid must be around the range. Rates are eventually governed by these four elements – material costs; the cost of your manpower; engineering and other services; the level of experience the company boasts; and, the planned profits and overheads by the company. Even if you reduce your profits while bidding for a project, material specifications will still be a cost which cannot be altered beyond a point.
5. What is the most challenging aspect of your job?
Coordinating on projects like Akoya by Damac and Akoya Oxygen is a good challenge for my department, which is 145 members strong. For us, ensuring all contracts, materials, manpower and other aspects related to these master-developments is a huge job. Both developments include luxury residences, hospitals, schools, and everything else a city comprises. It’s like bringing together pieces of a jigsaw puzzle. Akoya by Damac involves more than 1,000 contracts; imagine coordinating all of that for solid project delivery.