Dubai: An offplan property boom. More high-visibility infrastructure projects. Some relief on building material costs. UAE’s construction sector would close 2022 with a lot more cheer than they had same time last year.
Into this mix, Jihad Bsaibes, CEO of Amana Contracting, would add a touch of modular and sustainability elements - something that more contractors and project managers want to sign up to. Not to forget a dash of ‘green’.
Group Amana is uniquely positioned to talk about that green part, having played a stellar role in the ‘world’s largest vertical farm’ that opened at Dubai South. The ‘Bustanica’ - as it is called - farm is the first vertical farm for Emirates Crop One, a joint venture between Emirates Flight Catering and Crop One, a specialist in indoor vertical farming.
Bsaibes says, with quite a bit of emphasis, that such efforts at sustainable development can never be a one-off.
Amana recently restructured its divisions - was that in part done with an eye on creating more sustainability-themed projects? Like the vertical farm?
Group Amana is now organised into three verticals - construct, manufacture and enhance. Construct consists of Amana Contracting and Amana Aviation Fueling, and builds on a legacy of 30 years of industrial construction. Manufacture leverages our expertise in modular construction through companies DuBox and DuPod.
And Amana’s Enhance vertical is focused on helping companies achieve their green ambitions with brands Amana Solar and Amana Energy-Saving.
National initiatives - the UAE Green Agenda 2015-2030, Vision 2021 and Saudi Arabia’s Vision 2030 - regulatory requirements and the urgency of tackling climate change have all contributed to the increased focus on improving sustainability. We are seeing this with clients who are demanding sustainable buildings and processes.
Amana Contracting recently handed over Al-Futtaim Auto Park in Al Ain with solar PV plant, expected to generate 800 MWh of energy, equivalent to 5,571 trees grown over 10 years.
Plus, we recently delivered the world’s largest vertical farm - the high-tech hydroponic facility in Dubai South can produce over 2 million pounds of high-quality leafy greens annually under the ‘Bustanica’ brand.
What’s all this talk on modular construction?
With the shift from projects to ‘productization’ in construction, we are seeing demand for faster, leaner and greener modular construction. Modular construction shifts construction to off-site, potentially reduces material waste by up to 30 per cent and improves work safety by up to 70 per cent compared to conventional construction.
Moreover, modular buildings can be constructed in 50-75 per cent of the time of a conventional site-built project of comparable size, which has helped us hand over projects on time despite delays caused by supply chain crises during the pandemic.
Sources say that steel and other commodity prices have started to decline – do you buy this argument?
Material price increases have been a challenge for the construction sector. We witnessed average increases of up to 25 per cent in the prices of steel (structures and reinforcements), aluminum, copper and chemicals. Inflation has squeezed profitability. And contractors have been under tremendous pressure.
We cannot speak for other businesses but our strategy has been to focus on material price forecasting and increased digitalization in order to deliver accurate estimating, tracking and timely delivery.
With effective project management, risk assessment and adopting innovative technologies such as modular construction, we have has been able to tide over challenges and deliver projects on time. It’s important to understand the cyclical nature of such events to ensure project teams stay motivated – this comes with experience. We have been in business for a long time (since 1993) and weathered many such cycles.
Would you say there’s enough capacity in the UAE for cement?
We haven’t witnessing any shortage or squeeze of cement at this point in time. Having said that, most of our projects are steel buildings, and thus, we don’t rely on cement and concrete like other traditional contractors.
Have contracts started flowing out from the Expo City makeover and new constructions?
We are witnessing the rejuvenating effect of Expo 2020 Dubai on the UAE’s real estate sector cascading to all segments of the economy. The legacy infrastructure of this world-class event will now support thriving communities.
We anticipate demand for various real estate products, including residential housing, hospitality and schools is expected to increase.
Projects outside of the UAE – do they make up 20-30 per cent of your book now?
Accelerated digitalization and focus on food security in the region has unleashed Design Build opportunities for Amana in data centers, ecommerce fulfilment centers, agritech, and cold storage facilities in the UAE and across the GCC.
Our presence in Saudi Arabia dates back to 2006. It continues to be an exciting market, with Amana involved in several marquee projects. The mega projects currently under construction in the Kingdom greatly benefit from the socio-economic and environmental benefits delivered by modular construction.
We are well placed to supply hospitality projects, with design and build turnkey modular solutions, for mega projects in remote locations that would otherwise be difficult to execute using conventional construction methods. To meet demand for modular construction, DuBox set up a 94,000 square metre factory in Rabigh. It supplied modules for our award-winning work at The Red Sea Development Project, a 150-room hotel at the project site.
We are also constructing Green Silos for grain storage for Al Silaa port in Kizad, two e-fulfilment centres for noon in Saudi Arabia and in the UAE, modular offices for Neom in the Kingdom, and food packaging facility for Al Foaa, also in Al Silaa.
Soon, we are going to be delivering products for specific use cases, for instance, in sectors like offices, hotels and residences.