Report: Removing waste from UAE construction

12 May 2020
Insights on reducing waste and improving efficiency in construction in the UAE
More from the MEED Mashreq Construction Partnership:

Waste is one of the biggest challenges facing UAE construction. Poor planning, lack of skills and unfair contracts combine to prevent one of the country’s most vital industries from achieving optimum performance. As a consequence, the UAE is wasting billions of dollars every year on badly executed projects.

But while leading industry figures agree that the performance of the construction industry can be significantly improved, no one can say for sure just how much time, money and energy is being wasted on projects.  

There is no objective international benchmark against which performance can be measured. And more fundamentally, there is no national system for construction data collection and performance measurement on projects.      

The best contractors have internal benchmarking that allows them to monitor their own performance, but this data is not shared.

Additional data might come from consultants that have conducted research, or from academic studies by management schools.

Most of the evidence however is anecdotal, based on personal experience. 

These opinions place construction waste in the UAE at somewhere between 25-33 per cent of the value of projects.

With close to $710bn of construction projects planned or underway, even the lower end of these estimates suggest that about $175bn will be wasted in the UAE through the life of the projects that we currently know about.         

A simple way to measure waste is to compare the prices and deadlines agreed on contract tender bids, with the final costs and time taken to deliver the projects.

The variance between the original promise and the final outcome would indicate the level of overruns. This does not allow for artificially low bid prices and unexpected technical challenges. But it provides a starting point against which improvements could be driven.  

It is just as important to measure the efficiency of a building through its lifecycle. A poorly designed and poorly built structure requires far higher maintenance and operational costs that one that is well designed. There is also the issue of the energy wasted when construction and demolition material is sent to landfill rather than being recycled. 

With close to $710bn of construction projects planned or underway, even the lower end of these estimates suggest that about $175bn will be wasted in the UAE through the life of the projects that we currently know about.

Over the past five years, lower oil prices and tight budgets have made life very difficult for the UAE construction industry. The disruption caused by Covid-19 is set to make the coming five years more difficult still. Less capital investment will result in fewer projects, and inefficient companies will disappear.

It is both a challenge and opportunity for everyone involved in UAE construction to rethink the way projects are designed, built, financed and operated.     

Removing Waste from Construction is the 10th report from the MEED Mashreq Construction Partnership. It seeks to provide ideas, lessons and inspiration that will help UAE construction move forward into its next phase with a sense of purpose and optimism. 

Download the report here 

To learn more about the MEED Mashreq Construction Partnership, write to us on MEEDMashreqPartnership@meed.com or log on to www.meedmashreqindustryinsight.com 

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