SUNBIZ

Construction Is Gearing Up and Sees Improvement, Say Industry and RBF

After a lull of about seven months since the COVID-19 second wave hit Fiji, the construction industry is slowly gearing up into the new normal, says Gordon Jenkins. The president of the Construction Industry Council highlighted several issues that must be considered in the long-term, however was positive that through efficiency and time, the industry can rebuild.
15 Dec 2021 09:45
Construction Is Gearing Up and Sees Improvement, Say Industry and RBF
The entrance of the expanding Yue Lai Hotel in Flagstaff, Suva, on December 10, 2021. Photo: Leon Lord

Reserve Bank of Fiji (RBF) this week indicated that the COVID-19 induced economic recession was beginning to bottom out.

And with that construction, like other sectors, will begin to see improvement in this post-pandemic era.

This was noted by RBF Governor and chair for Macroeconomic Committee Ariff Ali when highlighting the revised projections for the economy until 2024.

 

After a lull of about seven months since the COVID-19 second wave hit Fiji, the construction industry is slowly gearing up into the new normal, says Gordon Jenkins.

The president of the Construction Industry Council highlighted several issues that must be considered in the long-term, however was positive that through efficiency and time, the industry can rebuild.

 

RBF Review
In the RBF November economic review, statistics showed that construction demand was slowly picking up evident with the increase in cement production.

Additionally, it noted an improved labour market condition for October.

“RBF Jobs Advertisement Survey reflecting recruitment intentions noted a monthly growth of 16.6 per cent as firms progressively attempt to return to pre-lockdown normalcy,” the review noted.

 

“Higher recruitment intentions were mostly noted for the construction; wholesale and retail trade and restaurants and hotels; transport, storage and communication; manufacturing; and electricity and water categories.”

Construction Industry Council president Gordon Jenkins. Photo: Ranoba Baoa

Construction Industry Council president Gordon Jenkins. Photo: Ranoba Baoa

Jenkins View
In an interview this week, Mr Jenkins, who is a quantity surveyor by profession, said: “For probably more than six months, there was nothing happening and now it’s be ginning to build up again.

The obvious reason was on lockdowns in the be ginning of the second wave in April and because construction like other sectors were not deemed essential, the industry came to a halt.

“So the best thing they could do was not so much closed down but to put everything on hold until it became satisfactory to continue,” Mr Jenkins said.

 

The downside to that soon became obvious, he said.

“Every building contracted is to be finished on time.”

“It relates to cost and time,” Mr Jenkins said.

 

“The delay or the pandemic is a negotiable item that has to be talked about between the one who’s paying for the building and the builder.”

“It’s really between them.”

“Contractually they’re supposed to finish on certain time.”

 

In his view, Mr Jenkins said an extension of time (EOT) arrangement may be the push needed for the industry.

But even that was without a downside, he noted.

“They still have to spend the same money and everything,” Mr Jenkins said.

 

“If things push out, prices are going to arise, then most contracts are on what’s called a fixed price.”

“There’s no adjustment for increased costs.”

“There may be an increase, there may be increases in costs.”

 

“There’s been enormous increases in costs, in all building materials, and in a number of other items.”

“First of all, it’s availability and secondly the supply chain problem.”

“Raw material goes to a manufacturer, then it goes to a supplier then to the builder.”

 

“So there’s three or four (chain of supply).”

“When it comes to shipping it has to be shipped from one country to another and then to Fiji.”

“So, therefore we are open to any rise and anything out of (Fiji’s) control.”

But it’s something that we have to deal with and we’ll have to do it, he said.

 

“From the council’s perspective. Things are pretty much looking up.”

“There may be some slowdowns but generally I would say things will proceed.”

“It may take some time but we will get there,” he said noting the new normal and adapting to it.”

 

“We’re still in uncertain times but we will see a clearer way…the light at the end of the tunnel.”

When asked on Government’s steps to get the economy back and running, Mr Jenkins said Government had managed the pandemic well.

 

Quick Observation
That said, SunBiz visited a few major project sites in the Capital City.

From the Yue Lai Hotel taking great shape and already hosting a number of events, these building are set to create opportunities to many.

The following are some key developments that we’ve seen are once again taking off and some of which are still on halt for perhaps the very reasons Mr Jenkins highlighted.

 

An artist’s impression of FHL Tower.

An artist’s impression of FHL Tower.

FHL Tower
i.   The 18-storey FHL Tower on Gorrie Street, Suva, is hard to miss.

ii.  In 2018, Fijian Holdings Limited announced the $65 million investment to add to the city’s high rise building development.

iii.  Designed by architectural and engineering company, Kramer Ausenco, on its LinkedIn page the tower was announced to be Fiji’s first Green Building.

iv. “The design intent for the FHL Tower is to reduce the overall life impact of the building on the environment,” the company said.

v.  “This includes reducing overall carbon emissions and environmental impact, siting and structure design efficiency, energy efficiency, water efficiency, material efficiency and waste reduction.”

v1.  Day in and into the night, workers and contractors are hard at work completing the project.

 

Nausori Plaza at the old bus stand. Photo: Leon Lord

Nausori Plaza at the old bus stand. Photo: Leon Lord

Nausori Plaza
i.  The $50 million project was announced in 2019. This is enabled through a joint venture of the with the Nausori Village mataqali (clan) and a Chinese company.

ii.  A visit to the site this week saw no indication of continued building. The plaza was announced to be five-storeys, yet so far construction has reached three-storeys high.

 

The entrance of the expanding Yue Lai Hotel in Flagstaff, Suva, on December 10, 2021. Photo: Leon Lord

The entrance of the expanding Yue Lai Hotel in Flagstaff, Suva, on December 10, 2021. Photo: Leon Lord

Yue Lai Hotel
i.  The once iconic and popular Noble House was renamed Yue Lai Hotel when a new developer came into the picture a few years ago.

ii.  In 2019, it was confirmed that Yue Lai Hotel owner was investing $10 million into the project.

iii. And since that time, the project has now taken shape. Upon observation since last year observation, the project development remained slow but continued until it looking as it is now from an aerial view.

 

The 28 story WG Plaza. Phone: Leon Lord.

The 28 story WG Plaza. Photo: Leon Lord.

WG Plaza
i.   Against the backdrop of Yue Lai Hotel is the certainly hard to miss 28-storey building, WG Plaza.

ii.  Boasting tenancy from Wyndham Hotels and Resorts, it is set to create 200 jobs locally.

iii. The WG Friendship Plaza project began in 2016. In light of the challenges faced over the past years and COVID-19 the expected date of completion was still not confirmed.

iv.  But work has been continuing slowly but surely.

 

(Fiji) International Mansion. Photo: Leon Lord

(Fiji) International Mansion. Photo: Leon Lord

(Fiji) International Mansion
i.   In 2014, developers of this proposed luxurious apartment is located on 83 Princes Road in Suva.

ii.  At the time, it was set to be called (Fiji) International Mansion

iii.  While works have been slow it has been progressing in recent times.

iv.  The developer is China’s Great Han International Company Limited

 

FUTURE PROJECTS
Tech Park, UN Headquarters in Pacific
i. In the 2021-2022 National Budget, the Attorney-General and Minister for Economy Aiyaz Sayed-Khaiyum announcement an investment into a new ICT Park in Tamavua and the construction of a United Nations Building to serve as the UN Headquarters in the Pa¬cific.

ii. To this end, calls for local designers and builders to place their bid on the above future Suva developments

iii. The park will include data storage services for businesses with a 20-year tax holiday for investments of more than $10 million.

 

Feedback: ranobab@fijisun.com.fj



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