2013 property and constrution handbook_2013
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AFRICA PROPERTYAND CONSTRUCTIONHANDBOOK 2013
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AFRICA PROPERTY AND CONSTRUCTION HANDBOOK 2013
26th EDITION 2013
ISBN 978-0-620-55244-8
AECOM South Africa (Pty) Limited.All rights reserved.
https://build.phonegap.com/apps/213157/share
AECOM Property and ConstructionHandbook 1.0.1: App download instructions
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Message from theManaging Director
For AECOM in Africa, 2012 was a year of significantgrowth and change creating a platform for ourbusiness to go from strength to strength in 2013.We have expanded exponentially with the addition ofBKS to the AECOM fold. Established in South Africa
in 1965, BKS is a leading multidisciplinary consultingengineering and management company, with a proudhistory of providing turnkey solutions for projects inSouth Africa, Africa and the Middle East. BKSs visionof being a world-class leader in supplyingsustainable development solutions to help eradicatepoverty complements AECOMs purpose to create,enhance and sustain the worlds built, natural andsocial environments. Our operations in Africa nowboast over 1,100 people.
Our program, cost, consultancy (PCC) practice wasalso enhanced with the addition of Davis LangdonKPK, an AECOM company, a construction cost,contract and project management consultancy firmwith operations across Asia. KPKs 39-year trackrecord of providing construction cost, contract andproject management consultancy services in Asia willadd to the portfolio of our cost and project consultancybusiness in the region. With 3,400 PCC employeeslocated in more than 90 offices globally, we are wellpositioned to offer our clients comprehensive, globalconstruction cost management services across Asia
and the world.Globally we have streamlined our business into fourkey practice areas. PCC falls into the buildings +places practice, which is the collective name for ourthree practice lines whose work is focusedprimarily on the built environment planning, design
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+ development (PDD) (comprising design + planning,economics and architecture), program, cost,consultancy (PCC) and building engineering.
Organised around market sectors, the buildings +places structure provides a framework from which wedevelop and market our combined offer to clients. Weoperate in all market sectors, leading in our primarymarkets commercial, sports, leisure, healthcare,education and government and working closely withAECOMs other practices to deliver our services andgrow our market share in end markets such asmanufacturing, transportation, water, energy andindustrial.
We believe thisrestructuring of the way we operate,will enable us to better extend our global capabilityinto all our markets around the world. And we haveexpanded our local presence on the African continent
even further by establishing a full-time presence inEast Africa.
Our keen focus on development of the Africancontinent is also illustrated in our drive to contributeto a better South Africa. We recognise thatBroad-Based Black Economic Empowerment (B-BBEE)is an integral part of our drive to contribute to a betterSouth Africa. We fully endorse and support B-BBEEand its role in addressing the imbalances of the pastand B-BBEE is a major cornerstone for the continuedsuccess of our company and also encourages soundbusiness practices aligned to our Core Values.We have been independently evaluated and certifiedin terms of the Construction Sector Charter issuedin terms of section 9(1) of the Broad-Based BlackEconomic Empowerment Act and we are very proud tohave achieved a level 2 contributor rating at thebeginning of our Fiscal Year 2013.
We are also very excited about our Global Unite toollaunching in 2013, which will provide clients withinternational cost benchmarking data these include
the critical performance indicators that go beyond costand have the potential to influence design.We believe this tool will further differentiate us fromour competitors and will truly add value to yourprojects.
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Finally, we are delighted to share with you this 26thedition of our annual Africa Property and ConstructionHandbook. It contains a selection of referenceinformation and cost data relevant to Africa, which wetrust will be of interest and assistance to you. For morespecific information related to your project ordevelopment, please feel free to contact us directly.
Yours sincerely
Andries Schoeman
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Environmental impact categories
Deutsche Bank
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Green star SA
SECTION 1Davis Langdon has evolved
1AECOM 2Purpose and Core Values 5B-BBEE statement 7Quality management 8Safety, health and environmental management 9Sustainability 10
Research support 11
SECTION 2Our services 13Quantity surveying/cost management 14Mining and engineering cost management 17Building services cost management 19Project management 21Project controls 23SHE-Q consultancy services 26
SECTION 3South African market conditions 28
Construction industry outlook 29Commercial sector outlook 31Education sector outlook 32Energy sector outlook 33Healthcare sector outlook 34Industrial sector outlook 35Leisure sector outlook 36 Mining & minerals sector outlook 37Residential sector outlook 38Retail sector outlook 39Transportation sector outlook 40
Contents
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SECTION 4South African cost data 41Key factors influencing building cost rates 42
Approximate inclusive building cost rates 47
SECTION 5Global sentiment and building costs 55Africa outlook 56 Africa in figures 57Africa building costs 61Global building costs 63
SECTION 6Building cost escalations 67 SECTION 7Method for measuring rentable areas 76
SECTION 8Return on investment 82Residual land value 87
SECTION 9
Directory of offices 89
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DavisLangdonin Africa has Evolved
Founded in 1922 by EB Farrow and DJ Laing, westarted our long history in Africa as Farrow Laing.In 1946 Farrow and Laing grew to Farrow, Laing andMcKechnie. Thirty successful years later in 1976,Farrow, Laing and McKechnie merged with Lane,Werry and Hattingh to become known as FarrowLaing and Partners.
In keeping with developments in business in SouthAfrica in the 1990s, we became Farrow LaingNtene in 1998. In 2000 we became part of the DavisLangdon family, then being known as Davis LangdonFarrow Laing. From 2006 we became known as Davis
Langdon and at the end of 2010, we became part ofthe AECOM family, rebranding to Davis Langdon, anAECOM company.
As from the end of 2012, and the beginning of ournew financial year, we are now branded as AECOM,forming part of AECOMs global program, cost,consultancy practice.
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AECOM is a global provider of professional technicaland management support services to a broad rangeof markets, including transportation, facilities,environmental, energy, water and government.
With approximately 45,000 employees around theworld, AECOM is a leader in all of the key marketsthat it serves. We provide a blend of global reach,local knowledge, innovation and technicalexcellence in delivering solutions that create,enhance and sustain the world's built, natural, andsocial environments. A Fortune 500 company,AECOM serves clients in more than 140 countries and
has annual revenue in excess of $8.0 billion.Our Program, Cost, Consultancy (PCC) servicesOur core services are cost, programme and projectmanagement, complemented by a wide range ofspecialist consultancy capabilities, includingbuilding surveying, capital allowances consulting,design management, engineering cost management,legal support, management consulting,specification consulting, facilities management, valueand risk management and sustainability consulting.
Our projectsWere passionate about partnering with corporateclients on their most challenging projects, helping
them get to market quickly and maintain theircompetitive edge.
Our clients span the industrial spectrum, includingdiversified industrial, automotive and commercialvehicles, banking and finance, chemical/pharmaceuticaland life science, oil and gas, healthcare, metal andmining, consumer products, food and beverage,
high tech, aerospace and defence, and utilities.
Our dedication and enthusiasm have earned usrelationships with many household-namecompanies. We serve our clients around the world,through all aspects of the real estate cycle, across
AECOM
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all real estate asset types, and through all deliveryvariations.
Our comprehensive services include planning andconsulting; architecture; engineering;construction management; cost and projectmanagement; energy, water and environmentalmanagement; and integrated offerings. We workwith clients through their preferred delivery method,including agency; at-risk; engineering, procurementand construction management (EPCM); engineering,procurement and construction (EPC); design-build;design-bid-build; and fast-track.
No matter the project scope or delivery method,AECOMs clients trust us to handle their mostvaluable hard assets, such as offices; research anddevelopment centres; data centres; manufacturing,packaging and distribution facilities; utility plants;
water treatment facilities; assets related to landresource production or transmission anddistribution; and point-of-sale facilities.
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Excellence and AwardsAt AECOM we continuously strive for excellence.We maintain our successful track record by retaining
the industrys most talented professionals.We are driven by a well-defined set of Core Values,including Excellence and Innovation. This fuels ourintense focus on continuous improvement, whichleads to repeated commendation by our industry,clients and others.
We are proud to be recognised by major awardsprogrammes sponsored by professionalassociations, government agencies, civicorganisations and industry publications for ourexcellence and innovation.
Our selection for these prestigious industry honoursreflects our commitment to create, enhance andsustain the worlds built, natural and social
environments.
- AECOM listed onAmerica's Fortune 500 at #322.
- AECOM named oneof the Worlds MostEthical Companies for2011 and 2012 by theEthisphere Institute .
- EngineeringNews-Record (ENR) magazine ranksAECOM No. 1.
- AECOM named BestDiversity company2008, 2009, 2010 and2011 by readers ofDiversity/Careers inEngineering andInformation Technology
Magazine.
- Newsweek includesAECOM on its list ofGreenest BigCompanies.
- AECOM recognised bythe U.S. Chamber ofCommerce'sBusiness CivicLeadership Center ashonouree for BestCorporateStewardship.
- Financial Times namesAECOM among its BestWorkplaces.
- Careerbliss.com namedAECOM as one of thetop 10 companies
dedicated to making itsemployees happy.
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Purpose AndCore Values
We continue to improve our global resources throughlocal networks. We are made up of some the worldsfinest engineering, design and programmemanagement companies with long decades ofexperience in their respective fields.
One thing remains constant at AECOM ourpurpose: to create, enhance and sustain the worldsbuilt, natural and social environments.
Dedicated to this promise, our company is driven bya clear set of Core Values, which define who we are,what we do and how we do it.
Integrity
We are honest and ethical in our actions. We keepour commitments and treat others with mutualrespect and trust.
EmployeesWe are a global team of some of the most talentedprofessionals working on the worlds mostchallenging projects. We respect and encourage our
employees ideas, diversity and cultures.
ClientsAECOM sets the industry standard for client service.We are passionate about solving clients problemsand exploring new opportunities with them.
ExcellenceIn all areas of our business technical, operationaland administrative we strive to achieve excellence.We pride ourselves on bringing outstanding results toeverything we do.
Innovation Creativity, exploration and imagination are key toour business approach. We continually look forcreative, new or better ways to apply our expertiseto all dimensions of our work.
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Agility We embrace change, flexibility and adaptationin a rapidly evolving world. We work to anticipatechanges before they happen, and help clients andemployees adapt to those changes.
Safety In addition to preventing injuries, safety also meansmaintaining a healthy workplace and ensuring thatwe protect and preserve facilities, property,equipment and the environment.
Profitable Growth Through organic growth initiatives and strategicacquisitions, we continue to grow and prosper.A solid pipeline of well funded, long-term projects,coupled with ongoing cost-containment efforts andefficiencies in marketing through shared services,positions us well for continued profitable growth.
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B-BBEE StatementAECOM recognises that Broad-Based BlackEconomic Empowerment (B-BBEE) is an integral
part of our drive to contribute to a better SouthAfrica. We fully endorse and support B-BBEE and itsrole in redressing the imbalances of the past.B-BBEE is a major cornerstone for the continuedsuccess of our company, and also encourages soundbusiness practices.
We have been independently evaluated andcertified in terms of the Act for the ConstructionSector Charter issued in terms of section 9(1) of theBroad-Based Black Economic Empowerment Bill(B-BBEE) No. 53 of 2003 and the results are asfollows:
Score: 85.72Level: Level 2 contributorProcurement recognition level: 125%Value-added supplier: Yes
The above scores have been achieved by quantifyingall the components of B-BBEE, namely:- Ownership- Management control
- Employment equity- Skills development- Preferential procurement- Enterprise development- Socio-economic development
While we are proud of our achievements to date inB-BBEE, we constantly strive to improve on and
maintain the highest possible score on all scorecardelements. We have therefore developed a B-BBEEstrategy which sets continuous improvement targetson all the BEE scorecard criteria in order to maintainour leading role in the built environment and ourpositive impact on society.
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Quality Management:Delivering to the HighestStandardsA quality management system is maintained withinall our offices, which is certified as being inaccordance with the international standard forquality management, ISO 9001:2008. Managementof the firm recognises that maintaining andimproving the certified quality management systemis an essential factor in guaranteeing the
provision of professional services of a consistentlyhigh standard.
Delivering well is not only about employing the bestpeople, but also about equipping them with the besttools. The way in which information is shared haschanged dramatically, and we are able to offer ourclients both traditional and more innovative
solutions for team collaboration on projects.
In doing so, we are fully committed to the policiesand principles incorporated within our IntegratedManagement System, which emphasises the needto fully understand our clients requirements and tostrive to meet or exceed their expectations.These policies and procedures fully comply withthe requirements of the international standard andincorporate a cycle of corrective and preventativeactions which create positive opportunities forcontinuous improvement.
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Safety, Health andEnvironmentalManagement Our Integrated Management System incorporatesrequirements of environmental management inalignment with ISO 14001:2004 and safety andhealth management in alignment with BS OHSAS18001:2007. We have obtained and continue tomaintain certification in accordance with both theseinternational standards.
The rationale behind this is that we support theethos of an operationally safe office environmentand remain committed to ensuring we have a healthyand safe environment for our staff and colleagues.
Additionally, we are committed to positivelycontributing to the efforts of our clients in
developing their projects in such a way as tominimise their environmental impact, where suchcommitment is compatible with the scope of ourcommission.
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Sustainability
In recognising our social responsibility, AECOM hasformed an international sustainability group, whichis active in research and development of sustainablesolutions for developments.
The expertise of our international partners isextensive and of great value to us locally assustainable practices abroad have advanced andprogressed by large measures in recent years.
AECOM, through Davis Langdon, was a silverfounding member of the Green Building Council ofSouth Africa (GBCSA) in 2007. We also assisted theGBCSA on their technical working groups to launchthe Green Star South Africa Office rating tool in 2008and the Green Star South Africa Retail Centre ratingtool in 2010.
In South Africa, we publish the very popular QuickGuide to Green Design Attributes as a service to theproperty and construction industry. This publicationis currently in its 5 th edition, 2012/2013.
Staff from all regions in South Africa havecompleted the Green Star South Africa accreditedprofessional course and are available to assistclients and colleagues to also achieve their socialresponsibilities in addition to their financial or otherobjectives.
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Research Support
Research is a key part of AECOMs aspirations toprovide inspiring solutions and enduring legacieswithin the built environment. Through our researchand knowledge creation activities, we aim tostimulate beneficial cultural and businesschanges, resolve industry-specific problems,support our knowledge database and enhance ourcompetitive edge in order to deliver cost-effective,high-quality and relevant services. We also
undertake contract research on assignment forclients.
AECOM globally has a tradition of supportingresearch collaborations, and in South Africa we arecurrently pursuing a wide range of research studieswith local academic and research institutions,professional bodies and the government. Our current
research interests nationally and internationallycentre around:- Local, regional and international influences on
construction costs and prices- Building Information Modelling (BIM), BIM cost
models and organisational integration in the SouthAfrican construction industry through BIM
- Sustainability and green buildings drivers ofgreen design, construction and operations withindifferent building types
- Improving infrastructure project delivery inSouth Africa
- Tall, large and complex buildings efficiencies inconstruction, life cycle costing, sustainability, BIMand simulation
- The triple bottom line in construction and propertydevelopment
- The soft landings process for buildings.
We also have ongoing collaboration with ourinternational offices with specific reference to globalinfrastructure sentiment surveys, sector-specificresearch and developing global project cost
databases. Finally, we aim to work closer withindustry on continuing education workshops and indeveloping relevant industry reports and publications.
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Our Services O U R S E R V I C E S
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AECOM provides comprehensive cost managementservices from project initiation to completion throughall six stages of the project cycle identified by TheSouth African Council for the Quantity SurveyingProfession, Tariff of Professional Fees, QuantitySurveying Profession Act 2000 (Act 49 of 2000)summarised as follows:
Stage 1- Assisting in developing a clear project brief- Advising on the procurement policy for the project- Advising on other professional consultants and
services required- Advising on economic factors affecting the project- Advising on appropriate financial design criteria- Providing necessary information within the agreed
scope of the project to the other professionalconsultants
Stage 2- Agreeing on the documentation programme with
the principal consultant and other professional
consultants- Reviewing and evaluating design concepts andadvising on viability in conjunction with the otherprofessional consultants
- Preparing preliminary and elemental or equivalentestimates of construction cost
- Assisting the client in preparing a financial viabilityreport
- Auditing space allocation against the initial brief- Providing services for which the followingdeliverables are applicable:- Preliminary estimates of construction cost- Elemental or equivalent estimates of construction
cost - Space allocation audit for the project
Quantity Surveying/CostManagement
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Stage 3- Reviewing the documentation programme with
the principal consultant and other professionalconsultants
- Reviewing and evaluating design and outlinespecifications as well as exercising cost control inconjunction with the other professional consultants
- Preparing detailed estimates of construction cost- Assisting the client in reviewing the financial
viability report- Commenting on space and accommodation
allowances and preparing an area schedule- Providing services for which the following
deliverables are applicable:- Detailed estimates of construction cost- Area schedule
Stage 4
- Assisting the principal consultant in the formulationof the procurement strategy for contractors,subcontractors and suppliers
- Reviewing working drawings for compliance withthe approved budget of construction cost and/orfinancial viability
- Preparing documentation for both principal andsubcontract procurement
- Assisting the principal consultant with calling oftenders and/or negotiation of prices- Assisting with financial evaluation of tenders- Assisting with preparation of contract
documentation for signature- Providing services for which the following
deliverables are applicable:- Budget of construction cost- Tender documentation- Financial evaluation of tenders- Priced contract documentation
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Stage 5- Preparing schedules of predicted cash flow- Preparing proactive estimates for proposed
variations for client decision-making- Adjudicating and resolving financial claims by the
contractors- Assisting in the resolution of contractual claims by
the contractors- Establishing and maintaining a financial control
system- Preparing valuations for payment certificates to be
issued by the principal agent- Preparing final accounts for the works on a
progressive basis- Providing services for which the following deliverables
are applicable:- Schedules of predicted cash flow- Estimates for proposed variations- Financial control reports
- Valuations for payment certificates- Progressive and draft final accounts
Stage 6- Preparing valuations for payment certificates to be
issued by the principal agent- Concluding final accounts
- Providing services for which the followingdeliverables are applicable:- Valuations for payment certificates- Final accounts
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Mining and engineering cost management operatesas a specialist service and comprises specialist skillsand applications that enhance the risk and valuemanagement techniques required by the mining,infrastructure, minerals, metallurgical andpetro-chemical sectors of the industry.
This includes the constitution of dedicated
independent teams specialising in and responsiblefor the estimating, procurement, cost managementand contract administration activities relative to theabovementioned industries. The mining andengineering cost management group is responsiblefor many diverse projects within these industrieswith principle benefits to our clients beingindependence, accountability and evidence ofcorporate governance.
The mining and engineering cost management teamoperates throughout Africa using infrastructuresupport from our other local offices located in allmajor centres in South Africa, Mozambique andBotswana. The engineering cost management groupemploys professional qualified quantity surveyors,cost managers, cost engineers, contractadministrators, construction programmers andbuilding surveyors.
Mining, infrastructure, minerals, metallurgical andpetro-chemical projects are generally of a highmonetary value and it is therefore most beneficial to
involve the mining and engineering costmanagement team at an early stage in the projectcycle. This allows for strong financial discipline tobe imposed on the project to ensure accurate andstructured estimating, timely and cost-effectiveprocurement, accurate and up-to-date maintenanceof costs to completion, including the costmanagement of design changes and the timelyclose-out of contracts. The implementation of theseprinciples of financial management will delivermaximum shareholder value and it is in this area thatthe engineering cost management team strives tosignificantly influence project outcomes to benefitall stakeholders.
Mining And EngineeringCost Management
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Our mining and engineering cost management groupprovides a depth of experience, expertise andindependence, which will contribute to andcomplement the clients team. This is critical,particularly in the early stages of a project whenthe opportunity to add value, as well as recogniseand define cost is established. Simultaneously, theformalisation of project principles is equallycritical throughout the project with costmanagement continuing through to thepostcontract period and final closeout.
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Every client wants rigorous control of overallbuilding costs and to ensure that every Rand spentis optimised. Building services such as electrical,air-conditioning, fire protection and the variouselectronic installations are part of every buildingproject and usually comprise 25% to 40% of the totalconstruction cost. It follows that the need foreffective cost management of the building services is just as essential as for any other part of theconstruction costs.
Our building services cost management teamoperates within AECOMs PCC engineering costmanagement service, and draws upon its uniqueexpertise to provide financial management andcontract administration of building services. These
services include:- Electrical installation- Heating, ventilating and air-conditioning (HVAC)
installations- Fire protection systems- Fire detection and evacuation systems- Access control
- Closed Circuit Television (CCTV)- Lifts, escalators, travelators- Communication systems- Building management systems- Security systems- Data systems
We have for many years offered cost advice andquantity surveying services for all building servicesand have a track record which includes many majorprojects. Meticulous procurement and costmanagement practices are part of our standardmethodology, and independent cost managementensures transparency of costs and a dedicatedservice not linked to the specific design consultant.
Building Services CostManagement
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Working in close conjunction with the appointedmechanical, electrical and fire protectionconsultants, our building services team provide acomprehensive service encompassing the following:
- Cost planning at an early stage prior to detaileddesign
- Cost studies to compare alternative materials anddesigns in terms of capital, operating, maintenanceand depreciation costs
- Monitoring and evaluating design as it evolves toensure compatibility with the approved cost plan
- Advising on contractual arrangements andpreparing tender procurement documents
- Adjudicating tenders in conjunction with theconsultant team
- Cash flow predictions- Cost management and reporting- Valuation of work done during construction
- Determining final costs- Settlement of final costs with the contractor andsub-contractors
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AECOM's project and programme management teamprovides that vital independent and professionalservice to plan, lead, organise and control themanagement of projects and programmes, frominception to completion.
Recognised as one of the worlds leading providers ofmanagement and consultancy services, we employhighly skilled professional project managers from abroad range of professional disciplines offeringexperience across a wide range of sectors.
This equips our project teams with the in-houseskills and market expertise to develop centres ofexcellence and the ability to recognise potential anddefine objectives from the outset, whilst alsoensuring the delivery of value and appropriatemanagement of risk throughout the project cycle.
Our strength lies in our ability to provide a dedicatedservice that is focused on the clients vision for theproject in question. Through our "One AECOMapproach to managing projects, we draw on theinherent global knowledge base and commercialstrength of the practice whilst also delivering a
creative and people-based service.Our services can be tailored to suit the needs of theproject and client and include:- Project management- Programme management- Development management- Clients representative- Engineering Procurement Construction
Management (EPCM)- Value and risk management- Project programming, planning and controls- Project consultancy- Due diligence reporting
Our project management team will invariably workwith client teams that are carefully pre-qualified andselected for their expertise, enthusiasm and drive todeliver the required results.
Project Management
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Our project managers work together with our clientsto manage the appointments of the necessaryconsultants, including advising on the variousmethods of selection, the negotiation and agreementof their services and fees. In addition, we will providea single point of contact for the client when dealingwith other third parties, contractors and suppliers.
We are committed to building and managing teamswith a common culture of delivering excellence, andstrive to engender healthy and vibrant workingrelationships throughout the life cycle of the project.
The growth of this service in recent years has beenbuilt upon strong alliances with long-standingclients and our ability to deliver wherever andwhenever required, to a prescribed quality, on timeand within budget on a consistent basis.
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Project controls is the effective management ofsystems, processes and procedures for key
project delivery elements of time, cost and quality.It comprises the core competencies that underpinand ensure the successful completion of all projects.Project controls is also intended to be aninformation tool for the project management team,enabling them to utilise and draw information fromthe project and make informed decisions.
Project controls is a service line offered in all ofAECOMs current sector offerings. Our approach toservicing our clients requirements is focused onoffering the following:- Planning and scheduling- Document control- Contracts administration- Change management- Cost management- Risk management- Project administration and information technology (IT)
Drawing on the vast array of knowledge at ourdisposal from a truly global company, a suite ofsystems, standards and tools have been developed
to better control and guide a project through toultimate success. These are the global AECOMstandards to which we adhere and when required,they are able to be adapted or modified to suit anyspecific client requirements. We are therefore ableto provide a depth of experience and expertise toour clients from start-up right through to projectcompletion.
Project Controls
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The most crucial part of any project is the projectstart-up or implementation phase. If the correctreporting streams and requirements are notidentified prior to this stage, it becomes extremelydifficult to align these once construction hascommenced, as the focus of all parties shiftstowards the construction phase.
It is therefore crucial that an experienced start upteam is consulted to advise and guide the set upprocess and through previous experience we are ableto provide as much guidance as is required.All too often, once projects have been completed, theknowledge and lessons learnt through theimplementation process are lost for future projects.
AECOM collects records and analyses thisinformation and historical information available fromsimilar global and local projects to ensure such
lessons learned benefit current and future projects.This provides us with the knowledge and businessintelligence necessary to advise and guide ourclients and future projects through to ultimatesuccess.
Some client specificdevelopment
Piloted or developedspecifically forpractices or regions
Goal is to grow anAECOM standard:Baseline of processesand tools
Client/Project Specific
Process Technology
Process Technology
Process Technology
Practices/Region Specific
AECOM Common Standard
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Business Intelligence Company Direction, Business Trends.
Knowledge Project Trends , Project Norms, etc.
Information Reports, Certificates, etc.
Raw Data Measures, etc.
Through AECOMs Global Unite system, project
information from different regions around the worldis captured and consolidated into one platform. Thisallows us to benchmark project cost rates andperformance ratios for different building projectsacross the globe, which in turn enables us to providemore accurate offerings to our clients.
Project controls are also able to implement
different software suites as required by the clientin order to manage cost, documentation, risk andschedule while allowing transparency and ease ofaccess to the current project status and progress.
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Using information that is even a few weeks old tosteer projects can be detrimental to a project, andthe use of software systems such as Proliance orUniPhi allows for the information to be available atthe project managers fingertips in order to makequicker and more efficient judgment calls.
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Our Safety, Health and Environment QualityManagement (SH&E-Q) team offers the necessaryexpertise to assist constructionconsultancies obtain ISO 9001, ISO 14001 andOHSAS 18001 certifications. Since obtainingISO 9001 Quality Management certification in 2000,we have expanded our services to provide such
assistance to quantity surveyors, consultingengineers and other construction consultancies.
In the case of Quality Management we provide:- Consulting services to develop the necessary
manuals, policies and procedures to enable a firmto establish a Quality Management System (QMS)in accordance with the requirements of ISO 9001:2008 international standard
- Ongoing support to allow a firm to maintain itsQMS, including carrying out internal audits ofquality management procedures and consultationon maintaining and improving the system
- In-house training to management and staff- Advisory services prior to the certification visit and
subsequent external audits by a certifying authority
The scope of our services incorporates:- Defining the organisational mission, vision and
values; the organisations internal and externalenvironment; and the resulting quality objectives
- Fully engaging top management- Identifying the key processes and interactions
needed to meet quality objectivesRegarding Safety, Health and Environmental (SH&E)management, our services develop the systems andprocedures necessary to put in place both anEnvironmental Management System and anOccupational Health and Safety ManagementSystem, adequate to enable firms to obtain
certification in accordance with ISO 14001 andOHSAS 18001 international standards.
We guide clients through the development andimplementation of tailored SH&E processes,systems and manuals to international standards, upto the certification processes.
Quality, Occupational Health, Safetyand Environmental ManagementConsultancy Services
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These services incorporate:- Putting in place the necessary SH&E policies- Planning for SH&E hazard identification, risk
assessment and control, legal and otherrequirements
- Implementation and operation, including definingthe resources, roles, structure, responsibilities,competencies and training required
In all cases we work with and recommend aninternationally recognised certificationauthority, which is well suited to work withconstruction consultancies in improving their SH&E-Qsystems and consequentially their effectiveness.
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South AfricanMarket Conditions
3 S A
M A R
K E T C O N D I T I O N S
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International economic conditions remain negative
with continued weakness in global economicconditions. While there are signs of possible revivalin the U.S economy, economic conditions in muchof Europe are expected to deteriorate during 2013.Emerging markets continue to perform strongly, butgrowth in China and India is expected to slow in 2013on the back of slowdown in the European Union.
As a result, global construction sentiment is slightlyoptimistic regarding 2013 in the U.S, but outlookfor the U.K, Europe and most other Organisation forEconomic Co-operation and Development (OECD)countries remains depressed. Further contraction isexpected following on from the last few years withreturn to growth in 2014.
In South Africa, despite slight improvement inbuilding confidence amongst contractors, materialsmanufacturers and professionals, the outlook for theconstruction industry remains subdued.The economic growth forecasts for 2013 have beenrevised downwards steadily and current projectionsrange from 2.5% to 2.8%. Industrial unrest in themining and manufacturing sectors, challenges ineducation and unemployment, and the effect of theglobal slowdown have dampened consumersentiment with spill-over effects on the constructionindustry.
The low level of construction demand in all sectorshas resulted in a very competitive tender climate with
minimal profit margins and an oversupply of workers.Plans by the South African government tosignificantly increase infrastructure spending arestill in initial stages, but civil construction is still themost active sector of the construction industry. TheFirst National Bank/Bureau for Economic Research(FNB/BER) Construction Confidence Index rose to its
highest level in three years on the back of improvedworkloads in the civil construction sector.
The uncertainty in local and global economicconditions is a key factor impeding constructionactivity in the private sector, as companies reviewinvestment decisions and re-assess priorities.
Construction Industry Outlook
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Demand for residential, retail and commercialbuildings remains low and the building pipelineweak. In other sectors, demand is dependent on theeconomic performance of South Africas key tradingpartners, key commodity prices, and the policyenvironment arising from the African NationalCongress elective conference held in December2012. A more detailed look at the key constructionsectors in South Africa follows in the next sections.
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In the major cities of South Africa, demand is stillhigh for prime and Grade A commercial property in
premium areas. Limited availability and strongdemand drives new development in these areas,especially where these are close to transport linksand amenities. Demand for other grades ofcommercial property and those in less attractiveareas is low due to the challenging economic climateand higher tenancy risk, as well as stricter fundingcriteria from financial institutions.
Commercial property rentals and vacancy rates havestabilised after steady decreases and increasesrespectively, but are expected to remain at currentlevels for the next year. South Africas commercialproperty sector is expected to remain stagnant in2013, with little improvement taking place inconstruction activity on the back of currenteconomic conditions and declining businessconfidence.
However, there is still substantial committeddevelopment (776,000m in the third quarter of2012) 1 from investors looking ahead to a recoveryfrom the current economic downturn.
Green buildings continue to attract interest due totheir appeal to environmentally-conscious tenantsand lower occupation costs. It is therefore likely thatdevelopers will increasingly build in green aspectsinto commercial buildings especially if the expectedincreases in energy costs are realised.
Some property owners are also likely to takeadvantage of lower construction costs arising fromthe competitive tendering environment and scarcityof work to renovate properties, so refurbishmentwork opportunities should remain steady over thenext year.
1 SAPOA Office Vacancy Survey
Commercial Sector Outlook
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Education is a government priority asevidenced by budget allocations at all levels, andtotal public sector infrastructure expenditure ineducation is estimated to reach R10.9 billion in2012/13, R14.5 billion in 2013/14 and R15.3 billion in2014/15.
The most significant source of activity in theeducation sector is the university build programme,which includes the construction of new universitiesin Mpumalanga and Northern Cape and projects toexpand higher education infrastructure focusing onteaching facilities and student accommodation.
There are also large allowances in the MediumTerm Expenditure Framework (MTEF) for thesecondary schools recapitalisation conditional grantto build, refurbish and resource new and existingteaching spaces. The Department of BasicEducation (DBE) is in the process of a nationalschool build programme and improvement of schoolinfrastructure, overseen by the DBEs ProgrammeSupport Unit and the Development Bank of SouthernAfrica (DBSA). This aims to eradicate 496inappropriate structures, provide basic water to
1, 257 schools, basic sanitation to 868 schools andelectricity to 878 schools (backlogs).
Although many projects in the education sectorare likely to be small projects with low associatedspends, there are overall large allocations foreducation infrastructure grants to supplementprovincial programmes, including theconstruction of new schools and the schoolsmaintenance allowances.
While the above are likely to boost constructionactivity in the sector, several challenges stand in theway of significant activity. These include a shortageof financial resources and lack of technical expertiseto implement infrastructure projects; the difficulty incoordinating projects between different branches ofgovernment and local communities; andmaintenance cycles.
Education Sector Outlook
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The energy and utilities sector is one of the morepromising ones in South Africa, as it is a cornerstone
of governments infrastructure development planand infrastructure pipeline. The sector hasexperienced sustained activity over the last threeyears with significant activity in energy generation,renewable energy and water distribution.
Electricity generation to support socio-economicdevelopment is one of the 17 Strategic IntegratedProjects in the 20-year Infrastructure plan framework.Renewable energy projects worth R25 billion havebeen announced, such as a renewable energyindependent power producer programme to generate3, 725megawatts by 2016; a planned 100MWconcentrated solar power plant; and a proposed1000MW and 5000MW solar park. Most of these arestill at a nascent stage.
Water projects revolve around dam construction andwater distribution in the three spheres ofgovernment, for example, the Kamati Water Schemeaugmentation Project; Lesotho Highlands WaterProject; and Olifants River Water Project.
With an increasing demand expected inSouthern Africa on the back of growing economiesand programmes to provide populations with accessto electricity and water, and an overworkedelectricity infrastructure, an increased demand forenergy is anticipated. Investments in energy andutilities are thus foreseen over the next decade.
Energy Sector Outlook
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Public-sector healthcare expenditure is currentlybeing restructured to improve the quality ofhealthcare and prepare the health system for theNational Health Insurance (NHI) scheme.
Large allocations have been set aside in the nationaland provincial budgets for hospital infrastructurebuilding, renovation and maintenance under theHealth Facilities Infrastructure Management grants.These focus on hospital revitalisation, healthinfrastructure and the building or upgrading ofnursing colleges. There are also allowances forsmaller projects maintaining institutions andupgrading primary care institutions and hospitals.
At the end of 2012 there were approximately 50public sector health mega-projects at feasibility
stage and 29 projects in the financing stage for theperiod 20122020. While this points to potentialhigh levels of tender activity, delays in issuing largetenders have been blamed for current plans nottranslating into increased projects, and underspending is chronic. This is mainly attributed to ashortage of capacity in government.
Private-sector healthcare expenditure oninfrastructure is projected to grow slowly butsteadily, though opportunities are concentrated inurban areas across the country.
Healthcare Sector Outlook
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While the industrial property sector has been lessaffected by the economic slowdown than many
others, the key factors influencing industrialproperty prices are under severe strain.The manufacturing and retail sectors areexperiencing weaknesses following the ongoingEuropean crisis and slowing prospects for Chinaseconomy, exacerbated by static local demand andincreasing incidences of industrial action. Sectorgrowth prospects remain weak and it is unlikely thatcompanies will invest in new infrastructure atcurrent levels of economic uncertainty.
In this sector, the choice of location is especiallycritical and proximity to major transport routes aswell as a centrality of location for warehousing anddistribution operations are key factors thatinfluence the demand. As a result, certain nodes arestill in demand with activity high, such as Epping inthe Western Cape, Mount Edgecombe in Durban,Midrand and the vicinity of OR Tambo airport inJohannesburg. In most other areas, however, rentalsare either experiencing sluggish growth orcontracting
Long-term investment in mining-related industryand other manufacturing projects remains weak.While there is hope for sector improvement based onbetterthanexpected manufacturing activity in thelast quarter of 2012, and government policyproposals aimed at stimulating specific industrialsectors, demand for space is likely to remain stablerather than strengthen unless household
expenditure, the retail sector and the economyrecover considerably.
Industrial Sector Outlook
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The outlook for the hotel industry in South Africa ismoderate growth as there has been a surplus inhotel space following a sustained period of hotelconstruction in South Africa between 2005 and 2011.
Boutique and niche hotels are still experiencinginterest, but budget hotels and the average4-5 star hotels are under pressure and little activityis expected in this segment. While domestic andinternational visitor numbers are expected to growby 3.4% and 2.3% respectively annually between2011 and 2015, existing room numbers are currentlyadequate to accommodate such growth.
Activity in Sub-Saharan Africa looks positive over thenext five years, as business and leisure travelnumbers grow. Revenue per available room is
forecast to grow between 7-15%, one of the highestregional growth rates in the world. There are anumber of branded hotels with a strong pipeline ofrooms especially in West and North Africa,presenting opportunities for South Africanoperators and their regular service providers.
Hotels are increasingly focusing on their operating
efficiencies and margins, and green hotels attractmore visitors at a premium to ordinary hotels.Conversion of existing hotels to increase their energyefficiency and resource usage is therefore a highpotential growth segment of this market.
Little activity is expected in the sports and culturesub-sectors as previous investments in the 2010World Cup and in library grants have alreadyaccounted for much of the potential growth.
Leisure Sector Outlook
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The mining sector has faced difficult operatingconditions in 2012, with weakening export demand,the nationalisation debate, the downgrading of thecountrys sovereign credit ratings and a wave ofunprecedented industrial action underminingperformance and output. This has had some effecton investment plans from mining companies; thevalue of announced projects fell from R34.2 billionin the first half of 2012 to R6.3 billion in the second
half. Knock-on effects have also been felt in theparts of the manufacturing sector reliant on mining.
Associated projects such as housing for miningemployees have also seen cutbacks as capitalinvestment plans are deferred or abandoned.Despite this, there is still optimism for the latterpart of 2013 with expected recovery of commodity
prices accompanying the expected slow recovery inthe global economy. Mining sector value is expectedto recover to approximately US$30 billion in valueby 2016.
South Africa is still attracting foreign directinvestment in mining and minerals. The large-scaleinvestments in infrastructure to support mining, forexample the Sishen-Saldanha rail line and proposedinvestment in transport in Limpopo andMpumalanga, will further expand production andexport capacity, especially for coal, platinum groupmetals and chrome.
Mining houses are increasingly looking to invest inthe rest of Africa, attracted by low-costopportunities and improving governance, and thereare opportunities for companies offering mininginfrastructure support to follow this expansion intothe continent.
Mining & Minerals Sector Outlook
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Activity in the residential sector remains underpressure from more stringent mortgage financeconditions, the tough economic conditions facingmany households in South Africa and the low levelof consumer confidence. This is evidenced byplanning and completion figures from StatisticsSouth Africa. Residential plans passed by majormunicipalities declined compared with the sameperiod in 2011 while the number of completed
residential projects grew marginally.Supply into the market from the existing homemarket at prices that compete favourably with newconstruction also constrains new construction inthe sector. This is partly a result of building costinflation and of lower demand for housing from theweak economy and household disposable income
growth rates.
The strongest demand is experienced in thesmaller-sized houses and flats and townhousessegments driven by urban densification processand efforts to draw more lower- to middle-incomehouseholds into the housing market. Demand forhouses larger than 80m will likely remain subdued.
A further decline in activity in the sector is expectedover 2013, except in the affordable and smallhousing segments. Most activity will be in theGauteng and Western Cape regions on the back ofincreasing migration into urban areas to look foremployment. There are also likely to be increasingopportunities to provide low-income housing closeto transport nodes and employment prospects.
Residential Sector Outlook
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Outlook for the retail market over the next year isslightly positive, with stable shopping centrevacancies and returns to investors averaging 10%.There are, however, notable risks arising fromincreasingly indebted households and weakhousehold consumption expenditure impacting on thedemand for retail property. Lower retail trade salesare driven by rising household costs, uncertainty inthe economy and rising unemployment, and retailers
expect sales growth to moderate in the last months of2012 and beginning of 2013.
While location is less critical than in most otherproperty sectors, regional centres appear toperform much better than local neighbourhoodcentres. Most of the potential retail market in majorcities in South Africa is already well supplied, but
opportunities still exist in townships, rural areasand smaller towns.
The supply pipeline over the next three years isexpected to improve substantially, and in 2013 retailconstruction activity should benefit from amoderate recovery in household consumer spendingand relatively low interest rates.
The rest of Africa also offers considerable potentialand the retail sector has been identified as a keygrowth area on the continent, given the existing lowbase of supply and growth in consumer incomes.The numbers of South Africa retail investors withsuch expansion plans offer a potential opportunityfor those with larger risk appetites.
Retail Sector Outlook
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Significant activity is forecast in the transport sectorin South Africa over the next three years, arisingfrom targeted infrastructure investment in rail, roadand mining-related transport. Several cross-borderprojects are also in the pipeline, such as a146-kilometre railway line between Mpumalangaand Swaziland.
Transnets capital programme forms a major part ofthis spend; the state entity plans to spendapproximately R300 billion over the next seven yearson its infrastructure. Substantial national andprovincial budgets for transport and logisticsinfrastructure have also been allowed for in theMedium Term Expenditure Framework (MTEF) publicsector infrastructure budget.
Other transport projects include Transnet'sproposed spending on pipelines; South AfricanNational Roads Agency (SANRAL) funding for roadconstruction and maintenance; projected airportupgrades for the Airports Company of South Africa(ACSA); and work associated with the Durban dig outport for Transnet. In the governments StrategicIntegrated Projects, the development of rail and roadinfrastructure in Limpopo; a Durban to Free State toGauteng logistics and industrial corridor;a south-eastern node linking the Eastern Caperegion, Northern Cape and KwaZulu-Natalprovinces; and road and rail infrastructure in theNorthwest are given prominent mention.
While such plans point to significant activity in thetransport sector in the foreseeable future, they arelikely to be subject to public-sector resource andcapability constraints, and the vagaries of the globaland South African economic performance.
Transportation Sector Outlook
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Cost Data
S A C O S T D A T A
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Key Factors Influencing BuildingCost RatesInherent difficulties and pitfallsThis section highlights the inherent difficulties andpitfalls that may be experienced when inclusive orsingle rates are used to establish the estimated costof a particular building.
Construction cost estimation is complex.Comprehensive exercises based on detailed andaccurate information are required to achieve reliablelevels of comfort. For various reasons, however,decisions are often based on inclusive rateestimates, i.e. rate per square metres (m) ofconstruction area or rate per unit in number.
The most widely used method of quick approximateestimating to obtain an indication of the
construction cost of a building is by therate/m-on-plan method. It is often also referred toas the order of magnitude method of costestimation. It certainly is both quick and convenient,but it can be very misleading if used indiscriminatelywithout care being taken in the calculation of theconstruction area and the selection of the rate.
Comparisons of the costs of various buildings areoften made by comparing the individual rates/mwithout due consideration being given to a numberof factors that can affect the rate/m to asubstantial degree.
Very often the cost of a building is expressed in R/mand the unit cost is ignored, if calculated at all.This rate/m is then used as the sole yardstick ofwhat the building costs. For example, a securityguards shelter measuring 2m x 2m consisting ofbrick walls with windows, one door and a simple roofconstruction may cost R6,000/m. This rate, whencompared with the rate for a 200m housecontaining plumbing, carpets, etc. at R4,700/mwould seem to be very expensive. Yet, in fact, theunit cost of the shelter is R24,000 compared withR940,000 for the house.
The following are a few of the important criteria tobe taken into account when rates/m areconsidered:
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40m
40m
SpecificationTwo buildings having identical shape andaccommodation can have vastly different R/m ratesshould the one building have finishes of a differingstandard from the other. For example, expensivecarpets in lieu of vinyl floor tiles can increase therate by R100/m.
Wall-to-floor ratio plan shapeThe most economical shape of a building is a square.This shape requires the minimum wall length toenclose a given floor area, e.g.
Case AArea 1,600mWall length 160mWall height 3mWall area 480mWall floor ratio 480/1,600Cost of external facade in terms of R/m of floor areato each R/m offacade area 30.0%
Case B
Area 1,600mWall length 232mWall height 3mWall area 696mWall floor ratio 696/1,600Cost of external facade in terms of R/m of floor area
to each R/m offacade area 43.5%
The rate/m on plan of a facade costing R600/m onelevation in each case is:
Case A R600 x 30.0% = R180/mCase B R600 x 43.5% = R261/m
The reader with a good knowledge ofmathematics will correctly fault the aboveargument by promoting a circle as being thegeometric shape that requires the minimum walllength to enclose a given floor area. In very fewcases, however, this is the most economical plan
100m
16m
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shape of a building, as for various reasons the costof constructing a circular as opposed to a straightexternal envelope is generally greater than thesaving in quantity of the envelope.
Floor to ceiling heightsTwo buildings of identical plan shape and area but ofdifferent floor-to-ceiling heights will havedifferent rates/m due to the additional cost ofwalling, finishes, etc. in the building with the higherfloor-to-ceiling height.
Plumbing, mechanical & electrical installationsThe concentration of plumbing installations has amarked effect on the rate/m of the building.The cost of a toilet block per m is much greater thanthat of a house containing one bathroom becausethe high cost of the bathroom area is spread over theless expensive areas of the remainder of the house.
Similarly, in office blocks, factories, etc., therate/m will depend greatly on whetherair-conditioning, security systems, sprinklers, smokedetection systems, specialised electricalinstallations, acoustic treatment or other specialisedinstallations are incorporated into the design.
Construction areasThe rate/m for a building having large balconies oraccess corridors that have been included in theconstruction area cannot be compared with therate/m for a building not having similar areas oflow cost.
Internal subdivisionsThe rate/m for open plan offices should not becompared directly with the rate/m for officeshaving internal partitions without the relevantadjustments being made. The inclusion of partitionscan increase the overall rate/m by up to R230/m ofoffice area.
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Parking Should the building in question contain certain areasfor parking within the building area, the averagerate/m will be less than for a building having theidentical accommodation but with parking outsidethe building structure. An example follows overleaf.
Case ABuilding having parking within the building area
Cost of buildingOffices 2,400m @ R7,000 = R16,800,000Parking 600m @ R3,000 = R 1,800,000
Total R18,600,000Average rate/m R 6,200
Case BBuilding having parking outside the buildingstructure and on grade
Cost of buildingOffices 2,400m @ R7,000 = R16,800,000Parking 600m @ R 300 = R 180, 000
Total R16,980,000Average rate/m R 7,075
Plan area 600m/floorConstruction area 3,000m
Basement
OFFICES
OFFICES
OFFICES
OFFICES
PARKING (600m)
Plan area 600m/floorConstruction area 2,400m
OFFICES
OFFICES
OFFICESOFFICES PARKING (600m)
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Under Case B the area of parking is not includedas part of the construction area for purposes ofcalculating the rate/m. Similarly, the rate/m forsupermarket/hypermarket shopping centres shouldbe qualified as to whether the cost of on-site parkingand ancillary site development has been included,which cost could be in the region of R500/m ofconstruction area.
There are numerous further points of considerationthat should be taken into account in addition tothose given above. Amongst these are site worksparticular to each specific contract, number ofstoreys, floor loadings, column spans, concentrationof joinery and other fittings, overall height ofbuilding, open atrium upper volumes, etc.
In conclusion, rates/m must be used with
circumspection and the degree of accuracy of theanswers provided must be considered to be in directproportion to the amount of research and surveysundertaken to establish the rate for the building inquestion.
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Offices Rate per m (excl. VAT)Low-rise office parkdevelopment withstandard specification R 5,800 - R 7,100
Low-rise prestigious officepark development R 7,500 - R 11,200
High-rise tower block withstandard specification R 8,300 - R 11,200
High-rise prestigioustower block R 11,200 - R 14,000
Note: Office rates exclude parking and include appropriatetenant allowances incorporating carpets, wallpaper,louvre drapes, partitions, lighting, air-conditioningand electrical reticulation.
ParkingParking on grade, including
integral landscaping R 400 - R 500Structured parking R 3,100 - R 4,000Parking in semi-basement R 3,100 - R 4,200Parking in basement R 3,400 - R 5,100
RetailLocal convenience centres(Not exceeding 5,000m) R 5,800 - R 7,600Neighbourhood centres(5,000 12,000m) R 6,300 - R 8,100Community centres(12,000 25,000m) R 6,900 - R 8,800Minor regional centres(25,000 50,000m) R 7,600 - R 9,400
Regional centres(50,000 100,000m) R 8,100 - R 9,900Super regional centres(Exceeding 100,000m) R 8,500 - R 11,000
Note: Super regional centres and regional centres aregenerally inward trading with internal malls, whereasconvenient, neighbourhood and community centres
are generally outward trading with no internal malls.Retail rates include the cost of tenant requirementsand specifications of national chain stores.
Retail costs vary considerably depending on thetenant mix and sizing of the various stores.
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Industrial Rate per m (excl. VAT)Industrial warehouse, including office and changefacilities within structure area (architect/engineerdesigned):- Steel frame, steel cladding
and roof sheeting R 2,800 - R 4,200- Steel frame, brickwork to
ceiling, steel cladding aboveand roof sheeting R 3,400 - R 4,700
- Administration offices,ablution and changeroom block R 5,400 - R 6,800
- Cold storage facilities R 10,000 - R 14,300
Residential Rate per no (excl. VAT)Site services to low-cost housingstand (250 - 350m) R 24,900 - R 38,100 Rate per m (excl. VAT)RDP housing R 1,400 - R 1,600Low-cost housing R 2,200 - R 3,600Simple low-rise apartmentblock R 5,300 - R 7,400Duplex townhouse- Economic R 5,300 - R 7,500Prestige apartment block R10,100 - R 15,700Private dwelling houses:- Economic R 3,800- Standard R 5,200- Middle class R 6,100- Luxury R 8,800- Exclusive R13,000- Exceptional (super luxury) R20,100 - R 40,300Outbuildings R 2,200 - R 3,800
Rate per no (excl. VAT)
Carport (shaded) - single R 3,300 - double R 6,300
Carport (covered) - single R 5,100 - double R 9,300
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Swimming pool Rate per no (excl. VAT) - Not exceeding 50 kl R 67,800- Exceeding 50 kl and
not exceeding 100 kl R 67,800 - R 112,000Tennis court- Standard R 242,000- Floodlit R 315,000
Hotels
Budget R 557,000 - R 869,000/keyMid-scale R 1,166,000 - R 1,537,000/keyLuxury R 1,977,000 - R 2,719,000/key
Note: Hotel rates exclude allowances for furniture, fittingsand equipment (FF&E).
Studios Rate per m (excl. VAT)Studios dancing, artexhibitions, etc. R 10,000 - R 14,300
Conference centresConference centre tointernational standards R 18,000 - R 23,300
Retirement centresDwelling houses- Middle class R 5,900- Luxury R 8,300
Apartment block- Middle class R 6,100- Luxury R 9,500
Community centre- Middle class R 8,000- Luxury R 11,800
Frail care R 9,500
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Schools Rate per m (excl. VAT)Primary school R 5,100 - R 6,400Secondary school R 5,400 - R 7,100
Stadiums Rate per no (excl. VAT)Stadium to PSL standards R 24,400 - R 38,200/seatStadium to FIFAstandards R 56,200 - R 75,300/seatStadium pitch to FIFAstandards R15,900,000 - R 19,080,000
Prisons1,000 Inmate prison R424,000 - R451,000/inmate500 Inmate prison R451,000 - R504,000/inmateHigh/maximum securityprison R673,000 -R901,000/inmate
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InfrastructureAirport development costsRates exclude any future escalation, loss of interest,professional fees, Value Added Tax (VAT), contractorspreliminary and general allowances, insurance, ACSAdirect costs and contingency allowances.
Apron Stands (incl. associ-ated infrastructure
Rate per m (excl.VAT)
Code F Stand (85m long x
80m wide = 6,800m)
R 3,500
Code E Stand (80m long x65m wide = 5,200m)
R 3,700
Code C Stand (56m long x40m wide = 2,240m)
R 4,600
Taxi Lanes (incl. associatedinfrastructure) Rate per m (excl.VAT)
Code F taxi lane (101m wide) R 115,000
Code E taxi lane (85m wide) R 97,000
Code C taxi lane (49m wide) R 56,000
Service Roads Rate per m (excl.VAT)
Service road (10m wide) R 11,900
Dual carriage service road(15m wide)
R 15,200
Taxi ways (incl. associated
infrastructure)
Rate per m (excl.
VAT)Code F taxi way (70m wide) R 82,000
Runways (incl. associatedinfrastructure)
Rate per m (excl.VAT)
Code F Runway (3,885m longx 60m wide = 233,100m)
R 191,000
Parking (excluding bulkearthworks) Rate per no (excl.VAT)
Structured parking R 126,000
Basement parking R 193,000
Shadenet on grade parking R 19,300
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Perimeter Fencing /SecurityGates
Perimeter walls with perimeterintrusion detection (PIDS), etc.
R 5,800p/m (excl. VAT)
Security gate R 11,000,000p/item (excl. VAT)
Super security gate R 33,000,000p/item (excl. VAT)
Terminal & other buildings
(excl. bulk earthworks,external site & services works)
Rate per m
(excl. VAT)
Terminal building (excl. termi-nal building baggage & X-ray)
R 19,500
Pier terminal building (excl.telescopic air bridges, seating& ads)
R 20,500
Telescopic air bridges (rate perunit. excl. VAT)
R 7,500,000
Aircraft Docking System (ADS)(rate per unit)
R 1,100,000
Building servicesThe following rates are for building services
(mechanical and electrical) applicable to typicalbuilding types in the categories indicated. Rates aredependent on various factors related to the design ofthe building and the requirements of the system.In particular, the design, and therefore the cost ofair-conditioning, can vary appreciably depending onthe orientation, shading, extent and type of glazing,external wall and roof construction, etc.
Electrical installation Rate per m (excl. VAT)
Offices- Standard installation R 375 - R 625- Sophisticated installation R 500 - R 850- UPS, substations, standby
generators to officebuildings R 275 - R 375
Residential R 400 - R 625Shopping centres R 600 - R 750Hotels R 750 - R 950Hospitals R 900 - R1,175
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Electronic installation Rate per no (excl. VAT)Offices- Standard installation R 400 - R 500- Sophisticated installation R 500 - R 650Residential R 220 - R 300Shopping centres R 475 - R 650Hotels R 425 - R 550Hospitals R 425 - R 575
Note: Electronic installation includes access control, CCTV,public address, fire detection, data installation, WiFi(Wireless Fidelity), CATV, PABX (Private Automatic
Branch Exchange) and Building Management System(BMS).
Fire protection installation Rate per m (excl. VAT)(offices)Sprinkler system, includinghydrants and hose reels(excluding void sprinklers) R 160 - R 260
Air-conditioning installationVentilation to parking/serviceareas R 200 - R 350Offices- Console units R 500 - R 750- Console/split units R 500 - R 800- Package units R 800 - R 1,050- Central plant R 1,000 - R 1,500- Variable refrigerant flow
(VRF) R 850 - R 1,500Residential split units R 800 - R 1,300Shopping centres- Split units R 750 - R 850- Package units R 800 - R 950- Evaporative cooling R 400 - R 800
Hotels
public areas R 1 ,200 - R 2,000Hospitals split unitsto wards R 1,500 - R 1,700
Hotels Rate per no (excl. VAT)- Console units R 14,000 - R18,500/key- Split units R 20,000 - R30,000/key- Central plant R 40,000 - R60,000/keyHospitals operatingtheatres (per theatre) R250,000 - R750,000 Note: For guidance with regard to the cost of buildings rated
under the Green Star South Africa rating tool system,see the latest edition of the AECOM publicationentitled Quick Guide to Green Design Attributes.
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55
Global Sentiment
and Building Costs
G L O B A L S E N T I M E N T A N D B U I L D I N G C O S
T S
555
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56
Africa generally continues to enjoy strongeconomic growth despite the stagnant performance
of western economies. Africas economic growth fellin 2010 and 2011 on the back of the North Africanuprisings, but should see a rebound in 2012 and2013.
Relatively high commodity and oil prices, stablemacro-economic environments, a growing middleclass and rising internal consumer spending drivethis growth. Africa's real gross domestic product(GDP) growth rates are forecast to be between 4.5and 5.0% in 2013 as a result, and seven of the topten fastest growing economies in the globaleconomy between 2011 and 2015 are expected to befrom Africa. This will be contingent oncontinuing strong foreign investment flows,investment in natural resources and infrastructure,increasingly sound macroeconomic policies andgood governance.
The continent continues to benefit from relativelyhigh growth in the BRIC economies (Brazil, Russia,China and India); weak growth in Europe, Japan andthe U.S; and uncertainty in Chinas growth outlook
are causes for concern. Although most commodityprices have declined due to weaker demand andincreased supply, prices are still above the averagelevels over the last decade. World economic activityis expected to strengthen in 2013 providing positivegrowth for Africa's commodity exporters.
While growth is expected to remain stagnant
in North African countries, Sub-Saharan Africacontinued to grow by more than 5%. Growth in theoil-exporting economies is projected to remain high,growth in South Africa is projected to be lower thanthe continents average, and low-income economiesface varying outlooks but are mostly favourable.
Africa Outlook
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Africa In FiguresArea and Population
Country
Population
Angola 1,247 18.1 2.9 15 45
Botswana 582 2.1 1.4 3 33
Cte dIvoire 322 22.0 2.2 66 40
DRC. 2,345 73.6 2.9 29 46
Ethiopia 1,104 91.2 2.6 83 43
Gabon 268 1.6 2 6 36Ghana 239 24.7 2.2 105 38
Guinea 246 10.9 2.1 41 43
Kenya 580 43.0 2.6 70 43
Lesotho 30 1.9 1 68 39
Liberia 111 3.9 3.7 41 42
Malawi 118 16.3 2.8 154 46
Mozambique 799 23.5 2.5 29 44
Namibia 824 2.2 1.9 3 36
Nigeria 924 170.1 2.4 170 42
Rwanda 26 11.7 2.6 405 42
South Africa 1,219 50.1 1.3 41 30
Tanzania 947 46.9 2.8 49 45
Uganda 241 33.6 3.2 166 49
Zambia 753 13.8 2.4 17 46
Zimbabwe 391 12.6 0.2 32 39
World - 7,017.6 1.2 52 27
L a n d a r e a
( 0 0 0 k m )
M i l l i o n s
, 2 0 1 2 ( e s t
)
A v e r a g e a n n u a l
% p o p u
l a t i o n
g r o w
t h r a
t e ,
2 0 0 0
- 2 0 1 0
D e n s i
t y , p
e o p l e p e r
k m , 2 0 1 2
%
o f p o p
a g e d
b e t w e e n
0 - 1
4
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Population 2012
A n g o
l a
B o t s w a n a
C t e
d I v o
i r e
D R C
.
E t h
i o p
i a
G a
b o n
G h a n a
G u
i n e a
K e n y a
L e s o t h o
L i b e r i a
M a
l a w
i
M o z a m
b i q u e
N a m
i b i a
N i g e r i a
R w a n
d a
S o u t h
A f r i c a
T a n z a n
i a
U g a n
d a
Z a m
b i a
Z i m b a
b w e
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
180.0
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G D P ( U S D
M i l l i o n s )
G D P g r o w
t h
( a n n u a
l % )
G D P p e r c a p
i t a
( U S D )
G r o s s
f i x e d c a p i t a l
f o r m a t
i o n ( % o f
G D P )
Year 2000 2010 2000 2010 2000 2010 2000 2010
Angola 4,156 11,893 3.0 3.4 298 623 12.8 12.7
Botswana 5,633 8,408 5.9 7.0 3,204 4,190 25.8 27.1
Cote d'Ivoire 10,417 11,597 (3.7) 2.4 628 588 11.2 13.8
DRC 4,305 6,961 (6.9) 7.2 87 106 3.4 23.6
Ethiopia 8,111 18,138 6.1 9.9 124 219 20.3 24.7
Gabon 5,068 6,344 (1.9) 6.6 4,103 4,214 21.9 27.2
Ghana 4,983 8,789 3.7 8.0 260 360 23.1 23.0
Guinea 2,995 3,877 2.5 1.9 359 388 19.6 10.6
Kenya 12,705 19,064 0.6 5.8 407 471 16.7 20.3
Lesotho 746 1,076 5.7 5.6 380 496 42.5 28.5
Liberia 529 1,053 25.7 10.9 186 264 7.5 26.4
Malawi 1,744 2,696 1.6 6.5 155 181 12.3 24.2
Mozambique 4,249 8,972 1.1 6.8 233 384 31.0 24.7
Namibia 3,909 6,155 3.5 6.6 2,062 2,696 16.6 25.7
Nigeria 45,983 85,657 5.4 8.0 372 541
Rwanda 1,735 3,745 8.3 7.2 214 353 13.4 21.0
South Africa 132,878 187,640 4.2 2.9 3,020 3,753 15.1 19.6
Tanzania 10,186 19,966 4.9 7.0 308 459 16.4 31.5
Uganda 6,193 12,701 3.1 5.9 256 380 19.2 23.3
Zambia 3,254 5,619 3.5 7.6 319 435 15.9 21.1
Zimbabwe 6,690 4,055 (3.1) 9.6 535 323 11.8 14.0
Sub-Saharan Africa
336,958 534,825 3.6 5.1 505 626 16.5 20.6
Gross Domestic Product(At constant 2,000 prices )
Source: World Development Report 2011 * Figures not available
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Gross Domestic Product 2010
A n g o
l a
B o t s w a n a
C t e
d I v o
i r e
D R C
.
E t h
i o p
i a
G a
b o n
G h a n a
G u
i n e a
K e n y a
L e s o t h o
L i b e r i a
M a
l a w
i
M o z a m
b i q u e
N a m
i b i a
N i g e r i a
R w a n
d a
S o u t h
A f r i c a
T a n z a n
i a
U g a n
d a
Z a m
b i a
Z i m b a
b w e
G D P , U S D M i l l i o n s
G D P p e r c a p i
t a , U
S D
20,000
-
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
GDP, USD Millions GDP per capita
60
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Africa Building Costs
This section makes provision for comparisons ofAfrican building costs, international building costsand international rental rates.
The following table (Africa building cost comparison,page 62), presents in summarised form theapproximate estimated building costs fordifferent types of buildings in various locations inAfrica. Rates are based on projected 1 July 2013 costs
and provide an indicator for the expected buildingcost rates over 2013. Exchange rates have also beenbased on those prevailing as at 1 December 2012.
Rates include the cost of appropriate buildingservices, e.g. air-conditioning, electrical, etc., butexclude costs of site infrastructure development,parking, any future escalation, loss of interest,
professional fees and VAT. These rates are ofindicative nature and therefore the qualificationsdealt with elsewhere in this publication would apply.
These are estimated costs only and should beconsidered in the context of acceptable buildingstandards in each relevant country. These standards,both at a technical level and pertaining to quality, dovary from country-to-country, therefore the buildingcosts must be seen as being for the normalstandards prevailing in each particular region. Thisbeing the case, these costs must be usedcircumspectly.
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Prices exclude land, site works, professional fees, tenant fit-out, equipment & VAT.Hotel rates exclude an allowance for FF&E
62
AFRICA BUILDING COSTS
U S D / m
A n g o
l a
L u a n
d a
B o
t s w a n a
G a b o r o n e
G h a n a
A c c r a
K e n y a
N a i r o
b i
M o z a m
b i q u e
M a p u t o
N i g e r
i a
A b u j a
R w a n d a
K i g a l i
S e n e g a l
D a k a r
T a n z a n
i a
D a r e s
S a
l a a m
U g a n d a
K a m p a
l a
Z a m
b i a
L u s a
k a
R e s
i d e n
t i a l ( r a
t e / m 2 )
A v e r a g e m u l
t i - u n
i t h i g h - r
i s e
L u x u r y u n
i t h i g h r i s e
I n d i v i
d u a l p r e s
t i g e
h o u s e s
( D e t a c
h e d h o u s e s
& b u n g a l o w s )
1 , 5
1 9
2 , 4
7 3
4 , 5
9 7
1 , 6
7 8
2 , 8
8 7
2 , 4
2 8
1 , 5
2 8
2
, 4 9 5
1 6 5
, 0 0 0
, 0 0
3 1 0
, 0 0 0
. 0 0
4 5 0
, 0 0 0
. 0 0
1 , 4
0 7
7 6 9 . 2 3 0 8
1 1 5 3
. 8 4 6
1 5 1 2
. 8 2 1
1 0 8 9
. 7 4 4
1 5 3 8
. 4 6 2
1 0 8 9
. 7 4 4
5 2 5 . 6 4 1
7 6 9 . 2 3 0 8
7 6 9 2 3 . 0 8
3 0 7 6 9 2
. 3
3 5 2 5 6 4
. 1
5 1 2 . 8 2 0 5
1 , 1 0 0
1 , 4 0 0
1 , 6 0 0
1 , 3 5 3
1 , 6 3 0
1 , 2 7 0
8 5 0
1 , 1 0 0
6 0 , 0
0 0 . 0
0
1 4 0 , 0 0 0 . 0 0
2 1 0 , 0 0 0 . 0 0 5 1
3
5 5 8
7 4 5
8 0 3
6 8 6
8 6 8
6 3 8
5 1 3
9 1 7
7 5 , 0
0 0 . 0
0
1 7 5 , 0 0 0 . 0 0
2 3 5 , 0 0 0 . 0 0
4 0 8
1 0 5 0
1 3 5 0
2 1 5 0
1 0 5 0
1 4 4 0
1 2 3 0 8 5
0 1 3 5 0
1 6 5 0 0 0
3 2 5 0 0 0
3 6 5 0 0 0
7 8 5
8 6 4
9 4 2
1 , 0 3 0
9 6 0
1 , 0 5 2