Construction World March 2021

Construction MARCH 2021 P U B L I C A T I O N S CROWN COVERING THE WORLD OF CONSTRUCTION

WORLD

HAS ANY BOOT DONE MORE TO BUILD OUR NATION? Turn to page 18 for the Lemaitre Maxeco

CONTENTS

04 UP Engineering Faculty dean appointed chair Professor Sunil Maharaj has been appointed chair-elect of the Global Engineering Deans Council. 08 Massive decline in 2020 manufacturing sector a major concern The Steel and Engineering Federation of Southern Africa is concerned. 13 SA’s construction industry can build its way back to success in 2021 CEO of GVK-Siya Zama, Eben Meyburgh believes the industry can kickstart the economy. 16 6 stars for a sustainability icon The Ridge has been awarded a 6 Green Star Office Design rating. 20 Dynamic glass Tower with soaring wing-like façade dhk Architects recently completed 35 Lower Long in Cape Town’s CBD. 22 Waterfall retains world’s best title The development is the Best Mixed-use Development in Africa for the 7 th time. 26 Phase 2 of Sol Plaatje University Precinct to be completed in mid-2022 AECOM is forging ahead with phase 2 of the Sol Plaatje University precinct. 28 New suites at Cape Town stadium on schedule Construction of 168 new suites at Cape Town stadium with be completed by the end of March. 30 Oxford Parks phase 2 Oxford Parks is a focal point along Oxford Road in Rosebank and has a jigsaw puzzle configuration. Lemaitre’s new campaign celebrates the widespread effect of 30 years and millions of pairs of Maxeco serving South Africans. It’s been there to help build the country and its people. It’s created jobs through local sourcing and manufacturing. It’s contributed to an inclusive economy for all our people. And it has been on the frontlines of the nation’s industries, protecting those who are strengthening South Africa. Has any boot done more to build our country? Turn to page 18 ON THE COVER

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Construction MARCH 2021 P U B L I C A T I O N S CROWN COVERING THE WORLD OF CONSTRUCTION

WORLD

REGULARS

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Marketplace

HAS ANY BOOT DONE MORE TO BUILD OUR NATION? Turn to page 18 for the Lemaitre Maxeco

Property

Environment & Sustainability

Building

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COMMENT

Industry Insight is a company that was established out of an industry requirement for a holistic approach to market intelligence in the South African construction market. It recently stated that the R340-billion infrastructure pipeline will not be a 'miracle cure' for the country’s ailing economy unless the private sector’s confidence levels are restored.

I n essence, the company says that Government alone – despite the massive pipeline that it announced for various infrastructure sectors – cannot resurrect the industry unless it is assisted by the private sector. However, this sector has little to no confidence in government after three years of empty promises or it doing exactly the Industry Insight says the private sector is no longer buying into Government’s (up to now) largely empty promises because “the country is still yet to see any meaningful economic reform and progress of reforming Eskom, corruption,” etc. As such, President Ramaphosa’s comment in his State of the Nation Address about Government’s infrastructure expenditure plan as part of opposite of restoring faith. Miracle cure not so miraculous

its COVID-19 economic recovery plan, has been largely met with extreme scepticism. The so-called ‘miracle cure’ will be no such thing unless faith can be restored. But, paralysis still exists Industry Insight says that implementation paralysis persists within broader reforms. The infrastructure rollout relies on private sector participation, contributions from the fiscus, and the R100-billion Infrastructure Fund. Getting this mix right will ensure its success … while getting it wrong, will lead to failure. The country can ill afford the latter – now more than ever as the dire situation was further exacerbated by the COVID-19 pandemic. Infrastructure development is a massive contributor to the economy and its success will lead to job creation, and to sustainable economic growth. It is therefore a vital pillar for economic prosperity.

This should spur on all parties involved, but government’s continued bailout of ‘bankrupt’ SOEs (for all intents and purposes) which leaves less funding available for far more productive sectors of the economy (such as infrastructure), has led to confidence in government being at an all-time low. At a time when investment by Government has been adversely affected by a weakened fiscus, structural imbalances and higher debt-related expenditure, such low confidence may be problematic for the country achieving its development goals.

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The Dean of the University of Pretoria’s (UP) Faculty of Engineering, Built Environment & Information Technology (EBIT), Professor Sunil Maharaj.

UP Engineering Faculty dean appointed chair OF GLOBAL ENGINEERING DEANS COUNCIL The Dean of the University of Pretoria’s (UP) Faculty of Engineering, Built Environment & Information Technology (EBIT), Professor Sunil Maharaj, has been appointed the new Chair-Elect of the Global Engineering Deans Council (GEDC), making him the first Dean in Africa to occupy this position.

P rof Maharaj will work as Chair-Elect during 2021 alongside the current Chair, Dean Sirin Tekinay of the American University of Sharjah, and will assume the chairship in November 2021. In this leadership role he will work closely with leaders throughout the world until the end of 2023 and will work closely with the International Federation of Engineering Education Societies, which links global organisations, professors, students, corporate entities, UN agencies and other multilateral global organisations. Prof Maharaj says he feels humbled to be entrusted with this position by the members from across the globe who voted for him. “I was on the GEDC Executive Committee for the past two years, which afforded my colleagues time to get to know me, perhaps helping them to vote for me with confidence.” The appointment follows the disappointment of having to move the 2020 GEDC world conference – which was set to be co-hosted by UP in Cape Town – to an online format. “In 2020, for the first time the GEDC and World Engineering Education Conference was to be held in an African country, but due to the COVID-19 pandemic it was recently hosted online, and I chaired the conference,” Prof Maharaj said. The 2020 GEDC conference theme was centred around “Disruptive Engineering Education amidst Global Challenges”. The conference also engaged on how to increase the diversity of people working in engineering. “Getting more women, and especially black women, into the field is still a challenge. This is a challenge across the globe, not only in South Africa, and there is a big opportunity for women interested in engineering. The cause could be that engineering is perceived as a career designed for men. We – across the globe – need to do more to showcase that this field is for everyone, and develop role models for women who will be instigators for change. And we need to actively reach out to recruit and welcome women. Industries need to play their part as well.”

He further notes that there is no need for concern regarding the state of engineering at universities in the developing world. However, there is a need to innovate, by constantly promoting 'disruptive engineering'. “We need to always innovate to stay relevant, and South Africa has done well thus far. It is the only country in sub-Saharan Africa which is part of international accreditation bodies, including being a signatory to the Washington Accord. We are part of the global space, and we are a global player.” The GEDC’s vision is to enhance the capabilities of engineering deans to transform schools in support of societies in a global economy. Its mission is to serve as a global network of engineering deans, and to leverage their collective strengths for the advancement of engineering education and research. The Council’s “We are all excited to work with Prof Maharaj, being fully aware of his deep commitment to strengthen not only the role of his own university but also that of other African universities,” said Dr Hans Hoyer, Executive Secretary of GEDC. “Given his successful record of engaging with the global community, this will link many Deans and universities within our network of six continents.” Prof Sirin Tekinay, the outgoing GEDC Chair, said, “I am looking forward to a year of working with Prof Maharaj in this capacity, and continuing to support him as the immediate past chair beyond 2021. With the chair’s office moving to South Africa, the GEDC will benefit from a whole new perspective that will improve the globalisation of the organisation. Prof Maharaj will be the ninth chair of GEDC, and it will be the second time the chair’s office is moving to the southern hemisphere in the history of GEDC." Prof Maharaj says he hopes to facilitate the strengthening of international networks in the organisation, with the focus on innovative engineering education and research collaboration through engagement with industry, students organisations, local governments and global funding agencies. ▄

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SA government construction tenders and contracts STILL DON’TACKNOWLEDGE COVID-19 RISKS After almost a year of dealing with COVID-19 related shutdowns and disruptions, public sector tenders and contracts do not include any clauses that deal with the pandemic. This is according to construction and technology law experts, MDA Attorneys, following a recent review of the contract conditions of several tender packages posted for public sector work. “C learly the pandemic can no longer be unforeseen and treated as a force majeure event, which is

the provision most claims have relied upon during the significant disruptions of the past year. The ramifications are not only foreseeable (such as levels of lockdown which restrict movement) but they can now be provided for in contracts and tenders. COVID-19 is likely to continue to wreak havoc on South Africa’s construction sector for at least another year and parties need to be agile and prepared for further possible repercussions,” says Natalie Reyneke, Director at MDA Attorneys. Areas of impact The most common matters dealt with by MDA’s clients were identified and relevant clauses to deal with these issues were added to public sector tenders and contracts: • Works on site were suspended or completely halted. • Border closures affected the supply chain, materials and goods delivery. • The restriction of movement meant demobilising workers from sites and necessitated additional travel arrangements. • Health and safety measures had procedural and cost implications. • “Most of the public works tender documents we reviewed incorporated the General Conditions of Contract for Construction Works (GCC) 3 rd edition, 2015, 2 nd print,” explains Reyneke. “Amendments to applicable laws and events that occur after commencement instructions are two areas of this contract that need to be adapted for COVID-19.” What can be done? In view of the uncertainty surrounding the pandemic, parties who commission work (employers) may be faced with time and additional money claims from contractors. “Since COVID-19 and its potential impacts on the time and cost of a project have not been factored into the tender documents, we are advising our clients to include them as early as possible. A key issue to be agreed is whether pandemic-related issues should be a shared risk between both parties,” says Reyneke. The clauses of a contract that should be amended are

Natalie Reyneke, Director at MDA Attorneys.

now much simpler to identify. They include: • delays and/or other events preventing performance, which will entitle a claim for extension of time with related costs, • access, mobilisation, demobilisation to and from site, • health and safety, • price adjustment, escalation in supplier costs, • types of insurances to be considered for proper cover relating to certain unforeseen events and the impact, as a result as well as termination of the contract. Reyneke warns that parties should carefully review the circumstances and expressly define COVID-19 related events as well as the entitlements to time and money that could be claimed by the contractor. “The risks and circumstances differ for each project. Identify and research them and ensure your agreement includes clear, balanced duties and responsibilities for efficient, cost-effective operations,” she says. ▄

SAICEwelcomes new industry body

T he South African Institution of Civil Engineering (SAICE) welcomes the establishment of the newly formed construction industry umbrella body, Construction Alliance South Africa (CASA). Vishaal Lutchman, SAICE CEO states, “We are proud to be one of the founding member organisations of CASA and look forward to playing an active role in creating a united voice in our quest to lead the post-COVID recovery of the industry

as well as tackling a number of longstanding issues such as transformation of the sector, corruption and unethical business practices.” Chaired by industry stalwart John Matthews, CASA aims to bring SAICE together with 28 other South African professional bodies and contractors within the construction industry with the shared vision of an innovative, competitive and transformed industry. ▄

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MASSIVE DECLINE IN2020MANUFACTURING The COVID-19 pandemic and the lockdown conditions which it occasioned had a devastating effect on the South African economy in general and the manufacturing sector in particular in 2020, Steel and Engineering Industries Federation of Southern Africa (SEIFSA) Chief Economist, Chifipa Mhango recently said. SECTORAMAJOR CONCERN

S peaking after the release of the latest economic data by Statistics South Africa (Stats SA), which showed that manufacturing production fell by 11% and total sales declined by 9,9% in 2020 when compared to the previous year, Mhango said the Stats SA data revealed the pressure under which companies within the Metals and Engineering (M&E) sector operated: total M&E production across the 13 sub-categories declined by 13,6% in 2020 when compared to 2019, and total sales declined by 12,3% to reach R727-billion. The largest sales value for the year was in the non-ferrous metal products sub- sector at R162-billion Mhango pointed out that the M&E sector represents 29% of the South African manufacturing base, and that its decline has massive implications for other sectors of the economy such as construction, into which 60% of its products feed as key inputs. He noted that in 2020 the local economy experienced shortages of several key products used by the construction sector due to industries operating below the prescribed capacity. “Indeed, there was shortage of steel as construction activity resumed and as other manufacturers that rely on steel in production also resumed operations,” he said. Mhango said SEIFSA was also concerned about the latest figures on capacity utilisation. According to Stats SA, in 2020 total capacity utilisation in the manufacturing sector was 72,3%, 1,8% down from the 81% in 2019. Within the M&E sector, average total capacity utilisation in 2020 was 67,6%, with the lowest level recorded in the other transport equipment sub-sector, at 58,4%, and the basic iron and steel sub-sector, at 54,2%. He said these figures explained the shortages of steel experienced in the country. The South African economy is estimated to have contracted by 7,5% in 2020, partially due to the weak manufacturing production trends throughout the year, as a result of low capacity

utilisation at producing companies under stringent COVID-19 lockdown regulations. Mhango said it was important for the Government to do more to revive the ailing economy, with special focus on speeding up implementation of policies. “At SEIFSA, we want to see the finalisation and speedy implementation of the Steel Master Plan, which we believe will benefit both primary and downstream players in the local steel industry – this will be key to ensuring the M&E sector’s survival,” he said. Mhango said fixed investment was also key to reviving the M&E industry. He said South Africa’s level of gross fixed investment to total GDP needed to move to levels of above 40%, from below 20% at present, in order to grow the country’s industrial base. Mhango said although the Government had committed, during the 2020 national budget speech, to spending R815-billion over the next three years on various infrastructure projects, mainly though State- Owned Entities (SOEs), implementation was slow. He said the M&E sector is heavily reliant on demand from key Government projects to boost its production and sales, especially for products such as steel and other related downstream products such as roofing material. He said the lack of progress in the implementation of such key Government projects was a hindrance to reviving the economy. “As we await the tabling of the National Budget in Parliament on 24 February 2021, we expect tough statements in dealing with mismanagement of funds at SOEs and speeding up of reforms, coupled with increased investment incentives for the manufacturing sector, for both small and large businesses. More also needs to be done to revive the railway system that is not supporting industrial activity transportation, which was a commitment made by Government in a previous State of the Nation address,” he said. ▄

Consulting Engineers South Africa’s (CESA) President, Sugen Pillay, presented his presidential message and theme for the year at a virtual event attended by media, CESA members, and infrastructure stakeholders from around South Africa. Pillay revealed his 2021 theme as ‘Rebuilding with Purpose’. ‘REBUILDINGWITH PURPOSE’ “W hen I delivered my presidential address this time last year, I had little idea of what was to come in 2020 – the

You might remember, I said: ‘We are certainly in a period of great change. In times such as these, there is always uncertainty as to how events may unfold, and a certain amount of trepidation as to what the change may entail, and what the future may hold.’ This was before COVID-19 reached our shores.”

unprecedented trials and tribulations that would face our industry, our country, and our global society,” began Pillay. “However, the words I said then, 12 months ago, were more apt than I could have imagined.

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infrastructure, both new and maintained, for the benefit of end- users as well as the creation of jobs. • A decentralised approach to spatial planning and development, spurred by the decreased emphasis on metros due to remote work and teleconferencing. • Increased attention to agriculture and surrounding services, as the agriculture sector is performing well and surrounding areas are prime for development. • Greater focus on maintenance, which is vital due to the poor performance of our infrastructure, as highlighted in the recent SAICE Infrastructure Report Card. Purpose “In our efforts to rebuild, let us maintain our focus and purpose on doing so with quality and integrity. If we are to truly save lives and livelihoods, we must operate with an unwavering focus on value, reliability, and sustainability.” CESA’s emphasis on quality has been further highlighted by the new mandated management systems for CESA members based on international standards for quality, integrity, and sustainability. This demonstrates CESA’s commitment to accountability, which Pillay says he hopes to see reflected in public sector spheres. Looking forward to industry developments, Pillay mentioned the upcoming CESA Annual Infrastructure Indaba, the FIDIC Africa Infrastructure Conference, as well as the newly formed Construction Alliance South Africa (CASA) as key in creating constructive engagements and industry coordination. Recovery In conclusion, Pillay said that CESA is committed to contributing to effective and sustainable solutions, and will continue to guide its members and the industry at large towards more transparent and prosperous infrastructure delivery processes. “Every person in South Africa stands to benefit from this goal which would see improved use of taxpayers’ money, an appropriately capacitated state, and the delivery of safe and reliable national infrastructure offering a strong foundation for further economic growth. ▄

However, Pillay said that despite the uncertainly and trepidation, South Africa is facing these economic and social challenges with resilience and determination. He cited the South African Economic Reconstruction and Recovery Plan, which has created some much- needed optimism for the consulting engineering industry. “Despite the hardships facing our country – hardships we cannot expect to dissipate soon – CESA remains committed to improving the business landscape and playing our part in creating a conducive procurement environment as well as shaping the requisite talent to see that our country’s developmental goals are met. We aim to mould our industry of consulting engineers to ensure we continue to protect lives through quality and safe infrastructure, and protect livelihoods through the creation of economic opportunities for the wider construction value chain,” he said. Reflecting on the past year, Pillay said CESA had made progress in strengthening the relationship between government and the private sector, showcased by the association’s involvement in the Sustainable Infrastructure Development Symposium South Africa in June last year. “However, it has become clear that South Africa still faces many of the same challenges as in prior years, with an ongoing demise of public decision-making processes, a lack of checks and balances within procurement systems, and a loss of accountability of those tasked with leading change.” He mentioned President Ramaphosa’s slow and laborious efforts to curb corruption, and the poor results from the 2020 Auditor-General’s report as examples. ”We also face continuously delayed infrastructure delivery, and those projects which do see progress are hampered by obstructions from the so-called construction mafia.” However, Pillay chose to highlight the good, and not dwell on the negative. He said that last year showed a greater focus on people rather than profit. “As compassion and empathy gained momentum amid a public health crisis, we are now seeing an industry of people who act with more care for others, and we hope this spirit of ubuntu continues through 2021 as we stand together. Ultimately this spirit of ubuntu and caretaking is what CESA aims to promote to industry – to protect lives and livelihoods, and consider the tangible social and economic outcomes of our work.” Rebuilding Unpacking the 2021 theme, Pillay highlighted the importance of democracy. “As we have seen recently in the US, democracies are precious and fragile, and need to be nurtured. Democracy will become less and less meaningful to those in our society that are stuck in poverty, with no access to basic services, and with no opportunities. Thus, as we embark on this massive rebuilding project, let us try to rebuild in a conscious and mindful manner, so that rebuilding doesn’t just become about providing infrastructure, but that it is consciously engineered to address poverty, inequality, and unemployment.” Importantly, he said that as we rebuild, industry must be understanding of the immediate needs of society. “Without doubt, the most pressing requirement is the roll out of the COVID-19 vaccine. CESA encourages the industry to be patient and understanding as resources are diverted to funding the vaccine initiative. CESA and its members have the necessary skills and expertise to assist with the massive vaccine rollout undertaking, and offers it services to assist in this regard. We need to be aware that municipal budgets set for infrastructure may be diverted. And we should stand ready to assist in infrastructure that might be prioritised, such as hospitals and clinics.” He called on industry to contribute where they can, to go beyond the call of duty, and work together with the state to address issues around resources and governance. Pillay presented various opportunities which could be leveraged in 2021 to strengthen the industry and economy: • Greater community involvement in the development of

CESA CEO, Chris Campbell (left) and CESA President, Sugen Pillay.

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MARKETPLACE

ARE YOUR CLIENT’S FIRE-COMPLIANCE STRATEGIES SAFETY-PROOF?

Your client’s organisation, its operations and its people are what drive a business and protect them, as well as your reputation. If a fire had to break out at one of your client’s buildings while the business was functioning at a reduced workforce capacity (let alone fully-populated), would the fire early warning systems and equipment in place be adequate - and would employees know where to find the emergency routes and exits, to ensure life safety?

T he OHS Act requires any building to be inspected four times a year for fire hazards; fire drills to be carried out twice a year; and the fire alarm system to be tested every third month. Simple fire safety assessments can be done by the appointed fire marshals to ensure basic fire safety measures are adhered to – such as general housekeeping and emergency escape routes. Where more in-depth assessments are required, a professional and competent fire engineer would be required to evaluate the current fire risk and compliance to the approved fire rational as approved during construction. Dean Gopal, Product Manager for Life Safety Division at Eaton says a few changes, such as whether hard-of-hearing or disabled team members have been employed since the last assessment was done or if a building been extended or modified in any way, can significantly impact your client’s level of fire safety risk. “Fire prevention and response strategies should be regularly reviewed and updated. We work closely with our customers to meet the highest of standards, whether sites are stadia, high-rise offices, government buildings, transport hubs, hospitals, retirement homes, industrial facilities or retail and leisure complexes.” Eaton brings decades of expertise in designing and developing fire alarm systems and manufactures a comprehensive range of market-leading Addressable and Conventional fire alarm systems that are compliant, efficient, user-friendly and configurable for specific application needs.

Dean Gopal, Product Manager for Life Safety Division.

ensures the system is fault-tolerant with short circuit isolators, and continuous fault monitoring ensures high availability. A wall-mounted all-in-one box voice evacuation system, such as Eaton’s DAU500, is powerful and flexible, containing a completely integrated voice evacuation system, capable of both standalone (for small systems) and network operation (for larger system expansion). Gopal says the best approach is to use the appropriate device for a given situation after having assessed all the risks. “Looking carefully at the practicalities of any given situation should provide a better understanding of the best fire compliance solutions to implement, taking into account the safety and convenience of your client and their employees.” ▄

“Robust fire detection and voice alarm systems are essential to fire safety strategies to prevent catastrophic damage, injury and loss of life. The risks associated with failure – from preventable death to irreparable reputational damage – make the carefully considered design and installation of a fire or voice alarm system a vitally important process,” says Gopal. Eaton’s VoCALL 16, for example, is a high specification loop- driven intelligent digital emergency voice communication system that offers sophisticated functionality along with simple end user operation. It is designed to allow for easy expansion in the future; while a maximum of 512 outstations in a networked solution can be viewed controlled from one central area. Its loop wiring

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T opline is a family-owned and run business that has been supplying the hardware, tool and building industries for over 32 years. They are experts in the sourcing, branding and distribution of numerous categories of tools, garden products and international market leading brands. A product that is ideal for the construction industry, is its high quality gloves that it distributes through 3rd party couriers across Southern Africa. These gloves provide performance, strength, ergonomics and unmatched durability backed by competitive pricing. Since its establishment in 1947, Towa Corporation has been an innovative creator of both industrial and household gloves. Towa, known as a rubber dipping expert, has been introducing a variety of high standard gloves for decades to many industries, including construction, automotive, farming, fishing, warehousing etc. The quality of Towa gloves was soon recognised widely in Japan, and its reputation and Towa glove ranges have now spread to over 30 countries across five continents. Towa maintains its commitment in creating high quality gloves over a multitude of industries. These gloves’ unique selling point is that it has MicroFinish ® technology which promises outstanding grip performance. Towa believes that the most important part of glove manufacturing (and what separates Towa from other manufacturers) is to create former HIGHQUALITY GLOVES

moulds that truly fit the human hand, thereby ensuring a much better fit and more accurate working. The manufacturing process conforms to EU Conformity Declarations, all factories are ISO accredited while stringent quality checks are performed. Topline supplies Stefanutti Stocks, Bohle Glass and Fedex with these high end gloves. ▄

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The results of the 2020Q4 cidb SME Business Conditions Survey point to a mild improvement in construction activity led by an uptick in work in the civil engineering (CE) sector, while activity growth in the general building sector (GB) was stable at the weak level registered in 2020Q3. CIVIL ENGINEERINGACTIVITY TICKS UP INQ4

“O n the plus side, it’s encouraging that the results aren’t all negative. However, this has to be interpreted with caution as the sector still faces many headwinds”, said Ntando Skosana, Construction Industry Performance. Weighing on overall GB activity was a sharp deterioration in current work among contractors in Grades 5 and 6. Despite this, ztheir confidence was unchanged at a low 13. In contrast, the confidence of Grades 7 and 8 fell by 7 points to 0. While activity improved significantly, it was not enough to prevent overall profitability from deteriorating. “Although activity is better than in 2020Q3, it seems GB in Grade 7 and 8 are sitting with increased cost pressures both by way of higher overheads resulting from the cost of COVID-19 health and safety requirements, but also due to increasingly scarce building materials which could be pushing up the cost of inputs,” noted Skosana. Confidence among GB in Grades 3 and 4 slipped by 3 points to 30. Provincially, Gauteng was the only region to register higher confidence at 25, from 21 in 2020Q3. This was supported by a slight rise in activity. In contrast, GB confidence in the Western Cape and KwaZulu-Natal declined to 8 and 0 respectively. GB confidence in the Eastern Cape was unchanged at 0. After rising by 7 index points in 2020Q3, CE confidence increased by a further 10 points to register a level of 29 in 2020Q4. Activity growth improved to its best level this year, supporting the uptick in confidence. Confidence was higher across all grades led by CE in Grades 3 and 4 at 16 “The results for CE are very encouraging, especially because it is not only sentiment that improved but also activity, and in a broad-based manner. However, it must be considered that activity growth is still under significant strain and this mild improvement comes off an exceptionally low base,” remarked Skosana. Although activity was better in all provinces, the uptick in sentiment is less broad-based when considered from a regional perspective. While CE confidence in the Eastern Cape and KwaZulu-Natal registered a more than 10-index-point decline, in the Western Cape and Gauteng sentiment moved higher. Indeed, CE confidence in the Western Cape, at 46, is at its highest level since 2018Q4. Even better is the index measuring activity growth which is at its best level since

2017Q4. “The performance of civil engineering contractors in the Western Cape definitely stands out this quarter. Not only was activity higher, but tendering price competition eased and overall profitability was better. All the indices improving in tandem is evidence that demand, at least in the Western Cape and to a lesser extent Gauteng, is improving albeit off a low base,” commented Skosana. The outlook remains downbeat for both GB and CE with the index measuring insufficient demand for new work as a constraint remaining elevated at 80% for both sectors. In summary, conditions, especially regarding work, remain tough in the GB sector. In contrast, there seems to be a broad-based uptick in CE work although more noticeable in the Western Cape and Gauteng. Overall, the survey suggests a slight improvement in construction activity in 2020Q4 relative to 2020Q3. “It is heartening to see some signs of improvement in the civil engineering sector but sustainability is difficult to gauge. Hopefully, we could see some of the work related to the much-vaunted infrastructure development programme in the next few months. Also, although the fiscus is under pressure, local government capex, or at least the efficiency thereof, could be boosted in light of the municipal elections set for next year. As for general building contractors, the outlook is bleak over the short term,” said Skosana. ▄ ABOUT THE SURVEY The cidb SME business conditions survey is conducted qu arterly among Grades 3 – 8 cidb-registered contractors (categorised into Grades 3 and 4, Grades 5 and 6 and Grades 7 and 8), both for general building and civil industries. The main indicator used for analysis purposes is business confidence, which indicates whether respondents find the current business conditions satisfactory. A business confidence index can vary between zero (indicating an extreme lack of confidence) and 100 (indicating extreme confidence). The 50 index-point mark is interpreted as neutral. The 2020Q4 survey was conducted during the period 5 October and 16 November 2020.

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Eben Meyburgh, CEO at GVK-Siya Zama Building Contractors.

SA’S CONSTRUCTION INDUSTRY CAN BUILD ITSWAY BACK TO SUCCESS IN2021

In his State of the Nation Address (SONA 2021), President Cyril Ramaphosa announced that the R100-billion Infrastructure Fund is now in full operation. He said that infrastructure projects that have been planned will lead to the revival of the construction industry and the creation of much-needed jobs.

W ith this in mind, Eben Meyburgh, CEO at GVK-Siya Zama Building Contractors believes that the industry has the potential to help kickstart the economy after it declined in 2020 following an extremely difficult year due to measures taken to protect against COVID-19. “As the public sector is investing in various civils projects, we hope to see a positive knock-on effect when it comes to increasing work opportunities for related industries such as building construction, material manufacturing, engineering, architecture and electrical construction. It is important to note though, that it won’t be smooth sailing as the industry is still anticipating another disruptive year, he adds. “Challenges brought on by the pandemic and slow economic growth are expected to persist into 2021, and although expenditure in the private industry is loosening up marginally, this, along with the slowdown in public sector work, may not be sufficient in the short to medium term. As such, the labour force may become more desperate due to unemployment which could result in the rise of disruptions by the construction sector mafia.” He adds that government has the opportunity of making a considerable contribution towards averting drastic risk to industry and the labour force by accelerating project awards and reducing lag. Despite this, he points out that there is cause for optimism and that he believes the industry can start building its way back to positive growth in 2021. “The Economic Reconstruction and Recovery Plan has helped to address some of the uncertainty in the construction industry and players in the sector are currently in engagements with Government regarding the rollout of strategic

integrated infrastructure projects to revive the economy.” Meyburgh is confident that the construction industry will be able to successfully navigate 2021 as the sector is now better equipped and able to deal with the continuing challenges brought about by COVID-19. “The lessons we learnt last year will definitely assist us to handle crises that we may face, and construction teams are armed with effective ways of ensuring their own safety and that of others on site and in their personal lives.” “The sector, therefore, needs to be ready to take advantage of these opportunities, he says. “I believe that the key theme of this year is to accept and embrace change, partner with industry stakeholders to find solutions and create opportunities for growth, and growing people.” Like most South Africans, Meyburgh points out that the team at GVK-Siya Zama has learnt to embrace change and upheaval. “More than anything, we place emphasis on the importance of retaining and building trusted relationships with all stakeholders and supporting one another through these difficult times. Working together and uniting with our colleagues, clients, sub-contractors, suppliers and other industry players has strengthened us as individuals and as a company.” Meyburgh urges construction industry peers to remain positive. “It is incumbent upon us to contribute to the revival of the economy by being solutions oriented, improving efficiencies and driving alternative and sustainable building methods. “I implore industry leaders to proactively drive innovation and creative thinking to successfully grow the industry in 2021,” concludes Meyburgh. ▄

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PROPERTY

During the COVID-19 pandemic, property stocks in general took a significant hit, where retail and commercial office space – and even some industrial property holdings – were affected. In contrast, lower-income affordable housing – and inner-city housing in particular – has performed better than most other property markets in South Africa over the same period. TRENDS DRIVING INNER-CITY REVITALISATIONAND URBANRESIDENTIAL PROPERTYMARKETS

C hanges in the way we work, which were catalysed by the pandemic, as well as South Africa’s urban densification imperative are some of the trends driving this performance. Paul Jackson, CEO at TUHF, shares his views on the trends shaping urban regeneration in South Africa, and boosting the residential property market in inner cities. The urban densification imperative Urban densification is a national imperative. It is happening, as part of a natural demographic trend that happens as countries develop. It is also happening at a much larger scale than people may believe. According to the Centre for Development and Enterprise (CDE), 70% of South Africa’s population will be urbanised by 2030, with more than 60% urbanised already1. However, Jackson believes that South Africa’s urban development and, in particular, the current approach to making housing investments have contributed to enormous and unsustainable urban sprawl as people continue to flock to urban areas and inner cities. “Urban densification must be managed carefully to avoid creating urban decay in the process.” “Meeting this challenge cannot be done with the traditional property development approach of building single, large scale and often comparatively expensive projects on the periphery of our cities. With the existing urban landscape of most inner cities already under space pressures, urban densification must take the form of many less expansive projects that rely on ordinary people with local knowledge for their success,” says Jackson. “In our business, we are seeing small and medium-sized developers taking up opportunities to develop projects between R1 million and R100-million, and we expect this phenomenon will continue.” The changing world of work Lockdown restrictions implemented to contain the COVID-19 pandemic catalysed the adoption of work-from-home strategies for many traditionally office-based employees. Even with restrictions easing, many companies are either not returning to the office, or are reducing the office space they rent, to reduce costs. “The result is that we are seeing office and retail space remaining disused, or no longer fully tenanted. And as such, many large, listed organisations and investors who own commercial properties in inner cities are either looking to sell or transform their building stock into residential or mixed-use developments,” indicates Jackson. TUHF believes that small and medium-sized entrepreneurs can capitalise on this trend as unwanted commercial space in inner cities becomes available for conversion. “Inner cities are multi-sector economies that, when managed well, attract pedestrians, commercial activity and reliable tenants while stimulating new businesses. As ordinary South Africans remain under financial pressure, and as working from home becomes part of the 'new normal', people seek affordable, decent accommodation with access to physical and social infrastructure,”

Paul Jackson, CEO at TUHF.

says Jackson. In the longer term, reduced commuting time and costs will also continue to drive urban densification trends. The daily commute, for example, sees 20% to 40% of South Africans spending 2-3 hours of their day and 30% of their monthly income on getting to and from work. As people increasingly move to the inner cities to reduce their living costs and/or gain access to better facilities and amenities, the opportunity to invest in inner-city rejuvenation and refurbishment projects makes both short- and long-term sense. A positive fiscal impact The final driver behind inner-city investment is the knock-on effect on the greater economy. Jackson suggests that while RDP housing developments certainly serve an important purpose, these developments often have a net negative fiscal impact. “They require additional services and ancillary infrastructure development in areas that have none, and people living in these developments often struggle to pay for services such as utilities, rates and taxes.” TUHF’s impact through scale approach has been developed based on proven results of sustainable investments and returns, while still being aimed at stimulating micro-economies in the immediate surroundings of a development so that urban densification largely has a net positive fiscal impact. This not only stimulates economic growth but attracts people that are more likely to be able to pay for services, rates and taxes. These projects also require less upfront investment, as they make use of existing infrastructure that can be refurbished or improved. “People are already investing in inner cities, financing important urban development to create urban densification projects. It is a phenomenon that is already shaping our urban areas. The market trend is extraordinarily positive, and for government and private investors, the opportunity lies in helping to ensure that these investments are regularised and contribute to inclusive wealth creation,” concludes Jackson. ▄

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WHAT TO EXPECT FROMTHE INDUSTRIAL PROPERTYMARKET IN2021

The Industrial Property Market in 2021 is certainly not an easy one to predict. However, learning from the past year’s events gives us a good idea of what we can expect.

recover fastest towards the end of 2021. Developing countries will likely only see their economies improve in 2022.” “The Industrial Property sector in South Africa will remain tough, but better than the retail, office and leisure sectors – the speed of recovery will depend on the speed of the vaccine roll-out,” advises Bales, who says that companies utilising industrial property will continue to push for enhanced efficiencies, while modernisation across all business processes will be a continued theme. “This includes further mechanisation of processes, where possible. Also, far greater utilisation of computerisation and cloud-based solutions. Along with better computerisation, access to buildings with fibre/5G will be critical.” Bales says that along with greater computerisation, the ratio of offices to warehouses and factories will continue to decrease (i.e. less office space in demand)

T his is according to industrial property expert Tony Bales of Epping Property. Bales unpacks the main themes of Industrial Property in 2020 and how the year ahead will play out. The industrial property sector was the best performing property asset class in the last 12 months. • Logistics and warehousing were the best performing components of the industrial property sector. Also, food-related businesses faired relatively well. • While overall industrial rentals softened, they were not as dramatic as the retail, office and leisure sectors. • New industrial developments were minimal. These were mainly developed for specific businesses. • Efficient buildings/warehouses were in more demand than older, less efficient buildings. Think m³ rather than m². • Notwithstanding the difficult economic conditions, demand for environmentally friendly buildings was strong. What does this mean for the Industrial Property Market in 2021? According to Epping Property, the global economy will remain weak in 2021. “However, due to vaccine roll-outs, developed economies will

and demand for environmentally friendly buildings will increase. “Hopefully, Eskom will not impose too much load shedding in the year ahead. However, as the economy picks up and the utilisation of power increases, Eskom’s ability to cope with the increased demand remains an ongoing concern.” “Certain businesses will try to keep leases short until a greater amount of certainty returns, and landlords will demand higher rentals for the luxury of a shorter lease in the industrial property market. In general, industrial rentals will remain under pressure during 2021,” advises Bales. “Asking rentals in the last quarter of 2020 were lower than at the same time in 2019 and in addition, achievable rentals are now roughly 10% lower than asking rentals, whereas a year ago achievable rentals were only 5% lower than asking rentals. This will be due in part to the weak economy and the competitiveness of landlords to secure tenants for their vacant buildings.” Bales concludes by stating that the Industrial Property sector in South Africa should, once again, be the best performing property sector in 2021. “Recovery at the end of 2021 and into 2022 (of all business sectors) is likely to be heavily reliant on the manner in which South Africa deals with COVID-19 and the speed and efficiency at which it can roll out a successful vaccination programme.” ▄

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ENVIRONMENT & SUSTAINABILITY

6 STARS FORA SUSTAINABILITY ICON The Ridge, a new commercial building in the Portswood District of the V&A Waterfront, celebrates its 6 Green Star Office Design rating by the Green Building Council of South Africa (GBCSA), a rating considered as demonstrating 'World Leadership'.

A ccording to the certification, the Ridge exceeded the base entry scorecard level of 75 for a 6 Star Office design rating, by achieving a total 80 design points. Of significance were the 9 innovation points given by assessors on the scorecard against an achievable maximum of 10. These are awarded over and above any credit obtained in other categories and are special points awarded at the discretion of the GBCSA. The innovation category encourages efforts which demonstrate that sustainable development principles have been incorporated to the wider process of design, construction and performance of buildings, as well as any positive environmental influence brought to bear on the wider geographic area in which the project is located. One such example of innovation is also the building's outstanding feature, its eye-catching cross laminated timber façade. This plays a major role in the indoor comfort of all building occupants – functionally and in the choice of a natural material – which grabbed the attention of the green building assessors. Further innovation points were given to passive design criteria. The way the building breathes - its indoor climate control - is based on mixed mode ventilation, using mainly fresh air and having openable windows. Heating and cooling is based on further innovative criteria. (Information is given in the notes below). An unusual innovation credit comes from the highly creative use of plastic waste as ecobricks inside non-load bearing concrete floor slabs, to displace the use of conventional concrete or polystyrene ‘void formers’. This appears to have been a first for a South African commercial building and achieves various sustainability goals. According to Vusi Nondo, Executive Head of Development at the V&A Waterfront, there is also much more to the Ridge than some environmental firsts: “The V&A Waterfront’s ethical development approach defines our master planning which focuses on sustainability

and care for the people who will use the building. This approach is ‘Our Normal’, a vision to set the tone for sustainable green building, guiding our planning and development strategies. “A vital part of our circular economy is the focus on people. This building creates an unparalleled internal environment with the highest level of natural light and fresh air, a virtual oasis in the city. Occupants and visitors can enjoy inspiring views, inner green spaces which include a groundbreaking ‘central street’ concept naturally ventilated with fresh air, breakaway zones, and an all-round environment conducive to productivity. “The Ridge is the very opposite of conventional city buildings which are dominated by concrete and glass. Its pioneering timber façade and mixed mode natural ventilation mechanical systems are firsts for South Africa”, he explains. Lisa Reynolds, CEO at the Green Building Council of South Africa (GBCSA), commends the V&A Waterfront and the entire professional team on another iconic 6-star Green Star certified building within the Waterfront precinct. “The Ridge represents the V&A’s commitments to world class sustainability leadership as well as showcasing local built environment professional talent capable of delivering innovative sustainable design” says Reynolds. “Green buildings like The Ridge help to inspire a built environment in which both people and planet thrive”, she adds. Georgina Smit, Head of Technical at the GBCSA explains that a 6 star Green Star Design rating at the project design stage represents an intent to achieve a sustainability performance level that equates to world leadership, exceeding South African excellence (5 star) and industry best practice (4 star). “Six-star ratings are unusual in SA and is not an easy achievement for a design rating. Only nine other offices have achieved this accolade to date, either through our Design or As Built rating, or both,

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