Role of construction in Qatar’s tourism sector
Tourism is considered to be a key growth area in Qatar National Vision 2030. Naturally, the construction industry has a large role to play in developing Qatar’s tourism sector, writes Mark Shea – head of Hospitality Middle East at Faithful+Gould.
Global events such as the 2022 World Cup and other major sporting tournaments, together with Qatar’s diverse cultural offering are great drivers to boost the country’s tourism industry. Growth of tourism, in turn, also brings the requirement and demand for new facilities such as hotels, entertainment hubs and greater capacity in the country’s transport infrastructure. Taking the future demand into consideration, the Gulf state has a significant number of new hotel rooms planned or in the pipeline. In the past, hotel developers looked at five-star luxury hotel developments due to their high revenues per unit which is in contrast to the emerging trend for three- and four-star properties that have proven to have comparable profit percentages. That said, in the quest of building new projects, it is important not to forget the existing assets that will require refurbishment and maintenance to protect the standards that we are used to seeing in the region.
One of most prominent impacts of Qatar’s growing tourism sector will continue to be seen on its airport facility. While the country opened its new hub-and-spoke facility, Hamad International Airport (HIA), in 2014, major extensions are currently under progress to further increase the airport’s passenger and cargo capacity. This, of course, will also mean continued expansion of the national carrier, Qatar Airways, providing a major transportation hub and key gateway for visitors to Qatar.
While the continued development of infrastructure required to host the 2022 World Cup will be a high priority in the short term, investment for the development of cultural offerings such as museums will not only broaden the range of entertainment spots for tourists during the World Cup but will also serve as an asset for Qatar’s long-term goals of promoting its tourism sector. One such project is the National Museum of Qatar. Located in central Doha, the under-construction museum inspires its design from the crystal formation of a desert rose.
Likewise, the development of themed entertainment centres, such as those planned at Doha Oasis, will also provide opportunities for local and international tourism. Similarly, the under-construction Mall of Qatar claims it will bring a unique Live Interactive Visual Entertainment centre to the city. Some other recreational attractions scheduled to come to Qatar in the future include Angry Birds Activity Park, Juniverse and Virtuocity for kids, teens and adults.
Apart from cultural and recreational facilities, it is important to recognise the impact a broad retail, food and beverage offering will bring to a destination in support of its tourism development. While the construction of hotels progresses, Qatar must not lose sight of the development and refurbishment of its existing eateries across the various segments from budget to luxury.
Like any other project, tourism projects in general face the same challenges affecting the overall construction sector. Some obvious issues include securing skilled labour and the right resources to undertake the projects necessary to expand the tourism sector, securing appropriate visas for the expatriate workforce, and making sure that there is sufficient social infrastructure in place for the workers, such as affordable workers’ accommodation, while trying to manage wage rise inflation.
Availability of key materials to support the construction industry is also a key concern given the volume of construction work that is anticipated over the course of the next five years across the wider Middle East region.
The summer periods are harsh with high temperature and humidity levels, which make the provision of projects with external elements difficult.
Apart from these generic challenges, projects related to tourism are specially more sensitive to the environmental conditions here. Therefore, in designing and building these projects, there has to be an appreciation of the natural climate. Building environments need temperature-controlled conditions in their operational state and this must be factored in right from the design outset. Careful consideration of the position of buildings within plots and orientation when considering sun paths, can impact on the shading and cooling loads required of the building systems. Proper attention to detail during the design detailing and real supervision of the building operations are key. For instance, the quality of build can help minimise air leakage from buildings and reduce the overall cooling requirements.
Undertaking formal training and handover to the operators/maintenance teams of hospitality and leisure projects led by the designers and constructors of the building MEP systems will be invaluable so as to prevent such MEP systems from being operated differently to the way that they were designed to run in the first place.
The summer periods are harsh with high temperature and humidity levels, which make the provision of projects with external elements difficult. Innovation and development of off-site pre-fabrication and the development of repetitive and simple component parts to install will assist. It would be equally significant to give due consideration to programming of major works in an external environment to be undertaken in the cooler months.
In terms of the overall quality of the project, it is important to look at the owner’s motivation. Though not always, a project owner, who is looking to develop and sell on assets as part of an investment strategy, may only look to construct as cost effectively as possible, in order to increase the opportunity for margin. On the other hand, an owner with a longer-term mindset and one who is interested in the operational costs and efficiencies of the building in performance will be open to the options to spend more capital in the expectation of significant operational cost savings in the future.
Across the region, there are many examples of tourism projects that have been a success. The development of luxury hotels and destination resorts has been a great success, with generally good levels of occupancy and good rates being achieved. In many ways, the region is synonymous with the provision of luxury and opulent destinations with a corresponding level of service. The development of major shopping and retail malls, often with hotel accommodation attached, has been well received in the marketplace, and continue to perform well while providing an added draw to the tourists.
While the Gulf Cooperation Council (GCC) is full of success stories for its tourism facilities, many projects within the region did not turn out as expected. However, rather than looking at individual projects, it is important to understand the reasons behind their failure and identify the lessons to learn.
PwC’s Middle East Capital Projects & Infrastructure Survey from June 2014, using insights from 130 project owners across the GCC, identified that more than 95 percent of projects are delayed beyond the original schedule, with 44 percent delayed by more than six months. To add to this, 71 percent of projects were reported as being over budget with six percent being more than 50 percent over budget.
In designing and building tourism projects in the region, there has to be an appreciation of the natural climate.
While the Middle East is an intensely competitive market, we are still seeing a lack of expertise in design and implementation causing budgets to soar out of control. Understanding an owner’s intention for the development of an asset from the outset can impact the approach to design and construction, leaving little room for expenditure on efficient design or sustainability despite a growing demand from the end user and the necessity for cutting costs in light of the current economic slump.
Clearly, there are numerous reasons for such significant numbers of projects being over budget and late in their delivery. In order to avoid such incidents, it is important to set realistic project expectations from the start, along with a carefully constructed brief. In addition to the brief, the development of a realistic development budget – that is used to inform development appraisals with value at the forefront – together with the identification of appropriate timelines for the completion of each project stage, are some of the key elements to setting a project on the right path from the outset. A design that is well considered and developed to an appropriate level to allow procurement of construction partners, with the correct apportionment of risk, is another factor to be considered.
Despite best-laid plans, mistakes can happen on any construction project. However, robust reporting and monitoring during the various project stages will help to identify potential areas of concern early enough in the project lifecycle so that remedial actions can be taken to bring projects back on track.