Refurbishment Projects on the rise

The fit-out and refurbishment industry has grown leaps and boundsin the GCC and Middle East. As more tower blocks near the decade mark, and some even older, the need for refurbishing them is fast approaching. The value of contracts being awarded is also on the rise.

In the hospitality industry, Dubai-based fit-out specialists Romeo Interiors completed a US$50 million refurbishment project a couple of months ago. Romeo Interiors worked on the Abu-Dhabi based Al Maha Arjaan by Rotana and completed the project in approximately 12 months.

Then, in January 2017, the Shangri-La Dubai hotel completed the first phase of its refurbishment project,which saw the entire lobby transformed. The first phase of the project was valued at $19 million and was carried out by Hirsch Bedner Associates (HBA). Phase two is currently underway, and is expected to address the 302 guestrooms and suites, due to be completed by 2018.

The usual lifespan of a property — before a soft or complete refurbishment is considered — ranges between seven to 10 years, according to industry experts. However, the longevity depends on the standard of property maintenance executed.

That places the onus on a facilities management service provider, and its subsidiaries, to ensure the original fit-outs last for as long as they can. The Emirates Palace Hotel in Abu Dhabi, operated by Kempinski, has not undergone a major refurb for over a decade now.

Here, the efforts of the housekeeping and engineering team have played a part. Regional rooms specialist India, Middle East and Africafor Kempinski Emirates Palace, Pamini Hemaprabha explains: “That is purely down to the efforts of the housekeeping team. It’s very important to ensure we take care of the facility like it’s our own. The Emirates Palace has not seen a major refurbishment for a while now.”

The standard and quality of MEP installations also plays a crucial factor. In most cases an FM service provider does not have to deal with snags and issues surrounding the DLP period, which is mostly 12 months after hand over of a new building. “It’s usually the major bits such as cracks appearing in the building, problems with PV panels or central air conditioning systems,” MJB Group’s operations manager Kiran Dommeti tells fmME.

Owners’ associations generally keep contractual agreements fluid, and do not wait for too long to assess the performance of an FM service provider. “If a building needs to undergo refurbishment, owners’ associations generally handle the matter quite fairly. An FM service provider cannot be pulled up because contracts state quite clearly that the client has the power to terminate the agreement with a three-month notice. In special cases even a month’s notice has been accepted by the industry at large. We are not held responsible,” Dommeti adds.

This translates to an ongoing dialogue between the FM company and the building management. A system which includes checks and balances, key performance indicators and quality checks are constantly on.

Refurbishments in the serviced residences and hospitality sectors will continue to dominate the sector for the years leading to the run up of Expo 2020. A 2015 report stated that Dutco had identified 60 refurbishment projects and targeted an annual turnover of $150 million. Research from Arcadis in 2013 estimated that 10,000 of Dubai’s hotel rooms will need an upgrade by the year 2020.

fmME spoke to a few service providers and understood that many are dabbling with the idea of getting into the refurbishment and fit out space, with a separate arm of the business in charge of quotations for prospective clients and execution of tasks. “That keeps matters transparent as we approach the client in a professional manner,” said a respondent who wished to remain unnamed.