Partner Andrew Bereza gives his annual assessment of what lies ahead over the course of the next 12 months for Brewer Smith Brewer Group (BSBG), and the market in general, in our 2019 outlook…
Success in 2019 is likely to be dictated by the extent to which businesses show flexibility, along with readiness and willingness to adapt to change. ‘Global uncertainty’ has become a permanent fixture in discussions surrounding the future for business, but it’s when faced with these uncertain times that leadership and prudence become decisive factors in achieving success. A key element of this is to look at a multitude of different potential outcomes, and use the experience gained from similar historical situations to guide your vision.
When we strategise at BSBG, our outlook stretches far beyond 12 months. While there is no question the market is in a difficult moment right now, as a business we ensure we are well prepared for these downturns, and well positioned to move forward despite this, by making sure we continue to offer a unique solution to the market, where demand for ultimate efficiency and value is currently at a premium. In addition to this, our strategic investment in new markets outside the Middle East continues, and during 2019 we hope Asia and Europe will gain a good deal of traction for us.
Dubai and the UAE remains a powerhouse of the Middle East construction market. Second only to Saudi Arabia in the region, projects of approximately $900 billion in value are currently under construction, or soon will be. The Middle East is up there as one of the most exciting markets in the world for projects, particularly as the region’s governments continue in their quest for economic sustainability through diversification.
But despite the move to curtail a dependence upon oil by investing in large scale projects, ironically it is the price of oil that dictates the level to which many of the regional leaders are prepared to spend on construction. However, this is not directly the case in Dubai. The real estate market and tourism have a more direct impact on investment, and while tourism growth has levelled (which can be linked partially to oil prices and a strong US dollar), the real estate market has become the victim of over supply. As a result, project activity has reduced over the last few years.When the market is in this shape, competition for tenders is fierce, and those that can deliver on key developer targets that such conditions demand will come through this period in a strong position. Developer focus now is sharply attuned to working with partners that have a proven record of reducing exposure to risk, offering a product that is hugely efficient, and delivering outstanding value.
How long the current conditions will last is up for debate. The region is still acclimatising to the introduction of VAT, with the tax widely considered to have had a negative short term impact on the economy. But new business incentives have been and will continue to be introduced, targeted at boosting investment. With construction by far the largest sector in the GCC for contracts awarded, it will be intriguing to see whether this gets any special attention in order to encourage more activity in the run up to – and post – 2020.
Resilience, patience and the confidence to remain on course are key in this moment. Large projects are still out there, it’s just that they may take longer to get moving than they did previously. The recovery post-2008 was never likely to last in its “mini-boom” form, and what we see now may be a correction that settles into a more consistent and mature resolve, aimed at building upon the success of the past in focused areas of development.
Corporate identity is predicted to be a huge factor in success for 2019. When we talk about corporate identity at BSBG, we’re aware of the need to reinforce our message and update it as the business evolves. Our reputation in the market is for highly efficient, first rate design and delivery of complex and prestigious projects in Dubai and the Middle East predominantly. This is the foundation upon which our brand message is built, and much of our presence and reputation in the market is down to this.
During the course of 2018, and throughout 2019, parts of our identity are changing. We now have a global presence stretching from Europe to Asia, and as many will know, our name changed to reflect this. Brewer Smith Brewer Gulf became Brewer Smith Brewer Group. It’s very important to us that people perceive us as what we are: an international architecture, interior design and structural engineering group, rather than a Middle East-based practice. Our website url changed to bsbgroup.com to demonstrate this, and our business collateral also was updated.When the market conditions are tough as they are now, it’s important to consider market perception, and assess whether the message we’re putting out is reflective of the long term vision we have in place. This message may also refer to other areas of the business, such as performance consistency, technological innovation, transparency and authenticity, which are all of equal value. We believe many organisations will re-evaluate their own message, and see the establishment of a much clearer corporate identity as a key factor in achieving success this year.
We also look at the ways in which we model our resources, our implementation of aspects of digital design and technology, and the relationships and collaborations we embark upon with our long term partners. We assess these factors with a view to providing added value to our customers, to enhancing our own business proposition and remaining a trusted and respected partner capable of delivering projects that surpass expectation.
We’ve now diversified our business to bring our unique brand of multi-disciplinary Lead Consultancy to new markets. In both Europe and Asia, we believe there is an urgent need for the level of sophistication and value in design and delivery we provide. This is what our reputation has been built upon in the Middle East.
In Europe there does remain the cloud of Brexit, the outcome of which seems less certain as each vote is cast in the Houses of Parliament, while in Asia the Chinese trade war with the US and general economic slowdown are sending ripples across the continent. However, these are temporary circumstances, and while the outcomes are difficult to predict, we are prepared for many different eventualities.Our outlook takes into consideration the future beyond these current geopolitical issues, and we are hugely encouraged by the reception we’ve received in the new territories we’ve entered. We will continue our commitment to the market in the Middle East, but will have an additional focus on further expanding our international reach. We believe we are well-equipped to adapt to whichever challenges and obstacles the future presents, and although the landscape may change, our vision and path will remain absolute.