With Bahrain having reinforced its commitment to developing its strategic projects by flagging off the prequalification process for the much-awaited Bahrain Metro project, the country’s construction and real estate sector can look ahead at the New Year with optimism, says Dr Khalid A Rahim, Chairman and CEO of KAR Group of companies.
“The Bahrain Metro project will have a significant knock-on effect on the market not only with supplementary construction associated with the metro such as car-parking, access bridges, incoming supplies but also in complementary developments such as shopping facilities, connecting roads, and residential and office construction closer to the metro stations,” he tells Gulf Construction.
Dr Rahim is a veteran in the industry with a finger on the pulse of each facet of the construction industry, having set up the flagship of the group – Cebarco (Civil Engineering, Building and Construction) – back in 1992. The group now enfolds virtually the entire spectrum of construction-related companies to support Cebarco and the industry’s requirements – covering mechanical and electrical engineering and contracting services (Kartec), facades (KAR Facades), cranes (KAR TC), sanitary ware and tiles (Marmara Trading/Aqua Art), building products and equipment trading (KAR Trading), and PKE (electronics and security services). In addition, the KAR Group also has interests in the real estate sector (KAR Properties).
Cebarco is currently working on the BD83.6-million ($220.4 million) New Exhibition and Conference Centre (NECC) in Sakhir, which along with the proposed Bahrain Sports City that is planned to be built adjacent to it, will attract other businesses to the locality and will further enhance this area as a new standalone destination, Dr Rahim says (see Page 42).
The firm is also working on a design-and-build contract for the BD12-million Electricity and Water Authority (EWA) control centre for monitoring of Bahrain’s electricity and water networks. The scope of the package includes civil and electromechanical works for the new building, in addition to modifications in the existing control centre to turn it into an emergency control centre.
“The control centre for EWA will be the new nerve centre for the whole of Bahrain for the next 50 years. This is a unique building with a stepped and twisting structure, shielded from the sun by extensive shading to help reduce solar gains. Internally, the building will house complex operation and control systems to ensure that electrical supplies in the kingdom are never subject to outages,” says Peter Sellers, CEO of Cebarco.
At Diyar Al Muharraq, Cebarco is building the landmark Marassi Galleria and the adjacent Vida Hotel and serviced residences.
The Vida hotel has been handed over and opened to the public in December. Work on the Marassi Galleria – originally targeted for handover in mid-2021 – has been delayed by a number of factors and is now scheduled for completion in the first quarter of this year (2022).
Commenting on the project, Cebarco’s CEO says: “This has been a very difficult project as it is reliant on materials from overseas, which meant that deliveries were impacted by the coronavirus pandemic when factories closed down for months in Europe and elsewhere, and borders were closed; so our hands were pretty much tied.
“Even goods from the GCC were significantly delayed due to the closure of the Saudi border and we, as all other business in Bahrain, were fighting for seafreight slots and searching for available containers. We ended up having to increase advances to suppliers and this has hurt our cash flow.
“The good news is we are recovering from these closures and are progressing well. The Vida hotel is handed over and we are planning delivery of the mall in the first quarter of 2022 on the basis that all final materials arrive on time,” he says.
Cebarco’s showpiece infrastructure project, the Dilmunia Grand Canal at the nearby Dilmunia island was opened with much fanfare early last year and since then the contracting company has been awarded additional works to cover the extensions to previous phases as further land plots have been sold and new developments started within the island off Muharraq.
Another major accomplishment for 2021 was the 10,000-seat-capacity Al Dana Amphitheatre, which in November held its first concert to a sell-out crowd. While the facility was virtually complete when the Covid-19 pandemic broke out, Cebarco has since carried out additional works to ensure that the amphitheatre can handle a multitude of events.
Cebarco is now engaged on the 15-storey District Tower in Seef, which it aims to complete early this year.
In the renewable energy sector, Cebarco, along with its German partner JUWI, have completed and handed over the first solar power and wind plant for EWA at Ad Dur and this plant is now supplying renewable energy into the Bahrain power grid.
“This is a 5-MW solar farm, together with two wind turbines. This pilot plant will lead the way to a significant increase in use of renewable energy for the kingdom and is the first step in achieving the goals of HRH Prince Salman bin Hamad Al Khalifa, Crown Prince and Prime Minister of Bahrain, in achieving carbon neutrality by 2060,” Dr Rahim says.
In the wastewater sector, Cebarco is working on Phase Four of the Tubli sewage treatment plant with its partner WTE of Germany.
“This is a significant civil engineering project for Cebarco with complex structures, including 30-m-deep pumping stations constructed with slipform, 3-m-diameter mains incoming sewer lines bored with tunnelling machines. We understand that this line is currently the largest bored sewer line in Bahrain. The project is being carried out on an extremely tight site, which has made logistics extremely difficult but we are managing well,” says Sellers.
In addition, Cebarco is set to add another major BD21-million deal to its already healthy order book worth BD300 million, which is expected to keep it busy during 2022.
The KAR Group has a well-devised strategy in place to ensure that it is well poised to take a major share of the business anticipated in the New Year.
Towards this end, it is looking to leaner and more efficient operations and is seeking strategic partners to target complex works where specialist services are involved.
“We are currently reviewing our own operations and structure to see where we can better optimise our resources. We are also looking at where subcontractors and suppliers can prove more efficient and we will be using the best resources possible going forward. We have appointed new operations managers who are tasked with making the best possible use of our resources or those of others,” Dr Rahim says.
From the sustainability point of view, the company is looking at changing its site operations to solar power to increase its green footprint and also to offset increased costs of diesel fuel for site generators.
Cebarco also intends to broaden its horizons, with plans to set up operations in Saudi Arabia “still on the table”.
“We have been talking to several large organisations about making a move across the causeway, as to where we can add value to their developments and we are hopeful of a structured move in the future,” he adds.
Cebarco has a branch office in Cyprus, where it is developing a mixed-use project. According to Dr Rahim, the project has suffered due to the pandemic as well as owing to the changes in investor rules.
While the project has been scaled down from a three-tower to a two-tower complex, “it will probably be the most iconic building in Cyprus,” he adds.
Meanwhile, KAR Properties is poised to open the Riffa Gharbi Mall in the near future. The boutique development in the heart of Riffa is set to become a “destination for quality service”. The mall includes a new showroom for group company Mamara Trading, which has been doing good business despite the pandemic, according to Dr Rahim.
The Gharbi Mall will also accommodate an Al Osra supermarket, which is currently being fitted out; a VIP travel services outlet; an exclusive Bathroom Solutions showroom and a wellness facility offering exceptional spa and beauty treatment.
With the residential segment of the real estate sector being buoyant, KAR Properties is planning to develop a villa community in Isa Town, comprising 135 two-and-a-half-storey townhouses.
The company is also looking at setting up a showroom complex with two upper levels in Sitra.
Contrary to the trend of businesses slowing down and reducing staffing levels during the pandemic, Dr Rahim says the KAR Group has in fact recruited new staff and made the most investment in plant and equipment since 2009, when it constructed the Abu Dhabi F1 Circuit.
“Even our tower crane company KAR TC has been purchasing equipment – which for me is a good indicator that things are coming back to normal,” he stresses.
“We will continue to develop group companies to support our other activities where we see opportunity. We have several irons in the fire at the moment…,” Dr Rahim adds with a grin. “However, whatever business I set up must be able to stand on its own two feet and act independently of the group.”
The group is also in discussions with some major international players about bringing financing into government housing and infrastructure projects, with a view to setting up an engineering, procurement, construction and financing (EPCF) venture.
Dr Rahim is optimistic about prospects in the Bahrain market, where several projects are on the cards. These include the Fourth Manama-Muharraq Crossing, which will help reduce traffic flow in Muharraq and give direct access from Manama to Diyar Al Muharraq and Dilmunia; Diyar Al Muharraq, which continues to expand and will soon host a cruise terminal; and the Al Jazayer beach hotels and the Hawar development, which will boost tourism.
Bahrain is also developing new townships and has reclamation projects on the anvil and additional work is planned for the airport complex to position the country as a cargo/transit hub. This apart, Bahrain is focusing on renewable energy projects as well as on sustainability and waste management – all of which spells good news for the construction sector, Dr Rahim concludes.