CBE SYMPOSIUM 2008

Roles of Professionals in the Booming Built Environment

Presented

ByMs N Mandindi

Chief Executive Officer

Intersite Property Management Services

Content

The boom: What is spoiling the boom party? Is the boom over?

Roles of professionals: Agents for industry transformation

Exceed sector charter targets Skills development Employment equity

Create employment opportunities Ambassadors for the environment

What is spoiling the party?

Inflation

• CPIX increased by 10.1% (y/y) in March 08• 9.4% February 08 • Exceeded SARB target of 3% and 6% • Impact: Building materials & labor costs

Annual % change in CPI

Source: Statistics SA

Interest rate

• The Repo rate is currently at 11.5% • The prime rate has increased by 15%• Impact: Balance sheet (Debt ratio)

Brent crude oil

• Price of brent crude oil reached all time high, breaking over $126/barrel (as of Friday 09/5/08)• Impact: Inflation trigger

Proposed Eskom Price Hike

• Eskom proposed 60% electricity tariff increase

• Impact: Exacerbate inflation

Load shedding

• Disrupt operations across the board

Is The Boom Over?

• Government infrastructure projects • Flagship projects

• GFIP • Gautrain• FiFA World Cup• Transnet Capital projects

Roles of professionals in the BE

• Agents for industry transformation– To exceed sector charter targets

• Skills development• Employment equity

• Create employment opportunities• Ambassadors for the environment

Skills development

• Embrace JIPSA & exceed sector charter targets

• Commitment• Take responsibilities• Will contribute to the Scorecard

Skills DevelopmentIndustry sector charter targets (5yrs)

Construction sector Property sector •1,6% payroll per annum on skills development

•1,5% of payroll per annum on skills development

•70% total skill development spend on black people

•25% skills dev spend on black women

•25% spend on black management

•20% spend on black women

•2,5% employees on learnerships (rolling 12 months average

•2,5% of staff learnerships for blacks

•70% of total learnerships on black people

•2,5% mentorship for blacks

Skills developmentGovernment progress

Source: AsgiSA annual report 2007

Work done since March 2006

Work done beginning of 2007

Setting up structures & processes

Expanded scope of work

Determining priorities Address challenges of town & regional planning skills

Analyzing critical issues Mathematics

Quantifying the challenges Science & language competence in public schools

Developing proposals Management & planning skills in public sector

Employment equity

• Employment equity is the right thing to do– Transformation of the industry– Contribution to the Scorecard

Employment equity targets

• Source: Government Gazette (DTI)

Construction sector (2010) Property sector (5yrs)

25% senior black management 30% senior black management

10% senior black women management

15% senior black women management

30% black middle management 37,5% black middle management

12% black women middle management

20% black women middle management

40% black junior management

Employment opportunities

• Create job opportunities to South Africans & discourage foreign skills imports

• Unemployment rate dropped by 23% in Sept 2007 compared to 25,5% in same period 2006

• The construction industry contribution to total employment for 2007 was 8% .

• An annual % change of 432,000 in Sept 01 & 07

Employment rate by industry

Source: Statistics SA

Ambassadors for the environment

• Incorporate green principles in designs• S.A is adopting green building principles• Establishment of GBCSA to support the commercial property sector• BE & other property association should support GBCSA initiative. Obtain accreditation

Designing for the future client

• Who is the future client?– Corporate Green– Government Green

• What are the demands?– Green commercial space– Low operational expenses– Space that enhance productivity

Profile: Bahrain world trade centre

• 240m• 50 floors• Offices & shopping mall• Three wind turbines• Wind turbines generate up to 15% total

building energy supply

Bahrain world trade centre

Bahrain tower

Bahrain tower

Bahrain tower

Bahrain tower

Bahrain tower

Guess what?

• The Bahrain world trade centre was designed by a South African Architect (Shaun Killa)

• Constructed by the South African developer (Muray & Roberts)

QUESTIONS?

Maybe we need this one in JHB CBD (Taipei, the tallest in the world, 509m, 101 floors)

THANK YOU