Chartered Quantity Surveyors

Construction Cost Consultants / Economists

Project Managers

CQS Warsaw Presentation 28-10-08

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CQS GROUP• Founded in 1998 by Matthew Creagh

( 22 years experience in both Ireland & the UK)

• Staff of 20 Professionals within the group

Three Separate Divisions

1. Ireland– Head office in Mullingar, 15 professionals

2. Poland – Office in Krakow, 5 professionals

3. International– 1 professional who is dedicated to our business development abroad

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CQS Ireland

Cathal Scott - Practice Manager

• Chartered Quantity Surveying & Construction Cost Consultancy

• All surveyors have gained degree qualification

• Professional Accreditation from R.I.C.S and S.C.S

• ISO 9001 Quality Assurance Accrediation

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Services Offered: Pre-Contract

• Site Selection

• Feasibility Studies

• Due Diligence

• Value Engineering

• Procurement Advice / Suitable Contracts

• Environmental Consultancy

• Detailed Cost Planning

• Option Appraisals

• Design Team Co-Ordination

• Bill of Quantities Production

• Tender Document Production

• Contractor Selection

• Contractor Appointment

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Services Offered: Post-Contract

• Contract Administration

• Project Management • Construction

Management • Cost Management • Cost Reports

• Agreeing Variations • Site Inspections • Project Supervision • Dispute Resolution • Final Account

Agreement

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Specialist Services

• Life Cycle Costing

• Planned Maintenance Reports

• Schedule of Dilapidations

• Insurance Claims

• Tax Planning

• Capital Allowances

• Advice on Tax Designated Areas

• Funder's Representative• Risk Management• Bank Monitoring • Liquidation Advice /

Corporate Recovery • Mergers & Acquisitions• Consortium Formation

For Developers & Design teams

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Project Sectors

• Residential

• Commercial

• Hotel & Catering

• Services Stations & Car Showrooms

• Educational

• Health Care

• Infrastructure

• Civil Engineering

• Pharmaceutical

• Government Bodies

• Churches

• Demolition & Dismantling

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Clients - Developers• Residential Developments

• Business Parks

• Mixed Use Developments

• Medical Centres

• Nursing Homes / Retirement Villages

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Clients - Commercial • Hotels• Restaurants• Supermarkets• Boutiques• Petrol Stations

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Clients - Manufacturing

• Factory Extensions• New Build Headquarters• Refurbishment / Remodelling

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Clients - Government Agencies

• Department of Education• Vocational Education Committee• County Councils• Office of Public Works• National Roads Authority

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Clients -Major Contractors• Preparing Tender Bids• Advice on Public Sector Tenders• Contractual Advice

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Consultants Collaborated With

Government Projects

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High Rise Social Housing - London

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High Rise Social Housing - London

1. Winterton House, East London ( 25 storey )

2. Contract Value of €11m

3. Client was London Borough tower of hamlets

4. Client's Quantity Surveyor

5. Dismantling, re-strengthen works, piling and forming 100No. Apartments.

6. Form of Contract was JCT 80 with Quantities

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Commercial Projects

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BBC Offices - London

1. BBC Offices London ( White City One )

2. Contract Value €25m

3. Total GIFA of new offices was 25,000 m2

4. Clients Cost Consultant

5. Fast Track office Fit Out

6. JCT Management Contract

7. Site of 1908 Olympics ( 100 years ago )

19BBC Offices

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Commercial

1. Ganly’s Homevalue Hardware Store, Athlone

2. Contract Value of €9.5m

3. Client was Michael Ganly

4. Clients Cost Consultant

5. RIAI contract (with quantities)

6. New Hardware & Associated Stores 10,000 m2

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Heathrow Airport

1. Heathrow Airport, Engine x-ray building

2. Contract Value €2.5m

3. Fast Track contract of works

4. Contract was JCT 80 with Design Supplements

5. Concrete bunker inside aircraft carrier. High radiation protection construction (e.g. 1m thick concrete walls etc). External & internal inbuilt cranes within structure

Civil Engineering

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Civil Engineering

1. Dundrum Shopping Centre, Dublin

2. Contract Value of €14m

3. Client was PSK Construction / John Sisk & Co

4. Contractors Cost Consultant

5. RIAI contract (with quantities)

6. Insitu Suspended Box Culvert & Stair Cores

Educational Projects

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School - Primary1. Grange Educate Together

Primary School, Mullingar

2. Contract Value €7m

3. Our Client was Western Building Systems

4. Project Cost Consultants and Project Managers

5. RIAI form of contract (without quantities)

6. Construction of new 16 classroom school, culvert and external works in 19 weeks

Health Care Projects

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Nursing Home1. Thomond Hall Nursing Home (48

Bedroom), Ballymahon

2. Project Value of €2.53m

3. Our Client Sean Kelly Builders Ltd

4. Clients Project Cost Consultants

5. RIAI form of contract (with quantities)

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Retirement Village1. Thomond Hall Nursing Home (61

Housing Units), Ballymahon

2. Project Value of €7.6m

3. Our Client Sean Kelly Builders Ltd

4. Clients Project Cost Consultants

5. RIAI form of contract (with quantities)

Hotel Projects

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Annebrook House Hotel 1. Annebrook House Hotel, Mullingar

2. Project Value of € 20m

3. Our Client Vincent Dunne Development

4. Clients Project Cost Consultants, Project Managers & Procurement Managers

5. Construction of 36 bedrooms, 26 Apartments, Function room, Bars & Restaurants

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The Bush Hotel

1. The Bush Hotel in Carrrick on Shannon

2. Contract Value of €3m

3. Our Client was The Bush Hotel

4. Clients Project Cost Consultants & Project Managers

5. RIAI form of contract (with quantities)

6. Construction of Two storey extension over existing Function Room

Infrastructure Projects

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Luas Line1. Luas Light Rail Line, Dublin

2. Contract Value €23m

3. Our Client was William Kenny & Sons

4. Contractors Project Cost Consultants

5. RIAI form of contract (with quantities)

6. Civil Works to Luas Line throughout Dublin city

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Luas Line

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Street Reconstruction 1. Haggard St. Reconstruction, Trim,

Co Meath

2. Contract Value €1.2m

3. The Client Trim Town Council

4. Contractors Project Cost Consultants

5. Civil Engineering form of contract

6. Complete Reconstruction of Street Landscape and New Services, Street Furniture & New Road Construction

Residential Projects

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Market Point1. Market Point, Mullingar

2. Contract Value of €45m

3. Our Client was FK Construction

4. Clients Project Cost Consultant, Project Managers & Procurement Managers

5. Investigated new methods of construction in order to reduce costs and life cycle costs and reduce programme

6. Construction of 274 Residential & 27 Commercial Units

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Grand Canal Square1. Grand Canal Square, Docklands,

Dublin

2. Contract Value of €70m

3. Our Client was Pierse Contracting

4. Contractors Pre-contract Cost Consultant

5. RIAI form of contract (without quantities)

6. Construction of Hotel & Apartments

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Grand Canal Square

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Knockanally Golf Village1. Knockanally Golf Village,

Knockanally, Co. Kildare

2. Contract Value €4m

3. Our Client was Tom Cuffe & Sons Ltd

4. Contractors Project Cost Consultants

5. RIAI form of contract (with Quantities)

6. New & Refurbished Houses & Apartments

Service Stations & Car Showroom Projects

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Service Station & Restaurant 1. Applegreen New Service Stations &

Restaurants (throughout Ireland & UK)

2. Contract Values each approx €1m

3. Our Client Petrogas Group Ltd

4. Clients Project Cost Consultants

5. Client agreement to complete approx 25 stations within Ireland & the UK

6. Locations: Ashbourne, Newbridge, Osberstown, Balbriggan, Kinsealy, Trim and many others

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CQS Poland -The Company

• CQS Polska Sp. z o.o.

• First Irish Chartered Quantity Surveying & Construction Cost Consultancy Practice in Poland

• Established in 2007

• Matthew Creagh – Managing Director

• Stanislaw Harezga – Director in Poland

• Head Office Krakow

• Staff of 5 Professionals

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CQS Poland - Background

• Extensive research into the economies & the construction industry in emerging markets in Europe in 2006

• On a long term plan we choose Poland as its base for first overseas office

• Long term investment

• Own office was purchased

• 2.5m pln invested in the company

• Established alliances with Universities & Krakow University of Technology to develop the Business & have access to highly qualified graduates

• Looking at projects in Warsaw, Lodz, Wroclaw, Rzeszow and other cities with a view to establish regional offices

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My experience

• Masters Degree in Construction

• Degree in Engineering

• 7 years Hochtief - Commercial Manager

• 1 year KPB Cracovia ( Main Contractor ) – Commercial Manager

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Krakow

New Build Apartments 9,870m2 including basement ( 181 No. units )

Krakow

€36m

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Rzeszow

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Rzeszow

New Build Offices & Apartments

 

28,000m2 Offices & 8,000m2 Apartments

 

Rzeszow

 

€48m

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Wroclaw

New Build Offices  6,000m2 Offices & 1,500m2 Basement Car Parking Wroclaw €10m

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Wroclaw

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Wroclaw

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Wroclaw

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Poland - An Overview

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Regions - Voivodships

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Comparing : Poland to Ireland about 5 times bigger

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Poland has a population of 38 million

Comparing : Poland to Ireland has about 9 times more people

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Higher Education in Poland

• More than 5% of population in Poland are students

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• Growth of graduates between 2001 and 2007 is about 35%

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GDP in Poland

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GDP per capita in Poland

• In Ireland which was on the second place in the world in 2007 GDP per capita is about 3 times higher

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Economical growth in Poland in 2000 – 2008 (2008

forecast)

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Unemployment in Poland

• In 2009 unemployment in Poland will probably be less than in Ireland ( Taking Ireland as 8-9% and Poland as 7-8% )

Foreign Investment In Poland

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Why Invest in Poland There are many reasons why Poland is so attractive to investors:

• Size of Polish Market

• Location in Central Europe with Eastern Europe & Russia close by

• Availability of low cost labour

• Amount of skilled people & professional graduates

• Perspectives for economic growth

• Direct Grants – SEZ

• Availability of funding through EU structural funds

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Direct Foreign Investment in 2007 to new members of EU

Direct Foreign Investment in 2007 to new members of EU in mln Euros   

Investment in Poland at €12bn was double that of the Czech Republic

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Foreign direct investment in Poland

The inflow of capital between 2002 and 2008 (in mln Euro)

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Foreign direct investment in Poland in 2007:

 geographical structure of inflow

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European funds in Poland in the years 2007 – 2013

Over €67 bln of EU funds in 2007 - 2013

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Special Economic Zones

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In a SEZ the entrepreneur can obtain the following privileges;

• tax exemption (CIT or PIT) 

• fully prepared for development for the investor at a competitive price

• free assistance in dealing with formalities in connection with the investment

• exemption from property tax (on the territory of certain Gminas)

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The level of regional aid available to the entrepreneur depends on ;

• location of the investment ( each SEZ is administrated separately )

• level of capital input, or

• costs of employing new workers

• size of the business seeking tax relief

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Special Economic Zones in

Poland

Location of the 14 No. of Special Economic Zones throughout Poland 1 No. per Voivodship - the brightest

 10 No. and more per Voivodship - the darkest

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Sectors of building in Poland

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Type of construction sectors ;

• Residential buildings

• Non-residential buildings

• Civil engineering works

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Value of construction in mln pln, 2005-2007

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Value of construction by type of construction ( PLN m ), in Q1 2008

( 11,840 mln PLN in Q1 2008 )

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Residential Construction in 2005 – Q1 2008

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Non-residential buildings

• Hotels and similar buildings

• Office buildings

• Wholesale and retail trade buildings

• Traffic and communication buildings

• Industrial buildings and warehouses• • Public entertainment, education, hospital or institutional care buildings

• Other non residential buildings

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Hotels and similar buildings Value of construction by type of construction ( PLN m),

Q1-Q3 2005 to Q1-Q3 2007

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Office Buildings

Value of construction by type of construction ( PLN m), Q1-Q3 2005 to Q1-Q3 2007

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Warehouses / Logistic Parks

Growth of the Warehouses/ Logistic Parks from 1,2 mln of sq m in 2004 to 4,1 mln of sq m divided by sectors

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Civil Engineering Works• Highways, streets and roads

• Railways

• Airfield runways

• Bridges, elevated highways, tunnels, and subways

• Harbors, waterways, dams and other waterworks

• Long-distance pipelines, communication and electricity lines

• Local pipelines and cables (including water treatment works

• Sport and recreations constructions

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Highways, streets and roads

Programme of Road Development for 2008 – 2012; in total 121 bln PLN

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Implementation of Programme of Road Development for 2008 - 2012 should result in ;

• 632 km of new motorways

• 473 km of motorways in Public Private Partnership ( additional funding )

• 1,980 km of expressways

• 54 No. ring roads; total length about 428 km

• Reinforcement and reconstruction of national roads; total length 1,560 km

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Sport and recreational constructions

Euro 2012 Football Cup:

• Warszawa – new stadium

• Poznań – new stadium

• Wrocław – new stadium

• Gdańsk – new stadium

• Kraków – reserve – modernization and development of existing stadium

• Chorzów – reserve - modernization and development of existing stadium

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Construction Process

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Construction Process – legal regulations

• The construction process in Poland is regulated mainly in:

• the Construction Law of 7 July 1994 with more than sixty decrees of proper Minister,

• the Master Planning Law of 27 March 2003,

• the Civil Code of 23 April 1964,

• the Administration Proceeding Code of 14 June 1960,

• the Public Procurement Law of 29 January 2004,

• the Author’s Right Law of 4 February 1994.

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The construction process in general ;• Site purchase

• Local master plan or Planning Decisions

• Design for Building Permit

• Obtaining a Building Permit

• Technical Supervision, Designer Supervision

• Construction Design

• Construction work Contract / FIDIC

• Occupancy Certificate

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Local master plan or Planning Decisions

In accordance with the Master Planning Law a local master plan should describe ;

• the function of the land

• general public areas requirements

• planning ratios and planning conditions, including all limitations required by law

If there is no master plan for the area where the investment is planned (which happens frequently at present), Planning Decisions must be obtained

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Design for Building Permit

Building permit design is attached to the building permit application

This design, drawn up by a licensed professional, is to be approved in the building permit decision

The detailed requirements for Design for Building Permit are presented in the separate decree to the Construction Law (dated 3rd July 2003)

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Technical Supervision

On the basis of the Building Permit the Client is obliged to employ Technical Supervisors who:

• Represent the Client on Construction Site

• Confirming correctness of construction works with the Design for Building Permit

• Confirming quality of Construction works

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Designer Supervision

On the basis of the Building Permit the Client is obliged to employ design supervisors for the construction period ;

• Confirming correctness of construction works with the Design for Building Permit

• Presenting opinion about changes suggested by Technical Supervisor or Site Manager

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Construction work Contract

The parties are generally allowed to shape the contract freely

In the construction work contract, the investor and the contractor agree upon the detailed scope of work to be performed by the contractor and the work to be subcontracted

Contractor must not execute an agreement with a subcontractor without investor’s consent Investor and the contractor are jointly and severally liable for paying the subcontractor

No standard form of contract in Poland

To adopt / amend existing standard contracts from other countries ( RIAI Contracts )

It is possible to use FIDIC model contracts in Poland

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FIDIC the French International Federation of Engineers

In 1999 FIDIC published four standard forms of contracts:

• Conditions of Contract for Construction for building and engineering works designed by the Employer

• Conditions of Contract for Plant and Design-Build for electrical and mechanical works and for building and engineering works designed by the Contractor

• Conditions of Contract for EPC/Turnkey Projectsfor Engineering, Procurement and Construction (EPC): providing a fully-equipped facility, ready for operation

• Short form of Contractfor building or engineering works of relatively small capital value

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CQS International

• Division of the CQS Group

• Established in 2007 to target projects outside Ireland

• Matthew Creagh is the Divisional Manager

 • Based in Mullingar, Ireland

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How can we offer such a Service ?

CQS have established Professional alliances in various countries with similar Professionals and work closely with them to ensure that the Client receives correct advice

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Network with local professionals

It is essential to establish professional relationships with local Professionals to establish :

•Methods of procurement to be used

•Contractors to use / not to use

•Local Politics

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The Project

When a Project is presented to us it is reviewed as follows:

1. Clients requirements are reviewed and analysed using the requirement matrix

2. Why establish in this Country / location

3. Is there a market for the end product

4. Is the project a Commercial Development or for the clients own end use

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Consider External Factors What is the county’s economy like

– likely to get state funding / tax relief or benefits from the state agencies

– Is there Political stability / change of Government imminent

– Changes in the law or taxes which effect this project immanent

– Is it stable or on an upward / downward trend

What is the construction industry like

– Is there a shortage of labour or an abundance of cheap skilled labour

– Is there a ready supply of materials

– Is materials expensive / cheap

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Employ a Local Design Team

They may not even be the Lead Consultant however they may be beneficial in the following ways:

• Knowing particular details regarding ground conditions / existing structures

 

• Be familiar with planning issues and the personalities involved

• Types of Construction to use, a particular material may be suitable but in short supply

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Get client’s own Designers / Project

Managers involved • Client may need to have a watching brief from their own designers to

liaise between them and the local designers

• To ensure the Design programme is being met

• To ensure their exact requirements are included in the design

• To ensure that they are constantly updated on planning issues and all financial issues to enable them to work around delays / financial problems

• That the Client is not being fed information on a need to know basis

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Establish early Cost Control Measures An initial Budget must be established for the entire project

This may be very basic however it should include:

– Land Purchase – Legal Fees & Planning Fees– Other Contributions Required ( local amenities )– Construction Costs– Construction Inflation– Design Team Fees– Financing – Clients Internal Costs– Sales / Advertising Costs

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Projects Undertaken

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CQS International - Clients

Bosicor Oil Pakistan Limited

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CANADA

1. Hotel & Residential Development / Ski Resort, Newfoundland, Canada

2. Contract Value of $ 40m

3. Our Client was FK Developments & Pacrim Group

4. Client Project Cost Consultant and Feasibility Adviser

5. Construction of Hotel, basement, Apartments, Chalets and external works under a mountain

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WALES

1. Dismantling of Oil Refinery, Wales

2. Contract Value of £17m

3. Our Client was Bosicor Oil Pakistan Ltd

4. Client Project Cost Consultant

5. Bar coding, dismantling, packaging and shipping to Pakistan for re-erection by others of a disused Oil Refinery in Wales

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Oil Refinery in Wales

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CQS International

Projects CQS have Secured

• Hotel & Residential Development – Canada• Oil Refinery – Wales• Oil Refinery – Italy

Projects CQS are Reviewing

• Residential Development – Bulgaria• Oil Refinery – Cyprus• Petrol Stations – UK

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In Summary

When conducting business in areas that are unfamiliar some key points to be considered are:

– Establish Local Network of Professionals

– Know the Local Politics  – Know local planning constraints

– Don’t assume that the local professionals can grasp your requirements as quickly as your own professionals would

– The end product is what is important and often the design and procurement of the product may vary to what we are familiar with, however it is the control and monitoring measures that are implemented that are important

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Irish Companies Operating in Poland

Banks BZWBK ( AIB ) Third Biggest Bank - 460 branchesConstruction Consultants PM Group Project Management / Design

CQS Group Cost ConsultancyORS Consulting Project ManagementDesmond & Associates Consulting EngineersMoylan Consulting Consulting Engineers

Manufacturing Glenn Dimplex Electrical heatersJFC Engineering Plastic tanks / pipesSmurfit Paper Kingspan Cladding & InsulationWind Build Wind Energy componentsCRH (Grupa Ozarow ) Cement / Building MaterialsPortwest Ltd TextilesPrint & Display ( Polska ) Printing

Contractors Sunley Polska Main ContractorSpecialist Contractors Mercury Engineering M & E - Design & Build

ABM Mosty Precast Bridges - Design & BuildDevelopers 50-100 Irish DeevelopersReal Estate Agents TNI Properties - in 2 citiesHotels Quinn Group Sheraton Hotel - KrakowInformation Technology Codec Systems IT / Business data management softwareHealth Care Valcon Healthcare Packaging of healthcare productsQuarring Whelan GroupRecruitment / HR CPL

Grafton Headcount SolutionsSigmar

Agricultural Agro Irlandia Consultancy in dairy / agri. SectorCP Naughton 1,200 acre commercial farm

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CQS Target Market

• Developers• Large Consultancies, Architects, Engineering

Practices & Project Management• Government Agencies• Contractors• Manufacturing Companies

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FOR CQS PRESENTATION PLEASE VISIT -

www.cqs.ie

Do widzenia!