December article from Estates Gazette design, build, cost delivery challenges and procurement problems in the UK construction industrial sector.

1. 44 www.estatesgazette.com 5December2015
Topicsupfordiscussioninthiswinter’sIndustrialTalksincludeddesign,build
costdeliverychallengesandprocurementproblems.Recruitmentandthepriceof
steelwerealsoattheforefrontofpanellists’minds.NoellaPioKivlehanlistenedin
talkstalks
Challenges/recruitment
Kester Purslow: It’s been a very
challenging year, but we are
extremely busy across all the
sectors we work in. We have a
backbone of distribution as a
sector and across all of our end users
and end-user clients and developed
clients. It doesn’t really seem to be
slowing down at the moment.
Again, we’ve seen a large number
of end users still doing specific
built-to-suit requirements. Some of
those are very big and very challenging
projects.
One of the main challenges for us has
been staff recruitment. Resourcing and
bringing new people in is a challenge. We
are constantly recruiting, not through
wastage, just in terms of growth.
Stephen Pickup: Challenges on the
property side have been rents and trying
to peg rents... to manage the charges. It’s
all about processing, unfortunately.
INDUSTRIAL TALKS
Obviously, [we want] to keep the rent
down as much as we can, move gears,
and in a challenging market we are
seeing rises in certain areas. We’re just
about keeping our head above water in
that respect.
David Gavin: We’ve seen some changes
over the past three years in regard to the
retailers’ requirements. Automation is a
big thing now. You fit the building around
the automation, rather than fitting the
automation in the building.

2. www.estatesgazette.com 455December2015
SAVILLS IDI GAZELEY
INASSOCIATIONWITH
THE PANEL
SIMON BARNES
DEPUTY MANAGING
DIRECTOR,
SEVERFIELD
KESTER PURSLOW
TECHNICAL
DIRECTOR, RPS
PLANNING &
DEVELOPMENT
JAMES KELWAY
DIRECTOR,
BUILDING
& PROJECT
CONSULTANCY,
SAVILLS
DAVID GAVIN
DIVISIONAL
DIRECTOR,
MCLAREN
CONSTRUCTION
ALISTAIR
JESPERSEN
CONSTRUCTION
DIRECTOR FOR UK,
IDI GAZELEY
STEPHEN PICKUP
HEAD OF REAL
ESTATE AND
PROPERTY
SERVICES, TNT
We’re seeing the procurement routes
changing significantly across all sectors,
and there is a lot more two-stage
tendering. I think that’s due to the
pressure on the supply chain.
In regard to changes for our business,
we’re constantly recruiting. We’ve always
tried to get the best staff we can.
Simon Barnes: The challenges, as
other people have mentioned, are
finding and keeping skilled people. We
have been looking for engineers, skilled
fabricators, skilled draughtsmen. It’s
really one of the challenges for us,
given our location in Scarborough. [We
are] trying to get people to invest
upon themselves and the business,
and keep an interest for everyone. So
it is challenging, but that’s what we
do.
Alistair Jespersen: We’ve seen
tremendous growth, especially since
spring of this year and we have changed
our platform offering from being a
trader/developer to an asset holder, so
there are lots of considerations around
that.
We’re looking at the products in far
more detail in terms of it being a long-
term hold, so the performance, the
efficiency of that building, the design,
even the sizes of those buildings, all start
to change.
Procurement/steel
SB: The Tata situation has had a lot of
negative publicity. My own take on it is
that it will affect primarily the kind of
plate market and some of the smaller
sections. I think the larger UBs and UCs
[universal beams and universal columns]
you typically see in structural steel
will still come from Tata for the
foreseeable future.
There’s a lot of price pressure from
Europe. We remain, as we have done for
the past 20-30 years, committed to
supporting Tata. We take 90% of our
steel from the company because we like
the quality. We like the delivery. We like
the reliability.
And we get a lot of efficiency because
we order things to the correct length, so
it cuts down on wastage. There are a lot
of advantages in staying with Tata, so
we’re not pressing the panic button.
In terms of the long-term view of
steel prices, it’s crystal ball-gazing: it’s
so volatile.
James Kelway: Regarding the gap
between client expectations and
suppliers, my experience is that when a
prelet deal is coming together with an
occupier, developer and an investor, we
tend to find the timeline gets pushed up
and up and up, then the deal’s done, the
transaction’s done, everybody’s happy,
ALAMY

3. 46 www.estatesgazette.com 5December2015
INDUSTRIAL TALKS
and they say, “Well, have you started on
site yet?”
Where I see real advantage is if we
are able to have more visibility with the
client organisations around the deal in a
way that can give more weeks’ notice
through procurement, allowing security
around placing early orders. That’s
what I’m challenged with at the
moment.
DG: But something will always come
up. We normally place orders... as soon
as we’re instructed. We place steel on
day one and sometimes we go to place
earlier than that, but then you’ve got the
planning issues that come up. So the
deal’s got to be that all the boxes are
ticked, that the planning’s got to be
done. It stretches out even further in
regard to the time that you can start and
sign.
JK: We try to rev the programme in a
way that the plan has progressed: get
into an initial agreement, get some
underwriting, and off you go with the
planning application which goes through
its determination. You can’t physically
start an assignment until those
pre-commencement conditions have
been discharged.
Equally, if we have more visibility or if
there’s another way round the deal that
allows us to rev up the way in which we
can procure things, it gets a commitment
earlier on. That would just help get some
of this lead-in period. That goes through
the steel work, because the steel work is
a critical part in the warehouse.
AJ: Steel procurement is stretching out
now, and it starts to impinge on the
question of how much risk we’ll be
prepared to take. I haven’t got an answer
for that. The determination of the
planning consent, for example: would
you be prepared to place an order
beforehand? This is a conundrum.
Design
AJ: We are looking at multi-level
opportunities, also the sub-divisibility
and the multi-tenanted units, and we
have task forces working on that.
KP: Certainly future flexibility and
subdivision are the things we really are
focusing on from a design point of view at
the moment. [On two of our] most recent
projects… both focused on multi-tier
mezzanines, potentially multi-occupiers,
and very much on future flexibility.
SP: From our point of view, whether
design is generic or bespoke depends
obviously on which direction the company
goes. Obviously for the market, it is the
home delivery sector that we are not
really in. I think home delivery will focus
a lot of developers on small cross-dock
warehouses, not building the 400,000
sq ft sheds.
BIM (building information modelling)
SB: With BIM, there’s some great
opportunities now with 3D software
coming through and we’re seeing our 3D
software being linked into the cloud, so
we’ve got multiple users that could be
extended to client integration,
engineering integration. We’re seeing
fantastic new fabrication machinery
coming through the system. People are
starting to develop robots that are a long
way off yet for what we do, but the
technology is coming through.
JK: It’s fantastic hearing that we’ve got
a subcontractor embracing BIM because
the future is digital. BIM will really help
us get the visualisation, collaboration and
flexibility around design in the delivery of
our buildings, which will help our
developer clients to help our occupier
clients.
SB: Especially with our more learned
customers, the likes of John
Lewis, Waitrose, TNT, it’s almost
a demand because it links into
their fit-out and facilities
management.
“One of the main challenges for us has been staff
recruitment. Resourcing and bringing new people in
is a challenge. We are constantly recruiting, not
through wastage, just in terms of growth”
FANATICSTUDIO/ALAMY