The Built Environment in a Post Covid World
Session 3 of Be Summit 2020 focused on the implications of government stimulus, new policies and regulations, and opportunities for the built environment to get back to business in a post-covid construction landscape. Explore the key insights from this session.
Our final session for Be Summit 2020 was a panel discussion led by our program MC Jamila Rizvi on the topic ‘The Built Environment in a post-Covid World’ with panelists John Held (Russell & Yellend), Frank McMahon (Multiplex Australasia) and Lee Sammartino (Cbus). If you missed the 2020 session or would simply like a recap of the discussion – here are some of the key insights.
Quick return to business or long term changes?
The discussion kicked off with talk around whether the panellists thought, in the construction industry, there would be a quick bounce-back or long term changes to recovering from the effects of COVID-19.
“As a business, we really do not think it will be business as usual, like the pre-COVID-19. We’ve been working tirelessly in the background to ensure worker social distancing and worker safety has been upheld…all this means a drop in productivity…it really hit our business.” – Frank McMahon (Multiplex Australasia)
Frank continued to emphasise that worker safety is paramount, the safety restrictions they have needed to put in place, for example, smaller workforce on-site, staggered breaks, virtual meetings – these have all cost time and put a strain on usual day-to-day business.
“I’d like to sound optimistic that by quarter 3 next year, our business working with the likes of Cbus…are gaining momentum, gaining confidence to start, commence and complete projects.” – Frank McMahon (Multiplex Australasia)
Turning to Lee Sammartino (Cbus), he recognised that the industry has experienced a setback, incomes and super contributions have been affected. But that as a company, Cbus will play a role in rebuilding the economy whilst also creating jobs for members, they are looking to contribute to the creation of around 100,00 Australian jobs throughout the recovery process. Lee also commented on the fact that post-COVID, there is an opportunity for change within the sector to focus on sustainability, efficiency and innovation in properties.
“With super being a long term gain, we’re always looking to the medium to longer-term, and that isn’t changing…the outlook is positive for cbus and its members.”- Lee Sammartino (Cbus)
Is working from home here to stay?
“40% of architects around Australia have architects working in the office…we see that 60-70% of firms will be changing work practices not just during COVID but after” – John Held (Russell & Yellend)
John continues to explain that difficulties will arise, such as BIM not being able to work effectively at home, and one of the main issues is around the collaborative nature of the front-end of the industry. How will continue to do this from a working from home environment?
“We have to think that the way we’ve been doing things in the construction industry over the last 10 – 20 years isn’t the best way of doing things and this is a shock to the system that we can do better.” – John Held (Russell & Yellend)
Much of the construction workforce is on-site, and throughout 2020 a proportion of this workforce has remained on site. However Frank (Multiplex Australasia), also adds that their head office and administrative staff have been working from home, and that aspect of their workforce and the flexibility there is likely to be accommodated in the future.
“Raising the issue of working from home is not an issue now…the systems and the way we do things will have to change now to accommodate that” – Frank McMahon (Multiplex Australasia)
Government policy initiatives and measures
From a Cbus perspective, their policy is for stability, and the context of superannuation.. “the government’s budget proposals of superannuation are very focused on fees, while fees are important, long term net returns are more important for member outcomes.” says Lee (Cbus)
Cbus is determined to assist businesses in delivering strong investment outcomes and back projects that spur employment – they want to support economic activity now and build their members’ retirement balances for the future. Lee (cbus) stated that Cbus have committed $240 million in general corporate debt to Australian businesses, and they have made the move into construction, having committed $300 million in construction projects.
On the topic of the federal budget, John (Russell & Yellend) expressed the opinion that there has been a missed opportunity for some sectors, particularly on the lower end, smaller projects which engage at a community level – such as social housing and community facilities. For example, John (Russell & Yellend) questioned the need for building more main roads when people are not commuting as much.
“I think it’s disappointing that there is very little in the sustainability and renewable energy sector…we’re not really addressing this, on a national level…A little bit of a narrow focus on apprentices and tradies but little training for the rest of the industry and there is so much requirement for upskilling across the whole of the industry in terms of new technology…” – John Held (Russell & Yellend)
“We sit here today at a really low point in relation to market confidence, we require the government to spend big to stimulate the market, to demonstrate that…Australia is open for business. The sooner that occurs the sooner we get to see a lot more confidence come back to the market….” – Frank McMahon (Multiplex Australasia)
Opportunities for the Built Environment moving forward
It seems that 2020 has certainly hit the industry hard, however, Frank (Multiplex Australasia) explained that they have found an opportunity for growth moving forward. Multiplex has recently been made preferred on Footscray Public Hospital which is a 1.5 billion project over the next four years – positive for a business not within infrastructure. These public works projects, particularly when relevant to the public state of health, this is the path Multiplex will look to continue working down.
Lee (Cbus), sees growth by Cbus with a focus on infrastructure of a local and state level that will create jobs, Cbus has the ability to be a capital provider to large projects. Lee (Cbus) also mentioned that Cbus have been looking at the social housing space for some time now, and they are a supporter of the ‘affordable bond aggregator model’.
Sustainability and renewables is a topic that kept cropping up throughout the session, Cbus has a carbon neutral certification, and also recently announced a commitment to net-zero greenhouse gas by 2050.
“A focus on sustainability is important when taking a long term approach…cost-effectiveness in the short term may not drive value in the longer term.” Lee Sammartino (Cbus)
A recent Cbus proper development, 444 Queen Street Brisbane, is the first 6-star apartment tower in Australia. Perhaps we can see more of our built environments developed with a sustainable focus, incorporating the right technologies, and similar to the Queen Street apartment tower, using building facades that captures energy from the wind and the sun.
Going forward, John (Russell & Yellend) sees moving forward as an opportunity for work to be done to get buildings up to scratch, for example, school and aged care facilities, and working on increasing the standards of the buildings we already have, especially as these already make up 40% of our energy usage.
BIM & Government funded construction projects
When asked about government-funded construction projects, particularly around BIM, in the future, John’s outlook was not positive in terms of government support, saying that the opportunity was there 10 years ago and the industry was pushing for it, but the government dithered for too long in the sector.
“Unless you have the expertise within the client group to actually know what you’re getting, you’re going to get lots of pseudo BIM…lots of disappointing results…I’d put the challenge out to clients like Lee (Cbus) to say that’s probably more where the innovation and the ability try and standardise things will come from…I despair about any federal mandate.” – John Held (Russell & Yellend)
Pivoting and procurement of products/materials
On the topic of product/material procurement John (Russell & Yellend), discussed how the reduction in ‘red tape’ over the last 15 years has caused more problems for the built environment. For example when looking at cases such as Grenfell Tower, and now the lack of confidence in buildings, why would we try and lift anything else. John (Russell & Yellend) expressed that we should be building for the long term and the future.
“For us, we need to ensure we are diversified in sector coverage, for example in areas such as health, data centres and the impact on the cloud and for those still working from home – those are the capacity for pivoting for Multiplex.” – Frank McMahon (Multiplex Australasia)
“Every sort of crisis in history has resulted in a pivot…Optimistically I would hope that some of the stuff…about how we change things, can be picked up and move much more quickly…if we can live sustainably and learn the lessons of COVID in terms of what is important to us…” – John (Russell & Yellend)
Jamila Rizvi, Author, presenter & political commentator (Be Summit MC)
John Held, Director, Russell & Yelland
Frank McMahon, Regional Director, Multiplex Australasia
Lee Sammartino, Head of Corporate Growth, Cbus