Foreign firms target public builds

29/06/2015 - 10:37

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Despite the economic slowdown, Perth’s public infrastructure program is providing an opportunity for newcomers in the market to gain a beachhead.

Foreign firms target public builds
COSMOPOLITAN: Noel Perez-Falcon is bullish about the team assembled to build the new museum project.

Despite the economic slowdown, Perth’s public infrastructure program is providing an opportunity for newcomers in the market to gain a beachhead. 

A growing band of international players is competing with local companies for big public construction contracts, bringing impressive resumes and major project experience to the contest.

Spanish multinationals Acciona, Tecnicas Reunidas, and Ferrovial Agroman are leading the charge, while Salini Impregilo and BAM International, from Italy and the Netherlands respectively, are also gaining a toehold.

Some have opted to build alliances with local players, such as Tecnicas and Salini, while others have built experience through work in the resources sector, such as BAM, which has previously partnered with Clough.

Chinese interests have bought into the market, too, through the acquisition of John Holland.

While the state has drawn attention as a growth economy in the past decade, some players have opted to make moves now while the economy is off the boil, to secure a place for the future.

The upcoming wave of public works has given them the opportunity to do so.

Strategies to stake a claim in the Western Australian market are diverse, and particularly important for companies that might have a soft market in Europe.

Tecnicas managing director (Australia) Noel Perez-Falcon said the company had bid for the new WA Museum contract in the hope it could create a design that would promote Perth internationally as a cosmopolitan city.

He said the company would pursue one or two projects that required innovation, rather than undertaking a larger number of projects, and touted the benefits of the company’s alliance with Doric for the project, which includes high-profile international architect Jean Nouvel.

“Along with the Australian partners, we have this very interesting multicultural team … each one can bring their own previous experience,” Mr Perez-Falcon said.

He said Perth-based Doric would bring local knowledge to the project, while Mr Nouvel has designed the Louvre Abu Dhabi and Quai Branly Museum in Paris.

That museum features the largest permanent exhibition of Aboriginal art outside Australia.

Mr Perez-Falcon said Mr Nouvel had developed a relationship with members of the WA indigenous community, which could contribute to his design of the museum.

This project isn’t the first foray by Tecnicas into the WA market, with the company having built the $1.4 billion Southern Seawater Desalination Plant at Binningup, and won the contract to build the Burrup Ammonium Nitrate plant.

It now has a 25-year contract for operations at the desalination facility.

Mr Perez-Falcon said Tecnicas would be looking to do work overseas with Doric, as it has started to do with Valoriza Agua, a partner from the desalination plant.

Local and global

Perth’s development had attracted international companies, Mr Perez-Falcon said, bringing expertise that would ultimately ensure a better end product for the state.

However, although the project would be international, the Australian component was a huge part, he said.

Mr Perez-Falcon said the company would target a high rate of local content, noting the success of that strategy at the desalination plant.

Making tracks

Each of the three consortia short-listed for the complex $2 billion Forrestfield-Airport Rail Link has overseas links.

NRW Holdings has joined up with Salini, which entered the Australian market in 2012 to work on Sydney’s north-west rail link, while the now Chinese-owned John Holland teamed with former stable mate, Leighton Contractors.

A European trio comprising Acciona, BAM and Ferrovial has put its hand up as the third group.

Two further groups, both with international links, expressed interest and did not proceed to the short-list stage.

Acciona director of development Australia and South-East Asia, Nick Wall, said the company brought tunnelling experience, including through the recent Legacy Way project in Brisbane.

Mr Wall said Acciona had expressed an interest in some mining opportunities in the past but had had more success in public infrastructure on the east coast.

“There is (now) a bit more focus on public infrastructure in WA as a result of the cooling down of the resources sector,” he said.

“It’s a very good market for contractors who are interested in doing large construction projects.”

Mr Wall said Acciona had also considered, and decided against, bidding for the Perth Freight Link, which could include tunnelling.

Acciona has previously worked on the $300 million Mundaring Water Treatment Plant, which it now operates as part of a consortium.

By contrast, alliance partner BAM has been active in Australia for more than 50 years, including in a joint venture with Clough.

The business alliance had focused on marine facilities connected to resources projects, including the Wheatstone project loading facility and the Cape Lambert iron ore marine facility.

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