Remaining flexible and accommodating unexpected costs and challenges
As with many sectors, infrastructure projects have incurred some unexpected costs as builders and developers navigate construction of their projects through the pandemic. However, through broad government support, strong partnerships with suppliers and by adopting new work practices most projects continue to perform as expected while incurring limited cost or time overruns.
Nancarrow says where costs have been incurred, they often come in two forms. The first are those associated with simply continuing to carry out work in a pandemic-affected world - such as enforcing social distancing, increasing hygiene and taking other measures to curtail the virus's spread.
"We have never really had to consider social distancing on our projects before. Fortunately, most of our sites have vast quantities of space that allow for continued working at a distance; for any sites that have less space, we've adopted different shift patterns. One limiting factor has been in common and meeting areas, which we've addressed by offsetting breaks and through staff training."
The second and potentially greater - though rarer type of costs are those incurred when sites have been closed through government directives. Most governments around the world deemed construction sites as critical and directed construction to continue whilst mandating social distancing and providing guidance on improved work practices.
While the majority of Macquarie's development of assets has continued without significant disruption, one area being watched closely is government projects with a forecast imminent start. The RICS Global Construction Monitor showed that in Q2 2020, 25 per cent of new construction projects globally had been put on hold1. In some jurisdictions, this figure was much higher, like Singapore, where 58 per cent of projects were paused.
For Nancarrow one of the biggest challenges has been coming to terms with very different - sometimes conflicting - requirements, even in countries with similar transmission rates.
"When you operate 58 sites across 18 different countries, you need to be across a lot of detail and to be able to respond to it flexibly," Nancarrow says. "Our strong relationships with our builders, operators and our teams on the ground have allowed us to adapt quickly."