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UAE has highest percentage of ‘digital-first’ construction firms in EMEA, report says

Decarbonisation of construction projects will be an important challenge

Despite economic headwinds plaguing the global construction industry, the vast majority (89 per cent ) of construction decision makers in the UAE feel confident about the market conditions over the next 12 months, a study showed on Monday.

The ‘How We Build Now’ report was commissioned by leading construction management software provider Procore Technologies, Inc. surveying construction decision makers across the UAE.

According to the findings, confidence is backed up by the high volumes of work in the pipeline, with just under half (46 per cent ) of businesses expecting the number of projects to increase by up to 20 per cent over the next 12 months, while over a third (34 per cent ) expect it to go up by 20 per cent or more.

The research offers insight into the factors that stand to impact the growing momentum of the construction industry in the UAE. For example, the top three challenges facing decision makers are a lack of certainty/visibility on the potential pipeline of future work (26 per cent ), collecting pricing quotations from different companies in a centralised location (26 per cent ), and understanding business status in real-time to inform future business decisions and forecasts (25 per cent ). The report also found that construction companies in the UAE lose significant resources to rework with respondents stating that, on average, a quarter of a typical project’s time was spent on rework or rectifying issues.

Embodying the country’s characteristic tenacity, rather than caving into economic and industry volatility, the large majority (71 per cent ) of construction decision makers in the UAE say these pressures have instead prompted an increase in their digital transformation investment over the past three to six months, with a quarter (25 per cent ) saying it has driven a significant increase. Moreover, in the UAE, this increase appears to follow considerable investments that have already been made in technology solutions as in the country, a global high of 20 per cent of respondents described themselves as digital-first businesses. Among the main technologies used by regional construction firms are construction management platforms (38 per cent ), Artificial Intelligence and Machine Learning (38 per cent ), drones (40 per cent ) and Internet of Things (48 per cent ).

“With the real-estate boom in the UAE, and the impressive number of iconic mega projects now underway in the country, construction firms are presented with an unparalleled opportunity. Recognising that these projects are not without their pressures and challenges, companies are increasingly turning to technology to enable them to capitalise on these opportunities, achieve profitability, and deliver projects on time,” said Mohamed Swidan, Head of the Middle East & North Africa at Procore. “For those firms (40 per cent ) just starting out on their digital transformation journey, the impetus is there to unlock the true potential of digital construction.”

Sustainability a top priority

Following the success of COP27 in Egypt last year, and with the upcoming edition of the conference set to take place in the UAE in the last quarter of 2023, sustainability has been a key theme for the country’s governments and businesses. This is perhaps why Procore’s report found the UAE to be the most globally aware of the challenges pertaining to sustainability with 94 per cent of respondents in the country saying decarbonisation of construction projects will be an important challenge within the next 3 years.

But firms in the UAE are not only recognising the challenge – they are also rising to address it. At present, over a third (36 per cent ) already follow the ISO 14001 — environmental management system standard, and a further 46 per cent intend to become compliant within the next 12 months.

“UAE construction decision makers understand the vital role of data in enhancing decision-making, visibility, security, and client satisfaction, as well as promoting sustainability. The continued investments in digital transformation not only enhance the industry’s efficiency and financial performance in the present, but also equip it with the capability to adapt to unforeseen challenges and meet future expectations,” concluded Swidan.