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Jun 23, 2008:
THE Green Building Council of SA, which has attracted 20 paying members including several high-profile property players, will launch a pilot “green star” rating system for offices next month for public comment.
Executive chairman Bruce Kerswill says the rating system, based on the system used by the Green Building Council of Australia, will be implemented by October. The system will be used to rate buildings in various categories and award them stars according to how “green” a building is.
Kerswill says the rating system is aimed at the upper end of the market in the hope that these players will “pull the rest of the market” along with them. The council was established in September last year as a voluntary body to promote green building programmes, technologies, design practices and operations, and innovation in sustainable building practices.
The FNB Civil Construction Confidence Index, compiled by the BER, dropped from a level of 76 in the first quarter of 2008 to an index value of 71 in the second quarter.
Cees Bruggemans, chief economist of First National Bank, said that overall business conditions remain favourable in the civil construction industry.
He indicated however that although the larger construction companies participating in mega contracts such as the Gautrain, Sanral road building projects, Eskom and Transnet capital expansions remain upbeat about current business conditions, other participants to the survey indicated that a number of factors were tempering their optimism.
The factors included the sharp slowdown in residential township development work; political infighting in the Western Cape constraining the flow of new work; weak capacity at the local government level and slow payment by public sector departments and municipalities, which often leads to severe cash flow problems; and consequent financial stress being experienced by civil contractors.
According to Bruggemans, the growth in civil construction activity during 2Q2008 turned out below the expectations of respondents.
"The weaker demand conditions experienced by respondents resulted in an intensification of tendering competition for new work, with the result that gross margins took a knock, which in turn had a sizeable negative impact on the overall profitability of survey respondents," he said.
As a result of the moderation in construction activity, the growth in employment slowed down. Nevertheless, the availability of skilled labour remained a major headache and acted as a major constraining factor hampering the construction activity of contractors, he noted.
Looking ahead, Bruggemans said the survey respondents expected business conditions to remain stable in the third quarter.
