Interview with a Chief - Leading the way in the natural and built environment

Arcadis has a long and rich history, tracing its roots back to the Netherlands in 1888. Nowadays, it is a global Design & Consultancy firm for natural and built assets, with offices in Hong Kong since 1949.We spoke with Francis Au, Head of Cost & Commercial Management,Greater Bay Area (GBA) at Arcadis about e-commerce, their main Hong Kong projects and the GBA.

By Zuba Adham-Bos

Please tell us a bit about yourself and what you do at Arcadis
I have studied in the United Kingdom and joined Arcadis after I returned to Hong Kong. Over the past few years, my role has changed a few times. Two years ago I was leading the Hong Kong business of Arcadis, which covers quantity surveying, project management, business advisory and design engineering. We provide consultancy services to different types of clients; from banks like HSBC, Hang Seng Bank and UBS, to public sectors including the Development Bureau, Architectural Services Department, Highway Department, CEDD and MTR. We serve most commercial developers in Hong Kong as well, such as Sun Hung Kai, New World, CK Hutchison, Henderson Land Development and Wheelock. In 2020, my role changed to Head of Cost and Commercial Management of the Greater Bay Area. We look after construction costs and commercial advice to our clients.

What sets Arcadis apart from other companies in your industry?
I think there are several parts to this. One is the long history of Arcadis in the Netherlands and globally. The company has more than 130 years of history. Our Cost and Commercial Management business has more than 85 years of history in Asia. We started in Singapore and expanded into Hong Kong in 1949. We are the oldest Cost and Commercial Quantity Surveying company in the region.

The other advantage of Arcadis in Asia is the scale of the company. We are a pioneer Cost and Commercial Management business in Asia with more than 2000 people in Asia in this department. Lastly, our track record, large database of projects and quality of service have made us one of the top consultancies and leaders in the professional field. We have invested in digital and looking for innovative ways to delivery our services. Our business is BIM ready.

What is the impact of e-commerce on the natural and built environment?
Right now, there is not a large impact and we are not directly involved with e-commerce. However, we do work on projects related to e-commerce, for example, we are working on several projects for Alibaba.They are planning investments in digital infrastructure related to digital logistics, digital e-commerce, and cloud computing. Arcadis has partnered with Alibaba for over four years, delivering cost and commercial management services across their project sites.

Some of our clients use e-tender platforms and within our Cost and Commercial Management business, we are also developing our own e-tender platform, called L-10.That way, companies overseas can also respond to tenders.

Will e-commerce change Arcadis' work?
Because of the scale of our projects, we are currently not using e-commerce that much. For example, for each project we may use between a few hundred to ten thousands tonnes of reinforcement. This is not something you can source online via e-commerce. But I think in the future, we will use more e-plaforms for searches, communication and finalising deals. 

Another hurdle in e-commerce for the construction industry is the concern of quality. I think people will tend to work with people and companies they are familiar with, to make sure they deliver the right quality they are looking for. So at the moment, e-commerce is not used much, but I believe in the future it will be something we can’t avoid.

What are the main projects Arcadis is working on in Hong Kong at the moment?
Currently, we work a lot on Chek Lap Kok; we are working on the third runway concourse for the airport, SkyCity and a logistics centre. For the third runway system, the reclamation has been completed, which is a major milestone of the project. One of the major projects of our Design Engineering department isTrunk Road T2, connecting the Central Kowloon Route and Tseung Kwan O. Another project is an integrated waste management facility, involving incinerators and reclamations barges.

We have experienced some delays in early 2020, because of the lockdown in China. For almost six weeks, we didn’t have sufficient materials and labourers. Some of the labourers went to China for Chinese New Year and were not able to come back due to the lockdown in China. But for the last nine months, our operations have gone back to close to normal. For the coming Chinese New Year, we expect another delay due to the quarantine measures. Usually, we count on a two-week stop around CNY, but this year we are counting on five weeks.

What does the Greater Bay Area mean for your industry?
The Greater Bay Area (GBA) is familiar to us – we started working in China in 1985 and we have offices in Macao, Guangzhou, Shenzhen, Foshan and Zhuhai. We also have projects in Jiang men, Huizhou and other cities in the GBA. We work closely with technology companies in the GBA, such as Tencent,ByteDance and Alibaba.

We think the GBA is a huge opportunity and although the initiative is moving forward, the development pace is not as fast as we expected. However, we’re also seeing expansions into the west coast of the Pearl River Delta. Currently, the transportation to go there is not so convenient – it may take you almost two hours to go from Shenzhen to Zhuhai or Zhongshan. But when the bridge link between them is finished, which is expected in 2023/24, the whole area will rapidly change. I hope the COVID vaccine will be successful, so we can open up more to these areas.

Which trends do you expect to see in your industry in the next five years?
Besides the e-tender platforms and a move towards e-commerce, I think we will continue to see more acquisitions. There is a global trend for M&A in the consultancy business. There will be more GBA-related initiatives and more collaborations between the two SARs (Macao and Hong Kong) with their Chinese counterpart.We see that this is becoming a trend as developers from Hong Kong and Macao are going to invest in southern China, as well as the other way around. I expect there will be more joint venture developments in the future. Innovation is always on people’s minds, both on the technology and digital side, but also in the way we deliver business.I think working from home will have a huge impact on future developments. E-commerce will impact how shopping arcades will be planned in the future. And we are looking into smartcities,smartbuildings,how to protectourenvironment, how to be more agile, digitization and sustainability – which are all very exciting. Companies will invest on digitisation and sustainability. This is top of our agenda.

Is there anything else you would like to share with our readers?
I hope that everyone, no matter if they’re in the GBA or in other parts of the world, will be more open-minded to accept changes we have seen recently around the world and to unexpected changes in the next few years. I think people are calling this the fourth industrial revolution, so that will change a lot in the whole ecosystem.