Paul McNeive: 'Fire regulations & Brexit are issues for busy market'
The right moves
If the industrial property market is the barometer of the economy, then there is no better guide to the property market than companies servicing architects and contractors, in advance of new projects. KCC Architectural is a leading provider of architectural products and the activities of the company provide an interesting view of changes in the market.
I met David Skelly, KCC's business development director, to hear about trends in the industry.
KCC Architectural was established in 1998 following a management buy-out from the Ingersoll Rand Group. The company originally specialised in providing doors and ironmongery and in 2005 added a focus on fire and security-locking systems. This grew into providing facades, e.g. glazing systems on external walls, and internal partitioning, through bases in Dublin, Cork and Belfast.
The property crash affected the company badly in 2010 and KCC diversified into new markets, establishing bases in London and Doha, Qatar. These proved very successful initiatives with the firm providing architectural glazing systems to The Imperial War Museum and winning awards for work at King's Hospital and the Damien Hirst art gallery.
The firm subsequently moved their Middle Eastern headquarters to Dubai and now services the UK market from Ireland.
The company saw a strong improvement in business from 2016 and is now involved in a range of major projects. For example, KCC provided the highly-specialised security access systems for the Central Bank's new headquarters in the Dublin Docklands, as well some of the fire-rated glazing. The Docklands is an especially strong location for them and KCC is also involved in the Dublin Landings, Spencer Dock and Capital Dock schemes.
A particularly interesting project for the firm is the installation of custom-designed windows at the new ESB headquarters on Lower Fitzwilliam Street, Dublin 2, which they designed with Grafton Architects, "in sympathy" with the Georgian streetscape.
The firm specialises in providing fire-resistant products and David Skelly told me that the advent of the Building Control (Amendment) Regulations in 2014 had "caused chaos" in the industry, with the introduction of onerous requirements on designers, contractors, and certified assignee to provide a chain of certificates of compliance. KCC responded to this by introducing their '360' solution, which is a service providing building designers with a package of design solutions, full technical specifications and procurement advice in advance, and fire safety certification support.
Brexit is becoming a big issue for the construction industry, and Skelly is hearing more and more about building owners and designers questioning the reliability of supply of building components manufactured in the UK, or transported through the UK. As a result, KCC are working closely with their suppliers on supply routes and believe that their Belfast presence may assist them.
Whilst building cost inflation has been running at approximately 8pc per annum, David Skelly estimates that the cost of glazing systems has risen by between 10 and 12 pc each year since 2016. This is largely, he told me, due to a lack of capacity in the industry, with the recession having "wiped out a whole level of expertise" due to a cohort of specialists having emigrated.
"There's a big-gap now between the most experienced people at the top, and the new recruits," he said. This lack of capacity extends into the architectural practices too. "The information is slower now, in coming down to the contractors," he says.
Nonetheless, Skelly says that the market remains extremely competitive. "Every job is tendered for and there are always four or five people tendering against us. But KCC say they are not engaging in "a race to the bottom" and that a lot of work is negotiated and won through relationships with architects. "They know us and they trust us," he told me. David Skelly sees the market remaining strong for the next four to five years, before an inevitable turn. "But the architects know that we will still be here after that," he says.