Rising to a Challenge: How BESIX Watpac Topped Australia’s Builders

BESIX Watpac is a company that likes a challenge. The construction and engineering company topped the BCI Construction League for 2024 with total projects commenced in the year valued at $3.4 billion—and the more complex the project the better, says BESIX Watpac chief executive Mark Baker. “It’s about identifying projects where we can bring value, which means in a practical sense those projects that demonstrate a more complex engineering side, either through structure or services,” Baker says. Sector agnostic One of its show-stopper projects currently under way is the $638-million One New Zealand Stadium ( pictured top ), its first job across the ditch. “Stadiums are very complex from a structural engineering point of view, but also integration of the services and user experience,” Baker says. “And I don’t want to pick favourites, but it’s absolutely special. It’s a fully enclosed stadium, so it doesn’t have a retractable roof. “It’s in an earthquake-prone zone, so it required super complex engineering, both in final state and in temporary works engineering, so if there was an earthquake during construction, the structure could withstand it.” ▲ BESIX Watpac chief executive Mark Baker: Eyeing Brisbane Games contracts. It is one of 55 stadiums and venues worth $8.5 billion the company has built globally, putting it in a good position for contracts for the Olympics in the Queensland capital in seven years. “We’re lining up for a number of the venues associated with the Brisbane 2032 Olympics and Paralympic Games and we’d be absolutely keen to do that,” Baker says. But BESIX Watpac casts its net wide, taking on projects as diverse as Sydney’s ferry wharf upgrades, a youth detention centre at Woodford, Queensland and supermarket distribution centres, including Woolworths’ 93,000sq m Eastern Creek site in NSW. “The Woolworths project is enormously complex, it’s the ... largest in the southern hemisphere; I don’t think that they’ll build one of these again anytime soon. “The actual structure itself is mind boggling, it’s about 15,000 tonnes of steel and [is] temperature controlled ... across the entire facility.” Construction sector challenges But despite BESIX Watpac’s success, the issues of the sector are never far from mind. “The construction industry in general is not a really well-functioning sector, there can be low margins, high risk, and we’ve seen lots of insolvencies,” Baker says. “So for us, it’s about making sure that when we’re doing a project, we’re doing it for the right reasons.” ▲ BESIX Watpac is working on The Moore Park Precinct Village project next to the Sydney Cricket Ground and Allianz Stadium in NSW. Delays thanks to weather conditions, union negotiations and navigating subcontractor relationships have all presented significant challenges to the sector. “Post Covid, everyone has seen lots of project delays. And I feel for subcontractors who are saying ... I’ve got a 50-person workforce that was supposed to start on this project in September and you’re telling me it won’t start for another six months,” Baker says. “Our team needs to be thinking about how the project comes together and, if we’ve got a delay in procurement of a specialised bit of equipment, or the structural steel for this part hasn’t arrived on time, how do we re-sequence things and ensure that the building works continue on program. “It’s about [working] with our subcontractors in a way that makes them successful, which makes us successful. It’s a real team effort.” Culture Labour shortages are often cited as the major issue facing the construction industry, so attracting and retaining staff has been a key element of BESIX Watpac’s strategy. “We spend a lot of time on culture, and I know that a lot of organisations talk about that, but having people in the business who really do live and breathe values of excellence, co-creation, respect, passion and unity is important,” Baker says. “And that doesn’t mean you can’t have a bad day. That’s human nature. But we want people to come into our business and feel empowered. ▲ A rendering of Project Banksia, a flu vaccine development facility the company is building. “We’re very much a flat structure as well. I’m all about giving people authority to make decisions because in construction, making important decisions after appropriate consideration, but in a timely manner, is very important because it moves at such a fast pace.” Despite cost woes, the sector is comparatively strong, Baker says. “Having global operations, I can tell you the Australian industry is very, very good. Our people, our construction workforce and skills are fantastic. They’re world class. “There’s nothing that anyone else in the world is doing that we are not able to do as an industry. We’ve got a very mature, great construction workforce. “We just need a few of those pieces of the puzzle to work a little bit better together. But we are, I think, best in class. We just need to not be the most expensive in class.” Reducing admin crucial Productivity is, Baker says, is “about having the right amount of people on projects, particularly at the administration level. At the moment, both client side and our side, we’ve got lots of people doing lots of admin and I don’t think necessarily for the right reasons. “If we can resolve issues, get on and deal with things quicker, we shorten up programs, which means the costs are reduced ... productivity is enhanced and the purse strings go a little bit further as far as the ability to deliver more and more projects are concerned.” “If the project timeline is shorter, then you’re saving money on labour costs.” ▲ The firm began work on the Woodford detention centre last year. The industry has been criticised for its high wages, but Baker is not among those critics. “We’re not talking about reducing the cost of construction by reducing wages, because I would not ever be an advocate for that. “People in construction work bloody hard, and they should get paid very well. It’s a tough job, and they deserve it.” While innovative solutions to cutting down build times, such as prefabrication and modular building, are being touted, it’s not necessarily achievable by the industry as is, he says. “It would be a struggle to find a building company that has the financial bandwidth to actually invest in what’s traditionally considered R&amp;D,” Baker says. But there are other ways to position the industry for growth in the future, namely managing cash flows and changing the way some projects are structured in terms of risk, according to Baker. ▲ Data centres are a growing sector—BESIX Watpac has delivered one such project at Port Melbourne. “Every job is different, and sometimes a fixed-price lump-sum project is appropriate because it’s simple and that’s how it should be procured,” Baker says. “But in the context of the project and what the risks are, having an appropriate allocation of risk between client, consultant and contractor, is really, really important. And what we’ve found in years gone by, is that it’s probably not been like that. “Thankfully, it’s starting to change.” Looking ahead, BESIX Watpac, as well as moving into New Zealand, is turning its eye to future growth in health and data centres across the eastern seaboard, as well as South Australia and the ACT. But growth is rarely uncomplicated and linear, Baker says. “You have to be adaptable. You have to make sure that you’re able to be flexible in your approach.”

Rising to a Challenge: How BESIX Watpac Topped Australia’s Builders

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