The Al-Jaber Group has come a long way since its chairman, Obeid Al-Jaber, decided to form a construction company in 1970. At that time, Abu Dhabi had begun to spend its first oil revenues and develop the city into what it is today.

“In those days, there were a lot of projects,” says Fatima Al-Jaber, chief operating officer (COO). “Sheikh Zayed wanted to turn Abu Dhabi into a modern city and a lot of work was given to contractors then. After that, there were more roads and houses as new suburbs were developed around the city.”

Structure

The company has headquarters in the Mussafah industrial area and is wholly owned by Obeid al-Jaber, who this year bought out the firm’s partners as part of a restructuring. The company is financially strong and intends to remain family-controlled.

“We are not talking about an IPO [initial public offering],” says Al-Jaber. “It is not an issue now and is not on the table.”

Although there are many local construction companies, Al-Jaber claims to be the original Abu Dhabi contractor. “We are pioneers in the construction industry and this is due to the vision of our chairman,” says the COO. “He built the company around construction because he was convinced that it was the industry to grow with. Today, there are many companies growing like us, but we were the first.”

Operations

Although the company has diversified over the past 15 years, contracting remains its core business. It has traditionally specialised in road and infrastructure projects and low-rise construction, but this is changing.

In 1999, the company formed a joint venture with South African contractor Grinaker-LTA to focus on major projects in the rapidly growing building sector. It completed schemes such as the Mina al-Salam hotel and the Madinat souk before Al-Jaber bought out Grinaker’s stake in the company and turned it into a wholly owned subsidiary, Alec.

“We envisaged growth in that field [high-quality, large-scale buildings],” says Al-Jaber. “We are one of the leading contractors for horizontal construction, but it needed expertise for more complex projects.”

This expertise, provided through Alec, is now being used for several major projects in Dubai and Abu Dhabi, including Mirdif City Centre, Qasr al-Sarab and Marina Mall. It has become one of the largest building contractors in the emirate.

The firm has used a range of other joint ventures to deliver projects. For the runway package at Abu Dhabi International Airport, Al-Jaber is working with Brazil’s Odebrecht, and in 2006 it bid for the Saadiyat bridge contract in a joint venture with South Korea’s Samsung Corporation.

Ambitions

As one of the largest contractors in Abu Dhabi, the company is well placed to capitalise on the large number of megaprojects that are planned in the emirate over the next 10-15 years.

It was the first contractor to work on the $27.2bn Saadiyat Island project when it was awarded the earth-moving contract in 2006, and it is working on marine works for the $14.7bn Al-Raha Beach development.

Besides real estate, it has installed infrastructure for new industrial cities in Mussafah and Al-Ain, and was recently awarded the contract for the reconstruction of the Mafraq interchange. “We will definitely be busy for the next five years, simply because of the projects that are under way in Abu Dhabi,” says Al-Jaber. “This is great for the industry, but it puts you in a situation where you have to be careful who you work with because labour, materials and staff are limited.”

Like other contracting companies, Al-Jaber is trying to improve its supply chain by devel-oping vertical companies to provide the contracting division with basic materials. Concrete is the obvious place to start.

“We have established our own ready-mix concrete company called Extramix and it is growing well,” says Al-Jaber. “We are thinking of expanding into precast.”

Other products can be produced by the firm’s factories (see box), which include aluminium extrusion plants and steel fabrication yards.

Although there are opportunities overseas - the company has a strong presence in Qatar, for example - it will focus on the domestic market. “What is happening in the emirates means we need to focus on expanding internally,” says Al-Jaber.

MEED assessment

The name Al-Jaber is synonymous with construction in Abu Dhabi. It has worked on almost all major projects in the emirate over the past 30 years, and with vast resources and a proven track record it will continue this trend.

Its roads and infrastructure business should benefit from opportunities with road projects such as the Abu Dhabi to Ghweifat Highway, the proposed Desert Highway linking Dubai and Abu Dhabi and, in the long term, the Abu Dhabi light-rail scheme and the inter-emirates rail network.

Through Alec, it should also play a leading role in the building sector. Currently, the majority of Alec’s work is in Dubai, but as development in Abu Dhabi moves to the next stage, it will expand further into the emirate.

Operationally, the main challenge is to secure enough resources, primarily labour, to allow it to maximise the opportunities available to it.

Another possible issue is Abu Dhabi’s growing reliance on all-encompassing partnering agreements for its projects. Local developer Aldar Properties has formed a joint venture with the UK’s Laing O’Rourke for Al-Raha Beach, and is in talks with Belgium’s Besix for a similar agreement for the Ferrari World theme park on Yas Island. Australia’s Gulf Leighton, meanwhile, has signed a partnership agreement with the Tourism Development & Investment Company for Saadiyat island.

Although Al-Jaber will be able to work as a sub-contractor on these projects, they could reduce the volume of opportunities available to local companies.