12 May 2006

The appointment in mid-April of a Hill International-led joint venture as project manager on the $2,700 million Shams Abu Dhabi project on Reem Island is the latest in a string of major projects in the Gulf to be managed by the US construction manager.

In the 21 years since the New Jersey-based firm opened its first office in the region, Hill has established itself as a major player in the region's construction sector, providing construction management and consulting services on major projects across the region, including the $3,100 million Palm Jumeirah in Dubai, where it is project manager, the $2,700 million Bahrain Financial Harbour, on which it is programme manager, and the $4,100 million expansion of Dubai International Airport, where the company is claims consultant.

Hill was established in the US in 1976 by chairman and chief executive officer Irvin Richter to provide claims consultancy services to US construction clients. Over the following three decades, Richter built Hill into one of the world's biggest construction management firms, employing more than 900 people in 25 offices and providing construction management on more than 1,000 projects worth about $100,000 million.

The Middle East has been a significant part of the Hill story, with the Gulf construction boom underpinning a 33 per cent rise in revenues in 2005 to about $112 million from about $84 million in 2004. The company also delivered a $3.1 million profit in 2005, up from a $400,000 loss the previous year. Construction and project management services in the Middle East accounted for about $24 million of 2005 revenues with claims consultancy providing a further $3 million.

'The Middle East is a very big part of our business,' says Richter. 'Five years ago, the Middle East represented only about 5 per cent of our global business. Today it accounts for more than 30 per cent of our global revenues, all in the building sector.' The company founder believes that Hill is perfectly positioned for further strong growth in the region. 'The Gulf construction market has moved faster than the region's infrastructure can keep up, both human and physical,' he says. 'It is difficult to find the quality of people needed to deliver the quality of projects planned in the region. And the many newcomers to the region bring many risks. Many don't understand the rules. It is still a minor claims market. The key is to deliver on time and budget and not to make claims - to fix the problem not the blame. But many will not understand this.'

With so many cutting-edge projects such as the Palm Jumeirah under way, Richter thinks it is inevitable that there will be difficulties. 'When you have new technologies on projects such as these, there will be hiccups,' he says. 'The key is to have the organisation in place to deal with it. It is a question of mitigating against the unknown.'

Hill operations in the region began in 1985 when it opened an office in Abu Dhabito support work it was doing for Abu Dhabi Public Works Department. 'We were involved in claims and dispute resolution,' says Hill International president and chief operating officer David Richter. 'Then we branched into project management. Today, nearly 85 per cent of the company's business is in project management.'

From its Abu Dhabi base, Hill expanded across the region providing construction management expertise for public sector clients such as Abu Dhabi Oil Refining Company (Takreer), Dubai Municipality, Saudi Consolidated Electric Company and the Kuwait Ministry of Public Works. And more recently to a growing number of major private sector real estate developers such as Dubai's Nakheel or Bahrain Financial Harbour.

Today it operates out of six offices in the region, in Iraq, UAE, Qatar, Bahrain and Kuwait.

Throughout its 30-year history, Hill has remained under the control of the Richter family. Irvin Richter remains at the helm, while his son

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