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Saudi project win caps record year

1 February 2024

 

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US-based project management firm Hill International ended 2023 on a high with a major contract win in Saudi Arabia.

In a joint venture with Italy’s Italferr and Spain’s Sener, the firm was awarded the contract to provide project management services for the Saudi Landbridge. The estimated $7bn railway project will connect the east and west coasts of the kingdom and is one of the region’s largest infrastructure schemes.

For Hill International’s CEO Raouf Ghali (pictured), the award confirms Saudi Arabia’s position as one of the world’s most important and exciting construction markets.

“There’s no doubt that Saudi Arabia is going to be the largest single market in the construction industry, outside of the US,” he says. “The scale of the projects they have is unbelievable.”

The Landbridge award came at the end of a year that Ghali says went exceptionally well for Hill after it completed its merger in December 2022 with US-based engineering and construction services group GISI.

“The merger gave us what we were expecting. It gave us a much stronger balance sheet and the cash we needed for investment,” he says.

“It allowed us to stay independent, but also be part of an organisation with $13bn of revenue and 12,000 people. So we can claim the strength that some of our competitors can, but also remain the only global independent project management construction management firm.”

Gulf performance

The Middle East played a significant role in Hill’s success in 2023. “We did a record high in 2023 with close to $600m in consulting fee revenue. The Middle East is about $200m, and North Africa is probably around $100m. The Middle East came in strong, mainly with Saudi Arabia and Abu Dhabi,” says Ghali.

The outlook for 2024 is also positive. “It is going to be more of the same,” he says. “For us as a company, we’re going to grow in the US. At the end of the day, the largest market in the world is the US market. With the trillions that are coming down for infrastructure, we will be growing the US market a lot.”

A strongly performing market in the US has implications for the Middle East as it will mean US-based people will be less likely to work in the region.

“When the construction industry in the US is booming, it’s very difficult to lure people out of the US.

“We have some of our internal people who are willing to move, and we use those, but we also augment them with a lot of Western Europeans and people from Asia Pacific – from places like Hong Kong and Singapore, where we have a great deal of accessibility now because of GISI. They have a big organisation that we can tap into,” says Ghali.

He adds that the UK is another potential source of people. “In the UK, construction is not exactly booming, so there are resources from the UK that we’re tapping into.”

There are also people in the region. Over the past decade, Hill has worked extensively on major projects such as the Grand Egyptian Museum and the Cairo Monorail. Ghali expects Egyptians to play a key role in delivering projects in Saudi Arabia.

“There is a lot of acquired know-how and lessons learned that we can move to the Landbridge and other projects,” he says.

“Egypt was a great market over the past five to eight years and they have megaprojects there that have never been seen in Egypt before.

“Given the current environment in Egypt, I am not so sure that there is going to be as many new projects released in the future, and I can understand that because they have to get the economy correct first,” he adds.

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Colin Foreman

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