Wednesday, June 25, 2014

Agenda Constructiilor: OCTAGON- Geotechnical works worth over 6.5 million euro in Romania

Octagon Contracting & Engineering, one of the main players in the geotechnical constructions field in Romania, with a turnover worth 19.6 million euro in 2013, is currently working on national projects amounting to around 6.5 million euro.

Alexandros Ignatiadis
For 2014 the company’s management has estimated a 16 million euro turnover. "In the first half of this year we started works on three new projects.  In March we began executing the superstructure of building B within the office project Green Court Bucharest, developed by Swedish group Skanska on Herastrau Street, in the Capital. The works are worth 1.9 million euro. We also delivered the first building within the same complex.A project begun last autumn, on which we are still working, is an office building, PC Business Center, located on 7-9 A Bucharest - Ploiesti National Road, a 1.7 million euro contract", said Alexandros Ignatiadis, co-founder and shareholder of Octagon C&E. The company also continued to work on the rehabilitation of the National Road 6 (Domasnea - Caransebes, km 408+ 895 - 449+ 960), an investment started in 2011. The total value of the works performed within this project is almost one million euro. "We have two new infrastructure projects. One of them consists in the rehabilitation of the railway Brasov - Simeria, Coslariu – Sighisoara section, Micasasa – Coslariu segment, worth 260,000 euro. We have been subcontracted by Aktor for this project. Our most recent project consists in the execution of bored piles for sections A, D and E of the second section of Lugoj – Deva highway, a 5 million lei contract (around 1.13 million euro), granted by the general contractor Salini Impregilo", Octagon manager also said.
The company will start in the near future the geotechnical works on the underground passage from Piata Presei Libere in Bucharest. The general contractor of the project is Apolodor and the value of Octagon’s contract is 600,000 euro.

Expansion of the activity on Iraq and Kurdistan markets
Octagon is also performing construction works abroad, in Iraq and Kurdistan markets. This year the company will consolidate the activity of Iraq branch (open since 2011) and will continue works on 125MW Shatt Al Basra Power Plant, from Basra and of the residential complex Iraq Gate, developed by Iraqi investor Almco in Baghdad. Octagon is also in the negotiation stage for the construction of Bawanur dam din Kurdistan, a project worth 5 million dollars, bid in partnership with Hidroconstructia SA.

Negative conditions to maintain on the Romanian construction market
According to Alexandros Ignatiadis, 2014 will not be very different from 2013. "In the first trimester the sector contracted 3%, while the GDP went up by 3.8%, so the construction sector was not a growth engine for the economy. The private sector was revived by the construction of two malls in Bucharest and of several factories countrywide, but these investments have not generated profit yet. These results, combined with the activity decline in the public sector have led to the 3% contraction of the construction sector", showed Octagon manager. At the same time the elections have not influenced the construction sector positively either, due to political instability. "During the elections a large part of the investments for constructions are redirected towards public sectors that can generate votes, such as social protection, to influence the electorate", explained Alexandros Ignatiadis.

At the same time, according to the manager, the new public bid rules have not solved the major issues in the area. "Maintaining the lowest price as main criteria to determine the winner of a contract can significantly affect the quality of the delivered projects. A more detailed approach and deep changes in this respect are needed.” said Octagon shareholder.

You can read the romanian version of the article here.

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