Company Report: Adamson Nielsen Construction (Pty) Ltd
Opporunity in strife Construction in South Africa is tough at the moment, but some are doing better than others. Construction Digital talks to Rod Nielsen and Phillip Kypuros of Adamson Nielsen Construction (Pty) Ltd to find out more

Adamson Nielsen Construction was established in 1984

The company has diversified over the years and has added a d

South Africa has undergone huge development in the past deca

South Africa has undergone huge development in the past decade. This is, of course, because there was plenty to do and lots of funding to support it. However, a once full pipeline of work, particularly in the commercial and residential parts of the industry, has dried up fast, and firms have been left struggling. Only those on Government-backed contracts have work, it seems.

However, that’s not the whole story; those that are smart, like Adamson Nielsen Construction, are finding new niches and are actually performing quite well, all things considered.

“Adamson Nielsen Construction is well-known in the South African construction industry, involved in building construction ranging from residential, commercial and industrial, to property development,” says Rod Nielsen, the Managing Director and co-founder of the Sandton-based firm. “South Africa was once one of the fastest growing commercial and residential property markets in the world,” he adds. “Residential sales were extremely high a couple of years ago, as an economy full of optimism looked to grow.

“However, the global economic crisis has thrown a spanner in the works, with South Africa struggling with the global downturn.”

He continues: “In general terms, 2008 and 2009 were totally different from the previous years. The housing market completely collapsed, it was a real crisis. It was dog-eat-dog and the banks stopped lending.” Commercial and industrial construction, as a result, has seen a huge decline, Nielsen stresses. “The effects of the down economy are everywhere — commercial construction has slowed massively,” he says.

That said, Adamson Nielsen Construction has still had its lion’s share of commercial work, including the Alex Junction Shopping Centre, a 50,000 square metre building in Alexandra, Johannesburg, worth R180 million, and the Noordheuwel Shopping Centre refurbishment. It has also just completed the flagship Holiday Inn Express Hotel in Woodmead, which is the second such hotel to be built in South Africa.

“We have been fortunate as a company during the downturn,” says Nielsen. “We had arranged and secured a number of contracts which sustained us during 2008 and 2009. For this financial year, thanks to the secured work, we are okay as a company.

“In saying that, the meltdown has affected a lot of South African companies in that their turnover has been destitute or reduced and this has affected the tender market. Those companies that have relied on the tender market have suffered a lot.”

He added that Adamson Nielsen Construction is currently working on a 300-bed hospital in Soweto, which is valued at R550 million and will be finished by February 2011.

LOOKING AFTER THE AGING
So, given the decline in most commercial markets, how is it that Adamson Nielsen is performing so well? After all, it has gained new contracts, but hardly enough work to be flourishing like it is. “When you’re a progressive company and you look for opportunity, recession is not too much of a worry,” says Commercial Director Phillip Kypuros, who along with Joe Da Silva helped Nielsen found the company. “What we are busy with at the moment are retirement villages. There is a major shortage of good quality retirement villages in South Africa.

“We aren’t really talking the traditional sort of retirement facility here where people get around-the-clock care – we are talking gated communities, with frail care facilities, where people can retire and be properly cared for,” he adds.

Taking up the point, Nielsen continues: “We are utilising our experience as a developer of quality homes and estates, by building homes that cater to the needs of retired people.

“Our retirement villages are very different from those that have sprung up over the years and we have benefited from legislation changes, which require a better standard of care,” he adds.

This sort of independent living, as it is called, is really taking off in South Africa and Adamson Nielsen Construction hopes to continue to build many quality homes and communities that will improve the quality of life.

STILL GOING STRONG
Adamson Nielsen was established in 1984 and has enjoyed continual growth. But why? Nielsen thinks it is down to experience and drive. “Our growth is mainly due to the committed management team,” he says. “We are very competitive in the commercial, retail, residential and industrial sectors of the industry and offer quality products.”

The company has also diversified over the years and has added a dedicated property development division to its portfolio.

“We are primarily a construction company with extensive experience in all aspects of building construction and development,” explains Kypuros.

“I suppose, ultimately, we offer quality construction,” continues Nielsen, who says the company’s vision is to continue to provide a superior product, on time, and to the satisfaction of the client. “We define quality construction as exceeding clients’ quality expectations, delivering the project on time at a market related price, while maintaining a safe workplace.”

This should see the company through just fine.

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