Dhananath Fernando  00:11
Hello, everyone. You are tuned in to Advocata Institute and Advocata Institute Studio, and joining with us today is Jose Alfano, who is a New York-born architect and an urban designer? Jose, welcome to Advocata Studio, and thank you very much for joining for the conversation, and welcome to Colombo.

Speaker 1  00:31
Thanks for having me. It's it's a pleasure.

Dhananath Fernando  00:34
So Jose has worked in multiple countries on urban designing and pretty much on livable cities, and of course he has done multiple projects. If you are following architecture, Jose's name is not not strange to you. But as an economic think tank, you may question like, what's the connection between architecture and public policy and economics? And if you are following our channel, you know that economics has an aspect in pretty much in everything, and definitely urban development and architecture is one of it. And especially since we have done a report on cost of construction and on livable cities, we thought since Jose is in Sri Lanka, it is best that we have him on our platform to discuss about the public policy challenges, especially when you are working on a long-term project, the finances of it, the public-private partnerships, the regulatory impact, the community aspect, how it affects businesses, and what's the resistance from people, and how the prices change, like a gamut of other issues. Jose, just give us a colour of like you have done multiple cities, including city of Melbourne. You have done work in Vietnam, New Zealand, big projects, ports, towers to livable cities. Like on a as as an as a as an architect, as a designer, how do you approach something like this, and what are the basics that you think of? Not mainly on the. It can be on the architectural platform, but also on economically, because cities are all about people's lives and communities. How do you basically? What's the approach that you would first take, if I may

Speaker 1  02:16
ask? Thanks for the question. Look, there's architects capital A, and there are architects, and then there's there's there's kind of another approach. We we've always had a position that everything we do is entirely site specific. Okay, so in the world of international architecture, it's that's kind of people might say this, but it's it's rather unusual, and and so that requires that requires a couple of things in terms of thinking, right? And the first thing is it requires a receptiveness to actually try and understand every single place. And as as you might say, building controls, mechanisms, concrete, these things are the the same everywhere, right? Yeah, they're pretty much the same. They're cut and pasted from all over the planet. And so, what what makes something appropriate in one place and not appropriate in another place is it is kind of fundamental to the to its to its overall sustainability and and its importance. There's a lot of building, right? There's very little real architecture. Architecture is is is is kind of the the it it becomes something that the community loves, something that means something culturally, it has longevity into it, right? And it it it's it's a funny thing. After the Second World War, we we tended to raid cities and put up big towers all over the place, and you see them disappearing, right? It's quite funny how how they how they had the value proposition, cultural value proposition, other than the physic, you know, certain aspects of it provided greater amenity, you know, better living conditions theoretically for people. They were not cheek to jowl, you know, higher sanitary, let's say, environments, those sorts of things. But it's but but it's an interesting thing. So so how do you go about that? So I I think when when you step back, I started in New York. I started in New York, as an architect doing buildings, oh, we got to put up a 40-story building. We knew we're from New York. We know how to do this, right? And we do. We've done them before, and they're all theme and variation to a great extent, right? So, if if our efficiency in the building was less than a certain amount, we got fired. They just fired. Said you're wasting our money and our time. So

Dhananath Fernando  04:19
basically, you even when you started, you thought. I mean, you started it as a building, and then later on, you bring the architecture. Yeah.

Speaker 1  04:27
So, so that's it's the same thing. Infrastructure works the same way. When someone you hire someone, you say build a bridge. They come. They have an idea. I got to get from point A to point B. How do I do this in the most elegant, cheapest, whatever way? You know, whatever I think I can do, it's kind of the same thing. But if you step back and think about it in another way, and you start going, how do how do I look at at the collection at the city, right? And how do I look at the quality of fit? I'm putting something into an environment, and how do how do how do I try to understand how that develops synergies, right, within that environment? Sometimes it's not the most. Appropriate thing to stick an apartment building next to another apartment building, right? Sometimes, and what we've learned over time is that diversity, diversity equals sustainability, right? Things change all the time, right?

Dhananath Fernando  05:14
Also, also now, since you mentioned, okay, from a building to moving to an architecture and thinking about the community aspect and something building that's something that people loves. So on that aspect, governments and especially on the on the scale of the projects that you work, especially when it's a city, when it's an airport, when it's a port, there's a lot of government intervention, and these are big projects. So what's what's your experience working from like you know from a apartment building to like in New York to when it comes to the large scale projects, how do you see the how do you see the evolution when it comes to the economic aspect of it? Like as an architect, what aspects that slowly slowly changes over a period of time?

Speaker 1  06:01
Well, I so so I think if if we go back to this concept of of looking at sustainability in a triple bottom line sense, okay, so economic, social, and environmental, and looking at looking at that as guaranteeing guaranteeing a future for whatever facility you do, if and and let's look look at that as the underpinning, and you weight these you weight these issues correctly. I mean, any large project. I've been involved in many large projects, and the only ones that have been successful are ones that have intense community consultation. Intense, right? And and looking looking at how we understand those things, it doesn't necessarily mean entire agreement, right? Because people want things that they don't necessarily understand. They don't understand the implications of all the time. People are reticent. You know, generally everyone's reticent to change. And whenever you try to do something different, I mean, my father was a is a very serious psychologist, and he used to tell me you could train people to eat anything, right? You could say we're eating snake livers, and if you took it away from them, they would they would strike right because we're creatures of habit and so so some things are cultural that we we do because of habit some things are cultural because because they actually means mean something in in a much deeper way and so I I think large scale projects need to be really conceived of in in in in a holistic way they need to take into account not not only not only the future, right, but the present and the past, and and so so you need to together those things. And sometimes the future is is is beyond us, right, in a conceptual sense. When you when when governments talk about future, they're talking about they're talking about the near past, right? They're talking about yesterday, right? Actually, future. We decided we're doing it, but it's last week, and so the real, so it it's quite funny. I, you know, we we and and there's an issue about political cycles and how, what is the attention span of of the public service? Yeah, yeah, yeah. Let's let's talk to that.

Dhananath Fernando  07:58
So you you you you you brought us two important points. So now, when you do, especially large-scale infrastructure projects, you have to have that futuristic aspect to it on one side. At the same time, there is there are challenges that sometimes even the people who contract you really do not know what to what extent that it it can it has the potential to evolve. Let's say it's let's take as an example a port. So the the current government or whoever the government has a plan because they had to finish it in like five year or six year cycle. But there's massive potential that that that can come in at a latter point. So, how do you basically, on an architect's point of view, when designing on those things, what is the borderline, or is there a philosophy that you follow, or is there a way that you look at things when it comes to these large-scale projects with a futuristic aspect, but with a short political cycle.

Speaker 1  09:02
Well, I I think so. To to to do this effectively, you have to provide a long term vision, which everyone gets on board with, right? And and so the the the thing is to the thing is as as I as I was saying before is to try to develop multiple dimensional synergies between these things. What tends to happen, for example, someone says, "I want to build a port. You say, "I'm just building a port. You say, "But is that the right thing? Is is it? Is there an opportunity to do more than a port? Right? What hap What happens? Ports reach a static point. They get to a certain size, and then you have to move them. Let's say your port's going to grow 5% every year for so long. In 20 years, you're going to need a new port. Where does it go? How does that work? Or does the port take over the city? It's not unusual in urban situations where you have conflicting interests, where one part's impinging impinging on the on the part which actually gives the gives the city its life, and the and and and that has to move. Jakarta is a good example. The city's been growing so big; it's gotten so big, it's unmanageable. It doesn't work at all. The city does. Not function for the people, right?

Dhananath Fernando  10:03
So when it comes to let's move to the cities concept and the livable cities.

Speaker 1  10:07
Sure.

Dhananath Fernando  10:08
So you have done work in Vietnam, in New Zealand, KL, and now we are working in Congo. Yeah. And so can you brief, like for our audience, what is the uniqueness of some of those projects, and what is the latest trend on like concepts that you use on developing these livable cities, especially on an economic kind of social angle? And what are the differences between few of those projects?

Speaker 1  10:36
Okay, so so back to this kind of let's call it urban design approach. the the the the the first requirement is to understand what's there. Actually, understand what's there. To do that, you need to understand it in multiple dimensions. You need to understand its function, its role within a within a larger context, its critical context, for lack of a better word, right? So sometimes you look at something, you say that that, for example, your port has a regional role, right? Your port relates the Homolaka Straits is involved with that piece of infrastructure there, so it has multiple dimensions to it. It also it has a obviously a relationship to Sri Lanka as a whole, and and and also Colombo specifically. So trying trying to understand the hierarchy of those things and and and compact that into let's say a matrix of competing issues, and then then trying to tune them, tune them in such a way where where you allow for maximum flexibility. Things happen over time, and urban metabolism is something that is happens over a period of about 50 years. So if things grow too fast, you always have problems because it it turns up, and then you go, oh, it's outdated, right? And this is a classic example in China. They build things very very quickly, and you end up with the whole city there, and you go, where the people? To to be honest, where are the services? How does this work? Where actually are the economics coming from? You said we the economics came from building. Yes, you can build. You spend a lot of money on concrete, and you provide employment for a lot of people. But but how does that work exactly? So so to do a sustainable city, I mean, you you really need to understand you you really need to first of all understand your deficiencies, right?

Speaker 2  12:12
Yeah,

Speaker 1  12:13
and also understand your strengths and weaknesses. Like so, you know, Colombo has some incredible strengths, for example.

Dhananath Fernando  12:19
So now, especially on these large-scale infrastructure projects, you mentioned you do like critical stakeholder consultation. You ask the community what they want. Sometimes it's not it's not like the consent from everybody, but it's at least you have to. You should know the deficiencies. You should know what what has to be done. When it comes to large-scale infrastructure projects, we discussed about this, you know, short political cycle, and the financing methods. Is there any gold standard or any particular projects that that the financing model and the government had like a proper structure or a layout, especially on in terms of fast-tracking the project or understanding the real requirement, is there a is there a standard or a regulatory framework that comes to your mind, or with your experience in in different parts of the world?

Speaker 1  13:10
Look, look, there's another coming back to this this idea about site specific design. I think you have to design you have to design these models specifically for different places. Some of the most successful models. I mean, Melbourne. Melbourne was really interesting because we the the city had a huge area of deep river port. Half the city was actually a port. We said we want to convert the port to city. The concept was we we open it up for development. It's basically government owns the land. The government government becomes a real estate agent. They they make people bid for the land, and they build buildings, and the city happens. So, so, so, so the question, the the overriding question was, who, what is, what's the impact on the existing city on the right culturally, but what is this new culture that comes? Okay, and so, in in a short-sighted sense, half of the Melbourne Docklands was built for people who could afford to buy second apartments, investments.

Dhananath Fernando  14:04
Right,

Speaker 1  14:05
they were baby boomers, so these were rich people, more or less rich people. So you you ended up with you ended up with with a piece of the city equivalent to the size of the central businesses, equal in size. So so fifth equal weight, high rise, new thing, relatively soulless, in on in one sense, from from a character sense, but but but on on the other side, unaffordable, unaffordable to normal people, right? The people who needed to live in the city were basically families, or people people who couldn't afford a car, or to drive long distances, or or or white collar workers, banks, insurance brokers, people who worked in the middle, so they they could not live there because this was tailored for someone else. It was tailored. Even the product was tailored to an investor's concept of what they thought would be worth money in the future.

Dhananath Fernando  14:48
Right.

Speaker 1  14:49
Yeah. So so so so that's that's an interesting deficiency of this real estate version model. Right.

Dhananath Fernando  14:56
And like incles context. Like we have the the recent development is that port city where we have some zoning where you know where the marina is, where the apartments are, where the business cities, but but but this part of the world really hardly uses sometimes the zoning. You have like the industrial zones, but your city is not planned in a way that brings the efficiency to together because you have quite congestive public transport system. It's not interconnected, and it hasn't really sometimes identified the need of the people. So, and at the same time, you know you don't get like a blank canvas to develop cities, as you said. Like you already have a city, and you have to develop it, you know, on top of it, and slowly, you know, bring it to a way that all the synergies comes together. So how how do what is the what is the approach? I mean, understand the consultative consultations has to be done, but especially when as when you do a city within an existing city, like what you did for Melbourne, what aspects that you look at it, and especially when it's zoning and things like that, how do you do it? Like, how do you identify? Is there a way that you think about it, or is it as you mentioned? It's very site specific.

Speaker 1  16:24
Well, no, on a on a systemic level for a large city, basically, it's quite interesting. Plan NYC is a good document. New York City is a sustainability document, and it's very sophisticated. Melbourne copied it. They call it Plan Melbourne. They they copied the idea. the The front of it they copied. The back of it they didn't copy.

Dhananath Fernando  16:45
Right.

Speaker 1  16:45
And what they did is they went and they looked at all of the urban infrastructure. They looked at all of it. Where the train lines go. What's there?

Dhananath Fernando  16:51
Right.

Speaker 1  16:52
Each city block. What's the capacity for the electrical network for each city block? The drainage systems, the water systems. And they realised that places like Brooklyn, for example, you're seeing a lot of development in Brooklyn, big towers, 50-story buildings going up. They were never there historically, never there. And the reason they're there is because they're at the confluence of three train lines, which used to feed the hinterland. So, so the first thing was to was to was to mine the existing existing infrastructure. You don't have to pay for it, right? Public transportation, the park systems, all of these things. Use them as the basis for it, I would I would suggest we did something similar in Melbourne where we looked at an internodal strategy. We went out a bit and said this place, this place, this place, this place have have have opportunities. They're at the back of systems. There might be schools, hospitals around them, but but but this is this is something in between areas. And we had a lot of we had a lot of interstitial, interstitial light industrial areas and and things which were available for transition. You say those areas can be done in a in a relatively in terms of quantum large scale for those places, but but but provide provide let's put this way choices right, and this is an important thing when you think about the when you build a city. You want to provide a diversification and and and opportunity for choices, different lifestyles, different people, different futures.

Dhananath Fernando  18:09
Right. So Jose, now on on you when you are designing the city, the the regulatory framework of that government also plays a crucial role. Like what you said in Brooklyn, there are only three rail lines, so which basically decides like sometimes the height of the buildings and many other specs, which is you know which has to be comply with the architectural guidelines. So when it comes to the because as you mentioned, like the the the the height of the building, it has to have the fire access, things like that, based on that site and the complexity. So, what is in terms of coming to the regulation? What, especially when you're doing, let's say, a city like Port City, what are the aspects that you need to consider, or like, what is the government on a on a government point of view, what approach that they should take, especially if you're, you know, embarking on a project with sort of zoning and and development.

Speaker 1  19:11
So, so it it's the chicken and egg question, right? We we tend to generate regulations, and and they apply to very large areas, so so they they apply for infill, right? Yeah. You you build inside an existing. They apply to extending the existing city and subdivision and and the like. So so so to be honest, the only way to only way to effectively do this regulation has to have an end, a means to an end. It it it's not just the administration of democracy. Everyone gets the same rule, right? So, so the purpose is what you're trying. The purpose of the thing is is trying to achieve a specific goal. Any regulation that is rigid. The most innovative thing that we did in Melbourne was we in inside the city we created an everything zone. You could do anything. There's no land use issue that you can't. Except high industrial, except things that pollute, right? Right. So office, residential, all these things could coexist, and and the idea was that they were going to coexist, and we we offered a differentiation between floor area. One of the reasons for this is that different land uses attract different different requirements, right? So, for example, an office building, people drive to it in the morning and they leave in the afternoon. A residential building, they do the opposite. If they're next to each other, basically they can use the same car parking or part of the same building, right? They they they can use the same network. Same thing with road network. If if you built an office, if you if you built the port here, all as office buildings, right? Let's say all the Japanese wanted to move in there. All the Koreans, everyone moved big office buildings in. You would have to triple the size of the highways, right, for people to to get there. So you start thinking about how that works. We did. We we had the same thing. Melbourne and in Melbourne, south of the river, South Bank, it had to be high density residential because the net road network could not handle the sequencing of people coming to the city, even though it was historically it was historically commercial.

Dhananath Fernando  21:05
The next challenge when you work on these large projects is that you have a project plan, and but when it comes to execution, there are executional challenges with the political authorities versus the regulatory framework versus many other factors. Like, how do you approach these issues as an architect? Because you have a, you know, you have a grand vision, but actually, when you when it comes to execution, there's a gap between the vision versus the execution. Any any thoughts on that? Any any best practices? Well, so

Speaker 1  21:35
in in the first, if you if you think about something having to have validity, validity over a period of 50 years. I'm not going to be here. You're not going to be here. The government's not going to be here. The short-term cycle ones have different issues associated with them, right? And that's commitment and funding. But generally, what happens is that generally, what happens you're going to need the private sector. I'll give you a good example. London Dockland, London Docklands, did development. They used it was basically 5050, private dollars to $1, one public dollar, right? 50, right? Belvin Docklands did it at 500 to one.

Dhananath Fernando  22:10
Wow!

Speaker 1  22:11
Much less investment, right? So, at some places in Dubai, they they work on different metrics. They're probably more like the 50 to one, but you know, which is kind of interesting. So, so the question is: Is the public going to invest? Normally, normally the the best way to do this is is to come up with a vision which provides for the public infrastructure, and I'm not talking just bridges. I'm talking about the schools, the hospitals, all of the other things that go on, and make a demonstration to commit to actually a demonstration that the government's going to do their part,

Dhananath Fernando  22:41
right?

Speaker 1  22:41
If they do their part, the value proposition is there. the The problem with something like your docklands, we had the same problem for years. We rezoned it, we left it there, and until we we we got we created a convincing model of why people should put the buildings in. The question is, who's going to be first? I put my building there. I'm I'm I'm alone in the middle of nowhere. Does is does my building is it does it provide a better financial return or a better environment for anyone that moves into it? Does it really work all by itself? How much how much development do you need for that to be a real place? There's a classic thing. I've been working on Putrajaya in in Malay the Malaysian capital for a very long time, and that's a very interesting parallel to Colombo. It was it was designed on a Garden City model, the same British planning principles that were used in Colombo. The concept was to put move the capital into a into a almost like Canberra too, into a lakeside district, make a large artificial lake, put all the government buildings there, all the employees will go there and build build 20 little little village centres with low scale housing, 123-story, housing around it, and these clusters would be separated by jungle. Beautiful, right? When you can walk from place to place, very compact, serviced with high-speed rail, high-speed rail from the airport. That you know, we're talking 200 kilometre an hour rail. Very modern, unprecedented internet, gas turbines, and almost zero energy stuff. Right? You go fantastic, and what a great idea. The problem is no one will move there today. The government built the buildings. They built all the infrastructure. The bridges are there. The high-speed rails there. Everything's there. It's all there. But people will. They even force the embassies to buy. The American embassy has a plot. They won't even put the embassy there.

Dhananath Fernando  24:16
Why is that?

Speaker 1  24:16
Because no one wants to go there. the The government people, the government officials are forced to go there. They drive from Kuala Lumpur to there, where they take the high-speed rail, reverse engineer it from the airport. They go there, and and they do that. But no one, but but people find it's first. I'm going to be there by myself. How how there's no sense of community. It doesn't work. And also they got the model a little bit wrong. It was it was an idealised model about you know it's it's kind of Santa Barbara, a little bit like this. It would make sense on TV, but you kind of really you think about it. Malaysians are not like that per se, right?

Dhananath Fernando  24:46
Right. If

Speaker 1  24:47
you've ever been to Penang, if you know anything about Malaysia, Penang and Singapore were the old population centres. They have certain character to them. They're quite dense. They colonial, neo-colonial, or not whatever. But but but they have they. They're quite specific, and they're quite and and and they're quite dense, and the streets are quite small. They're quite intimate. This big, huge, expansive kind of large boulevards in the middle of nowhere are are are very tricky.

Dhananath Fernando  25:12
I'm just trying to understand. So you mean Malaysians didn't move there because it lost that like that community aspect, which was one of the main characteristics of the Malaysian community. Yeah. Well, it's

Speaker 1  25:22
alien. Let's suppose it's alien. So if I'm a government employee, they can force me to work there, right? But force me to buy a house there? I don't know. I don't know, right? And kale's kale's nice. I mean, Kuala Lumpur itself, it's not. It it it's a very nice city. The the old established suburbs have great vegetation. They're beautiful. They're cool temperature wise. Why would you want to be out in the middle of you know in basically kind of in the middle of nowhere? So that's an interesting thing. That the same thing happened with Canberra is a good example too. You look at instances. Canberra's same exact problem. The reason I've been working on on on Puchojaya is is because of this Canberra issue. We spent a lot of time on Canberra. Canberra was a ghost town. The government officials would come. They would sit for parliament. They would leave. There would be. There would be not. The restaurants would close. Everything would close. And we spent a couple of years. There's a couple of sites there in New Act, and we spent a couple of years working on how do we densify the how do we densify and do mixed use buildings. We did a new building which is hotel, Department of Energy, and an apartment building in one building, it's you think Department of Energy is going to be on its own, right? But this is one actual physical building, and and it's dense. And Canberra was controlled. It's a Garden City model, same model. Nothing should be taller than the trees. In the conceptually, there was a an aesthetic idea, but but inappropriate in the sense where there's no place to go, like who's gonna? You have to drive everywhere, and and walking walking becomes impossible. Even bike riding's kind of onerous; it's too far, and you have to drive and your bike ride on on effectively highways. It's more like an airport.

Dhananath Fernando  26:54
Interesting. Thanks, thanks for sharing that Malaysian case study. Also, now when it comes to construct, I mean, any any scale of construction, infrastructure, architecture. The cost of construction is one of the key issues. Yeah. So, in in countries like Sri Lanka, it says it's of our research report says it's significantly higher compared to the region. How do you have you seen any best practices around the world to keep the cost of construction low, and any other techniques? Additionally, on an architectural point of view, rather than improving the efficiency, productivity of the designing to bring the cost down. When it comes to material, when it comes to other sorts of engineering, any any best practices that you would like to recommend to bring the cost of construction down?

Speaker 1  27:45
Yeah, so there's a number there's a number of interrelationships. So the when you talk about construction, so the the the primary headline issue everywhere is affordable housing, right? So it's not construction; it's affordable housing. Okay, and so we go. How how how do we have intergenerational capacity for people to actually be able to live, have families, grow, expand, invest? Also, like this is for most in Australia, every a house is is the primary investment vehicle, right? Yeah, for everyone's future, they retire on that. They sell their house when they retire, and then they they move into something else. It's wealth creation, right? It's actually civil. It's the fundamental of civil society to a certain degree. So, so there's a couple of issues wrapped up in that. The affordable housing issue, to a great extent. So, to the extent that governments don't build public housing, right? Public housing has a certain role. It's usually transitional, right? You you get married or something, you or you're at a certain place and you move into public housing. As you improve your situate, sorry, as you improve your lot, you you move out and you you you you save money and you invest. So it has has a social function. The interesting thing about it has another role, and engaging in public housing creates stability for the construction industry, and this reduces costs significantly. So, construction industry typically has boom and bust; they go like up and down, and this causes this causes has great implications on ultimate cost of construction. So, it's factored in. You go, oh, we're we're going up now. We have inflation. While while contracts are going, the building industry typically goes. Well, it's starting at the beginning of a cycle. I'm issuing contracts for X dollars. Somewhere in the middle, it's X times point five. Somewhere towards the end, it's X times point three or point nine.

Dhananath Fernando  29:37
Right. Right.

Speaker 1  29:37
So so so it's increasing. A lot of times, you'll see things. Why do new things get done and the old one doesn't get done? Because people are getting more. The industry is actually getting paid better for this one, and the costs have gone up. So, so we we see this across across the whole planet, and and and it's a very interesting thing. So, so the idea about levelling the playing field, levelling levelling the economic environment for that type of concern. Through the through the provision of either larger infrastructure, slow burn infrastructure projects, right, which which provide continuous continuous investment and also support of of that economy, private sector economy, but by and large governments have never been particularly successful at doing that themselves. You just have board of works, we had those, and and they government tends to not like being in that business. They have a lot of political political objections to it. Right, construction industries typically don't like having to compete with government for for for concrete. Yeah,

Dhananath Fernando  30:34
yeah, yeah. Also wanted to understand since you mentioned about the the project, since you mentioned about okay, we spoke about housing. Let's come to sectors like tourism and the building of the ecosystem of tourism and the infrastructure related to that. Yeah.

Speaker 1  30:59
Okay. Tourism is a very interest. Tourism is very interesting because it's kind of a double-edged sword. A lot of a lot of places overly focus on tourism, right? And you end up with whole tourism zones. It's look at Bali, for example. There are places which have been overtaken by tourism. It's particularly risky. Australia, Australia is quite interesting. The government used to spend inordinate amounts of money. We're talking billions and billions focused on tourism. They would subsidise tourism. They would they would subsidise the land for tourism, anything to do with tourism, because they wanted visitations. They wanted people to fly in. They realised Australia's very. If you get stuck there, it's very expensive. And the idea was that they would get you to come. The problem is that that that industry is is dependent on all types of things, right? And so it waxes and wanes. It has a cycle to it as well. And if you become over dependent on tourism, tourism needs to be based on some real thing, right?

Speaker 2  31:53
Yeah.

Speaker 1  31:54
And so, for example, in in Melbourne, we we tried to diversify that. So we created a conference environment. We created a very big conference environment, and we trade shows. All of these tried to diversify why people would do this, and and some of those things. When you look at them, for example, in Melbourne, we allowed them to build a casino. The reason we allowed them to build a casino is because we required that they build 2000 hotel rooms to support the convention centre.

Dhananath Fernando  32:21
Right.

Speaker 1  32:21
So the synergies between that. Then we built a plenary hall and another very large facility, which which can hold 1000s and 1000s of people to do other other sorts of events. So you you if you pair it with events, it kind of works. So so on another level, there's cultural tourism and eco tourism, and I think I think that's far more interesting and far more sustainable in in in in developing economies than people assume. So the idea of mining all your beaches and putting a giant hotel on every single beach is is kind of crazy in a way. It's they they can ultimately they compete with each other, right? So I think there needs to be a strategy. At the end of the day, if you look at some place like Fiji, Fiji's incredible at the moment, right? Fiji, Fiji's tourism industry is is based on creating a destination for everyone. So you have cheap accommodation for families. It's close, but but it's dependent on the airline at the end of the day, and Fijian Airlines now they fly from Hong Kong every day. They fly from LA, they fly from everywhere, and you think of a small country like Fiji having airlift like that is incredible.

Dhananath Fernando  33:31
Got it. Also, wanted to understand about the design and the innovation aspect of the cost of construction. It could be tourism because then the room rates can be brought down, which can be affordable to series of tourists. At the same time, when it comes to also the affordable housing, again the innovation aspect can can play a role. Is are there any developments or anything that the new the the the new designers have to think about or anything that they have to keep in mind. Yeah, so

Speaker 1  34:04
so we've we've been we've all been looking at manufacture construction for many many years, and so that some people call it modular, some people call it unitized. There's a lot of ways of looking at it. It it this manifests itself in a couple of different ways in different places, in the United States, for example, they've been doing manufactured housing for a long time, and there's a couple of reasons for it. It's there's some climate issues. About half the country, you can only pour concrete for about six months of the year. It freezes. You can't. Same thing with Norway, for example. Norway construction in Norway costs twice as much as construction in in in France. You go why slow? They have a shorter building period. They build lower buildings because they can't because of the time they have to actually pour concrete and they have to tent the buildings and keep the build keep the concrete warm if they're going to do it. So it has to do with a bunch of technology. So anyway, in the U.S. they build they build manufactured housing in factories, componentized, modular. Let's call it. Hybridization-they build it for half the price of conventional build.

Dhananath Fernando  35:03
Right.

Speaker 1  35:04
This is the nirvana everyone's looking for. You say, "I can do it for half the price. There's a number of reasons they do that. They can do that. First of all, timber and these type of materials for houses is very inexpensive in the United States. It's it's it's in good supply. There's no and building building materials. The United States is a massive provider of building materials. The other thing is labour is quite cheap. This is in the United States; it's it's unskilled labour, in principle. Building is is in Australia, we call them professionals, a guy with a hammer. In America, it's called unskilled labour. Right. So it's a different perspective. But when you look at so you look at it there, and you go, a lot of people go yes. So then we talk about we have shipping containers, manufactured stuff in China, blah, all of this sort of thing. Steel. The reason we don't build steel buildings in Asia is because steel. The cost of steel fluctuates great deal. It goes up and down. Concrete does not go up and down so much, right? It's it's a stable base material. What you'll find in the region, in Singapore, Malaysia, Philippines, is that we're running out of sand is actually a problem with concrete. Sand's being shipped from. I don't know about Sri Lanka, but Singapore was buying sand from as far away as Vietnam, just to do concrete. They were engineering sand recently, so concrete has become quite expensive. So you start thinking about the alternatives. Steel has certain attributes to it, which work, but it's a highly manufactured material; it the ore comes from Australia. Maybe it goes to China, gets manufactured, gets sent back. There's a lot of you know a lot of carbon footprint associated with it. So so so when you think about it, it's a question of how you do it in a highly industrialised economy. Terrific! There are a number of ways of doing this type of thing. You can create a manufacturing industry. We in Australia. We in the last 10 years, we lost our automobile industry. We had a very nice small boutique automobile industry. We had Ford, Toyota, and and and General Motors. And we we used to argue in Dandenong. There's a city called Dandenong outside of Maryland. We could make the space shuttle. They were all small suppliers of components. It was highly distributed. We could make anything, and and we still do. We make aeroplanes. We make military equipment. Very high high end military equipment. The same industry does that. And the idea was that we were going to convert that industry into manufacturing of housing because we need it so badly, and that actually manufacturing labour was worse paid, was poorer paid than than building labour in Australia, building labour is very expensive. So, so you know, not not to be legally the point, but I think the solutions are quite specific. Malaysia, the Najib six seven years ago declared a million houses. He wanted a million houses to be built in Malaysia. The Malaysian government came to us and said, "How do we can't build 100,000 houses with a guarantee. Even the government. Even if we, how do we do it? And their solution was to do precast. Was to do precast precast concrete. Okay. Like, and you know, you build a whole house with four panels, six panels. Right. So these were these were the the concept was maybe overly simple simplified version of this. So so I look. I think there is a role, but I think they need to be very. How do I say? Very economy specific. The thing I will tell you is that if you build something in a factory, in in in most places, the building side is the factory.

Dhananath Fernando  38:14
Right. No

Speaker 1  38:15
rent.

Dhananath Fernando  38:16
Right. If

Speaker 1  38:17
you build it in a factory, you have to add this on. So you have to. There has to be a way you have to get synergy you have to really you have to have a reason why you need to protect it or something that you can do inside that you can't do outside.

Dhananath Fernando  38:29
Got it. Coming back to the sustainable city concept, so can you explain like how this concept of sustainable building or like the sustainable construction, sustainable cities evolve over a period of time. And with your experience, which direction this trend is moving? What aspects that people are looking at? Because you in in the pre-conversation you you mentioned that even the habits of people are changing, like earlier house or a construction being considered like as a as an activity of wealth creation, but probably the Gen Zs are not very interested about it, and their lifestyles are different. So even the concept of sustainability has to evolve with the needs of the people. So how do you see construction and the sustainability going with those generational changes?

Speaker 1  39:22
Yeah. So sustainability. So back to the triple bottom line sustainability sort of model, and you you need to you need to look at look at the evolution of the city as in a sustainability sense as trying to avoid avoid the things that you do that you have to do again. Look at it this way. So so so typically what used to happen is the government would come and say, oh, we build a highway, we put a lot of houses. For example, we we build a highway, we put a lot of houses. We build the armature, we put a lot of houses. We collect the tax back from the house. It pays for the highway. Makes sense, right? It's there's a and it's a minor in. It's an improvement to sell land, one way or the other. Oh, and and collect rates. We get tax. We get all the other things that go along with it. And so, so we're financing a long term model. The so so so so the the issue with that is is what what happens when when this becomes dysfunctional, right? Who's who, or or or or devalues itself, right? And and and that's an interesting that that's an interesting proposition. I think I might have talked to you about the about the the the evolution that this extended metabolism of cities. Almost all cities started out as quite compact things, and they had a functional reason for them. They had industrial stuff on the outside. There's pressure to grow out the city, you know, residential wants to get bigger. The city gets bigger and bigger, so it grows, and it sort of consumes itself. Then it starts acting from the perimeter, and and what and it kills the centre. And then we go back to to revitalise the centre. And and this ebb and flow is an interesting thing. the The problem is that is that usually it's done in a in an in an in an unintegrated way. So it it's like it's like I build a building, I provide an extension lead to the building, I provide a substation that does the building. When I put a second building, I have to take that out and I have to put in two substations. I have to upgrade the system. The question is whether there's flexibility in the infrastructure system, and at the end of the day, sustain the primary sustainability buildings are fine, right? Double glazed windows and stuff. This is this is insignificant compared to the infrastructure, the the carbon footprint of the system, right? So, so if you want to build a sustainable environment, you have to start with the energy provision, the water provision, the the the productivity of and and the the movement of people, right? How they get to work, how they get back from where this idea of sort of 20 minute, 15 minute cities is is integral to the idea about trying to actually not waste a lot of time or energy or carbon footprint in transportation. Whether we build those, sometimes you don't need to build those things. Public transportation is a wonderful thing too. You know, a lot of a lot of cities like oh we need trains, we need trains. Everyone wants trains. You know, Brazil, Rio de Janeiro did BRT systems. You know, we I rolled one out in in Putrajaya, localised BRT, which is a bus rapid transit. Bus gets its own lane, has stations, very cheap. Buses are not expensive, but they are priority. They're not fighting with traffic, so they operate in the same way as a train, in the sense that they're not they're not conflicted with the grid and the lights and all that sort of stuff.

Dhananath Fernando  42:23
Thanks, thanks, Jose. Also, want to understand that these large scale. The other angle of economics is on, especially when you're bidding for these large scale infrastructure projects. There has been question marks around the world on the transparency, the way that the governments are working. I just wanted to ask you, since you have worked in again around the world, especially on on awarding the contracts, on bidding processes, because there can be because as architects you put a lot of effort even onto the bidding process with the little that I know. So

Speaker 1  43:01
sure,

Dhananath Fernando  43:01
and if something something irregular happens, it affects everyone else's businesses and your time commitment and the resources that you put in. So, is there a is there a way that you recommend, or is there a gold standard again that this has happened in a way to ensure transparency, understanding the requirement, making that bidding process, you know, more transparent, efficient. Are there any examples that you would like to share with your work experience?

Speaker 1  43:28
Yes. Look, we can, you know, aside from blatant corruption, right, and nepotism, and and and and sometimes they call them cultural, cultural paradigms. I, I, I think to be honest, that a lot of governments what they do is they don't they don't conceive of these things very well. Okay, they they come. We we need to build a bridge. What we'll do? We'll go to a lot of people and see who's going to provide the cheapest bridge.

Dhananath Fernando  43:56
Right.

Speaker 1  43:57
Right. And um and and what'll happen is is you'll ask for an integrated proposal, and it used to be the the Koreans would Samsung will turn up and say we build bridges, Hyundai, China Rail. They turn right. We'll do the whole thing, turnkey. You just pay us a residual fee, and and and we we do it that way. This form of public-private partnership is is problematic. Okay, it's problematic for a number of reasons, and we do them. We've been doing them in Australia too. We pioneered public-private partnerships. The UK, I think, got them from us, and the idea was that we didn't have recurrent spending. Government goes, wait, I can, I can lease, I can lease the office building. I can there. I can lease the office building for the new government department, but we need the road and we need the bridge. How do we do that? So, so what we'll do is, is we'll give it out to a consortia, and we'll say, "Look, there's some land here. The road and the bridge you can put a toll on, right? You can put a toll on part of the road, and you can collect money for that. And we can, and and and we can build it, and it'll all work out. And all we have to do is pay rent.

Dhananath Fernando  44:50
Right. So,

Speaker 1  44:51
and so what happens is governments are very adverse to debt. Treasury departments are always adverse to debt, and and it's a complicated thing. How how you get so so so. So back to transparency. Transparency is first of all. I think it's quite simple to go through that, and and and I think that any good any good Treasury Department would have sort of their own, let's say, protocols in terms of biddings. These things would be available for freedom of information. It would be entirely transparent. It'd be very obvious. Doesn't need to be complicated, and and so they don't need to be necessarily internal bids. I think as long as as long as you can describe what you're doing exactly, and everyone's competing for the same exact thing, not other alternatives, then then it should be okay. The real the real question is is how to finance these things. Governments all struggle on financing them, and they're always looking for other, other, like I said, other ways, public-private partnerships. You know, you know, we give, we exchange something for something else. Oh, you know, maybe there's some political political influence to be carried on a different level, something strategic that can be given away or sold, or leveraged.

Dhananath Fernando  46:01
On that question. Now, for a minister or a government or a department, when they contract it out, probably as you said, they may not have the long term idea. Like they will say, the only thing that they know is that you need to have a bridge. But it's only someone like you or an expert can think of. Okay, when you do the bridge, there'll be repercussions on this, and then you have to think of the community aspect and all sorts of things. But to understand that, probably a minister who is like elected by the public may not have the gravitas and the depth of it. So, is there a way like how do you approach in that sense, even in a government department? So, what what are the best models like? Is that means like the minister or the or the treasury that department first get a consultation on like understanding okay we need to do this bridge but what are the other architectural like the the the public infrastructure that is required and then you go for a tender process or a bidding process or you just give the requirement and you specify like the architects to think about it and and bid for the overall concept, or does it differ from case by case? What as a as an expert?

Speaker 1  47:10
Yeah, so this comes down to risk and also your capacity. Right, and look look at the end the the best historically over the last let's say, 100 years, big infrastructure projects. The best ones were done by by the public issuing bonds. The best ones were always done by the public creating a financial vehicle where people could invest in that. Even the private sector invests in that, and you create infrastructure bonds and you run it this way. And basically, the the the finance is separated from the construction,

Dhananath Fernando  47:42
right?

Speaker 1  47:42
Right. You separate the two things, so there's not an opportunity to actually use. Could you

Dhananath Fernando  47:46
elaborate a bit more on what you mean by that bond? Like, so basically, you float a bond and the public invest on it, and then you basically do that infrastructure based on it, and then you charge a fee. And how does it work? Can you say

Speaker 1  47:59
so? Look, look. There's a couple of examples. I so one example at city scale is Solidair in Beirut.

Dhananath Fernando  48:08
Right.

Speaker 1  48:08
So Beirut was in in Beirut was war torn for many many many years. It was it was subject to a very complicated situation where as a as a very ancient city, the the centre of the city was basically common ground, and around around the city were all different ethnic groups, every single ethnic group you could possibly imagine, and they they fought over the middle of it. There was no way to finance that, and and effectively, what they did is they consolidated all the land, they consolidated into one project. They they came with a with a model where everyone shared proportional to what they owned, instead of competing with each other, saying, "Well, I get a bigger building, and then you get nothing, and and and and and then and then they floated on the London Stock Exchange, and they generated enough capital to generate the project. Actually, start building the project. They did it in such a way where they catalysed the project, so they built the port again. They built the key elements, then the stuff in between that can the private sector can do in its own. It it it it's catalysed to the extent whether it'll take its own natural form. Robert Moses did it in New York, New York City. The bridges and tunnels were all built by private money, all of them, and and and so so they establish an authority which issued bonds. They use the they use the tolls to actually underwrite the underwrite the interest on the bonds, and it was put on on Wall Street. And the interesting thing about that, once one bond was offered to the up as a public as a public offering, the project had to go ahead, right? It had a life of its own, and it couldn't be politically fiddled because it was owned by the general public. So quite an interesting interesting model.

Dhananath Fernando  49:35
So do you do you you tend to do you tend to say that rather than the public-private partnerships, this bond is a feasible model because of less political intervention. Well,

Speaker 1  49:47
well, so the conversation started with political influence and and and and and the idea of derailing these things. Of course, once the finance, the finance is separated from the president. Well, if if. If it's a public company, it's publicly auditable. It's it's transparent. It's it's a it public but private. Let's say right. So so so this is some. It also generates tax revenue. It generates all of the things that you want a large company to do. So so that's there. And and and this this is kind of the way China Rail and the other companies work. They make a semi-public private company and they go out and they lend money to people. So you're just lending it to yourself.

Dhananath Fernando  50:25
Got it. Yeah. Also wanted to yeah at the final stages of our conversation. Also wanted to understand if you were to provide since you have also worked in Sri Lanka in in in some of the peer review projects, what advice that you would like to share, especially some policymakers are watching this. So, what advice with your experience? How to structure it? Anything that we could have done better, or with the new trends? Because we have also, as you are aware, we have done multiple infrastructure projects. Some were not successful. Some are successful. Some we are trying to make it successful, but overall, because I I found it interesting what happened in Malaysia that you mentioned when you did the city, but no one is willing to move. And we had couple of cases like we did a port, sometimes we did the the the cricket stadiums, but it we we we haven't seems to be thought about that overall aspect of it whether people would really like to go there, whether we can commercialise it. So, on thinking on all those aspects with your experience, any any thoughts or any advice that you would like to bring it to the Sri Lankan policymakers, especially who are working on the construction industry? Yeah, I look. I I think it's probably time. The so for for.


Transcribed by https://otter.ai