Inconsistency in measurement standards in construction, built industry
The Royal Institution of Chartered Surveyors (RICS) has introduced the international property measurement and valuation standards to stakeholders in the construction and building (built) industry at a forum in Accra.
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The meeting also marks the formal beginning of operations of RICS in Ghana.
In a presentation, the Global Property Standards Director, International Standards, RICS, and the Chair of the International Ethics Standards Coalition, Mr Peter Bolton King, expressed concern about the current inconsistency in the measurement standards in the construction and built industry.
He observed that property was measured in many different ways around the world, adding that depending on the standard used, the floor area measurement could vary dramatically.
He said the World Bank estimated that 70 per cent of global wealth was in property, but valuations were based on inconsistent local measurement data.The director noted that though globalisation was connecting markets, the standards adopted locally could differ dramatically and increase risk, one of the primary factors limiting investment.
Fundamental challenges
He mentioned fundamental challenges as including property measurement, construction costs measurements, as in what is and isn’t included, land tenure (inconsistent across markets), ethics, adding that many of the challenges had inconsistent standards at their origin.
”Construction measurement standards refer to the way construction project costs are calculated, classified and reported,” he stated.
”It’s not about the units of measurement ($, £, €, ¥ etc.) but instead the ‘line items’ in the calculation such as labour, land purchase, design, materials and client costs,” he added.
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In some areas, for instance, he said the floor area measurements often included outdoor swimming pools, while in other parts sometimes the air-conditioned space is used instead. For other parts, floor measurements include off-site car parks as well as common area, and in other areas, floor measurements include hypothetical areas.
Mr Bolton King said international standards were normally developed collaboratively, while they were principles-based and high-level and drafted by independent experts.
Also, he stressed that they were transparent and involved a consultative process, while they were enacted locally, through or alongside domestic standards and provided consistency, comparability and common language.
Importance of property measurement
The RICS Director said property measurement was important because sound measurement was fundamental to property markets, while it underpinned decisions made by all property users and provided a tool for comparison.
Also international standards establish global standard for assessing project costs, define what should be included in the calculation of a construction project and enable global consistency.
Mr Bolton King said the measurement was needed to help provide transparency, certainty, higher standards, enhance or re-build trust, reduce confusion and re-position the importance of ethics.
He gave an assurance that this would benefit investors, multinationals, developers, governments and the public in general.
First Government
Mr Bolton King announced that in September 2014, Dubai was the first to officially endorse IPMS and commit to its adoption.
Dubai’s endorsement of IPMS was a core theme in their successful bid to host Expo 2020, he noted.
RICS was founded in London as the "Institution of Surveyors" after a meeting of 49 surveyors at the Westminster Palace Hotel on June 15,1868. The inaugural president was John Clutton (who founded Cluttons, a property firm still in business).