Blue Ocean Group Stands Tall During Challenging Times
Sri Lanka’s construction industry contributes to about 7.1% of the Gross Domestic Product (GDP) of the country and employs more than 650,000 workers. Despite the economic slowdown faced globally across all industries and the resultant optimism dent within the real estate and construction sector, the Colombo District Land Valuation Indicator (LVI) reported an overall 6.8% growth rate in the first half of 2021.
Post-pandemic situation & subsequent economic crisis
After dealing with the many hurdles that the pandemic had thrown, the Sri Lankan economy moved into a state of an unprecedented economic crisis in late 2021. As a result, the construction and real estate sectors have undergone various challenges that had caused many smaller players to drop out of the market. Many others have developed a high-risk “hit and run” approach with their projects due to the scarcity of resources coupled with raw material price escalation which has posed a significant threat to the safety and the wellbeing of their customers and the public in general. But a handful of established players in the market have managed to stay resilient and strive through the most tumultuous years, understanding what less seasoned players do not – that quality and safety are not things that one can compromise, even during tough times. The Blue Ocean Group with a decade-old experience together with expertise garnered from successfully completing iconic projects is one such entity that has withstood the test of these trying times, churning out one successful project after another amidst these numerous challenges.
A challenging time for the construction industry
Like many other sectors, the real estate industry was not prepared for the current economic crisis both globally and in Sri Lanka. However, the sector was better geared and has showcased remarkable resilience. While any new projects were stalled due to the lack of resources and other limitations such as price escalation of raw materials, the demand remains still higher.
2021 was a definite game-changer for not only the real estate and construction sector but for the whole world in general. As the world’s largest vaccination drive gained momentum, the confidence among the public grew and the enthusiasm that followed in most sectors paved way for an encouraging boost post-pandemic. The financial year 2022-23 is now seen as a challenging year for the construction industry.
The annual turnover of the local construction sector is estimated at $ 4.3 billion. According to several projections, this number was expected to grow to reach $ 10.5 billion by 2023. However, this target has been stalled, driven by issues such as the prevailing local economic crisis, uncertainty in the global market, and impacts of the Russian invasion of Ukraine.
Sri Lanka’s construction sector, in particular, faces numerous challenges which include import restrictions and price escalation of raw materials such as steel, aluminum, and cement. These factors are straining the construction of apartments and houses, largely. However, the construction association has put forward a number of recommendations to the Government to arrange a credit line either from India or China to import raw materials that are required to develop apartment units in the country.
Material price escalation
Within the past few months, construction raw material prices have increased by over 200%, reflecting the highly volatile macroeconomic environment. Raw material costs increased significantly due to surging prices in the global market, along with increasing freight rates due to rising oil & gas prices, and high interest for longer credit periods.
Due to these continuous cost increases, manufacturers and traders increased the prices of products, including those of building materials throughout the quarter, resulting in a slowdown of ongoing construction projects thereby effectively postponing the commencement of new projects until price stability could be established in the market.
Standing tall during challenging times
The Group had already foreseen the challenges that were to come and had set a clear strategic path, set by professionally qualified and experienced corporate planners under the leadership of its chairman Mr. Sivarajah Thumilan. The Blue Ocean Group has been known for its commitment to integrity, quality, discipline, flexibility, safety, and service throughout recent years. Even with the current crisis in the country, the Group is well geared to cater to the needs and wants of the different social groups and in the long run, support the government in its quest for self-sufficiency even amidst daunting challenges thrown at it by the local crisis and the global economy.
The Group maintains its position by playing to its strengths and reshaping its strategies with utmost fluidity, including investing in markets where the government is committed to long-term infrastructure programmes and choosing to exclude regions and sectors which cannot provide profitable, low-growth. It is due to the dexterity of its strategic leadership that the Blue Ocean Group has been able to continue its policy of offering quality apartments at reasonable prices across strategic locations to the general public and to foreign investors, with relative ease.
The Group’s priority is executing their already strong order book which has been predicted to drive attractive cash generation and returns in the years to come while providing the group a strong foundation to stand on, amidst volatilities. Their sturdy foundation built on many years of trust, dedication, loyalty, and steadfastness is what helps them stand strong even in the face of the storms that an unstable economy brings.
The Blue Ocean Group continues to work on its existing high-rise projects in Colombo, Mount Lavinia & Nuwara Eliya and will commence work on a new state of the art high rise projects in De Seram Road, Mount Lavinia, and in Havelock Place, Colombo 05, within the coming months. This will further establish their place in the construction industry like real estate trailblazers. The Group stands in stark contrast to unscrupulous builders with their lackadaisical approach to projects, affected by the lack of qualifications, competent staff, sufficient experience, finances, or access to good quality building materials brought which in turn results in higher cost and time over-runs, culminating with customer disappointment.
Link engineering – reaching beyond the best since 1981
Spanning over four decades, Link Engineering, a subsidiary of Blue Ocean Group of Companies, is a household name in Sri Lanka and is one of the first few construction companies in the country with a distinguished portfolio of remarkable projects under its belt. The company concluded a number of prominent projects within the past year, leaving a trail of stupendous construction landmarks in its wake.
Having been recognized with many awards for its construction excellence over the years, Link Engineering has undertaken a number of successful government and non-government projects in the past and continues to forge ahead in its trailblazing journey, keeping in line with its promise of quality, stability, and integrity. The company currently has a number of condominium projects as well as a variety of state projects such as hospitals and universities under its wing that have been entrusted to the group.
The Blue Ocean Group – The reputation precedes the name of the construction and real estate giant
The Group’s dedication to building, maintaining, protecting, and enhancing its reputation as the most efficient, and trusted company among its employees, clients, customers, supply chain partners, investors, and the community at large has safeguarded its position in the market as one of the pioneers in the industry, while its robust approach to corporate responsibility, has ensured delivery of the highest quality within budget. Its foundation is a sturdy one built over many years of loyalty, trust, and steadfastness which helps them stand tall despite the uncertainty of recent times.
Implementing and using environment-friendly material and constant market monitoring for the most cost-effective solutions to meet and exceed customer expectations, the Group dedicates its resources to ensuring high-quality product and service delivery through constant monitoring in order to deliver a high-quality, consistent customer experience. Further, being attuned to the industry, the Group is committed to developing insight into future trends, behaviors, and expectations of customers to be better prepared, in order to always deliver best-in-class products despite the challenges and shortages that these unprecedented times will bring. The promise that the Blue Ocean Group builds to last has over the years become a statement written in stone, owing to the Group’s reputation as the country’s trusted real estate and construction partner for many a decade.