Building boom sends construction costs in city rocketing
The project to build the 2022 Birmingham Commonwealth Games athletes’ village is under review with the council in charge of the job admitting that a building boom in the city and a fixed deadline mean it will not be finished on budget.
Papers prepared for tomorrow’s Birmingham council meeting have revealed it will be forced to find more cash or scale back plans for the project (pictured).
The documents said: "The costs associated with delivery of the village are seeing substantial inflationary pressures as a result of both the high levels of activity in and around Birmingham and the constrained timescales for delivery of the village.
"As a result of these cost pressures it is no longer possible to fully deliver the village in the way originally envisaged within the previously identified cost envelope of £492.6m."
While the athletes’ village scheme is under pressure, firms working in Birmingham have reported an increase in client confidence this year with more work coming onto the market.
The city is undergoing a boom in areas such as tower block development and is set to benefit from HS2 being given the green light.
One source told Building: "Contractors that were looking at jobs [in Birmingham] before Christmas definitely feel they can be more selective now."
A number of significant schemes such as Argent's Paradise project are under way, while HS2's approval means other projects will be facing increased competition for skills.
>> Also read: Authorities express concerns over Commonwealth Games projects
>> Also read: Council confident about Commonwealth Games pool despite continuing red-risk rating
The athletes’ village development, which is located on the site of the former Birmingham City University in Perry Barr, will be home to around 6,500 athletes and officials during the Commonwealth Games in 2022, and will be known as the Commonwealth Games Village, before being used to provide 1,400 new homes for the area.
The council launched a detailed review of options to ensure delivery of the requirements as set out in the host city contract was under way.
The review will look at both alternative funding opportunities as well as a review of the scope of the project and will lead to a revised business case, which will be presented to the council's cabinet soon.
The 2022 Commonwealth Games was awarded to Birmingham in December 2017 after Durban in South Africa was stripped of its host city status earlier that year because of financial concerns.
This meant Birmingham was given a lead-in time to the games of around four and a half years rather than the usual seven.
The council has said substantial progress has already been made in the delivery of the programme, with more than 80% of the land required now in council ownership and the remainder due to be secured via a compulsory purchase order.
It also said contracts were in place for the construction of a significant chunk of the accommodation required for the games, with all accommodation scheduled to be handed over to the organising committee by 31 March 2022.
The Commonwealth Games will last for 10 days and run from 27 July to 7 August 2022.