Shortage delays uni project

The site of the new University of Otago music and performing arts centre on Union St East on...
The site of the new University of Otago music and performing arts centre on Union St East on Wednesday. PHOTO: PETER MCINTOSH
A shortage of builders is behind delays to Otago University's multimillion-dollar music and performing arts redevelopment in Dunedin.

Several major projects in the university's capital works schedule are behind this year, including the $26million development, which is due to be completed in early 2020.

It involves constructing a new building containing recording studios beside the Robertson Library in Union St East, while also refurbishing the teaching wing and two blocks on the university's College of Education campus.

A summary of work for the nine months to September 30, presented to the university council this week, showed the university spent $126.4million in capital expenditure against a budgeted $145.9million.

The music and performing arts project was more than $13million under budget.

Chief financial officer Sharon van Turnhout said there was so much construction work going on in Dunedin fewer tenders were coming in.

When tenders were in, there were "prolonged negotiations'' with contractors and it was difficult to negotiate favourable terms.

A groundbreaking ceremony for the new site was held in August and piling work has started on the facility.

However, the retendering process delayed the start date by about six months, a report presented to the council said.

Ms van Turnhout said on Friday she was expecting the situation to continue with the coming hospital build, and it was "a cause for concern''.

The university would be looking at its capital works plan and starting its projects earlier if it needed to, or making sure it had contingency plans in place if work needed to be done after the hospital build.

Otago Master Builders president Bill Hamilton said in general it was "certainly a busy time'' in the construction industry in the city, and builders were not able to meet people's expectations and start straight away.

He expected the high demand on builders to continue for the foreseeable future, he said.

"There's a shortage of supply of good workers and good tradespeople, really.''

Stewart Construction managing director David Grant agreed the last two years had been "extremely busy'' and there was "a fair bit of pressure on the market'', but he hoped the demand would continue into next year.

Otago Chamber of Commerce chief executive Dougal McGowan said high demand was noticeable across a number of different sectors, and was also driven by projects in South, Central and North Otago.

He saw the city as being "vibrant'' rather than the demand being a problem.

University campus development director David Perry said refurbishments of the existing performing arts buildings were expected to be complete by late 2019, and the new building was due to be finished in early 2020.

The original deadline for the project to be finished was mid-2019.

The research support facility on Great King St - which will be used for animal testing as well as other forms of research - was delayed earlier this year due to adverse ground conditions.

However, the university's dentistry buildings redevelopment, involving the construction of a new clinical services building and the refurbishment of the existing Walsh building, has gone over its budget for the year due to work progressing more quickly than expected - with $46.5million spent on the project, nearly $2million more than expected.


Interesting wording. I wonder what favourable terms the Uni was trying to negotiate, perhaps the same kind that have driven many other building companies to the wall?