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Decision details

JUNIPER HOUSE REDEVELOPMENT - AWARD OF CONSTRUCTION CONTRACT

Decision Maker: Cabinet

Decision status: Recommendations Approved

Is Key decision?: Yes

Is subject to call in?: No

Purpose:

Cabinet to approve the award of the construction contract for the redevelopment of Juniper House.

 

Decision:

Cabinet:

 

(1)  noted that an enhanced scheme for the redevelopment of Juniper House, which will deliver 91 new homes, 50 percent of which will be affordable, a nursery and commercial space has obtained planning permission;

(2)  noted that the Council was successful in securing GLA grant of £2.984 million under the Building Council Homes for Londoners programme for the Juniper House scheme.

(3)  approved the award of the Stage Two (Construction) contract for the Design & Build (D&B) of the scheme to Hill Partnerships Ltd for the sum of £30.1 million and delegate to the Commercial Director – Property and Delivery, in consultation with the Director of Governance and Law, the ability to enter into the necessary legal agreements.

(4)  approved additional expenditure of £25.3 million, which together with the previous approval of £4.8 million at Stage One, will bring the total approval to £30.1 million. This will enable the cost of the contract with Hill Partnerships Ltd for the two-stage D&B of the scheme to be met;

(5)  approved additional expenditure of £6.2 million to meet the Council’s client-side development costs necessary to progress the scheme to completion.  Approval of this sum, together with the previous approved expenditure of £1.4 million, will bring the total approval for client-side development costs to £7.6 million;

(6)  noted that the total additional approval being sought (paragraphs 2.1.4 and 2.1.5 of the report refers) is £31.5 million and, along with previous approvals of £6.2 million, brings the total D&B budget for the enhanced scheme to £37.7 million; and

 

(7)  noted that the scheme was independently financially appraised by GL Hearn (included in exempt Appendix D to the report) and that this appraisal indicated that this scheme can be delivered on a breakeven basis and realise a land receipt to the Council of £2.9 million, along with £0.6 million to cover previously expended staff relocation costs.

 

OPTIONS & ALTERNATIVES CONSIDERED

 

The alternatives to not awarding the Stage Two contract would be to either abandon the project altogether or seek to deliver the original reduced scheme of 68 homes. The former will result in significant abortive costs and reputational damage to the Council. The latter will render the scheme unviable and will not be supported by statutory consultees.

 

 

Report author: Chuck Onyiliogwu

Publication date: 10/10/2019

Date of decision: 10/10/2019

Decided at meeting: 10/10/2019 - Cabinet

Accompanying Documents: