Agenda item 82 includes a report from WHL which gives an update on progress on the development of Phoenix Avenue. The first part of the project was to demolish Eustace Crescent. It is my understanding that while WHL commissioned the demolition contract, they were not directly responsible for it. WHL intended the outcome of the demolition contract to be that the site was left ready for construction to start. However, a large amount of demolition debris has been left on site and needs to be removed, at considerable unforeseen additional cost. Could you please explain how this happened?
The decision to approve the demolition and the cost thereof was taken by the Executive in May 2012. The demolition work was actually carried out in 2014 and the contract for the building of Phoenix Avenue was awarded in 2015.
This whole project is controlled by a Project Board including representatives from WHL, Tenant Services, Property Services and others. They defined the brief for the demolition. At the time, back in 2012/2013, the specific requirements of WHL for the new build were not sufficiently advanced to inform the brief. That did not occur until much later after it had been demolished.
In the absence of a detailed brief, specifically around some of the debris, the demolition contractor was instructed by the Project Board to spread the hard core over the wet and muddy site including the voids and depressions left from the removal of the foundations.
A year on from this, after the land had settled following the distribution of that hard core in 2014, the site now has to be tidied up for building work to commence.
The original budget for the demolition had a contingency element which is quite normal in these cases, especially when the specific requirements of the new build are not defined and unlikely to be defined for 12 months. The estimated cost of the additional work means the total expenditure is within that contingency element. Clearly every effort will be made to reduce the final cost through negotiation but it is always helpful if contingencies are not used but they are in place to handle such circumstances.
But the real story here is of an ambitious Council working creatively to deliver 68 much-needed affordable homes to rent in Wokingham Borough.
As you know we very much support this project and we want it to be successful as we do want all the affordable housing projects that the Council is engaged in to be successful. So I suppose my supplementary is: it is a relief that we can contain the cost but this appears to have fallen slightly between two or three stools, shall we say.
Have any learning points been learnt from this and will you make sure that we don’t make the same mistakes again so that in future, and hopefully there will be many projects to come, we end up doing it properly?
Clearly the Project Board, which includes all the relevant people and has done from day one are actively looking at how this was handled and how it was managed and any learnings from that will obviously be taken on board.