Update on costs provided as gallery project nears completion
Published on 24 September 2024
A breakdown of factors that have contributed to cost increases for of the Sarjeant Gallery redevelopment was presented to Whanganui District Council’s Operations and Performance Committee this week ahead of the gallery’s opening date on 9 November 2024.
Redevelopment director Gaye Batty says the current forecast at completion ranges between $73.5 and $74.2 million – an uplift of $18.4 million in total from the time contracts were awarded in 2019.
“Councillors and chief executive David Langford have asked for detailed and regular reporting, as they should, so we have provided updated financial forecasts at every meeting.
She says, “It is very exciting to now be so close to completion of this project, which has offered up complex challenges and some unusual surprises along the way.
“If you consider the restoration of a fragile heritage building sitting on sandy ground, add in a massive archaeological excavation on the adjacent site and a change of material and design for the new building façade – then throw in a global pandemic, with its impacts on the construction industry, supply chain issues and insurance costs, you start to have some idea of the complex task this has been.”
Gaye Batty says, “As this was the last report to the committee prior to the gallery opening, we outlined all the drivers for cost increases.”
The heritage restoration was the biggest contributor to cost increases, followed by delays directly related to COVID-19.
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Cost
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Activity
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$5.49m
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Additional scope of heritage restoration works – e.g. extra earthquake strengthening, additional heritage plastering etc.
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$2.72m
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Direct COVID-19 delays
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$1.88m
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Cost-fluctuation claims due to industry conditions and inflation
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$1.72m
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Unforeseen ground conditions
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$1.1m
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Additional archaeology requirements
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$0.94m
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Additional external landscaping works e.g the eastern driveway
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$0.94m
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Historic sunk costs back to 2014
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$0.93m
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Escalation of insurance costs
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$0.57m
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Capitalisation of the café fit-out
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$0.52m
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Additional AV/ICT/digital infrastructure to future proof the gallery
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$1.59m
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Assorted design changes and consenting costs in support of the above
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Whanganui District Council’s general manager community, property and places Sarah O’Hagan says the project team has maintained a positive culture throughout construction. “The redevelopment has taken place in an incredibly difficult period in time, socially and economically, but at the same time it has contributed to the local community, with $16.6m of the construction costs going directly to local sub-contractors.”
She says the ratepayer is only meeting approximately 27.5 percent of the total cost of the gallery redevelopment. “The rest of the cost has been met by central government, Lotteries and donations from trusts, individuals and community fundraising.”
Completion date for the gallery is confirmed as 24 October 2024, with some exterior works ongoing until 30 October. Te Whare o Rehua Sarjeant Gallery will reopen to the public on Saturday 9 November.
Sarah O’Hagan says, “A full evaluation of the project will take place in early 2025 and will be reported to the Operations and Performance Committee in the first half of the calendar year.”