Posted Aug 30, 2024, 3:26 PM
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Registered User
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Join Date: Dec 2015
Posts: 15,602
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Gary Mason from last year. Seems more likely they didn't factor in cost escalation while the project was stalled out which is why it jumped so much. If they are doing some scaled down project they should move it somewhere else and COV can sell the land or redevelop it with a better use.
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The original budget for the project was set at $350-million, which included a $50-million endowment – the interest and dividends of which were to pay for the building’s annual upkeep. In late 2021, the budget was raised to $400-million, an amount to be covered through private donations and government contributions. With the $50-million endowment still included, that presumably leaves $350-million for construction costs.
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It is no secret that construction costs in Canada and around the world have exploded. All the factors for this price escalation are well known: the pandemic (which severely affected supply chains), inflation, interest rates, and fuel-cost increases linked to the war in Ukraine.
Widespread labour shortages in the construction industry have also led to wage inflation. Many developers and contractors are desperate for workers.
Rob Wilson, a director at BTY, a construction cost consulting company, told me that hard construction fees (which exclude things like design and permits) have increased 20 to 25 per cent in Greater Vancouver in the past couple of years.
The total gallery space is estimated to be 330,000 square feet. With a construction budget of $350-million, the cost per square foot that the gallery and its architects are banking on seems incredibly low for downtown Vancouver, especially for a project as unique and complex as this one. One construction builder I spoke to says the budget could be off by $150-million or more.
Also, one must assume that some of the money budgeted for construction has already been spent on soft costs such as architects, structural engineers, geotechnical assessment of soil conditions, and building permits. In the case of a gallery, those costs can be as much as 30 per cent or more, according to one architect I spoke with.
On top of that, you have the expense of relocating artwork, which can also be pricey.
All of which is to say: There seems little chance this art gallery is going to be built for anything near what they have budgeted, especially given that some of that money has assuredly already been spent on preconstruction costs.
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https://www.theglobeandmail.com/opinion/...ers-new-art-gallery-is-complete-fiction/
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