News: Rotherham markets revamp goes over budget again - reaches £46m
With the first phase due to open in a matter of months, the cost of completing a long-awaited revamp of the markets in Rotherham town centre has risen again and is now at £46.84m, more than double original estimates.
An increase in demolition costs, inflationary increases linked to delays with extended periods of clarifications and amendments, and "an overestimation of project readiness" when the contract was awarded are being highlighted in a series of challenges in the delivery of the project.
The council's chief executive is commissioning an investigation into the project, which, for town centre schemes, is second only to the £47m Forge Island development in terms of total investment.
The redevelopment of the Drummond Street site also includes a modern central library, a new community hub, improved public spaces, and links to the town centre and college. The renovations will build upon the existing mix of shops and services with the addition of a new food hub and dining area on the first floor. Flexible space is also being created which can be used for exhibitions and events when required.
Henry Boot began works at the end of 2023 and have since made progress on the construction which has a total contract price of £36m.
Second only to the £47m Forge Island development in terms of town centre investment, the revamp was originally scheduled to finish in December 2025 but this was pushed back to 2027. When government funding was originally confirmed, the estimated cost of the project was £22m.
Having secured a further £6.5m from the South Yorkshire Mayoral Combined Authority (SYMCA) last year, Rotherham Council's cabinet is being asked to approve an allocation from various council funding pots to fill a funding gap following an increase in the total budget from £40.894m to £46.844m.
£200,000 is set to come from the Local Regeneration Fund (LRF) surplus, £1.66m from the council's Town Centre Investment Fund and £4m from the authority's Capital Contingency Fund.
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A cabinet paper states: "Over the course of the project’s development, a number of challenges have arisen which has rendered the achievement of this scope undeliverable for the current agreed budget. Further, the delivery of the Outdoor Covered Market and Library has continued, in line with the agreed contract, resulting in insufficient budget to complete the project to the agreed scope.
"The Chief Executive of the Council will commission an investigation into how these challenges have arisen and what lessons can be learnt."
On delivery, the council admits that it tendered and entered into a contract before key assumptions had been confirmed, "resulting in an overestimation of project readiness. At contract award, the design and specification were insufficiently developed to be construction-ready, with undue reliance on value engineering assumptions and provisional sums. Contingency was underestimated, and an excessive level of risk was transferred to the Council."
A lack of detail on the council's specifications required further definition following the award of the tender, with the paper stating that: "This was in part due to a lack of stakeholder engagement early in the scheme." Extended periods of clarifications and amendments to layouts and servicing caused delays and increased contractor costs.
Outstanding design work required the appointment of additional design expertise, leading to significant delays and rising costs. "The volume of design work, clarification and consolidation between numerous design teams led to further delay and cost," the paper added.
When the design was completed, value engineering opportunities were anticipated to bring down costs but these assumptions did not happen.
The project also included unconfirmed budgets against which actual costs would be attributed as the project progressed. The risk of any cost increase in these provisional sums was accepted by the Council and contingency was insufficient.
Costs were also increased by Health & Safety and Compliance, as the council was unable to carry out invasive surveys before the contract was awarded. A "significant presence of RAAC and of asbestos" in the building, which opened in 1971, was previously blamed for cost rises.
The paper also sets out that, on governance and resourcing: "Fundamental aspects were lacking at crucial stages of the project, which led to uncertainty in decision-making and meant the scheme was not prioritised for oversight, management and resource in a way that properly reflects its multi-faceted nature and scale."
Also included in the report is the latest contractor programme which indicates the completion of various parts of the scheme:
• New Market Hall: June 2026
• Library: Autumn 2026
• Public Realm: Spring 2027
• Market Gardens: June 2026
• Library: December 2026
• Market Square: Spring 2027
• Indoor Market: Autumn 2027
Images of how the new Rotherham markets might look inside when complete, were published last year.
Images: Henry Boot Construction / LinkedIn
An increase in demolition costs, inflationary increases linked to delays with extended periods of clarifications and amendments, and "an overestimation of project readiness" when the contract was awarded are being highlighted in a series of challenges in the delivery of the project.
The council's chief executive is commissioning an investigation into the project, which, for town centre schemes, is second only to the £47m Forge Island development in terms of total investment.
The redevelopment of the Drummond Street site also includes a modern central library, a new community hub, improved public spaces, and links to the town centre and college. The renovations will build upon the existing mix of shops and services with the addition of a new food hub and dining area on the first floor. Flexible space is also being created which can be used for exhibitions and events when required.
Henry Boot began works at the end of 2023 and have since made progress on the construction which has a total contract price of £36m.
Second only to the £47m Forge Island development in terms of town centre investment, the revamp was originally scheduled to finish in December 2025 but this was pushed back to 2027. When government funding was originally confirmed, the estimated cost of the project was £22m.
Having secured a further £6.5m from the South Yorkshire Mayoral Combined Authority (SYMCA) last year, Rotherham Council's cabinet is being asked to approve an allocation from various council funding pots to fill a funding gap following an increase in the total budget from £40.894m to £46.844m.
£200,000 is set to come from the Local Regeneration Fund (LRF) surplus, £1.66m from the council's Town Centre Investment Fund and £4m from the authority's Capital Contingency Fund.
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A cabinet paper states: "Over the course of the project’s development, a number of challenges have arisen which has rendered the achievement of this scope undeliverable for the current agreed budget. Further, the delivery of the Outdoor Covered Market and Library has continued, in line with the agreed contract, resulting in insufficient budget to complete the project to the agreed scope.
"The Chief Executive of the Council will commission an investigation into how these challenges have arisen and what lessons can be learnt."
On delivery, the council admits that it tendered and entered into a contract before key assumptions had been confirmed, "resulting in an overestimation of project readiness. At contract award, the design and specification were insufficiently developed to be construction-ready, with undue reliance on value engineering assumptions and provisional sums. Contingency was underestimated, and an excessive level of risk was transferred to the Council."
A lack of detail on the council's specifications required further definition following the award of the tender, with the paper stating that: "This was in part due to a lack of stakeholder engagement early in the scheme." Extended periods of clarifications and amendments to layouts and servicing caused delays and increased contractor costs.
When the design was completed, value engineering opportunities were anticipated to bring down costs but these assumptions did not happen.
The project also included unconfirmed budgets against which actual costs would be attributed as the project progressed. The risk of any cost increase in these provisional sums was accepted by the Council and contingency was insufficient.
Costs were also increased by Health & Safety and Compliance, as the council was unable to carry out invasive surveys before the contract was awarded. A "significant presence of RAAC and of asbestos" in the building, which opened in 1971, was previously blamed for cost rises.
The paper also sets out that, on governance and resourcing: "Fundamental aspects were lacking at crucial stages of the project, which led to uncertainty in decision-making and meant the scheme was not prioritised for oversight, management and resource in a way that properly reflects its multi-faceted nature and scale."
Also included in the report is the latest contractor programme which indicates the completion of various parts of the scheme:
• New Market Hall: June 2026
• Library: Autumn 2026
• Public Realm: Spring 2027
• Market Gardens: June 2026
• Library: December 2026
• Market Square: Spring 2027
• Indoor Market: Autumn 2027
Images of how the new Rotherham markets might look inside when complete, were published last year.
Images: Henry Boot Construction / LinkedIn
1 comments:
They're messing the traders about no end. No confirmed moving date yet, just a vague one that keeps being pushed back. No confirmed rent price yet. All the while the footfall in the indoor market is now at an all time low with stalls closing on a weekly basis. By the time the move happens there will only be a handful of traders left.
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