Fears that cost of new civic square in city could spiral out of control

By Calum Ross

Published: 14/05/2010

A leading authority on architecture has raised fears that the cost of creating a new civic square in Aberdeen could spiral as uncontrollably as the final bill for the Scottish Parliament building.

Neil Baxter, secretary of the Royal Incorporation of Architects in Scotland, suggested the final price tag for Sir Ian Wood’s proposed development at Union Terrace Gardens could “easily” be double its £140million budget.

In a letter to Scottish Enterprise, he alleged the government agency signalled an “inappropriate” desire for an architect from outside Scotland to win the design competition for the site.

Scottish Enterprise said the claim was unfounded.

Mr Baxter’s intervention came on the day a 10,000-signature petition against the scheme was handed in to the local authority by supporters of rival plans to build a Peacock Visual Arts centre in the sunken Victorian gardens.

Councillors will meet on Wednesday to decide whether to accept Sir Ian’s £50million pledge towards the project. Chief executive Sue Bruce and her top team are urging approval of it.

A feasibility study by architecture firm Halliday Fraser Munro said the street-level civic square could be built at a cost of between £120million and £140million.

But in a letter obtained by the P&J, Mr Baxter cast doubt on the assessment, warning the debacle over the Holyrood parliament ensued from a “risible” initial budget being set for the design contest.

“Considering that, in recent years, buildings of comparable scale in Aberdeen and elsewhere i on straightforward urban sites have cost twice the quoted budget figure for this particularly problematic and challenging site, we would be concerned about launching a competition based on such a questionable budget,” he said.

The budget for the parliament buildings in Edinburgh soared from £55million to £430million, and it was completed three years late.

Mr Baxter also said a Scottish Enterprise official told his deputy there was a desire the competition should be won by a known name from outside Scotland. He said the suggestion was “offensive” to indigenous talent.

Maggie McGinlay, regional director of Scottish Enterprise, said the agency was committed to following European procurement rules. “We are disappointed that Mr Baxter has interpreted this phone conversation in this way,” she said. “His concerns are unfounded and I will be contacting him to discuss them as a matter of urgency.

“This was simply an exploratory phone call, undertaken as part of initial research into the international competition idea, should the Union Terrace Gardens project get the go-ahead from Aberdeen City Council.”

Tom Smith, chairman of Aberdeen City and Shire Economic Future (Acsef), the development body spearheading the civic square plans, said: “The project has already attracted global attention from architects and engineering firms and we hope to build on that through a competition which would be open to all and certainly not preclude Scottish or UK architects.

A full design brief which takes the public’s views, the existing topography, heritage and architecture into consideration will be prepared if the project moves ahead.”

Reader's Comments

The costing for the city square project looks somewhat dubious, up to the point of incredulity. The £120-140M projected cost does not include the numerous extra costs listed in the feasibility study and there is no contingency for cost over-run. The proposal to fund £70M with a TFI scheme is a desperate measure. This would probably involve the council issuing a bond for that amount with council property effectively mortgaged as assurance. If the council defaulted on the loan because of a shortfall in future business rates income, then the property would be siezed. It was also made clear on Wednesday night by ACSEF, that if there is a massive cost over-run, then the council would ultimately be liable for finding the money to pay for this. The suggestion that the cost could double gives an idea of just how risky this project is. The unfortunate fact of the matter is that it will be the public who will end up paying for any financial calamity with the city square either in loss of services, loss of amenities or extra council tax (for years and years). So there you go, we get hit with the downside if things go very wrong and the businessmen of the city make a profit no matter what happens. Huh! It's too much of a gamble councillors, give the city square the big No on Wednesday (just like we did ...).
mike shepherd
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Which ever side of this debate you may be on, there is one near stonewall certainty: if it is delivered as a public project, the public will pay a lot more for it than they were told at the outset. Examples are legion across the land. Donald Dewar told the people that the Scottish Parliament building would cost ‘not more than £40m.’ It cost at least £400m. The NHS super computer was scheduled to cost £2.3b and the last published estimate was a mind boggling £12.4b. Blair’s government announced that the Olympics would cost £2.4b and they have already racked up £9.35b. The cost of building the WPR was announced originally as being £395m and the figure has escalated so much that it isn’t talked about now. The London Dome cost over run was £204m. So if we are told that the project cost of City Square is £120m, we should assume that its final cost will be £240m, of which £50m is to met by a generous philanthropist, leaving a balance to be met from public funds of £190m. If ACSEF remains confident that it will be delivered for £120m then can we please have a personal guarantee from its committee members for any liability beyond that figure.
Ubi D
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I happened upon an Evening Express story published in 13/11/2008 when the debate started about Sir Ian Wood's desire to build a civic square. It says "There could be a new train station ..... "you would step off the train - and continue serenely upwards to the civic square. .......by utilising rail tracks and roadway below and linking them to lifts and escalators." It goes on to say that Montreal and Moscow houses shops underground - ... "Sir Ian describes his vision for Union Terrace Gardens as a 'cross between the Grand Italian Piazza and a mini Central Park'." I had to pinch myself at this last quote. Looking out of the window, I'm in Aberdeen, it's May, and the temperature outside is barely hitting double figures. I'll finish with a quote from the same article from Charles Skene of Skene Investments "I'm strongly in favour of what is proposed. It is a major opportunity. It is the last great open space which is under-utilised."
dorothy bothwell
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Maggie McGinaly told all those who asked during the consultation period that "it's not a numbers game" in answer to questions about how the result of the consultation would be determined. It now appears that her answer also applies to the budget allocation for the CSP. Didn't Acsef tell us that "this time we've done our homework" at the start of the consultation period? Looks like it's a fail, gentlemen.
Richard Fraser
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Gosh the Cheek of them (Acsef). Oh so the RIAS secretary, who undoubtedly has much architectural experiece, claims the same thing many of us have claimed, that the 140 million estimate is highly unrealistic and could easily be doubled before beginning to sound plausable, but Tom Smith, in all his infinite wisdon, can say with all certainty that this claim is unfounded, dismissing it as nonsense. Mike, not only is there no overrun contingency in that figure, but there is also, essential costs omitted, and flagged up as such. This involves purchase of private land, network rail airspace, and everything else that isnt the shell of the building. So before you even get to the contingency, it's already come up to an easy 200. But, no, tom smith knows best, maybe we are incapable of understanding the appendix of the feasibiloity report too, since we clearly didnt understand the vision.
Ved M
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The other thing that i find insulting, is the degree of certainty that they speak of this competition with, in their eyes, it's already been approved and all. Any PVA spokesman has always had a humble approach, speaking with hope and indefinitives, yet ACSEF show no concern over anything else going on, it's a definitive future tense sentecne construction, they Clearly don't care about anyone else, nor do they even consider anyone else's desire or opinion.
Ved M
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Of course there are only two reasons that the RIAS would say that Scottish Enterprise suggested they wanted a blue-ribband international architect firm to "win" the design competition. Firstly, they are lying. Why? Any project on this scale, no matter how unimaginative and limited, would represent a huge slice of revenue to a member in a tight market. The RIAS have nothing to gain from lying, then. The other possibility is that Acsef and SE denials are very hollow indeed. And that in fact they wish to bring in an architect of international reputation to provide their flagging (sorry, flagship) project with a fig-leaf of credibiliy it currently lacks.
Richard Fraser
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I think it's a great shame that Halliday Fraser Munro, who have actually successfully kept face in all this, are being misquoted, because this article makes it sound like they are the ones that have got it wrong, when it is Tom Smith's interpretation that is way off.. Criticism of the scheme design aside, HFM have produced a very detailed and robust report, with all omissions, assumptions that might not necessarily be true, and risks clearly outlined, it has that ACSEF touch of diplomacy in some areas, but if you read it in depth enough, they have actualoly covered all the bases that can be pointed back at them. Furthermore, they have never promoted the scheme as their own, nor have they advertised themselves as the architects spearheading this, they have always stated themselves as merely ACSEF's technical advisors. So to attribute an unrealistic cost interetation to them in this article is a tad unfair.
Ved M
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Is it not a disgrace that anything that is wrong is quickly made right if money can be found in it? This argument about finance is a smoke screen, keep away from it. All of a sudden the funds will, as if by magic, appear and it will be taken as the moral right to plough ahead.
manniewe naebrain
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Think it will take more than a fig leaf, Richard!!
Alasdair Johnston
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Richard, might be a distant memory, but did ACSEF not attribute Martha Schwartz's name at one point to this, as a leading landscape designer teaming up with HFM? That was the attempt to give it that big name draw. If PVA have Brisac Gonzaless, acsef will do one better, but not really.
Ved M
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Ved, I think you would have a point if it weren't for the fact that in November 2008 "Sir Ian warned that if the costs were above £100 million it would be “very difficult” to make it happen" according to: http://www.eveningexpress.co.uk/Article.aspx/933616?UserKey=#ixzz0ntVtL9Qy ... As with all these things, reports are produced according to brief. HFM produced a feasibility study in the full knowledge that costs above a certain level would stymie the project, so they came up with a cost base of £120m. Of course in order to do so they caveated their report to a quite amazing extent; 25 major exclusions, no fit-out or finish, and more. And that's before you start to question some of the assumptions that the engineering aspect won't throw up challenges we don't know about, so the exclusion of major contingency is a huge error. HFM aren't blameless. Of course no firm will respond to a potentially profitable brief by saying "ha ha you're mad it can't be done for that", they'll put in their response, win the contract and THEN say "ha ha" etc. The same is true for any architecture competition - entires will claim that it can be done and then it'll be a case of "well we didn't forsee this, nobody told us about that" and the cost will spiral. Had Wood said "here's my vision, how much?" then HFM's answer would have doubtless been radically different. But he said "tell me this can be done for around £100m" - and HFM knew that if they said no, somebody else would say yes and land a nice £100K+ contract to produce the report.
Richard Fraser
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I should add that the above is my own opinion, of course... But it's based on my own experience in business where producing a report designed to win business means you have to cost to the brief, or you won't get the business. I'm sure most in the tendering and procurement business will have experience of the same.
Richard Fraser
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You are absolutely right Richard, that was the ACSEF diplomacy in their report i was referring to, yes they did their utmost to bring it to as close to 100m as they could, and it is clearly done with a degree of promotion, but the assumptions and risks were still identified, something that they could have glided over, and are in the report for anyone wishing to put it under scrutiny, such as yourself, me and a few others. I'm surprised ACSEF themselves aren't a tad more worried, because it's well risky to be branding about a figure that they know for a fact should be larger. It has happened on so many many occasions, and inevitabely the finger is always pointed at the architect, when an unrealistic cost was given in the first place. This has been the case with the Parliament building, with the Liverpool One development which came in at just under a billion, and of course the Transport Museum, or every one of Zaha's projectws for that matter. Inevitabely, nobody is going to question the early claims, and once the project has been won, and is under constructin, the money WILL be found to finish it, at that pount any finger pointing is irrelevant, and the damage to their reputation is insignificant compared to the publicity once the project is finally complete.
Ved M
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There have of course also been many projects completed to budget, and on time, this is not an absolute rule of thumb in the construction industry. It's just when figures are trying to be masked, and when you people try to pass something of that they know will cost more as less expensive that this happens. Of course, it's entirely wrong, and in my opinion the ARB should have stricter punishments in place against it. After all, it does go against their code of conduct, by placing other practices at a competative disadvantage through unfair and false promises. Many times has a prospective project, that would be very realistic for a stated budget, been shelved in favour of a much more dazzling project that could have never been done to that budget but claimed that it would anyway. I think the CSP and PVA are a perfect example, the PVA does not promise all the Glamour and Success that the CSP does, but what it does promnise is entirely plausable, and acomplishable. Yet the ACC have completely bought into all the unrealistic CSP claims, and have given it free reign for over 18 months now, shunning the PVA in the meantime.
Ved M
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I have said this before and will say it again. If I was Woody and saw such strong opposition to my scheme I would simply have withdrawn my offer of £50M and gone away. Why has he not done this what is the hidden agenda here?
desperate red
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hey desperate red (nice name!), I would guess that SIW is displaying what the french call 'volonte'. This translates as willpower, but if you have ever worked with the french, you get to find out taht it means a lot more than this. Once you get an idea into your head, and you've convinced yourself it is right, you never ever give up until you have got what you want. A bit like being the Terminator chasing after John Connor ... In my experience, a lot of businessmen act like this, it's one of the tricks of being successful. It also makes working with the french a pain in the neck, although you know what you are up against. If you have to fight a tank, you need another tank!
mike shepherd
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Ha ha, Mike, that's what we will call the csp!! ''Place de Volonte'', right above the 'Centro Commercialle di Machiavelli'', since the Woodenator is so determined to make give aberdeen that international feel with his Menace in the Terrace..
Ved M
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For the £50M gift, the Aberdeen council will hand over their old building to Sir Ian Wood for £1 (a pound)for his renovations & upgrading. Wood Group will finally have their corporate head quarters in the centre of the Granite City..............Woody is no fool when parting with his fathers money
Fiona Cooper
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Better watch out Ved, the first thing set up in the new City Square will be a guillotine, with the ACSEF board happily knitting away in the background as the heads roll ... (like that one, Menace in the Terrace !)
mike shepherd
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Mike. Thanks for the vote of confidence in the "Nome de plume", its about the Dons not the commies!! However even a football fan has an opinion on this and it is to tell Wood to get lost and as Fiona says spend his fathers money somewhere else.
desperate red
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Mike and Ved - this is better than Mock the Week or Have I Got News for You!! Thank goodness a sense of humour hasn't vanished. Like especially the Menace in the Terrace - in fact like it all. So added to Wood's Folly we have................keep them coming.
dorothy bothwell
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Fiona - an interesting angle to this, which hadn't occurred to me. St Nicholas House, once empty, will be an embarrassment to wir Cooncil; nobody wants to buy or rent it, and they can't afford to demolish it as per the original plan. It's not inconceivable that ACC will end up selling it to SIW for £1, and that we'll have to look at this monstrosity for another 40 years!
Alex Mitchell
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This is beginning to sound like some fairy story. Once upon a time there was a Development body who were over the moon that Union Terrace Gardens were to be rejunivated by the Peacock Art and the Gonzales brilliant building, The Council was happy because there plan of a Civic square once St Nicholas came down would occur and the people were happy all this would make the city nice again. Thye were nearly shouting from the rooftops. Then along came a very, very rich man and said "I have a vision" Cover the garden with concrete and I will give you £50 million. Now if this had been Joe Bloggs, the laughter would have been heard all over Aberdeen. with a comment like "Get on your bike," This has already been brought up and quite rightly put down. But the magical money worked it trick and the ACSEF who was the development body and the City council soon forgot their dreams and plans and went along with this very, very rich man. The council gave them money to promote this with a public consultation so all the people could say what they wanted, Little did they know this was a very distorted picture, but even then they were not fooled and said No - Not what we want. Now this very very rich man had said, It the public don't want it I will go away. But the magical money had worked its job too well and would not let him. Most fairy stories have a happy ending, but this one seems to be destined for the bin. Even our unelected Chief Executive is willing to give them more money to pursue their "Vision". Now they want an International Architect. We already have a brilliant plan by an esteemed Architect. Perhpas Sue Bruce and council, can explain that when the city has more cuts coming, they can even contemplate the absurdity of this "Vision" And are quite willing to sell the citizens down the river. AS the saying goes. "The love of money is the root of all evil". And it has certainly done its work well here. From glowing praise for the Peacock plan to this, just shows how shallow these people are. We can only hope that enough of our council at their full committee meeting will show some common sense and decency to the public. But don't hold your breath.
minnie mo
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Tom Smith and 50 businessmen wrote that without this going ahead, Aberdeen is doomed and something about our tarnished reputation. Can anyone tell me where and what that means. We used to be called the "Silver City" so I would imagine that the "Tarnishing" is because of their hypocrasy and underhaded dealings in all this. Also we would be the laughing stock of the world. Can they not see that with their action, they have succeded in what they accuse the people of Aberdeen. They have Tarnished the reputation and are making us the lauging stock of the world. Time for ACSEF to be disbanded, if this is our future, it is all very bleak. Their arrogance is sky high.
minnie mo
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Alex. I have been assured by the council (Kevin Stewart & John Stewart) that St Nicholas House will be demolished. Its crumbling from the inside out. The cost of fixing it up and modernising it will cost more than it will cost for them to move into Marischal College. They cannot rent it out as it is not fit for purpose. What they could not do is put a date on the demolition. It could be standing empty for decades.
John Rutherford
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John can you trust your Aberdeen council friends to be honest? St Nicholas House is definatly fit for purpose & comes complete with car parking. Which will suit the Wood Group......bargain basement engineering....DIRTY DEEDS DONE DIRT CHEAP!!!!
Alan Hadley
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Breaking News - Annie Lennox writes letter to the council. http://www.annielennox.com/news.php?newsItem=1886 "I urge you then on May l9th to listen to your electorate and reject plans to take the unpopular City Square project any further. Over £300,000 of public money has been spent asking the people what they think. They have responded with a resounding 'No' to losing their Gardens,'No' to spending £90 million of public money on this project in a time of cuts to vital services and 'No' to losing the deliverable and sensitive plans of an arts centre within the existing Gardens. To carry on with the City Square would be an act of civic vandalism and an abandonment of democracy." RA for Annie! Well done that woman!
mike shepherd
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Well we will no doubt be getting Alex Ferguson and the Americans again on the side of ACSEF. They will run Annie down again but praise the others. Were the Americans and Alex Ferguson ever shown the other plan or even told of the Peacock project, or was that ignored like the consultation. It might be difficult for the council to decide wnen John Stewart is on the board of ACSEF and Sue Bruce is an invited guest. With the Chief executive throwing her weight behind the Wood project, no wonder Tom Smith is all grins and cheer. They must be feeling quite sure where this will go. Even if the council rejects it and there is still doubt there, ACSEF/Wood will go to the government with all the lies and tales of doom regarding the city and get them to overturn the decision. They have no shame in that regard, they cannot be seen to fail otherwise they will become a worse laughing stock than they already are. Just how can you believe anything they come up with in the future for our development after this almighty mess they have made of this project. We do need to consider the fact that none of them have any sense, but are too busy keeping their eye on the £50 million with no regard to the later costs, disruption and contempt of the people of Aberdeen. Our council has made millions of pounds of cuts for us, and are considering throwing away some more. It would not be a surprise if the Common good fund was robbed for this. After all it is being used for their Snacks. Wonder when Sir Wood came up with this idea, was he aware of what the reaction would be towards his "donation". We now have lived up to our reputation of being The Meanest City in Scotland.
minnie mo
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