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FAQs Lansdowne Closing Sept25 2012

FAQs Lansdowne Closing Sept25 2012

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Published by Jon Willing

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Published by: Jon Willing on Sep 26, 2012
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Questions and Answers:
Lansdowne Partnership Plan closing
September 25, 2012
Key Messages:
These reports provide a comprehensive update on all of the legal requirementsnecessary to finalize the Partnership with OSEG, and also provide an update on theconstruction schedule, costs and work to date.We’re pleased that all the final legal conditions have been satisfied and we are now ableto move forward with the construction and revitalization of Lansdowne.With the construction activities Council approved in May 2012 progressing well, theoverall construction is still on schedule with the stadium completed for the 2014 CFLseason and the remainder of the redevelopment fully complete by the summer of 2015. As part of this report, the City is also pleased to announce that Pomerleau was thesuccessful proponent for the tender to build the stadium, parking garage and remainingsite servicing, as well as provide overall site management.The City has obtained a fixed price contract for the stadium and a conditionalguaranteed maximum price contract for the parking garage after extensive negotiations.The litigation launched by the Friends of Lansdowne Inc. and the LansdowneConservancy, and the implementation of the rigorous design specifications approved bythe LDRP and Council, has resulted in an 18 month delay and an inflationary pressureof $8.2 million.Overall staff is recommending a 5.8 per cent increase to the Council approved capitalauthority, which given the complexity of this project, the costs associated with the 18month delay and the new information we now have as a result of moving from a pre-tender estimates to a fixed price contract, are within industry standards.The urban park design remains within the previously approved capital budget.We are now building a new Lansdowne that will connect Bank Street to the RideauCanal, and link the Glebe and Old Ottawa South into a vibrant, urban community.Lansdowne will be a model for best environmental practices as we work towards LEEDNeighbourhood Development certification. Lansdowne will be one of only a fewdevelopments striving for this new certification in Canada.Lansdowne will have one of the most spectacular parks in Canada, something thepeople of the Glebe and Old Ottawa South will enjoy, as will residents and visitors fromacross the City.
September 25, 2012 Questions and Answers
Questions and AnswersLansdowne Partnership Plan closing 
The new Lansdowne will be a magnificent citywide asset that will benefit and beenjoyed by all residents.
Questions and Answers:
Q: What’s new in this report? What’s changed?
 A: The report indicates that all remaining site plan conditions, Council motions anddirections and appropriate due diligence have been met prior to close of the LansdownePartnership Plan (LPP).This report provides an update on the LPP that was originally approved by Council in2010, and the legal conditions required by both the Ottawa Sports and EntertainmentGroup (OSEG) and the City to finalize and legally close the agreement. The report alsoprovides an update on the construction and design timelines and activities for allelements of the Lansdowne project, the costs and the associated agreements.
Q: Is the project still on schedule?
 A: Yes, while the start of construction was delayed, construction of the stadium is stillexpected to be complete in time for the 2014 CFL season and for the remainder of theredevelopment by mid-2015. This is possible due to the Council direction in May 2012to begin preparation work, including relocating soils to create a berm, moving theHorticulture Building and demolishing the Coliseum building.
Q: What is the current status of construction activities at Lansdowne?
 A: The current work at Lansdowne is on schedule. The east corner of the parkinggarage, which will be the foundation of the relocated Horticulture Building, will becomplete in October 2012. The Horticulture Building is being prepared for its move 150metres east, which will occur in November 2012. The Coliseum Building has beendemolished, and site servicing work, including sewers, is proceeding and expected tobe complete in November 2012.
Q: Has the contractor for the next phase of construction been named?
 A: Yes, Pomerleau was the successful proponent for the competitive tender process,initiated in July 2012, to build the stadium, parking garage and remaining site servicing(utilities, storm and sanitary sewer, etc.) as well as to provide overall site management.The tender was overseen by the City’s Chief Procurement Officer to confirm that itconformed to the City’s Purchasing By-law. A fairness commissioner was also appointedto oversee the procurement process to ensure it was open and transparent.Pending Council approval, Pomerleau will begin operations at the site in mid-October.
Q: What is the cost for the construction? What does this include?A:
 After extensive negotiations with Pomerleau, a contract (conditional on approval byCity Council) was awarded with a fixed price for the stadium and a guaranteedmaximum price for the parking garage.
 A conditional guaranteed maximum price
September 25, 2012 Questions and Answers
Questions and AnswersLansdowne Partnership Plan closing 
contract of $61 million for the garage has been agreed to by Pomerleau. The City’sportion of this is $43 million.The Lansdowne project team was able to obtain a fixed price of $74.9 million for thestadium and arena.The City’s total capital cost to complete the stadium, arena and parking garage is$167.4 million, which includes site servicing, costs associated with the residential andoffice air rights, site management all remaining soft costs and a $2.5 million contributionto the Urban Park.
Q: Have the costs for the stadium, arena and parking gone up?
 A: Due mainly to a 18 month delay in the construction timeline, the total estimatedconstruction cost for the stadium, arena and parking garage has changed slightly fromwhat was previously reported to Council. The vast majority of the cost increases are aresult of the 18 month delay with an additional inflationary pressure of $8.2 million. Intotal, the capital budget authority required for this construction has increased by $12million.
Q: What specifically has changed in the stadium design?A:
To ensure a fixed price for the stadium, three changes were identified during thevalue engineering review. These include modifications to: the north roof design, the veilsurrounding the south side stands and to the stadium’s north entrance canopies.Cannon Design and the LDRP were engaged in the design changes.
Q: What guarantees are there that the cost to the City will not increase?
 A: The contract has set a fixed price for the stadium construction. Through anengineering review of the designs, three modifications were identified to ensure thefixed price of $74.9 million could be met. The modifications included changes to the roof on the north side stands, modifications to the veil surrounding the south side stands anda reduction in the size of the canopies over the stadium’s north entrance.For the parking garage, a guaranteed maximum price has been set, of which the City’sportion is $43 million. The contractor and OSEG assumes the risk should costs escalatebeyond this maximum price.With regards to the urban park, a recent costing analysis confirms the park design isproceeding within the budget approved by Council.
Q: Who assumes the risk of construction overruns?
 A: The City has taken a number of steps to mitigate its exposure to risks that couldarise. On financial close, OSEG will provide the City with a committed maximum cost for redeveloping the stadium, arena and parking garage. OSEG will hold the contract withthe general contractor for the redevelopment and, to the extent that additional funds arerequired to complete the project, OSEG is to provide these as stadium completionfunds. OSEG is then able to recover any stadium completion funds contributed, alongwith an eight per cent annual return while invested, from the closed system waterfall.
September 25, 2012 Questions and Answers

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