$89M for Halifax Water’s new Burnside building is ‘excessive,’ says provincial regulator
Price not justifiable, according the Nova Scotia Utility and Review Board
The proposed $89-million price tag for a new Halifax Water operations centre in Burnside is not justified, according to an evaluation carried out for the Nova Scotia Utility and Review Board.
The regulator sought a second opinion after the project’s budget jumped from $52 million in April 2023 to $89 million by November 2023 — a $37 million or 71 per cent increase.
The estimate has since been pared back slightly to $87 million. The building size was enlarged by 14 per cent from the original approval.
“It is our recommendation that the current funding request does not get approved until further design, scope, and budget validation are completed,” said real estate services firm CBRE, which conducted the review.
Its 38-page report was posted this week by the board.
‘Integrated’ approach to construction
Halifax Water wants to move staff from four sites across the Halifax Regional Municipality into a single operations depot on Jennett Avenue in Burnside.
The estimated cost soared after the utility decided to use what’s known as integrated project delivery (IPD), a method where construction costs and profits for project participants are agreed upon up front in a single contract. The owner, general contractor and others all collaborate to ensure those goals are met. …[Continue Reading]