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CITY OF VANCOUVER ADMINISTRATIVE REPORT |
Date: |
September 14, 2004 | |
Author: |
Mark Lau/M. Sutherland | |
Phone No.: |
7565 | |
RTS No.: |
04484 | |
CC File No.: |
4657 | |
Meeting Date: |
September 28, 2004 |
TO: |
Vancouver City Council |
FROM: |
Director, Facility Design & Management in consultation with the Director of the Housing Centre. |
SUBJECT: |
Granville Residence Renovation - 1261 Granville Street - Report Back on Revised Capital Budget and Award of Construction Contract |
RECOMMENDATION
A. THAT Council approve the project budget for renovation of the Granville Residence to create 83 self-contained units and two retail units at $4.25 million, with the additional funding ($350,000) for contingencies to be provided from the Downtown South Development Cost Levies.
B. THAT the contract for the renovation of Granville Residence be awarded to Parkwood Construction Ltd., in the amount of $3,298,000 plus GST.
GENERAL MANAGER'S COMMENTS
The General Manager of Corporate Services RECOMMENDS approval of A and B.
COUNCIL POLICY
· Council approval is required for contracts over $300,000.
· Contracts are awarded on the basis of best value for the City.
PURPOSE
The purpose of this report is to request Council's approval to award a contract for renovation of the Granville Residence at 1261 Granville to provide 83 self-contained units and two retail units to the low bidder Parkwood Construction Ltd. and to approve an additional $350,000 in contingencies bringing the total project budget to $4,250,000.
BACKGROUND
The Granville Residence is a five-storey, 100-unit building providing single room occupancy accommodation constructed in 1919. The existing 100 sq. ft rooms share bathrooms located on each floor. Two retail units on the main floor are vacant.
On December 2, 2003, Council approved the purchase of 1261 Granville Street and authorized the Director of Facility Design and Management to enter into contracts up to $2,500,000 for the renovation of the building; source of funding, Downtown South Development Cost Levies. A consultant team, led by Chernoff Thompson Architects, was retained to investigate upgrading options. Various options were evaluated ranging from minimal repainting and cleaning to demolition and construction of a new facility with self-contained suites.
Council expressed support for the option which will renovate the building to provide 82 self-contained units with bathrooms, small cooking areas and averaging 160 sq. ft. in area. The ground floor will be developed with a lounge for tenants, washrooms, small kitchen and storage areas. The work will include asbestos abatement, replacing much of the existing electrical and mechanical systems, modest structural work (limited seismic upgrading) and a security system. The retail area of 4,200 sq. ft. will be reconfigured into two leasable units which can be marketed. These renovations are envisioned as enhancing liveability for the tenants, improving the return on the retail space, and extending the lifespan of the building by 20 years.
On June 30, 2004, a combined development/building permit with SRA permit was issued.
On July 6, 2004, Council approved the preferred option and additional funding of $1.4 million to an estimated total of $3.9 million, so that project could be tendered. Staff were to report back when tenders were received and the project budget could be established. Staff were also to report back on how costs of the retail area could be allocated once the space has tenants and rents are established. This work will be reported upon completion.
Over the course of the summer, plans were amended to move the laundry to the ground floor and increase the number of units from 82 to 83.
The current project schedule contemplates an award of contract upon approval by Council in late September. Construction would start immediately thereafter, with re-occupancy to occur in the spring of 2005.
DISCUSSION
From an open request for expressions of interest to general contractors, seven firms were pre-qualified on the basis of a published set of criteria to submit tenders for the project. Due to their current workload several companies withdrew and three bids were received, one of which was disqualified.
Contractors Total Price
Parkwood Construction Ltd. $3,298,000
Turn-Key Construction Inc. $3,309,240
Heatherbrae Construction Late - Disqualified
On the basis of best value, it is recommended the contract be awarded to the low bidder, Parkwood Construction Ltd. in the amount of $3,298,000 plus GST. Parkwood Construction Ltd. met all the requirements of the tender documents.
PROJECT BUDGET
The original estimated project budget (hard and soft costs) at $3.9 million has been impacted by increasing cost of labour and materials in the construction industry at this time. Tenders received for this project were somewhat higher than expected at $3.298 million. Awarding a construction contract at $3.298 million will leave a contingency of approximately $100,000 which is inadequate for a project of this type. It is recommended that the contingency be restored to 15 percent requiring an additional $350,000 be added to the existing budget.
The appropriate funding source continues to be the Downtown South Development Cost Levies. Following completion of the renovations, the retail space will be owned by the Property Endowment Fund. When the space is tenanted and rents are established, staff will report back on the value of this space. At that time it is expected the PEF will make a payment of this amount to the Downtown South Development Cost Levy fund.
CONCLUSION
Staff recommends award of the contract to the low bidder, Parkwood Construction Ltd., in the amount of $3,298,000 plus GST and a project budget of $4.25 million.
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