Busy contractors charging higher-than-normal prices for major construction projects are a growing problem, Cambridge Mayor Doug Craig says – with the planned renovation and restoration of the old post office on Water Street the latest project to experience a setback as a result.
The city has budgeted $12 million to turn the former post office into a library and community space.
When the project went to tender, six companies placed bids – but all of them were about 30 per cent higher than the projected cost.
Something similar happened when the city went to tender for redevelopment of the Hespeler Village streetscape.
While city officials estimated that the project would cost $5 million, the city ended up accepting a $6.2-million bid.
In an interview, Craig said the city had seen nine recent projects attract bids significantly over budgeted amounts. He blamed the discrepancies on the increasing pace of construction in Waterloo Region.
“Tenders are coming in over-budget everywhere,” he said.
“The contractors are stretched everywhere, and so they’re coming in with high bids.”
Contacted by CTV News, officials in Kitchener and Waterloo said that all bids received for construction projects in the first six months of 2015 came back within budget.
As far as the post office restoration is concerned, Craig says the city will make modifications to the design to get the projected cost down.
Those modifications will likely include replacing stainless steel doors with steel doors, some changes to lighting and a rethinking of a planned glass wall.
“All the heritage elements of the building are being protected,” Craig said.
Later this month, the project will be retendered; with a bid expected to be approved in August.
The delay will put the project behind schedule by about two months, Craig said.
