The Pioneer Manor expansion project is poised to cost more than initially planned, with an additional $4.75 million tacked onto its projected cost.
The city’s elected officials approved the long-term care home expansion in the city’s 2021 budget, at which time the cost of constructing a five-storey wing housing 160 beds came in at $58.1 million
The new wing is part of a larger bed redevelopment project to bring the facility up to current standards. The project will also result in a net increase of 11 new beds, bringing it to 444 units. To date, the city has redeveloped 284 beds in the existing building, which leaves the new wing as the final piece of the puzzle.
As reported last week, a $55-million loan has yet to be secured for the project and was expected to be factored into next year’s projected municipal debt total of $327 million.
Now estimated to cost $63.9 million, the municipality is responsible for the project’s extra costs, which will be added to the total amount of debt to be financed and increase the annual mortgage by $143,186 annually.
In a report by city administration, it’s noted that the initial business case for the new build was prepared in the summer of 2020, “before the full effects of the COVID-19 pandemic were realized.”
Since that time, additional infection prevention and control design considerations were incorporated into the project alongside an enhanced pandemic design for residents and staff safety. Meanwhile, existing costs have escalated in preparation for a late tender in 2021 due to cost increases in materials and labour.
The $4.75-million in new projected costs includes:
- Updated design providing enhanced isolation and smaller resident zones: $950,000
- Increased costs for medical equipment: $250,000
- Additional escalation allowance to recognize a late 2021 tender period: $820,000
- A post-contract contingency to account for risk during construction: $1.7 million
- Increase in building’s cost per square foot: $1 million
The cost increase is “not a local phenomenon being experienced by Pioneer Manor alone,” city administration notes in a report included in the Oct. 19 finance and administration committee meeting agenda.
A review of other long-term care redevelopment projects has revealed a similar trend with escalating redevelopment costs, according to the report. The cost per bed for large municipal redevelopments is between $350,000 and $450,000 per bed, with Pioneer Manor’s projected $400,000 per bed sitting right in the middle.
“Pioneer Manor has the added complexity of poor soil conditions, along with the need to integrate the new wing into the existing building,” the report notes, clarifying that the current cost estimate makes several assumptions and that “only when a more detailed analysis has been completed by the quality surveyor will the cost of redevelopment be better known.”
Tyler Clarke covers city hall and political affairs.