Purpose

This report sets out the results of the contract extension
exercise undertaken as per the mechanism in the existing Agar 1c
main works contract with Hill Partnership Limited (Hill) to deliver
Phase 2a regeneration works to the Agar Grove estate.
 
An option to extend the Phase 1c building contract with Hill to
include subsequent phase 2a is included in the contract. This
allows performance motivation for the contractor Hill but is wholly
at the council’s discretion. Whilst the option to extend was
included in the contract, the option cannot be exercised without
Cabinet approval for the phase 2 strategy. This was agreed by
Cabinet in July 2022 (SC/2022/19).
 
This report asks for approval to extend the Agar Grove Phase 1c
building contract by instruction to Hill in the sum of
£47,985,000 to deliver Phase 2a. The contract extension will
start in August 2023 with design development and contractor
mobilisation. Enabling works and constructions works will start in
January 2024 for a duration of 187 weeks.
 
The instruction of the contract extension to Hill is based on
their submission using the mechanism set out in the contract as
being value for money for the reasons outlined in this report and
the Part II appendix.
 
The contract extension will be made by issuing an instruction to
Hill to commence Section 2 of the Works (known as Phase 2a) under
the Agar 1c building contract as per ‘Agar Grove 1C Schedule
of Amendments to the Joint Contracts Tribunal (JCT) Design and
Build (DB) 2016 Contract clause 2.1.A.3’.
 
The GLA grant of £11.28m associated with Agar 2a has a
start on site condition. The recommendations in this report allow
us to meet this grant condition.
 
The scheme obtained planning approval in August 2014 and was
approved by Cabinet on 4 December 2013. Further Minor Material
Amendment planning applications were approved in 2020 and 2022. A
Cabinet update was approved on 20 July 2022.
 
 

Content

 
THAT the Executive Director Supporting Communities, in
consultation with the Cabinet Member for New Homes, Jobs and
Community Investment, Cabinet Member for Better Homes and Cabinet
Member for Finance and Cost of Living,  the
Executive Director Corporate Services, the Head of Property, as
well as the Borough Solicitor agrees to:
 
1.       Award the
contract extension to Hill Partnerships Limited to deliver Agar 2a
for the contract extension sum of £47,985,000 (which includes
value engineering items and possible associated planning risk) with
the contract starting in August 2023 with design development and
contractor mobilisation and enabling works and constructions works
will start in January 2024 for a duration of 187 weeks.
2.       Award this
contract extension by issuing an instruction to Hill to commence
Section 2 of the Works (known as Agar 2a) under the Agar 1c
building contract as per ‘Agar Grove 1C Schedule of
Amendments to the JCT DB 2016 Contract clause 2.1.A.3’.
3.       Approve the
updated profile of the budgets in the Part II appendix.
4.       Note the aim
to increase contingency levels to finance guidance over the short
term funded through additional income streams as outlined in the
Part II appendix.