28 Oct 2020

University of Otago's major project now unaffordable

1:06 pm on 28 October 2020

By Hamish MacLean of Otago Daily Times

The University of Otago says what would have been its largest construction project is no longer affordable, but it is going ahead with a new $90 million residential hall.

University of Otago - tower and garden, Dunedin, New Zealand

University of Otago. Photo: 123rf

The university has released details of its new capital development plan after it was forced into a rethink due to the financial effects of Covid-19 and a failure to secure any "shovel-ready" funding from the government.

Its new list of approved priority projects includes two significant ones outside Dunedin, which will now be either staggered or limited in scope.

University plans do include the $170m redevelopment of the school's Christchurch campus, home to 1000 students, including 300 medical students.

University chief operating officer Stephen Willis said the redevelopment, the university's most ambitious construction project, would go ahead in stages "subject to ongoing affordability" as other funding sources were being explored.

Further, the $10m reconfiguration and refurbishment of the school's Wellington campus would go ahead, but with a limited scope and budget, he said.

"It is important to note that while these projects have been prioritised, they are still not affordable unless the university can increase its annual surplus or negotiate alternative funding arrangements," Willis said.

A planned $350m capital programme had been in doubt after the government's infrastructure reference group did not grant any of the $102m the university sought in the government's Covid-19 shovel-ready programme.

The university appears to have dropped the planned $25m physical education refurbishment and extension, which did not feature in its list of upcoming capital projects.

The revised capital budget included two major projects in Dunedin going ahead, including Te Rangi Hiroa College.

Work on the university's six-storey residential college in Albany St would begin this year.

Willis named Southbase Construction as the main contractor for the four-wing residence, with 125 en suite rooms, 450 beds, staff accommodation, kitchen and dining facilities and communal spaces.

University documents show 25 percent of the costs had been sought through shovel-ready funding.

The university also announced yesterday its $30m-plus food science refurbishment and seismic strengthening redevelopment would go ahead as planned.

It had sought 100 percent of the funding for that from the shovel-ready projects programme.

The work addressed the need to strengthen a historic building while adding space for the growing department at the university.

The university also said work was expected at Studholme and Arana Colleges over the next five years, as well as the demolition of the Union Court building.

An interprofessional learning centre, in partnership with the Southern District Health Board and Otago Polytechnic, at present proposed to be co-located with other new Dunedin Hospital buildings on the existing Wilsons Block, was also part of plans for the next five years, the university said.

*This story was originally published in the Otago Daily Times.

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