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Newcastle developer, The High Street Group of Companies, has bought London rooftop homes specialist First Penthouse.

The Knightsbridge-based firm specialises in offsite rooftop extensions and has built luxury homes on top of existing buildings in areas such as Chelsea, Knightsbridge and St. John’s Wood.

It is currently working to secure and deliver a further nine projects across the capital, with a gross development value of over £120m.

High Street Group Chairman, Gary Forrest, said:  “A couple of years ago, the government welcomed a proposal to help address the housing shortage in London through the development of modular homes on top of existing buildings.

“We believe there is a huge potential in this innovative idea and have researched potential sites, as well as the associated considerations of planning, design, sustainability and construction.

“What we lacked was the expertise to deliver projects and that is why we have acquired First Penthouse.

“The deal adds people with practical and successful experience of rooftop development to our team, which will, I am sure, significantly accelerate our involvement in this market place.”

Patrick Brightman, managing director with First Penthouse, added:  “With the benefit of the group’s support and investment, we can exploit many more opportunities across London and further afield and can accelerate the number of developments we undertake, as well as our aspiration to build our own offsite modular construction company.”

A study by Interdisciplinary Design Consultancy HTA LLP identified that in the Borough of Camden alone, there are 475 potential rooftop sites, which could deliver 2,485 homes.

Across Greater London, it identified over 14m sq ft of developable roof space, which could deliver almost 180,000 properties.

A Knight Frank report suggests that there is over £50bn worth of rooftop development potential in the capital.

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Infrastructure project outturn costs are running nearly 80% higher than winning tender prices, according to new project data.

An influential report from Institution of Civil Engineers, which publishes the fresh figures from 25 projects, warns that the sector is facing a twin market failure.

A combination of unforeseeable cost increases driven by both external and project risks and low contractor margins, depressed by fears of not winning major project work, has stifled innovation, skills and sustainability, warn senior engineers.

The regular failure to deliver to budget has prompted calls for mindset changes among clients about cost envelopes during early project planning, more detailed scoping and much fairer allocation of risk with contractors.

The report is published as contractors planning to deliver HS2 main civils packages are locked in talks to agree on final bid prices near original cost estimates.

A leading infrastructure contractor supplied figures for projects awarded between 2009 and 2018 on the proviso it remained anonymous.

Only one project was delivered within the original tender price, with project costs swelling by 80% on average above the original contract value on the rest

The ICE emphatically rules out excessive profit taking, pointing out pre-tax margins in construction fell from just under 3% in 2013 to an average of –0.9% in 2018.

Miles Ashley, Chair of the report’s Steering Group, said: “Industry and government need to work smarter, find ways to reduce the disparity between forecasts and outturns, but also to change the narrative and ensure the wider public, the end users, are also aware of the whole-life benefits these incredible infrastructure projects are bringing to them.”

Recommendations
  • Infrastructure owners should complete scope, design and exploration before work starts to avoid scope creep or retroactive changes, taking steps to include contractors in design at an early stage.
  • The Government and infrastructure owners must move away from capital cost as the most important metric when assessing project benefits, and recognise the importance of whole-life economic, social and environmental value.
  • All public infrastructure owners undertaking procurement must award contracts based on a cost estimate range, using a should-cost estimate as a reference point, with an amount of contingency allocated appropriate to the level of project maturity.
  • Principles set out in the Government Outsourcing Playbook should be mandatory for infrastructure owners, this includes infrastructure owners undertaking should-cost modelling to help inform their expectations and knowledge of appropriate tender prices during the procurement process.

Report: Reducing the gap between cost estimates and outturns for major infrastructure projects and programmes

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Major contractors are cooling on the road maintenance market as Highways England changes the way it manages contracts.

The Enquirer understands that a number of Tier 1 contractors are looking to work-out existing maintenance deals but not bid any new work as they focus purely on capital projects.

The move comes as Highways England continues to take more decisions in-house under its asset delivery model.

Highways England staff are taking a growing number of decisions over maintenance spending and are looking to engage more directly with Tier 2 and 3 contractors further down the supply chain.

Big name firms fear further erosion of maintenance margins and are looking to focus their resources elsewhere.

One industry source said: “Big players see their margins being eroded here and are focusing on more profitable new infrastructure projects.

“I’m sure you’ll see some big names pulling out of the market in the near future.

“And Highways England won’t just be able to start talking to the Tier 2s and 3s like they do to the Tier 1s at the moment.

“The real construction world just isn’t like that.”

The first area contract under the asset delivery model was awarded by Highways England in 2016.

Maintenance deals across the country are currently operated by Amey, Ringway, Kier and Costain Jacobs with the remaining six areas due to be introduced on a rolling programme until 2022.

Another industry source said: “Maintenance is definitely seen as a tough area to make a decent return.

“We have all seen how the world is changing for major contractors and their business model will be to focus on higher return sectors.

“Highways England will have to realise that contractors – whatever level in the supply chain – need to make a sustainable margin going forward.”

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Developer Greystar has got the planning thumbs-up for a 39-storey student accommodation block, near the London Shard.

The slender 138m tall building designed by architect Kohn Pedersen Fox Associates will accommodate over 900 students and signals the return of student schemes the capital.

As part of the planning deal with Southwark Council, Greystar will make a £34m payment towards the councils’s housing investment programme to provide homes for over 300 local residents.

The deal clears the way to demolish an existing 10 storey office building at the 40-46 Weston Street, which is located next to Guys Hospital and London Bridge Station.

It will make way for the new Capital House building, which will boast a striking faceted facade featuring perforated metal cladding around windows when completed in over three years time.

The base of the building will feature a series of raking columns forming a ‘V’ shape at ground level.

The client team on the project includes building services consultant SWECO UK, structural consultant AKT II and cost consultants Core Five.

A previous owner had planning permission for a 31-storey tower of 470 flats dubbed The Quill in 2011 but sold the plot to Greystar in 2017.

The new building forms part of the St Thomas Street East development framework which has brought together four developers to deliver a cluster of stepped office buildings next to the Capital House student project.



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Highways England has gone out to public consultation with its route options for the £1bn plan to dual the A66 trans-Pennine route.

The agency is now developing plans to fully dual the remaining single carriageway sections of the A66, which total 18 miles of the 50 mile route in addition to junction improvements to the M6, junction 40 at Penrith and the A1(M) at Scotch Corner.

The preferred route will be unveiled in 2020 with as yet no start date for the project.

Highways England chief executive Jim O’Sullivan said: “The A66 connects businesses, communities and families across the north of England, and this highly anticipated upgrade is great news for the local, and regional economies and will improve the national road network.

“We’re pleased to be going out to the local community to consult on the options for the scheme.

“I would like to thank all our local partners who have supported us to get the project to this stage and I would encourage everyone with an interest in the scheme to get involved with this consultation.”

The consultation sets out the ideas for each of the remaining section of single carriageway.

Key sections of work

1. M6 junction 40 to Kemplay Bank roundabout (A66/A6 interchange)

2. Penrith to Temple Sowerby (3 miles)

3. Temple Sowerby to Appleby – Kirkby Thore

4. Temple Sowerby to Appleby – Crackenthorpe

5. Appleby to Brough (5 miles)

6. Bowes Bypass

7. Cross Lanes to Rokeby (1.8 miles)

8. Stephen Bank to Carkin Moor (4 miles)


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Kier Regional Building Scotland is starting pre-construction of the £22m transformation of Paisley town hall building into a modern facility.

The redevelopment work for Renfrewshire Council will allow the 19th-century town hall to host a broader range of events as well as improving the performance facilities.

The project includes new catering and conference facilities, better physical access, and improved mechanical and electrical systems.

Capacity of the main hall will be increased to 1,200 for a standing gig

Advance works are taking place on the site at present and Kier will start work on the main construction phase from January 2020.

Brian McQuade, managing director of Kier Regional Building Scotland, said: “We are pleased to work with Renfrewshire Council, operators Renfrewshire Leisure and hub West Scotland as we help to protect and transform Paisley Town Hall into a modern, vibrant venue.

“Work is due to be completed by the end of 2021. As well as transforming Paisley Town Hall into a top-class destination, we will be creating local jobs for local people together with valuable learning and training opportunities.”

Kier has several heritage projects in Scotland including the refurbishment of the Burrell Museum and has just successfully completed the technically complex redevelopment of Scotland’s oldest concert venue, Aberdeen Music Hall.

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London’s Havering Council and Wates Residential have submitted plans for the first phase of the borough’s £1bn housing regeneration project.

Proposals for the Napier and New Plymouth House site in Rainham include 126 affordable homes, with a number earmarked for families, and a further 71 homes for private sale.

The site is one of 12 included in the regeneration programme, which will see the Wates council joint venture deliver around 3,000 homes in the borough over the next 12 to 15 years.

The project will seek to increase the amount of council rented accommodation and double the amount of affordable housing, while the right to return is guaranteed to all residents.

Havering Council’s planning committee will now assess the application and a decision is expected later this year.

Councillor Damian White, Leader of Havering Council, said: “After months in the planning, it is exciting to see us entering the next phase in our ambitious regeneration programme.

“This project will provide much-needed quality, affordable homes for local people in our special borough. It will leave behind a legacy of skills, training, jobs and aspiration which goes far beyond just bricks and mortar.”

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House builder Countryside lifted completions by 43% to 2,362 homes in the first half of the year, after strong growth in affordable and build to rent homes.

Growth in total completions was driven by a 146% increase in affordable completions to 806 homes, largely as a result of the Westleigh business acquisition last year. 

But even excluding Westleigh, Countryside enjoyed organic growth in completions of 12%. 

In addition, private rental homes were up two-thirds to 594 homes, driven by a framework agreement to deliver 5,000 homes over three years for Sigma Capital Group.

This helped to drive adjusted operating profit in the first half up by 11% to almost £90m on revenue up by a fifth to £564m.

Private completions remained flat at 489 homes.

Ian Sutcliffe, chief executive, said: “We have delivered excellent growth in the first six months of the year and have continued positive momentum into the second half.

“We see strong demand for our high-quality homes and have underpinned margins with operational efficiency and the opening of our modular panel factory. We remain confident of delivering full year and medium-term expectations.”

In the first half of the year, private average selling price slipped 4% to £377,000, driven by an increase in the regional businesses in the North and Midlands where average selling prices were lower.

Sutcliffe said that underlying house price inflation was broadly flat in the half year, while annual build cost inflation was running at around 3%-4%.

He added: “While we have seen increases on both materials and labour, a greater use of standard house types and operational efficiency on site is enabling us to manage these pressures.”

He said that Countryside’s modular timber panel factory in Warrington was now fully operational with around 500 units expected to be delivered in the current financial year.

The factory will service Countryside’s northern regions with a total capacity of 1,500 units in FY 2020, helping improve build speed and to secure our supply chain for the longer-term.

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A positive start to the year has seen net margins improve to a “more satisfactory level” of 1.85% at contractor nmcn.

The firm’s built environment division returned to profitability during the period following a turnaround at the Telecoms unit.

The core water business continued to boom with revenue up 41.1% to £70.2m on the same quarter last year while profits doubled to £1.53m.

Cash flow at nmcn continued to be “very positive” with some of the money invested in the company’s growing housing division.

The firm’s first housing scheme in Nottingham is now complete with two more under construction in Sutton-in-Ashfield and Southwell with another two sites in the pipeline.

All the building work is being undertaken by nmcn’s construction division and the net cash requirement for the housing development pipeline is £14m.

The company added: “The outlook for the current year is positive and we expect further progress, strategically, operationally and financially to be made. 

“Our secured workload for completion this financial year stands at £342.0 million and we are confident that further orders will be forthcoming.”

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The costs of the HS2 appear to be out of control and could threaten plans for more essential upgrades to the rail network in the north, according to peers.

A report from the House of Lords Economic Affairs Committee says it is not convinced the £56bn budget is realistic and that major changes should be considered to keep costs down.

The report stokes up further doubts over HS2 with the Lords economic affairs committee urging the Government to consider a major rethink on the project.

This includes considering halting work on Euston station as the main terminus in the first phase, in favour of Old Oak Common in west London, which will connect to central London by Crossrail.

The Lords call for investment in the rail network in the north of England to be prioritised and warn that the Department for Transport’s  appraisal of the HS2 project is fundamentally flawed.

Lord Forsyth of Drumlean, Chairman of the Economic Affairs Committee, said: “As the Committee suggested in its 2015 report, rail infrastructure in the north should be the Government’s priority for investment, rather than improving north-south links which are already good.

“If costs overrun on the first phase of the project, there could be insufficient funding for the rest of the new railway.

“The northern sections of High Speed 2 must not be sacrificed to make up for overspending on the railway’s southern sections,” he warned.

The Lords committee, including two former Chancellors, a former Cabinet Secretary, former Permanent Secretaries to the Treasury and, a non-executive director at the Bank of England, urged that plans for Northern Powerhouse Rail be integrated with the plans for the northern section of HS2, with funding for the project ringfenced.

Lord Forsyth also warned: “The costs of HS2 do not appear to be under control.

“It is surprising therefore that the Government has not carried out a proper assessment of proposals to reduce the cost of HS2—such as lowering the speed of the railway or terminating in west London rather than Euston—which the Committee recommended in 2015.”

The Committee said it was concerned that the project would run out of money and the northern sections would not be built after former chairman of HS2, Sir Terry Morgan, told the Committee that nobody knew what the final costs of the project would be.

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