To give approval to CNDCL to appoint Moody Construction LTD to deliver Phase 3 of the Treadmills development and to approve the
consequent increase in the Council's budget.

PDR Construction was appointed as contractor to deliver Phase 3 of the Treadmills development. Work commenced on site. On 11 January 2022, however, PDR appointed administrators. In consequence, CNDCL (the Council's development partner) terminated the contract with PDR on 19th January 2022. As a result, another contractor is needed to continue with the delivery of Phase 3. During CNDCL's original tender process, Moody Construction Ltd
was placed second. Moody has now provided a revised tender for the contract. The revised construction costs with Moody as principal contractor result in an increase in the overall construction costs for Phase 3. The increase reflects the rise in costs (occasioned by inflation and market forces) between the date of the original contract and the new tender. Using the contingency of the Treadmills development budget and some underspend in other areas of the development budget, means that this overspend can be broadly met from within the development budget, however, there is an overall increase to the Treadmills Development budget of some £78,000. The increased contract price means that the costs of development are no longer in accordance with the Council's approved budget.
CNDCL has obtained advice from their Cost Consultant LHL, which confirms that the increases in Moody's tender price is in line with the current market conditions. LHL has also confirmed that the revised tender establishes value for money. This is explained further in the attached Value for Money assessment Note.

The decision is an urgent one and it is not practical to wait for a quorate council to be convened. The reasons are as follows. Moody's has provided a fixed price for the outstanding works needed for the delivery of Phase 3, and at present is able to hold some of the steelwork costs to that previously agreed with the steel fabricator sub-contractor, notwithstanding that the costs of steel have increased in the interim. However, following the end of the month (31st January 2022), Moody's has advised that it would need to revise its tender costs in order to incorporate any cost increases from its subcontractors.

Another consideration is the need to appoint a new contractor as quickly as possible. This will ensure that development is not 'stalled' for more than is necessary and will, as far as possible, ensure that key development dates on site are adhered to. Also, of consideration is that the development has secured a key anchor tenant (Everyman Cinema). Should the development not be completed in a timely manner (and any delay in appointing a new contractor could adversely impact on delivery), then Everyman can terminate the agreement. Further, construction costs are continuously rising due to increased material and labour costs, and also due to the uncertainties that the construction market faces. There is a window of opportunity for Moody's to take over the construction quickly and at a fixed price for now, but this will be at risk if the decision is not made before the end of the month, both in terms of costs and the possible availability of sub-contractors. It is not practical to convene a meeting of council before that date.

Any relevant decisions by officers must only be taken where they are in line with the Council's budget and policy framework. Any decision
which is contrary to or not wholly in accordance with the budget approved by full Council must be referred to the Council for final decision. However, such a decision may be taken by relevant officers if the decision is urgent, it is not practical to convince a meeting of Council, and the Chairman of the Scrutiny Committee agrees that the decision is a matter of urgency. This is the situation in this case. Given the urgency in this decision, and the consequences of not appointing the contractor quickly (for the reasons set out), this urgent decision shall not be subject to the call-in procedures as this would seriously prejudice the Council's interests (e.g. by putting the development timetable at risk, the likely further increase in costs, and subsequent reputational damage), and prejudice the public interest (e.g. the risk that delivery of Phase 3 may be further delayed with risks to the provision of the cinema, increased costs and potential loss of funding).

CNDCL carrying out a full retendering exercise for the contract has been considered and rejected. Another option of 'mothballing' the site risks both loosing Everyman as a tenant and the Future High Street Funding of £4.75m already secured for this development and which is subject to delivery targets.