Calgary downtown historic transformation project rising costs stall, contractors unpaid – Calgary Achi-News

Work on converting a historic downtown Calgary office into residential units has been delayed due to rising costs, and contractors say it’s been months since they’ve been paid.

The redevelopment of the Barron Building was officially launched last year, following years of preliminary work to build a parkland under the building.

The Barron Building, built in 1951 at 610 8 Avenue SW, was Calgary’s first skyscraper and was secured by the Strategic Group in 2009.

The company was working to transform the former office space into 118 residential rental units and 8,580 square feet of street-level retail space, while maintaining its historic features, such as the exterior facade and terrazzo floors near the main lifts.

The renovated building was expected to open in 2024, but work on the building has now come to a halt.

A Strategic Group spokesperson confirmed to Global News that construction has been delayed so the project can go through a “value engineering process” to address rising costs.

“As we began construction to convert the historic Barron Building from office space to modern residential apartments, we learned that the costs were much higher than we had anticipated,” the Strategic Group said in a statement.

During the pause, Global News has learned that some of the contractors who came in to do the conversion have not received payment in months.

Con-Forte, a local company specializing in concrete formwork, signed the project in January 2023 to carry out work on the parkade, the elevator core, and the stairs.

The company’s vice president of operations, Kyle Lucas, said they had $327,000 after payments stopped late last year.

“When you invoice, you’re usually 60 days after you start the work you’re invoicing for, so come November 31 when we didn’t get paid, the questions came in,” he said. Lucas. “January. 1, suddenly the next draw doesn’t come, nor the previous one, it piles up.”

According to Lucas, the work stoppage has led to layoffs and challenges for his company, which is working on other ongoing projects around the city.

He said some workers on site at the Barron Building are “demobilizing” equipment and materials that continue to incur costs.

Con-Forte, which is one of several contractors involved in the project, has also issued a builder’s lien against the property in an effort to recoup some of the money.

“It doesn’t make it easy on a smaller operation, that’s for sure,” Lucas said.

Strategic Group tells Global News it will pay its contractors, and said it expects the engineering value to take between 40 and 60 days before construction can start again.

“As construction resumes, all our construction partners will be fully compensated for the delay,” the Strategic Group statement said.

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“We look forward to completing this special project and welcoming Calgarians to new homes in the Barron Building.”

The building is one of a number of city center office to residential conversion projects in the city centre.

Although the City of Calgary is not involved in the operations of the project, the previous city council agreed to earmark $8.5 million towards it through the city’s incentive program and Historic Resources Preservation Grant Program.

However, none of that funding has been spent on the project.

“Under the terms of the Barron Building Residential Modification Grant Program, funding is disbursed when a permit of occupancy has been issued to the developer and construction has been completed,” said downtown strategy director Thom Mahler. in a statement. “This protocol ensures accountability and adherence to program guidelines, ensures that projects are completed and that they provide housing.”

Ward 7 Cllr. Terry Wong, who represents the area, said the successful completion of the project is important for downtown revitalization, and the city’s goals for the tower transformation.

“There are many artisans, many companies, many industries that are dependent on this project and are paid accordingly,” Wong told Global News. “Similarly, there’s a reputational concern when you’re talking about conversion projects. We don’t want to see any of those projects fail.”

According to the Alberta Government website, the estimated cost of converting the Barron Building is pegged at $100 million.

It is not clear when work will resume on the project.

& copy 2024 Global News, a division of Corus Entertainment Inc.