UNCERTAINTY over the plight of businesses due to the costly coronavirus pandemic has had a ‘very significant’ knock-on effect on Barnsley town centre’s ongoing regeneration, a council report has revealed.
The impact will be discussed by ruling cabinet members next week, but the report warns that ongoing uncertainty - which has plunged businesses’ futures into jeopardy - will ‘very likely’ have an effect on the Glass Works scheme.
Contractor Henry Boot took the decision to temporarily close the construction site on March 27 due to difficulties in maintaining social distancing, as well as their sub-contractors also taking decisions to temporarily close down operations.
Costs have crept up through the course of the development to a total of £180m for the construction work, but the council had to find another £10m to meet other costs, including money to meet loans in the early years of the project and to meet operating costs before the complex is completed and fully occupied.
This is now expected to climb higher given the delay, but priority will be given to units for businesses which have already signed up to occupy a space as workers return to the building site in a phased approach.
The report said: “Issues do remain - there is a shortage of certain materials, for example concrete blocks, and some products have increased in price resulting in the need to change suppliers.
“Henry Boot reported that operatives working away from home are still struggling to find accommodation and unsurprisingly there are supply issues with PPE and certain cleaning products.
“The immediate longer-term impact of the Covid-19 emergency on the ongoing leasing of the scheme is unclear, however it is very likely that it will have an impact on the Glass Works.
“The immediate priority for operators is to try and protect their existing businesses so it is very difficult to accurately predict the likely impact until the length of the current lockdown is accurately known.
“Potentially retailers may just delay leasing decisions, however it is likely that the current situation will stop investment in future stores by some operators.
“We are undertaking final negotiations with two further operators to take units in the scheme. These two operators are still intending to take space in the Glass Works, but beyond this there is virtually no leasing activity taking place across the whole country.
“Prolonged closure of shops, restaurants and leisure facilities can only worsen this, and it does create a potential risk to the success of the scheme.”
A full review of the Glass Works’ future leasing strategy is set to be requested from Queensberry, the managing firm behind the development, to further assess future financial implications.
It is hoped the current building delay - which is approximately six weeks as a result of coronavirus - will be chipped into in the coming weeks as more workers return.
“Stopping the scheme now is likely to have very significant legal and financial implications for the council,” the report added.
“Not completing the scheme is also likely to have wider economic impacts. The construction of the Glass Works has increased economic confidence in the wider town centre. A decision by the council to stop the scheme could significantly impact this.”
Once completed, the Glass Works is expected to welcome a 13-screen cinema multiplex, a bowling alley, Nando’s and retailers such as Next and Sports Direct.
Sarah Norman, the council’s chief executive, said: “There was a short period where they ceased construction while they were working out how they could do it in a socially-distanced way.
“They have now restarted construction for a few weeks, they have put all sorts of social distancing arrangements in place in order to keep the workforce safe but we have inevitably lost some time and at the moment they are not yet working at full productivity.
“In addition, we need to understand the impact on the leasing of the scheme, both in terms of the organisations that we’d already concluded lease arrangements with, and the organisations that we were seeking to get into these arrangements.
“I can say we’ve had some positive discussions already with the likes of Cineworld, and we can be confident that although there will need to be some changes to the scheme, I still do genuinely believe the scheme will be a success.”
