Council to continue Roxy Community Theatre Project as Principal

Published on 02 June 2023

At its Confidential Extraordinary Council Meeting on 29 May 2023, Council voted to continue the Roxy Community Theatre build with Council assuming the role of Principal and entering direct negotiations with relevant trades. Council also voted to direct $250K from its original budget to the architects and range of consulting engineers / specialists required to advise on the build and issue compliance certificates. 

While the overall cost to complete - which has been verified by a Quantity Surveyor - has increased since the Lloyd Group's original estimate in 2020, Council will only spend on the build what monies it has already committed to date ($5.284M), in favour of value managing out aspects of the project until additional grant funds can be found. These include a second lift to the dress circle, kitchen fit-out and equipment, fit out of upstairs dressing rooms and fit out of the Roxy 2 Theaterette. If necessary, further value management will occur along the way to bring the project in on budget.

Council also has the benefit of $350K of bank guarantees from the Lloyd Group that will be utilised to complete the build.

The Lloyd Group has officially gone into liquidation now - a disappointing and unfortunate reality for Leeton Shire and 60 plus other projects across NSW and Victoria - with their Directors citing fixed price contracting during tumultuous times in the development sector and the difficulty sourcing trades as major causes for their demise. 

Reflecting on Monday night's decision, Mayor Tony Reneker said:

"Nobody wanted to be in this position but I'm pleased to say Council has taken stock, considered its options carefully - and the associated risks - and determined a proactive path forward. We've made provisions to set up our own Roxy Project Management Office to manage the project, let contracts and oversee the works."

"Assuming the role of Principal, as opposed to bringing in another Head Contractor, is the most cost-effective approach and certainly the preference of our local trades."

"Where possible, Council will continue with the local trades who have already been working on the project and to whom we remain fully committed."

Cr Michael Kidd, Deputy Mayor and Portfolio Lead for Arts and Culture, said:

"Next steps include formally convening a Project Management Office with relevant expertise and letting the trades during the month of June. We
hope to see action on the ground from July." 

"If all goes exactly to plan, the build will be completed in May 2024. However, being a 90-year-old state heritage building that was built during the depression years, the Roxy tends to throw up surprises from time to time, so further latent conditions may have to be anticipated along the way. Council has therefore set aside $430K in the voted budget as a contingency."

The original Lloyd Group build price was $7.136M. To date $2.257M was paid to them. The latest forecast to complete-the-build estimate is $6.4M. The additional costs faced cover cost escalation, prolongation and any defects that now become Council's responsibility to sort. Initial estimates indicate $40K will be required for a drainage defect that requires remediation.

Council has separately procured seating and specialist equipment which remains unchanged as these were procured independently of the Lloyd Group. 

Mayor Cr Tony Reneker thanked the Roxy project funders Create NSW and the Commonwealth - who together are contributing more than $6M to the build - for being so accommodating under the circumstances as well as Council staff for their efforts to determine a path forward, stating "the situation we face is certainly not in the textbook". 

He urged everyone to give the team their full support and encouragement to get the project completed.

"Our resilience as a community serves us well as we roll our sleeves up and make this happen. While the delayed completion date of the Roxy Community Theatre will be disappointing to many, Council can now move on from the devastating news of the Lloyd Group's demise and progress the build with full control," he added.

Council will be presented a build progress report every second month which will keep them and the community fully abreast of developments, including how the finances are tracking.

ENDS