Steel corrosion causes $17M in unexpected costs at Civic Centre

Heavily corroded steel uncovered in the Civic Centre is estimated to cost $17 million to fix and city taxpayers could be on the hook.
 

Roger Greenberg, a partner with the Ottawa Sports and Entertainment Group, said the company will settle the bill for now but who ultimately pays for the work will be the subject of negotiations with the city in the new year.
 

OSEG and the city didn't anticipate that the condition of the steel beams would be so poor.
 

"This did come as a surprise," Greenberg said in an interview Monday. Greenberg said workers learned about the poor condition of the steel beams during the arena renovation, part of the larger Lansdowne Park redevelopment. Greenberg noted the project contract allows for talks with the city to determine if the repairs are "part of the scope of work that we agreed to do." The $17 million is "above and beyond" what was anticipated in the contingency funds, he said. "We're putting the cart before the horse at this stage," Greenberg said.
 

Marco Manconi, the city's manager of design and construction at Lansdowne, suggested it's OSEG's responsibility to pay for the extra costs.
 

"It is the city's view that, with regard to the funding of these unexpected costs, the provisions of the Lansdowne redevelopment plan project agreement related to the city's guaranteed maximum price require OSEG to pay for the costs of the work that are in excess of the project contingency that is contained within the guaranteed maximum price," Manconi said in an e-mail to the Sun.
 

If OSEG pays for the work, the company's equity in the redevelopment would increase.
 

The Civic Centre was built in 1967. Regular inspections through 2010 found the structure to be in good condition.
 

However, earlier this year OSEG commissioned a comprehensive investigation that involved removing material, such as insulation, that was covering structural steel. That's when workers discovered the extent of the corrosion.
 

Maintaining the construction schedule is paramount, which is why OSEG went ahead with necessary repairs after consulting the city, Greenberg said. Greenberg doesn't anticipate any other big surprises during the redevelopment. "I'm hopeful now that we pretty well got everything that should be expected," he said. "We hope."