Belfast Telegraph

Future of Belfast's Ulster University campus hangs in balance as builder considers pulling out

By Margaret Canning

'D-Day' is looming for the new £250m Ulster University Belfast campus as a major player in the process weighs up whether or not to resume work at the site, the Belfast Telegraph understands.

Tomorrow will be decision day for the future involvement of Portuguese firm Somague - which had been working on the project with Lagan Construction Group, after their joint venture Lagan Somague won the tender in 2014.

The firms were to build phase two of the £250m project, a £150m development of two new blocks on York Street, with the site to be ready in 2018. However, workers from all the firms involved, including subcontractors, downed tools on Monday.

Accountancy firm KPMG was yesterday due to be appointed administrators to four companies in the Lagan Construction Group. But it's understood the appointment has not yet taken place. No one was available for comment from Lagan Construction Group or KPMG.

Last night the university said it "continues to consult with Somague to ensure delivery of this landmark development".

"We await the formal appointment of an administrator to the relevant Lagan companies."

Lagan Construction Group last week said it was putting four of its 30 companies into administration - Lagan Construction Group Holdings, Lagan Construction Group, Lagan Building Contractors and Lagan Water.

With Lagan Construction Group no longer directly involved, Somague is expected to have decided by tomorrow if it will remain on the project.

Lagan had said factors including "delays in the commencement of new projects, protracted contractual disputes on some existing major projects" had led to its decision to put some of the companies into administration. Industry insiders have said it's doubtful that Somague will have the capability to complete the job alone - and that it may not have the appetite to start finding another joint venture partner.

And the university cannot obtain further funding to entice a new partner, the insider said. "They've got no access to further funding as there are no ministers in Stormont."

Contractors who had been working on the project have said they are "embarrassed" by the difficulties with the project. Many said they were owed money.

One contractor told the Belfast Telegraph that he and his staff were told by text on Monday morning that work would not be taking place for the foreseeable future. "We were waiting at the gates to be let in to start work when we got texts saying the work was stopping," he said.

Last month the Belfast Telegraph revealed that litigation between UU and the Lagan Somague JV meant that the opening of the campus would be delayed until 2022. Speaking in 2014, when Lagan Somague's successful tender was announced, then UU acting-vice chancellor Professor Alastair Adair said that 15,000 students and staff would "bring the new campus to life" in 2018. "Not only will the positive impact on higher education be felt for generations to come, but the impact on the economy, particularly in terms of the construction sector will be invaluable with over 5,000 construction jobs supported during the project build and fit out period."

Belfast Telegraph

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