Agenda item

To award a contract for the construction of 10 houses at Britannia Road, Rowley Regis.

Approval was sought to award a contract to Seddon Construction Ltd, in the sum of £2,297,287.00 for the construction of ten houses (8x 2 bed semi-detached and 2x 4 bed semi-detached) at Britannia Road, Rowley Regis using the Homes England Delivery Partner Panel 3 Framework, West Midlands Lot.

The cost of the proposed contract with Seddon Construction Ltd was covered within the original capital allocation of adequate resources to fund the proposed project on 20 March 2019 (see Minute No. 34/19). Project costs were originally split between the Housing Revenue Account (HRA) and Homes England grant funding.  However, funding was now proposed to be split between the HRA and Right to Buy 1-for-1 (RTB) capital receipts in accordance with clause 7.3 of the original approval. The funding sources for all schemes within the Council New Build programme were constantly monitored to ensure that the most beneficial funding source was selected, that all Homes England grant commitments were achieved and that all RTB capital receipts were allocated to prevent any loss of the receipts due to not expending them within the designated time periods.   An exemption was therefore required to the Council’s Procurement and Contract Procedure Rules.

Reasons for Decision

This scheme would provide ten new council-owned affordable homes that meet Building Regulations and current housing requirements.

Sandwell’s Housing Management Team had provided housing demand data in relation to bidding activity for different property types in the area which showed that there was demand for all proposed property types.

Subject to the approval and completing contractual arrangements, it was envisaged that works could commence January 2022 and complete October 2022.

Alternative Options

The alternative option was to not accept this tender through Exemption to Procurement and Contract Procedure Rules and to go back out and retender. Recent tender activity for other schemes had shown a reduction in the number of tender returns which was probably a direct result of above and the current construction market conditions. It was not recommended to re-tender as this would cause at least a 6 month delay to a start on site, there was no guarantee how many tenders would be returned and the tender sum was likely to increase considerably if the current trend continued.

Agreed:-

(1)          that the Director Regeneration and Growth be authorised to award a contract to Seddon Construction Ltd, in the sum of £2,297,287.00 through Exemption to Procurement and Contract Procedure rules (rule 15, rule 8.11 regarding single tender returns) for the construction of 10 houses (8x 2 bed semi-detached and 2x 4 bed semi-detached) at Britannia Road, Rowley Regis as tendered using the Homes England Delivery Partner Panel 3 Framework, West Midlands Lot;

(2)          that the Director – law and Governance and Monitoring Officer be authorised to enter into or execute under seal any documentation in relation to award of the contract and/or other agreements as may be deemed necessary;

(3)          that any necessary exemptions be made to the Council’s Procurement Contract Procedure Rules to enable to course of action referred to in Resolution (1) above to proceed.