Northern suburbs recreation hub Launceston in $7m shortfall

Increases in construction costs associated with Covid-19 have caused the cost of delivery for a “vital” piece of Tasmanian infrastructure to balloon by up to 40 per cent.

Estimates for the cost of developing a “vital” piece of Tasmanian infrastructure for an underserviced community have been revised upwards by 40 per cent, with the project now expected to cost “at least” $22m, leaving a significant funding shortfall.

Launceston City Council, the Tasmanian and federal governments have been progressing plans for a Northern Suburbs Community Recreation Hub, to be located at 316–320 Invermay Rd, Mowbray, as part of the Launceston City Deal since 2018.

Council’s My Place My Future Plan identified a need in Launceston for greater access to recreational facilities and public spaces, with the three current indoor stadiums, the Elphin Sports Centre, the Silverdome and YMCA “not capable of meeting community demand”, a report presented to council on Thursday said.

The federal government agreed at the 2019 election to stump up $15m for the “vital” project, with the cost of its delivery estimated in early 2021 to be $15.6m, with an additional $2m required to acquire the 3.3ha former industrial site.

Inside the disused warehouse at 316-320 Invermay Rd, Mowbray. Picture: Launceston City Council

However, the report said the project’s estimated cost had now been revised upwards to “at least” $22m.

“Council has observed a significant escalation in construction costs in the order of 40 per cent due to Covid-19 related factors,” it said.

“It is anticipated the funding shortfall will be met by a combination of the federal, state and local governments.

Proposal for the planned Northern Suburbs Community Recreational Hub, taken from the 2018 business case. Picture: Leisure Planners

“The state government is currently considering its position, which will be guided by the outcome of the design process.”

This is currently under way with architect Philip Lighton, the report noted.

On Thursday, Launceston City Council agreed to tip a further $1.1m into the project on top of $161,145 it has already spent on legal fees and removing contaminated topsoil.

Proposal for the planned Northern Suburbs Community Recreational Hub, taken from the 2018 business case. Picture: Leisure Planners

Of the $1.1m, $700,000 would be spent on removing asbestos roof sheeting, with the other $400,000 going towards “the overall development”.

A 2018 business case into the project identified approximately $125m of benefits flowing from its delivery, a return of $5.35 on every dollar spent.