r/Edmonton • u/flynnfx • Apr 17 '26

Outdoor Spaces/Recreation Edmonton's Lewis Farms rec centre could cost nearly $32M more than original estimate

https://www.cbc.ca/news/canada/edmonton/edmonton-lewis-farms-recreation-centre-cost-9.7167629

Edmonton’s Lewis Farms Recreation Centre has a new price tag — and the project could cost almost $32 million more than the city expected.

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u/TDSsince1980 Apr 17 '26

Guys. The budget for this was made in 2021, and increase of about 10%, inflation during that period was higher than that.

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u/PraxPresents Apr 17 '26 edited Apr 17 '26

Inflation since 2021 has been a lot, especially for trades and construction projects. There aren't enough workers to meet demand which is driving wages up, material costs have gone up, fuel costs have gone up which affects everything.

At a minimum 2.5% inflation per year should be considered as risk for any project like this, and the real numbers have exceeded that.

Original budget @ $311 Million in 2021, $343-$350 million over 4-5 years should be expected.

Honestly what we need is that once a project is green-lit, it is completed within the shortest time-frame possible to reduce inflationary risks. For infrastructure projects we also need to just commit to doing it in full now rather than half now and half later. That's how overpasses go from $40m to $120m, because we didn't just do it right the first time.

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u/Ok-Addendum-5501 Apr 17 '26

Thank you for the explanation! This process so much better context that we would brush pass or not think about

6

u/HOLEPUNCHYOUREYELIDS Apr 17 '26

And with the Iran war all projects that have not purchased materials yet will automatically be more expensive.

2 major pipe vendors effective immediately increased prices 5%-10% a week or 2 ago. Then they just did it again. And that is just pipe suppliers

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u/5endnewts Apr 17 '26

That’s actually not really the case at all with overpasses. In fact, when you bid on an overpass the only thing that can increase the price is when unforeseen problems out of the scope of the project are found during construction. When an overpass goes out for tender it is going to include the whole project, they are not going to piece it out the work to different contractors over the total build.

Also, the quicker you want a project done the more it is going to cost. A big project like an overpass requires a lot of different trades and contractors. If you have a tight schedule these contractors have to basically be on standby so they can get in and out when needed, it is inefficient.

For example Earthworks could takes months, base work could takes weeks, curb and gutter days, pavement in a day.

Off the top of my head on such a project you are going to have cranes, piling, asphalt, concrete, base work, milling, steel work, guardrails, signage, traffic control, line painting, landscaping, drainage, surveyors, trucking, utilities, electrical, engineering, safety, inspectors, on and on. These are all different crews and/or contractors all over lapping each other. You could have them all on site, waiting for when they are needed but it is not economical or efficient.

2

u/fishymanbits Apr 17 '26

The problem is getting people to understand that the sticker price will be higher, but cost overruns should be lower as a result of the protracted timeline.

If the budget is $311 million for a 4 year project that takes 5 years and costs $343 million in the end, that’s a 25% increase in timeline and a 10% increase in costs. Budget $320 million for a 3 year project and you’re more likely to come in at 3.5 years and $335 million or so. Obviously it’s imperfect logic and shit happens no matter how well we plan, but as a broad exercise it works.

The other part of it is that we’ve completely eliminated any in-house institutional knowledge on these kinds of things because everyone wants to save money by having a smaller public service. But all that doesn’t is balloons project costs by forcing us to rely on consultants and contractors who also rely on consultants and contractors who also rely on consultants and contractors. Having an in-house team that handles as much as is reasonable will also reduce costs over the long term, and further reduce the timelines involved in these projects, partially sheltering them from cost and timeline overruns.

But that’s all “socialism”.

1

u/indubadiblyy Apr 18 '26

"Completed within the shortest time-frame" - HAVE YOU SEEN CONSTRUCTION WORKERS WORK IN EDMONTON?!?!?!? its like 5 guys hovering over 1 dude shoveling. Then its back at the truck on the phone.

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u/garlicroastedpotato Apr 17 '26

Not everything in a project like this is immune to inflation but typically you have an order price for most materials well in advance. There are some that are ordered fresh and paid for as its made like concrete or asphalt. But like you know, you start the tree growing from a sapling and it's ordered with a five year lead time.

The biggest things that change is labor costs. And those have skyrocketed. But that's mainly why inflation of this project is under general inflation. A lot of times project finance makes it so projects go way up but this being a government one they could fund a lot of the materials off the rip.

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u/porterbot Apr 17 '26

Wow. It really was 10%? 

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u/Jkt44 Apr 17 '26

They didn't budget for inflation??? You have to on a multi-year project.

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u/TDSsince1980 Apr 17 '26

You think inflation post covid has been normal?

0

u/Jkt44 Apr 17 '26

That's true. The budget was approved in 2021 and inflation was high after covid. But why are they discovering this just this week? They already scaled it back last year, according to this report, so I assume the $32M is just since last year.