Great Hall Partners, the Ferrovial-led consortium formerly brought on to renovate Denver International Airport's Jeppesen Terminal and serve a 34-year term as concessionaire as part of a $1.8 billion public-private partnership (P3) deal, recently claimed that DIA officials' lack of engagement contributed to delays and cost overruns, according to documents obtained by The Denver Post.
The airport terminated Great Hall in August and has since hired a construction manager and new contractors.
The documents seem to indicate that the airport's small project management team, according to Great Hall, wanted to micromanage many elements of the project, but, at the same time, did not have the authority to make decisions needed to move the project forward.
Airport officials have more than doubled the size of the project oversight team but told The Post that it was because of the switch from a P3 to a "more traditional" delivery method, "not as an acknowledgment of prior shortcomings."
Great Hall is seeking a total of $288 million for change orders and termination costs, $166.7 million of which is for about two dozen change orders that include restrooms, concession offices, door hardware, water connection design and a switch to 200,000 square feet of solid-surface wall panels instead of walls covered with laminate and other materials.
The airport has estimated that Great Hall's termination-for-convenience payment will be somewhere between $170 million to $210 million. Airport officials still hope to complete the terminal renovation within its $770 million budget, which represents $650 million for the original construction costs plus a $120 million contingency. Airport CEO Kim Day has previously stated that the $770 million does not include Great Hall's termination fee.
The deadline for Great Hall to wrap up its business at the airport and vacate the premises was Nov. 12. DIA has already hired Jacobs Engineering Group as a consultant and has named Hensel Phelps and Stantec as the new general contractor and design firm, respectively. Airport officials have also previously said that Gilmore Construction and Sky Blue Builders would continue their work under existing contracts during the transition from Great Hall to the Hensel Phelps/Stantec team.
The Denver City Council is scheduled to vote on several contracts Monday, Nov. 18.
The project was originally scheduled for completion in 2021. Great Hall projected a two-year delay to the schedule, but DIA officials, according to The Post, have targeted sometime in 2024 as the new finish date as construction restarts in early 2020.
A late July letter from Great Hall to the project officials provides a glimpse into the state of the relationship right before Great Hall's termination. In it, Ignacio Perez Jainaga, CEO of Great Hall Builders, the P3's construction arm, said the major issue with the project's scope changes was "the owner's lack of engagement, direction and cooperation" and added that "the owner's failure to issue much-needed direction and support regarding these owner-caused changes plagues the project."
Although DIA officials are looking to resume construction as soon as possible, that doesn't mean they'll be able to tie up all the loose ends with Great Hall quickly. And when the parties are dealing with a termination for convenience, it can take a while to sort out exactly what a consortium like Great Hall is owed, Frank Banda, managing partner of financial consultancy firm CohnReznick LLP's public sector practice, told Construction Dive last month. "I think people underestimate how long it takes to start something, complete something and, in this case, unravel something,"
