Brant Construction Quantum Experts are regularly instructed to assist in resolving disputes relating to the abnormal costs associated with developments. These often include Infrastructure costs and occasionally build costs.

Brant has been involved in disputes ranging from relatively small housing developments, through industrial developments, to large scale mixed use developments throughout the country. These have included greenfield and heavily contaminated brownfield sites.

The most significant and complex development Brant has been involved with presented numerous challenges. It was a rocky road to an eventual victory by way of Expert Determination.

The development comprised several thousand homes, retail, leisure, local amenities, bus routes, major roadworks, significant landscaped areas and S106 works. Brant was instructed by the land agents dealing with the matter, who in this instance were representing two of the several landowners who were selling the land under option agreements.

The option agreements were set up such that the Developer would purchase the land for an agreed sum, less the appropriate proportion of the total budget infrastructure and build costs.

Brant was instructed to review the infrastructure cost plan produced by the developer’s cost consultant, which were in excess of £110 million. These included –

  • Archaeology
  • Topsoil strip
  • Bulk Excavation
  • Roads
  • Landscaping
  • Services
  • Professional Fees
  • Contingency

As is often the case, the cost consultant had limited information with which to produce the cost plan and therefore had made numerous assumptions when producing same. To properly understand and therefore consider the cost plan, Brant had to  obtain the information available to the cost consultant and to gain an understanding of the basis of the assumptions made.

Unfortunately, in this instance the Developer was not forthcoming in providing the information required. It was therefore necessary for Brant to approach statutory bodies and other parties, along with utilising the local planning portal to obtain the information required.

In terms of the assumptions made by the cost consultant, these were predominatly advised by the developer. These included allowing for the whole site to be stripped and plateaued, at considerable cost. We successfully argued that these operations would have been carried out by the housebuilders who purchased the various development plots and that these housebuilders would want to utilise the natural contours of the site. This alone knocked over £10 million off the cost plan.

Brant’s submissions also resulted in the expert agreeing to a £20 million reduction in the value of the roads. Primarily in respect of arguing that many of the roads were included in the externals costs and adjusting for frontage development.

It was a lengthy process to achieve this result, including the land agent and legal team having to deal with several legal challenges on the interpretation of the Contract, several rounds of submissions and numerous meetings.

Further reductions were achieved throughout the account, culminating in the Expert determining that the true valuation of the Infrastructure costs was less than half of the original cost plan value, a saving of circa £55 million.

Categories: Insight