Opinion: The proposed cost of Vancouver’s new art gallery is complete fiction

Early reviews of Berlin’s new Museum of the 20th Century have not been good.

In fact, late last year concerns were raised that the building’s barnlike design was going to waste vast amounts of energy. In some circles, the museum has been dubbed the “climate killer.”

According to The Guardian newspaper, Germany’s federal audit office has ordered a new design, deeming the current one an “overpriced and unecological” use of taxpayer dollars.

Indeed, since the project was first unveiled, the budget has jumped from an original estimate of $260-million to nearly $655-million.

The architects at the centre of this massive controversy are none other than the glitzy Swiss firm Herzog & de Meuron.

That sound you hear is throats tightening in the city of Vancouver.

In 2014, Herzog & de Meuron won the bid to build a new Vancouver Art Gallery – the company’s first Canadian project. Their proposed design is spectacular, to be sure, with copper cladding, an Indigenous motif throughout, and a massive amount of timber being used to reduce the building’s carbon footprint. Cough, cough.

The original budget for the project was set at $350-million, which included a $50-million endowment – the interest and dividends of which were to pay for the building’s annual upkeep. In late 2021, the budget was raised to $400-million, an amount to be covered through private donations and government contributions. With the $50-million endowment still included, that presumably leaves $350-million for construction costs.

That is, if all goes according to plan. But as we have seen with the Berlin project, it doesn’t always work out this way.

Herzog & de Meuron have been associated with other overbudget public projects, including a concert hall it designed for the city of Hamburg, which opened its doors in 2017. The final price tag was something north of $1.1-billion, more than 10 times the original estimate.

The same year, the famed architectural firm was asked to take a reduced fee to continue work on the Tate Modern Switch House, as its costs ballooned from $356-million in 2012, to $431-million four years later when it was finally finished.

Which brings us back to Vancouver.

It is no secret that construction costs in Canada and around the world have exploded. All the factors for this price escalation are well known: the pandemic (which severely affected supply chains), inflation, interest rates, and fuel-cost increases linked to the war in Ukraine.

Widespread labour shortages in the construction industry have also led to wage inflation. Many developers and contractors are desperate for workers.

Rob Wilson, a director at BTY, a construction cost consulting company, told me that hard construction fees (which exclude things like design and permits) have increased 20 to 25 per cent in Greater Vancouver in the past couple of years.

The total gallery space is estimated to be 330,000 square feet. With a construction budget of $350-million, the cost per square foot that the gallery and its architects are banking on seems incredibly low for downtown Vancouver, especially for a project as unique and complex as this one. One construction builder I spoke to says the budget could be off by $150-million or more.

B.C. government pledges $50-million to Vancouver Art Gallery

Also, one must assume that some of the money budgeted for construction has already been spent on soft costs such as architects, structural engineers, geotechnical assessment of soil conditions, and building permits. In the case of a gallery, those costs can be as much as 30 per cent or more, according to one architect I spoke with.

On top of that, you have the expense of relocating artwork, which can also be pricey.

All of which is to say: There seems little chance this art gallery is going to be built for anything near what they have budgeted, especially given that some of that money has assuredly already been spent on preconstruction costs.

And consider this: The B.C. government was recently promoting a new provincial museum that was going to cost almost $1-billion until a public outcry killed the plan. And yet somehow, Herzog & de Meuron are going to build a glorious new edifice in downtown Vancouver for a third of that cost in an ultra-inflationary environment?

Seems hard to imagine.

Proponents of this project are going to have to answer some very hard questions about costs, very soon. They will need to be transparent about where the money will come from if overruns occur: private donations (which have been incredibly hard to come by) or taxpayers?

If it’s the latter, then the public should be told now before the first shovel breaks ground.