Welsh round up
The current Welsh health scene includes the £200 million public private partnership Velindre Cancer Hospital, the Designed for Life (DfL) framework, featuring the rise of reserve contractor IHP and the massive £1 billion Cardiff and Vale University Hospital Wales 2 project.
The public private partnership or Mutual Investment Model is being tested on the Velindre scheme within the next two weeks. Market interest should be known in or near May, 2021. This is set to be a very, very green scheme.
Takes advantage of attractive listed site
There is an interesting team working on this scheme, a kind of kitchen cabinet. These have been appointed over this last year. This has been about getting the exact talent rather than a type of consultancy firm. This team has been working on the brief.
Yet procurement might be all about overseas firms with the financial backing of their own governments or might there by some UK interest in this deal?
Wales has been in serious lockdown for a long time and some firms on the DfL framework are not bidding citing C-19 and the lockdown as the reason. Will Velindre be affected in the same way?
Lots of experience
I spoke to the project director David Poole to gauge his thinking on all this. The English Government taskforce looking at managing the legacy private finance schemes, especially the special purpose vehicles and facilities management. Velindre, being a public private partnership (PPP), has something in common with past procurement.
Will contractors and facilities managers have the appetite?
“I have tried the different routes of procurement. They all have their difficulties, including PPP, the aim is to understand all this, he says.
I last wrote about it six years ago when Mott MacDonald was working with HLM Architects so a lot of water must have passed under the bridge.
“The gestation period for these projects can sometimes be very long even up to 20 years. When I worked on the £450 million Bristol Southmead (Carillion) hospital pfi there were 27 different schemes including pathology, a learning and development centre with the university and offices.
Who is working on Velindre apart from Archus?
“Richard and his team are working for us giving us a bit of help. I have appointed individuals over the past year so getting them is important. We now have a very good team working on it. We also have the architect John Cooper as our lead designer.
Well he is also helping Leeds and involved with the Edith Cavill Centre pathfinder schemes.
The rest of the team working with Poole is very eclectic. I had not heard of them before.
“John Cooper has been around for along time including the early days of pfi. We also have Phil Morgan as technical advisor. I worked with him at Bristol. Also, Rhydian Morgan from Mott MacDonald and Gil Roberts, who is involved with very high quality sustainable design. This will be a very green hospital. We are using a company called Down to Earth. Ken James is our cost control expert.
An Email revealed that Rhydian Morgan is Mott’s bid development director.
“These are very important schemes and what you want to do is find the really strong-minded individuals who know the subject.
Six years ago, when I last wrote about this, there was a £200 million budget is this still accurate?
“I think you can use that number as a guide.
Another point is the overseas interest. One individual, who knows you very well, reckons there are six overseas firms interested in this?
“That is interesting. I genuinely do not know. We will go out to the market shortly and see what happens. This is a PPP. Is there an appetite to do this kind of thing? I do not know. There are a lot of funding houses that are interested but the builders – they have issues with PPP and the big builders’ interest – that is the question?
“There is also a question about facilities management. They have issues with PPP. The issue for us is there a desire in the market to do this. Can you get construction and FM markets involved? We will find out shortly.
Can you talk about the number of firms, which have asked questions? I have told six overseas firms. Has this scheme legs?
Out in two weeks
“We will find out soon enough. The market is volatile. We have had lots of enquiries yes absolutely but we do not know for sure. We are coming out in April, 2021. I know the list of suspects. This one is different. The fact that we have had Covid, it makes it more uncertain. It is on the top of my list we want a decent competition.
This is the Mutual Investment Model. Somebody told me Gleeds worked on it.
“I do not know if they did but this was the Welsh Government with PricewaterhouseCoopers and the lawyer DLA Piper.
So what about the notorious ransom strip?
Use of cute railway station
“It was not really that. This issue was they picked is a lovely site the site of the old Whitchurch Hospital. This is, after all, a cancer treatment hospital and it was next to an Asda superstore also in Whitchurch. They wanted direct access to the motorway, which would be through the Asda superstore grounds. Also, near to Whitchurch railway station.
Asda didn’t take a pound of flesh. They did not hold it to ransom. We also have been getting planning approval which we now have.
This scheme, which recently reached outline business case stage, has already had £17 million spent on a redevelopment/relocation project feasibility study in 2015/2016.
This was then a £200 million cancer scheme and Mott MacDonald with HLM Architects worked on this study. This team beat Capita an IBI/Turner & Townsend team, and a Mace/Stride Trelgown/Buro Happold/Hoare Lea team. The AECOM/BDP team pulled out of the competition.
More recently, the Archus consultancy has been analysing the clinical computer model for capacity planning and the impact on nearby hospitals for Cardiff and Vale. This is followed up the independent Nuffield Foundation review. This was a stage one initial analysis report has been completed. Stage two of the target operating model at the regional level has not started yet.
Velindre one of the 10 largest cancer centres in the UK and provides specialist cancer services to more than 1.5 million people in the South East Wales region. More than 5,000 new cancer referrals and around 50,000 new outpatient appointments are seen each year there. The centre provides radiotherapy, chemotherapy and other specialised anti-cancer treatments and also cares for patients with specialist palliative care needs.
The rise of IHP
Against the background of the pandemic and two firms occasionally dropping out from bidding DfL jobs, quoting C-19 as their reason, the reserve contractor IHP and its supply chain has filled the gap.
DfL also has project and cost management Lots and recently set up a health planning framework. Very recently, Gleeds, Mace and Lee Wakemans have picked up the former work while Archus and property developer GB Partnerships have picked up health planning work.
An early day scheme is Swansea Bay University Health Board has a strategic outline case with the Welsh Government for a £17 million programme of work comprising extension and new build, which is elective orthopaedic, at the Neath Port Talbot Hospital Velioa (France) run private finance initiative. This pfi was started in 2003.
The latest DfL framework job is the laundry rationalisation project. This is to framework contractors and project and cost managers.
There are three sites at a total budget cost of £25 million. Archus worked on the business case for one of these.
One of the sites is Llanfrechfa Grange Hospital operated by the Aneurin Bevan Local Health Board, located to the east of Cwmbran in the neighbourhood of Llanfrechfa.
Another one is at Glan Clwyd Hospital, Rhuddlan Road, Rhyl. The price range for these schemes is £12 million, £10 million and a few million.
Meanwhile, IHP looks well placed to pick up the commission to build the medicines hub in Newport, Gwent.
Professional firms on the IHP framework include HLM Architects and engineers RPS and Hydrock.
Mace is project manager and Gleeds is the quantity surveyor. The south east Wales medicines preparation hub, sometimes called TRAMS, will be in part of a big industrial shed in Imperial Park 5, Newport.
This is not the only job IHP has won. The first one was at Wrexham Maelor Hospital in Clywd.
This was after video conferences with the short-listed firms on May, 28, 2020 with the winner will being 24 hours later. Wrexham is a £54 million logistical and engineering challenge and is the first part of the redevelopment. This includes improving the supply of power, water, heating and medical gas supplies.
One of the sites of fire improvement work
IHP also fairly recently won two fire safety projects in west Wales. Each will cost about £10 million to £12 million. The first is one is at Glangwili General Hospital and the other at Withybush Hospital in Haverfordwest, Pembrokeshire. Mace and Lee Wakemans picked up commissions to work on both schemes.
Withybush is managed by Hywel Dda University Health Board.
Called the Withybush Fire scheme this is all about fire upgrades, in two phases, at a total headline figure of just over £10 million though in reality the actual work will go ahead in two phases at a total cost of between £5 million and £7 million.
The first phase is upgrading fire protection for 60 minutes and the second phase is 30 minutes protection. So the first phase is £30,000 a week turnover for a contractor for 78 weeks. Phase two is about £4 million over about two and half years.
Mace has picked up both the project management commissions and Lee Wakemans picked up both the quantity surveying roles. There is limited interest in this scheme from the contractors on the framework so might see a reserve getting involved like Vinci did at Wrexham (leading to another more than one hospital reorganisation scheme) and very little for architects to do.
So what is this job?
It is a response to fire brigade recommendations and a mixture of new fire doors throughout, installing more dampers, internal fabric improvements.
The other firms on the framework are Kier, Bam, Tilbury Douglas and Willmott Dixon.
Contracts let in November and December, 2020 included a £17 million mental health scheme to Kier. IBI might be the architect. This is a specialist in-patients support unit at Llanfrechfa Grange Hospital. This is operated by the Aneurin Bevan Local Health Board and is located to the east of Cwmbran in the neighbourhood of Llanfrechfa. The project manager is Gleeds and the quantity surveyor is Lee Wakemans. The health planning commission was awarded to property developer GB Partnerships. Aneurin Bevan Local Health Board has £50 million to spend on mental health hubs.
There is also the £10 million sexual assault referral centre at Cardiff Royal Infirmary. This job was let at the outline business case stage. Willmott Dixon Dixon picked this up and Mace is the project manager and the quantity surveyor is Gleeds.
Although GB Partnerships picked up the mental health advisory commission via the DfL framework Archus picked up the Welsh Government and NHS Shared Services commission to evaluate the current estate of primary care general practice premises throughout Wales.
This was looking at capacity, the move to have more services “in area” and closer to home. Architect IBI is currently working on at least three of the health and well-being hubs as part of the Kier supply chain; Tedegar, Newport and Park Views. It is also working on one in Swansea City Health and Wellbeing centre as part of the Faithful + Goud led team appointed by Coastal Housing in partnership with Swansea Bay University Health Board. Archus is working on a hub in Powys mid Wales.
Part of the evaluation of the current estate of primary care general practice premises sits on top of these schemes.
Last year Grant Thornton and the Archus consultancy beat a number of rivals to an initial study into the Cardiff and Vale University Hospital Wales 2 project.
No architect is appointed for this, the Shaping the Future and Wellbeing Future Hospital Programme although in recent years the BDP consultancy prepared a high-level master plan.
Firms submitted tenders to the National Health Service for Wales Shared Services Partnership on November 2, 2020. Other bidders included KPMG, PriceWaterhouse Coopers, Ernst & Young with Mott MacDonald and Deloitte with ETL.
The programme business case is now with NHS Wales for approval. This includes capacity and future horizon planning and schedules of accommodation including cost consulting and looking at modern methods of construction. This is one of the biggest schemes in Wales for a very long time. Both the Health and Llandough hospitals are part of the study.
This is also an economic generation scheme with involvement with Cardiff University, life sciences.
The next milestone will be starting work on the strategic outline case. This might not happen until September, 2021