Over much of the past summer, there has been relatively little construction activity at the site of the future new Vancouver Art Gallery (VAG), which first began major construction work in March 2024 with the demolition of the underground structure of the site’s surface vehicle parking lot.
And now there is a reason why construction has seemingly stalled.
In a bulletin this afternoon, the Vancouver Art Gallery announced that the costs for building the project has now increased by a further 50% from $400 million — which was still the official cost figure at the time of the September 2023 groundbreaking ceremony with dignitaries — to $600 million. It is stated that the cost went up to this figure over the last two years.
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Due to the financial challenges of this increased budget, the VAG is now going back to the drawing board in an apparent attempt to conduct a new wave of value engineering work on the design to reduce its costs.
Furthermore, the new building will not be completed or opened by 2028. This likely means the VAG will remain at its current location within the heritage courthouse building next to Robson Square for at least a little longer.
“As a result, the Gallery will be taking necessary steps for the next phase of the project that are pragmatic, creative and will ensure prudent financial management. This will include a revised capital project timeline in order to address rising costs through changes to the building design, while simultaneously looking for opportunities to create a multi-faceted cultural hub for the Province of British Columbia and Canada,” reads the bulletin.
“While ongoing design work means decreased construction activity at the site, the Gallery will continue to work on the project and raise funds for the completion, fit-out and ongoing operations of the new building.”
Construction has now reached completion on the first stage of pre-construction work at the site located at the northeast corner of the intersection of West Georgia Street and Cambie Street, next to the Queen Elizabeth Theatre.
So far, the VAG has raised over $350 million towards its previous $400 million budget, which includes a $50 million endowment for the building’s operating and maintenance costs upon opening.
Over the years, the VAG received $100 million from art philanthropist and developer Michael Audain, $100 million from the provincial government, $40 million from the Chan Family Foundation, and $30 million from the federal government. The City of Vancouver provided a 99-year nominal lease for the VAG’s use of the City-owned site.
“The Gallery and its Association Board of Trustees remain committed to building a dynamic cultural hub to serve the diverse needs of the community and future generations. As planning continues for this next phase, further updates will be provided as new information becomes available,” continues the bulletin.
Construction costs for materials, labour, and equipment have drastically increased over the last two years, which is also seen in a growing number of public sector projects projects building new SkyTrain extensions, hospitals, schools, and community and recreational centres. Some private sector projects, including new residential buildings, have also been put on pause due to the uncertain cost and economic climate.
More to come…