The impact of rising costs means a major new development in Gateshead will be delivered more slowly and in three delivery packages.
Revised plans have been approved for the 12,500-capacity Sage Arena and International Conference Center in the north-east city, which was previously approved in March 2022.
These include the timelines for the delivery of the project, which includes a conference center now due to open in autumn 2025, a 344-bed hotel, which has been relocated and will open in autumn 2025, and the main pavilion, now scheduled for completion in 2027.
All development was previously due to be completed by 2024.
A statement from Gateshead Council said: “A number of global factors beyond the control of the council and its partners have affected and continue to affect the development.
“Issues include the continued impact of Covid on the supply chain, inflationary pressures, energy prices and the war in Ukraine. To mitigate these impacts, the developer has broken down the scheme into smaller delivery packages “.
The original plans were approved November 2020, with a project valuation of 260 million pounds; in December 2021, the cost had increased to £300 million. Co-developer Ask Real Estate has now valued it at £350m.
Bam Construct landed the site enabling works in December 2021, after taking over from Sir Robert McAlpine. Bam is listed as the main contractor for the project on Ask’s website.
Revised plans show the conference center will include 5,720 square meters of exhibition space, 2,520 square meters of meeting space, 17 conference rooms and a banquet hall. A new park will also be created at the planned location of the hotel.
Leader of Gateshead Council, Martin Gannon, said: “The development will bring numerous opportunities and benefits to our residents, attract visitors and create jobs and bring millions of pounds of investment to Gateshead and the North East.”
Last month, Russell WBHO, based in Manchester was appointed contractor for the development’s £48 million hotelwhich will be in charge of Accor.
