After scrapping designs for its new £650m UK headquarters, Google has confirmed work on its Kings Cross offices are unlikely to start until at least 2017.
News of the delay was first revealed by the boss of the contractor chosen to build the high-profile offices. “We were delighted to have been selected as preferred bidder for Google’s new headquarters in King’s Cross,” said Graham Cash, BAM Construction’s chief executive writing in the firm’s recently published accounts.
“It is disappointing, from our point of view, that the building has now been delayed to at least 2017 as Google has asked its concept architects to go back to the drawing board.”
Google announced last November that it had decided to scrap the first design for its state-of-the-art London offices and was embarking on a review process that could take up to two years. Its decision, the tech giant claimed, was made in a bid “to challenge ourselves to do better”.
Architect Allford Hall Monaghan Morris has been retained to rework the design of the 750,000sq ft project. Cost consultant, Gardiner & Theobald, and the consulting engineers Waterman Group have also been asked to continue with the scheme.
BAM, which published its 2013 year-end accounts this week, expected to make at least £300m from the Google contract originally scheduled to start this spring. In an interview with Building magazine the construction firm’s boss confirmed BAM was continuing to provide “sustainability consultancy to Google, assisting them to redefine the sustainability vision for the new headquarters” but no longer considered the project as part of its pipeline work. Cash even feared the contract would once again be put out to tender.
Characteristically, a Google spokesperson would only say it would now be a “number of years” before it moved into its new London premises.
Difficult trading conditions made 2013 a troubled year for BAM Construction which suffered a 36 per cent fall in profits. Revenue was £783m, down seven per cent from £838m the previous year, forcing a 36 per cent decline in pre-tax profits, which fell from £11.3m to £7.2m.
The wider BAM Construct UK group — which encompasses facilities management and property investment — posted a 9.7 per cent fall in revenue to £828m, down from £917m in 2012. Group pre-tax profit dropped 22 per cent, from £13.9m in 2012 to £10.9m last year, while operating profit fell 30 per cent from £13m to £9.1m.
The accounts showed that BAM’s facilities management business posted revenue of £43.1m, up 44 per cent on £30m the previous year, with a corresponding hike in operating profits up from 2012’s £1m to just under £9m.
Writing in the accounts, Graham Cash said: “Last year was another difficult year for most in our industry and, due to the lengthy nature of procurement and delivery of construction and property development projects, our sector felt the effects of recession later than the rest of the economy.
“Similarly, it will take longer for us to see the benefits of the recovery. Nonetheless, I feel that BAM Construct UK has withstood the effects of four years of recession well — our financial performance in 2013 is reasonable given the market we are in.”
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