Poland
Poland -- Construction Costs Shock Polish City's Metro Plans.
Warsaw, Poland - 9 June, 2008 When city officials opened the bids to build Warsaw, Poland's second metro line, what they saw was so high that some of them walked out of the meeting room. The officials were stunned by the results of escalating Polish building costs that have left Warsaw with a choice of either building bridges or a metro.
The City based its cost estimates on numbers gathered in 2006. The estimates were provided by firms in Poland, France, Spain and Czech. They estimated costs between 2.3 and 4.2 billion Zloty.
Based on the estimates, the City planned to pay about 3 billion Zloty.
But the contractors submitted bids that ranged from 5.9 billion Zloty to 6.2 billion Zloty.
The contract would not be awarded on price alone. The bid price would have a 70% influence on the final decision. The completion time would also be considered.
Each of the companies submitted an identical completion time. All estimated a total of 42 months which was made up of 10 months of planning, 30 months of construction, and two months for getting approvals.
Unofficial information is that each of the bids included approximately one billion Zloty to pay fines for not meeting the 42 month completion schedule that is generally considered unachievable.
Since 2006 wages in Poland have been increasing more than 10% per year. And for the 42 month plus time period after the contract is awarded that it will take to complete the metro, there is no evidence that wages will not continue to escalate.
Additionally the cost of building materials has been steadily increasing. And there is no end in sight.
There is no information available at the current time as to whether the City's estimate included the cost of the skyrocketing labor and materials.
City officials, including the President of the City of Warsaw, Hanna Gronkiewicz Walcz, were silent on the issue. The only information that came out of City offices was that the City was now faced with the decision as to whether to build a metro or to build big bridges. To build a metro at least one bridge construction project will not be able to go forward.
The public awaits more information from the Warsaw Government.
