Costs rising, AstraZeneca switches contractors and once again delays scheduled completion of its troubled $650M-plus HQ project
Design of AstraZeneca’s Cambridge Biomedical Campus
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Those rumors about big trouble for AstraZeneca’s $650 million (plus) HQ project proved to be entirely accurate. Today a spokesperson for the pharma giant tells me that they are switching building contractors and once again significantly delaying a planned move-in at the Cambridge, UK site. And the price tag for completion is headed higher.
Their statement in response to a query:
Yes, as the scientific fit-out and commissioning phase of the building takes shape, we are transitioning from Skanska to a company called Mace which has expertise in this next phase. As we begin this scientific fit-out we will have more updates but, as of now, we’re looking at occupation in first half of 2020.
The punishing setback came after a UK trade pub cited Skanska’s trouble in getting the sprawling headquarters site complete — a full 5 years after it was begun. The project — intended to represent AstraZeneca’s bold embrace of new tech and its commitment to the UK’s biopharma hub — has become an expensive albatross around CEO Pascal Soriot’s neck as he pushes to turn around the company.
Originally the project was to be completed in 2016, then 2017 and most recently in the spring of 2019 as AstraZeneca intended a staggered occupation for the local R&D work force, which has swelled in anticipation of the ribbon-cutting ceremony. This new set of construction goals will push the move-in to a full 7 years after construction was green-lighted at AstraZeneca.
As the work slowed, it also became significantly more expensive. Originally slated to cost about $430 million, the company had to add $220 million more. Now it’s headed even higher.
AstraZeneca declined to say what the new price tag on the building is, but conceded that the estimate has now pushed past the $650 million mark.
(W)hat we can say is that our overall investment in our Cambridge HQ project will be higher than initially communicated, now at over £500m. The increased investment reflects our commitment to Cambridge and the UK science-base, in particular:
- We have accelerated our transition to the Cambridge area ahead of building completion and over 2,600 of our staff are already here.
- Part of our investment in the new site is more state of the art equipment and technologies and we are investing heavily in this space.