Grenfell: Rydon struggled to ‘drum up’ interest from cladding contractors
Rydon faced pressure to return a tender for the Grenfell Tower refurbishment because it “struggled” to “drum up any interest” from cladding contractors, the Grenfell Tower Inquiry has heard.
The revelation came to light while the Inquiry heard from witness Zak Maynard, who was Rydon’s managing surveyor on the project in 2014 before later being promoted to commercial manager.
Maynard explained that Rydon regularly used firms like JS Wright and Harley Curtain Wall (who eventually went on to become subcontractor on Grenfell Tower).
But when it came to submitting a tender for Grenfell, a January 2014 email from Rydon estimator Katie Bachellier, on which Maynard was copied in, indicated that JS Wright would “struggle” to return a tender from the project because it was “snowed under” with enquiries from Rydon Construction.
Rydon refurbishment director Steve Blake then wrote to JS Wright and asked them to review the situation because Grenfell was “the best opportunity that Rydon have”.
On 8 January 2014, an internal Rydon email indicated that the firm had requested an extension of time on its tender from Kensington and Chelsea Tenant Management Organisation’s (KCTMO) agent Artelia. Bachellier warned that the contractor would have a “massive problem” if it were not granted.
She added later in the email: “Perhaps we could also cite the fact that we are struggling to drum up any interest from cladding contractors in relation to this project?”
Maynard said he believed that other cladding firms had been approached in relation to the project but didn’t know who they were.
‘Value engineering’ savings
Leading counsel to the Inquiry Richard Millett QC also probed Maynard on cost savings Rydon made during the project. It emerged in March 2014 that it had made an error in its tender sum amounting to £212,000.
Refurbishment director Steve Blake said in an internal email that the problem was “disappointing but not unexpected” and that “hopefully there will be something to compensate”.
Bachellier replied: “I think we will recover this from Harleys by taking the timber window reveals out of their package but that will mean we have to work a little bit harder of finding some significant VE savings”.
Asked if he understood this to mean that Rydon was contemplating identifying value engineering savings that would compensate for the error, Maynard replied: “Potentially, yeah.”
Meanwhile, it emerged that KCTMO’s budget for the refurbishment works was £8.4m, £800,000 less than the £9.2m winning bid submitted by Rydon, which meant more savings needed to be found.
Despite the size of the sum of money that needed to be saved, an email from Steve Blake to the TMO said he saw “no reason why this [the saving] can’t be achieved”.
Millett then asked Maynard about an email from Mark Harris at Harley Curtain Wall to Rydon detailing proposed cost savings, with large savings by using ACM cladding panels rather than zinc cladding, and even bigger savings using face-fixed ACM panels rather than cassette ACM panels.
It set out a series of options to save money on Harley’s January 2014 bid of £3.7m based on Proteus zinc cassette cladding with birch-faced plywood window reveals. The schedule of savings showed that using uPVC window reveals instead of birch-faced plywood would save around £74,000, while using Reynobond standard silver-colour aluminium cladding cassette in lieu of Proteus zinc cladding cassette would save £419,000 and Reynobond standard silver-colour aluminium cladding face fix in lieu of Proteus zinc cladding cassette would save £576,000.
However, when Katie Bachellier at Rydon sent an email to the TMO detailing value engineering options, the main contractor quoted a saving of £293,000 for the alternative aluminium system cassette and £376,000 for the face-fixed option – some £200,000 less than the saving quoted by Harley.
Millett asked Maynard why he didn’t tell the TMO what the real saving was. Maynard replied: “Because that wasn’t the saving that Rydon wanted to give.”
No formal written agreement
Millett also questioned Maynard about the appointment of Harley Curtain Wall, which he asserted “never entered into a comprehensive formal written agreement” for the Grenfell Tower works.
Maynard explained how Harley had initially signed a letter of intent to complete façade design works to the value of £30,000 in July 2014.
In August 2014, Harley director Mark Harris asked Maynard when contract documents for its work would be ready and Maynard said they would be sent to him “shortly”.
However, by 16 September 2014, Harris emailed again to say that “in order to maintain programme”, Harley needed to order special dyes and bar length material worth £325,000 and requested either an increase in the value of the letter of intent, or the subcontract in place “as soon as possible”.
Maynard increased the letter of intent to the full value of Harley’s lump sum price of £2.6m.
When Maynard was asked why two weeks had elapsed he had promised that the contract documentation would be sent out “shortly”, and why he didn’t proceed directly to a formal contract rather than increasing the letter of intent, he answered: “Workload”.
Millett drew Maynard’s attention to the letter of intent which requested acknowledgement from Harley and the signing and returning of a duplicate. However, the signature block for Harley was left blank and Millett said that no signed copy could be found. Maynard said he did not recall chasing for a signature.
Millett asked: “Was it common for Rydon to allow nearly £3m worth of work to be undertaken without a formal signed agreement in place?”
Maynard replied: “No. Normally there would be a full order in place.”
Asked if it caused any concern later, Maynard answered: “At the end, when obviously Harleys then went into administration it was a worry that we had realised it could have become an issue.” Harley Curtain Wall entered administration in 2015 and was sold in a pre-pack deal to Harley Facades.
The Grenfell Tower Inquiry continues.