Soaring costs and new delay revealed for Edinburgh's first new concert hall, Dunard Centre, for a century

The bill for the Dunard Centre – Edinburgh's new concert hall – has risen by almost £40 million

The cost of creating Edinburgh’s first new concert hall for more than a century has soared by nearly £40 million in the space of 20 months, it has emerged.

A huge funding gap has emerged over the flagship project, which was estimated at £45m when plans for the venue were first announced seven years ago.

The estimated bill for the 1,000-capacity Dunard Centre, which is earmarked for a site in the city’s New Town, is now £114m, according to an official report for the city council – one of its major funders. The centre’s planned opening date has also had to be put back another year until 2028 – eight years later than originally envisaged.

Inflation and "supply chain challenges” have been blamed for the dramatic hike. Those pressures have already affected other major cultural projects in the city, including the ongoing refurbishment of the King’s Theatre and a proposed transformation of the nearby former Royal High School on Calton Hill.

The New Town venue, which will create a new home for the Scottish Chamber Orchestra (SCO) and play host to Edinburgh International Festival shows, had an official price tag of £75m when a final public funding agreement was signed in March last year.

Although the venue is being heavily supported by American arts philanthropist Carol Colburn Grigor, the Scottish and UK governments have each committed £10m to the venue, with the council contributing a further £5m.

However, it has emerged that IMPACT Scotland, the charitable trust created to pursue the project, has been asking funders to contribute more to the project to help bridge the funding gap. The council has disclosed it has been asked to stump up another £2m to help ensure the project goes ahead.

Edinburgh's Dunard Centre concert hall is proposed to be built behind a Royal Bank of Scotland building on St Andrew Square.

The venue has been dogged by problems since it was first announced in 2016 after a long search by the SCO for a suitable city centre site.

The Royal Bank of Scotland agreed to lease land behind its historic former headquarters building on St Andrew Square, where a branch is still open. However, a significant price rise first emerged in 2019 when Ms Grigor, Scotland’s biggest private arts donor in modern times, upped her Dunard Fund’s contribution from £27m to £35m.

The project was delayed by a bitter legal battle with the developers of the neighbouring St James Quarter over the proposed height of the venue and its impact on views from its flagship luxury hotel.

An official new price tag of £75m was confirmed in August 2021, despite a significant reduction in the venue’s height and the dropping of a rehearsal, performance and recording studio. Planning permission was secured three months later, with construction work due to start in 2022 and finish by 2025.

The main auditorium of the planned new Dunard Centre

However, the transfer of land occupied by former RBS offices dating back to the 1960s was not agreed until the start of this year, shortly before work began to empty and dismantle them.

A new chief executive officer to oversee the project, Jo Buckley, was appointed in May and started work in September.

The former bank buildings have since been cleared from the site earmarked for the venue. However, construction work is yet to get underway as negotiations on the final costs are still ongoing between IMPACT Scotland and the main contractor, construction giant Sir Robert McAlpine.

A new report for the council states: “The Dunard Centre project is facing increased costs because of inflation, with previous estimates totalling £75m now forecast to be £114m. The council’s contribution was agreed at £5m, but an additional £2m has been requested.”

Edinburgh's Dunard Centre concert hall is proposed to be built behind a Royal Bank of Scotland building on St Andrew Square.

IMPACT Scotland chair Ronnie Bowie told The Scotsman: “The Dunard Centre will transform what is currently a closed-off city centre site into a new concert hall, a home for the Scottish Chamber Orchestra and a vibrant community hub for music lovers of all genres, backgrounds and ages.

“Our programme to clear the ground started in February, and over the past ten months the plot has undergone a transformation, to reveal the potential of this open space for the first time in 50 years.

“In parallel, our fundraising efforts have continued. We are delighted to confirm that we have raised an additional £30m through private philanthropy across the past year alone.

“This is an incredible result that underlines the depth of the support for our mission to bring more music to more people across the region, testifying to the appeal of this landmark partnership between private and public sectors.”

The long-awaited revamp of the King’s had to be rescued with additional funding to the tune of £3.85m from the Scottish Government and £3m from the city council earlier this year to help bridge an £8.9m funding gap blamed on rising costs and inflation.

Plans to relocate a specialist music school to the old Royal High were dropped after the project’s cost rose from £45m to around £110m. However a scaled-back proposal, also bankrolled by the Dunard Fund, for a concert hall and National Centre of Music is still hoped to go ahead, as well as the venue off St Andrew Square.

The Dunard Centre will be Edinburgh's first new purpose-built concert hall for a century.

Mr Bowie said: “There is no denying there are considerable construction sector challenges, which are currently affecting all capital projects, especially one-off, bespoke builds like this one.

“We’ve kept our stakeholders apprised of the impact of inflation and supply chain challenges on the costing projections we’ve received to date, and will continue to do so. We’re still in ongoing commercial negotiation with our main contractor and so cannot provide commentary on financial figures.

“However, it’s true to say the final total project cost will be higher than last reported, and that additional public sector financial support would be very welcome. We expect to conclude these tender negotiations in the new year.

“Our enablement works are progressing well and we expect to have the site cleared and ready for construction by the end of April 2024. We’re aiming to enter main construction shortly thereafter, and the second stage of the tender process has clarified that the construction phase will then be a four-year programme.

"We recognise this pushes our completion date back from earlier estimates, but this landmark building has been a long time coming and we’re determined to ensure we do it justice.”

Council leader Cammy Day said: “As is the case with many projects of this scale, we’re aware of increases in costs. We remain in close dialogue with the project, along with the UK and Scottish governments and other key stakeholders.

“We’re aware and remain supportive of the excellent fundraising campaign, and we await the outcome of commercial negotiations around the project. The council has no plans for a further capital contribution at this time, but will continue to monitor the project closely as it develops.”