Airport body will prioritise firms in good financial health when handing out contracts for third runway 

Heathrow

Source: Heathrow Airport

Work on the scheme is slated to finish in 2026

The man in charge of Heathrow鈥檚 拢14bn deal to build a third runway has admitted the collapse of Carillion last year has made the airport redouble efforts to make sure it works only with firms that have healthy balance sheets.

The country鈥檚 second-largest contractor sank a year ago this week, ushering in a year of upheaval at some of the country鈥檚 biggest firms. Both Kier and Galliford Try have had to launch rights issues while Interserve admitted last month it was in talks about a second rescue package in less than nine months.

Meanwhile the country鈥檚 biggest private contractor, Laing O鈥橰ourke, has still not filed its 2018 accounts, with chair Ray O鈥橰ourke admitting in the autumn that 鈥渉istoric turbulence鈥 in the industry has meant auditors, banks and regulators are being extra vigilant over signing them off.

Also read: Amid a series of UK infrastructure failures, can the Heathrow expansion become a construction success story?

Last week the firm said it had agreed the terms of a refinancing deal but these were 鈥渃urrently in the process of being taken through final credit approval protocols and documentation by each lender organisation鈥.

Carillion was carrying out some FM work at Heathrow when it collapsed and had completed a Terminal 5 satellite building, called T5c, back in 2011. The 拢300m scheme was the first major project at the airport after Laing O鈥橰ourke completed T5 three years earlier.

Now Heathrow鈥檚 expansion programme director, Phil Wilbraham, has told 黑洞社区 the airport will be extra vigilant over which firms it appoints ahead of the construction work set to begin in earnest in just two years鈥 time.

Wilbraham 鈥 who spent eight years at Carillion and its predecessor Tarmac, heading up its TPS consulting division, before moving to Heathrow in 2003 鈥 said: 鈥淯ltimately we will only contract with companies that we feel are strong and that we can work with.

鈥淲e want a really health construction industry. We absolutely want these companies to thrive and bring their best people to Heathrow.鈥

His comments come as the airport prepares to appoint the first contractors to work on the scheme by the end of the year.

Wilbraham said it will hold an open day by the middle of this year for firms interested in claiming spots on frameworks for demolition, earthworks and utility diversions. Dutch firm Fugro has already begun ground investigations work at the site.

The first major package of work in the programme is a 拢1bn scheme that will include moving part of the M25 motorway to make way for the new runway. The country鈥檚 busiest road will be shifted 150m west and lowered 6m between junctions 14 and 15, the M4 junction, to allow for the runway to be built over the road.

Wilbraham said moving the M25 alone will cost close to 拢600m, while other infrastructure set to be moved includes stretches of the A4 and the A3044, nearby rivers, and an immigration centre at Harmondsworth.

Main building works will begin in early 2025 and will centre on a new terminal building for the runway as well as extending the T2 terminal, which was completed in 2014. These  two jobs have a combined pricetag of 拢2bn.

Architect Grimshaw was appointed masterplanner for the scheme in 2017, fending off interest from a number of big-name architects including Zaha Hadid Architects, Foster + Partners and T5 architect Rogers Stirk Harbour + Partners. 

But Wilbraham said Heathrow will go back out to the market to find architects to design the new terminal buildings. 鈥淲e will have a signature architect that will lead on the building,鈥 he said.

Wilbraham said the airport body was still deciding whether to appoint main contractors to jobs on a scheme-by-scheme basis or to draw up a framework of firms for the work numbering no more than six.

Other firms already working on the scheme include Mott MacDonald, Arup, Atkins, Jacobs, Wood 鈥 formerly Amec Foster Wheeler 鈥 and planning consultant Quod, which are all part of the engineering design team.

Heathrow is also working with Mace, Turner & Townsend, Jacobs and Arup on project, cost and programme works management.

A planning application will be submitted to the government鈥檚 Planning Inspectorate early next year.

A third runway is born

2006 Proposal for third runway is published by Department for Transport

2010 Championed by Labour, the plans are scrapped by the Tory/Lib Dem coalition on its first day in office

2012 Coalition sets up Airports Commission on how to expand London鈥檚 airports

2015 Airports Commission concludes a new third runway at Heathrow is the best way to expand UK capacity

2016 Tory government backs Airports Commission鈥檚 recommendations

2018 MPs vote to back expansion by 415 votes to 119

Early 2020 Heathrow to apply for planning consent order

2022 Main construction work to begin

Late 2026 Third runway due to open

2033 Entire scheme due to complete