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City of Greater Dandenong Councillors have voted at their latest meeting to put their decision to appoint the ADCO Group to build their new Dandenong Wellbeing Centre on hold.

Having, on 24th February voted narrowly 6-4 to appoint ADCO Constructions to build the new aquatic and recreation for $108 million, the earlier decision was paused as a result of ADCO Group and its director facing 18 charges over the collapse of the steel roof at the Kew Recreation Centre while it was under construction in 2022.

As reported by local news outlet the Dandenong Star Journal, ADCO has been previously charged with an alleged workplace safety breach by WorkSafe Victoria over the Kew incident.

While both matters have been yet to be decided, ADCO has advised that it is strongly defending the charges.

The Dandenong Star Journal reported that Greater Dandenong Councillor Bob Milkovic said allegations against the contractor needed to be resolved before the council could “commit” on this major investment.

He commented “my question is … can I award $100 million of ratepayer’s money to the company who are before the court?”

However, Greater Dandenong Councillor Sean O’Reilly said further delays would contribute to rising constructions costs, noting “we would have to start a whole new tender process which would than cost this community several million dollars at least due to ongoing construction costs.

“Our decision as councillors is to acknowledge the process the tender panel has gone through.”

According to a council report, the tender panel was aware of the “pending legal matters”, noting “Council understands that this matter has not yet been resolved in the courts, as such is not able to make a pre-determination on the outcome of these pending legal matters.

“That being said, it is understood the other aquatic project has re-commenced construction with the contractor and is expected to be completed by the end of 2026.”

Risk-mitigating measures included nominating the ADCO parent company - rather than the prosecuted ADCO Group - as the preferred contractor.

The report stated that during the tender panel process, ADCO and another unnamed, shortlisted tenderer had submitted competitive bids.

It deemed that ADCO was “technically competent, legally compliant and financially sound” and offered the “best value”.

The report warned of escalating construction costs and the likely loss of a $20 million Federal funding agreement if the contract didn’t proceed.

ADCO Managing Director Neil Harding said the company was “working closely with Greater Dandenong Council officers” to ensure “accurate details and context” ahead of the next council meeting on 11th March.

He explained “no findings have been made in either (legal) matter and ADCO Group intends to strongly defend these charges.

“As these matters are now before the courts, we are bound by confidentiality and cannot provide any further comment.”

Harding said ADCO was a “recognised industry leader in the design and delivery of sport and leisure facilities in Victoria and Australia”.

The company completed 50 large-scale aquatic, sport and community leisure developments, including FINA-certified pools and more than 10 high performance centres of sporting excellence.

In a statement, Victorian Building Authority (VBA) alleges ADCO Group knowingly carried out building work at the Kew Recreation Centre outside of what was allowed under their building permit.

This includes that the company allegedly fabricated and erected a steel roof truss containing four spliced sections, instead of a single length of steel as required under the permit.

VBA alleged that the welding of the structural steel framework was non-compliant and the steel used in the truss did not meet Australian standards.

Since the City of Greater Dandenong’s endorsement of its Aquatic Strategy in 2019, costs for the new Dandenong Wellbeing Centre - replacing the 40-year-old Dandenong Oasis - have risen multiple times.

The entire project including new hockey pavilion and contingencies is set to cost $122.15 million.

Works will include a 50-metre pool along with a 25-metre 10 lane pool, two warm water pools, integrated hockey pavilion, new forecourt, extensive landscaping and car park, spa and sauna and a temporary hockey compound.

Images: Concepts for the Dandenong Wellbeing Centre. Credit: City of Greater Dandenong.

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