This is how Limak avoids the cost overruns that threaten the construction of the Camp Nou

BarcelonaThe choice of Limak for the remodelling of the Camp Nou caused astonishment in the construction sector. The Turkish company stood out from the other bidders because it promised to shorten deadlines and carry out the work at a very affordable price. While the Spanish construction companies asked for 1.3 billion euros, Limak committed in writing to less than 1,000. A very sweet treat that President Joan Laporta gladly accepted, and which, for Limak, meant his gateway to Western Europe.

Barça did what, in the world of construction, is known as a turnkeyStarting from a basic idea, a model, the preliminary project was passed on to Limak so that the company could will be responsible for developing and building it. It is a formula that is often used in constructions of this size, as it saves time: only one tender has to be held and, thus, the same construction company takes care of everything. In addition, it prevents you from having to blame any other company for unforeseen events or cost overruns. As you have carried out the project, if there are errors, it is your responsibility.

The system turnkey It works very well in new construction works, but it has risks in rehabilitations due to possible unforeseen events that may arise. This is exactly what has happened in the First phase of renovation of Camp Nou. Apart from the problems with the workforce or the time restrictions imposed by the City Council, the architects have detected serious deficiencies in the structure of the second tier that have had to be repaired. Also the first ten rows of the first tier, which had been assembled with prefabricated pieces in the summer of 1994 but had been damaged by humidity.

This, however, has not altered the cost of the work, according to official sources from Barça and Limak. The explanation is that they are going to agree on a guaranteed maximum price of 990 million euros, which included 903 million euros direct for the remodeling and 87 for contingencies or unforeseen events. Of the latter, 52 were for direct contingencies and 35 for possible extra costs in the purchase of material or labor due to the increase in the CPI. Neither the club nor the company have wanted to detail how much money has been spent on these unforeseen repairs, but they assure that "the budget is being met." A circumstance that Goldman Sachs, the financial company that has provided the money, is also closely monitoring, as well as the subsequent modifications. For example, the area of the stadium has been improved hospitality compared to the initial projection, for which two teams of interior designers have been hired with the aim of achieving a higher economic return with the packages VIPNeither the club nor the company have specified whether this money is included in the agreed budget or if it has to be paid separately. What is certainly not included is theskywalk, the great tourist attraction that will be set up on the roof once the remodelling works are finished.

Almost all the workers at Camp Nou are subcontracted by Limak

Of the 3,000 workers working at Camp Nou, only a small part are hired directly by Limak. They are the most qualified, such as engineers or architects. The bulk are subcontracted employees. The Turkish construction company's job is to run the orchestra, buy the materials and find workers to install them. Possible delays depend on good organisation, while possible cost overruns depend on purchasing; two sticking points that have caused moments of friction between the parties involved.

The deadlines have not been met and that is why could lead to huge penalties for Limak –Laporta said that it could be a million euros per day of delay–. But, as Barça admits, most delays are not attributable to the construction company. So, for the moment, neither has that money been claimed nor is it planned to be claimed. “Doing so now would be imprudent because it would only generate distrust and start a legal battle that would delay everything even more –they say from the noble offices–. In addition, Limak was the first interested in cutting deadlines, because it meant paying the staff less hours.”

With labor ruled out, the big battle horse to balance the numbers was the materials. Haldun Firat Köktürk, general manager of Limak, clarified at the beginning of the construction that he had agreed a price with the suppliers to avoid deviations in the medium term. But this has not been exactly the case, since the prices are being renegotiated downwards.

These companies could have given up, but they are sticking with the project and agreeing to sit at the table despite their profit margins being reduced. "The Camp Nou is a big enough project for it to be worthwhile to participate. Besides, saying 'I was there' can always be used as a publicity stunt," says one of the companies consulted, which avoids giving more explicit details of the negotiation citing confidentiality clauses.

There was also the temptation to go for more affordable products. An option that has been ruled out because a project like the Camp Nou is subject to extremely demanding standards, especially when it comes to the structure. One step below are the different finishes, such as flooring, tiling or paint. Here there was a certain margin for lowering. But taking into account that the stadium will be active every day and will attract 100,000 spectators per match, the Turkish construction company had a dilemma on the table. "Negotiating with Limak is a nightmare. They put us under a lot of pressure and we spend all day talking about prices. But it is clear that for them it is a test. It is the first football stadium they have built and they do not want it to be the only one. Their prestige is at stake," say the companies working on the site.