What is the Great Hall Project?
More than two decades after opening, the Great Hall beneath the iconic tented roof of Denver International Airport’s (DEN) Jeppesen Terminal needs updating to address today’s aviation needs. The Great Hall Project will include upgrades to Jeppesen Terminal, including restrooms and other infrastructure that is now 25 years old. Through these renovations, DEN is committed to delivering a path to long-term growth and Phase I is the first step in enabling future work.
Why is the Great Hall Project needed?
As DEN celebrates its 25th anniversary in 2020, it is important that we continue to look towards the future. By moving forward with the Great Hall Project, we can enhance safety and security, add capacity for the future, upgrade our aging infrastructure and create a more efficient passenger journey. It will take some time to build our terminal for the future, but in the end, DEN will be well-positioned to grow with our airline partners and our community.
What will happen with the TSA checkpoints?
Phase I of the Great Hall Project completes the infrastructure required to address security in future phases.
How is the Great Hall Project protecting their workers from COVID-19?
As construction work continues on the Great Hall Project, the safety of employees and passengers remains our top priority. To help minimize the spread of COVID-19, Great Hall contractor Hensel Phelps has taken a number of actions including:
- Taking the lead on ensuring compliance with Federal, State and Local COVID-19 mitigation requirements and other guidance on the project, and is working with DEN so DEN can assist in their efforts as needed.
- Continual cleaning to disinfect high-touch surfaces in common areas (meeting rooms, bathrooms, break areas, etc.), limiting the number of people in common areas and requiring face masks for workers where they are necessary and OSHA masks aren’t required.
- Added trained professionals to implement health checks that include high fever and symptom screening in accordance with City and State requirements.
- Incorporating CDC and State of Colorado COVID-19 precautions and ongoing developments at project orientations and safety meetings and is posting up to date information in high traffic and common areas to ensure personnel are aware of regulatory guidelines.
What is the status of the contract with Great Hall Partners?
In 2017, DEN entered into a 34-year contract with Great Hall Partners (GHP) to renovate the terminal and manage defined areas after completion of construction. Construction began in July 2018. In August 2019, DEN was no longer confident that GHP could deliver this complex project while maintaining the operations. As a result, DEN terminated the contract.
It is still necessary to renovate the aging infrastructure of the terminal and DEN will continue with the project to provide a quality facility for our passengers and to accommodate the demand of our airline partners.
How much did it cost for DEN to end the contract with GHP?
DEN will fund 100 percent of the project moving forward by refunding GHP’s investment in the project (approximately 25% of the construction cost) along with the lost return on their investment. In addition, the airport paid for any outstanding invoices and costs related to work in place and materials procured, as well as certain termination costs related to contracts issued by GHP.
What did the Great Hall termination pay-out consist of?
As part of the termination of its contract with Great Hall Partners for the renovation of the Great Hall, DEN is obligated to reimburse Great Hall Partners for work done to date.
Great Hall Partners was funding about 27 percent of the project and DEN was funding about 73 percent. As a result of the termination, DEN must reimburse Great Hall Partners for the money that it spent on the project for work completed. DEN does not have to pay any fees or penalties simply for terminating the Development Agreement. Paying contract breakage and termination costs are typical when terminating a construction contract for convenience.
There are three categories that make up the termination payment:
- Net Lenders’ Liability: Refunding Great Hall Partners’ share of project costs to date, which is the amount of money Great Hall Partners spent to design, construct, and manage the work completed. DEN now owns all the work, including the intellectual property such as design drawings and calculations. Great Hall Partners will use the refunded money to pay back the bonds they issued.
Total: $90.4 million
- Breakage/Costs: Payment to Great Hall Partners for the work that was required for them and their subcontractors to wind down the work on the project. There are three types of costs:
- Contractor Breakage Costs – The costs incurred by Great Hall Partners and its contractors because of the termination, such as demobilizing from the site, materials and equipment ordered that cannot be stopped or returned (which DEN will use in its completion of the Project), and other similar costs;
- Redundancy Costs – Great Hall Partners’ costs for terminating employees who will not continue with their company, such as severance payments, unpaid accrued time off, and moving costs; and
- Transition Costs – The amount spent by Great Hall Partners during the 90-day transition to DEN (August 12 – November 12), such as continuing the fire watch, the cost to secure the site, and management of the work during this transition.
Total: $55.6 million (includes all costs above and also settles $290 million in claims for additional money filed by Great Hall Partners)
- Equity/Return on investment: The return on their investment that Great Hall Partners’ owners would have received over the 34-year life of the contract.
Total: $37.7 million
Will taxpayers be responsible for this construction in any way?
DEN is an enterprise of the City and County of Denver, so no taxpayer money is used from the city's general fund for any projects or operations at the airport.
How is construction progressing?
DEN took over the Great Hall Project on November 12, 2019. On February 18, 2020, the Denver City Council approved the general contractor/construction management contract with Hensel Phelps to complete Phase I of the Great Hall Project. Construction resumed in March 2020.
On July 22, 2020, DEN and its contractor, Hensel Phelps completed its first major milestone on the Great Hall Project, the installation of the steel for the new airline ticketing pods on Level 6, a couple of weeks ahead of schedule.
In July 2020, DEN launched a project dashboard so the public can track the progress of the project. The dashboard can be accessed HERE. The metrics being reported on a monthly basis are:
- The overall schedule and key milestones:
- Ticket Pod Steel Completion-All the structural steel for ticketing pods are delivered, installed and completed
- Central Monitoring Facility-The new area where TSA resolves checked baggage screening is completed
- Ticket Pod Completion-The new ticketing pods are complete
- Commissioning-Verifying that the building’s systems operate as intended
- Substantial Completion-The majority of the scope of Phase I work is complete and the space can be occupied by the airlines
- Construction cost
- MWBE (Minority/Women-owned Business Enterprises) participation
- Workforce program
- Safety performance
How will this change the project?
DEN intends to complete the design and construction at the original budget of $650M plus $120M contingency. DEN owns all design work and construction performed to date.
Moving forward, DEN will review the project plan, scope, schedule, and costs and decide the most efficient way to proceed. Adjustments will need to be made. This project will no longer be a P3 (public-private partnership).
What happens to the subcontractors on the project?
DEN plans to continue to utilize local subcontractor partners as part of the project. They are familiar with the project and it’s most efficient to continue to work with them.
Regarding the concrete issues identified early in the project, is the airport safe?
In November 2018, concrete compression strength numbers were lower than originally reported. DEN acted quickly and hired outside experts to perform independent testing. In February 2019, these results determined that the concrete strengths were safe and construction on the terminal could continue.