The time and cost of the South Newcastle beach Bathers Way and skate park development are expected to be almost double when the controversial project is complete.
City of Newcastle has announced Daracon will finish the long-delayed and over-budget project after previous builder Lloyd Group collapsed into administration in March.
The council said about $8.6 million had been invested since work started in August 2020, and the remainder was expected to cost just under $11.5 million.
The initial contract was for $10.997 million. Works were initially expected to take two years, but the end date is now planned for May 2024, while the council said the lower promenade should open by Christmas.
The project has been battered by heavy swells over the years, which critics say is proof the project is in a poor location.
After Lloyd Group's collapse, Daracon was appointed as interim contractor to manage the site and fix defective work.
City of Newcastle said Daracon was ranked second when the tender for the project was awarded in 2020.
"The Lloyd Group was selected primarily on the price competitiveness of their bid," City of Newcastle executive manager project management office Robert Dudgeon said.
"On the basis that the Lloyd Group is now unable to finish the project, CN is able to appoint Daracon as the new head contractor to complete the work without having to go back out to tender. Doing this would delay the project by at least a further four months.
"The estimated cost for Daracon to complete the project is just under $11.5 million, which reflects the increased cost of labour and materials experienced nationwide since Lloyd Group commenced on site in 2020.
The council said Daracon would deploy additional staff to ensure both the Bathers Way upgrade and Newcastle Ocean Baths project were resourced appropriately and delivered.
"City of Newcastle has been frustrated and disappointed by Lloyd Group's project delivery at Bathers Way South Newcastle and the disruption caused by the firm's ultimate collapse earlier this year," Mr Dudgeon said.
"We know that the community are keen to see this project completed, as are we, and with Daracon already established on site, we look forward to seeing it progress as quickly as possible, with expectations of the lower promenade being re-opened prior to Christmas and the rest of the project to follow by May next year."
The project includes a $1.6 million upgrade of the skate park with wheelchair-accessible skate bowl and terrain park, a shared path from Shortland Esplanade to King Edward Park, parking improvements, landscaping, lighting and accessibility, fitness equipment, shade, seating and viewing areas, as well as a new café/kiosk and accessible amenities.
A development application was also lodged this week for the first use and internal fitout of the kiosk.
The works are estimated to cost $203,500.
