The cost for an affordable housing project in Chatham has more than doubled as construction drags on due to damaged units and a change in contractors.
Chatham-Kent initially awarded a construction contract to BECC Modular to build the three-story, 27-unit housing complex at 101 McNaughton Avenue West back in 2021. While construction was started, the municipality was forced to terminate the contract after the BECC Modular failed to meet its contractual obligations.
In December 2024, Jayden Construction was retained to complete construction of the project. Since then, the new contractor has discovered water damage to the existing units and the building envelope, as well as extensive structural steel deficiencies.
A third-party consultant determined that six apartment modules needed to be removed by crane to complete new structural steel repairs. Water damage remediation was required in 34 modules, with the remaining modules also requiring a range of repairs.
As a result, the anticipated final cost to complete the project with all of the costs incurred is around $19,239,231, including taxes.
The municipality has initiated a lawsuit against BECC Modular to recover some of the costs. However, BECC and associated companies have since gone into receivership, significantly reducing the chance of recovering those funds.
Chatham-Kent’s Legal Services Division will continue to negotiate with the surety company that provided a bond for the project, up to a maximum of $7,948,500.
The remaining cost balance for the project not covered by the surety or other sources will be detailed in a future report to council.
The modular housing complex is currently expected to be completed by late spring of 2026 and ready for occupancy by the summer.
