Status of the REM While we know now how efficient was the management of the pandemic in the execution of the Gordie Howe Project. as it relates to the construction schedule, and the time extension of 10-months granted and associated additional cost of 700M over the initial 5.7B (12% increase) the status of the REM (45% increase granted by the owner) was summarized yesterday in this article in the Joirnal de Montreal translated in English below for reference.
https://www.pressreader.com/canada/le-journal-de-montreal/20240108/281968907524153
BALANCE SHEET: FUND MANAGEMENT OVERSHADOWED BY REM, TRAMWAY AND THIRD LINK
CAISSE DE DPT
SYLVAIN LAROCQUE
For the Caisse de dpt et placement du Qubec, 2023 was the year when the REM and the Qubec City tramway took precedence in the public arena over its work as a fund manager.
The Caisse was in the news for many reasons in 2023, but hardly for its investment performance.
After years of planning, construction and testing, the Rseau express mtropolitain was inaugurated with great fanfare at the end of July, in the presence of premiers Franois Legault and Justin Trudeau, Montreal mayor Valrie Plante, Caisse CEO Charles Emond, his predecessor Michael Sabia and former premier Philippe Couillard.
The REM quickly made the headlines for all the wrong reasons: repeated breakdowns, noise disturbing the neighborhood, stations not sufficiently adapted to users with reduced mobility, deficient signage, poor communications with customers...
"We need to win back people's trust," Marc Boucher, senior vice-president at AtkinsRalis, one of Caisse de dpt's suppliers, acknowledged in early December.
The REM will ultimately cost just shy of $8 billion, 45% more than anticipated when the project was announced in April 2016. Provided, of course, that there are no further cost overruns on the sections to Deux-Montagnes, Montreal-Trudeau airport and Sainte-Anne-de-Bellevue. For the time being, only the segment to Brossard is open to passengers.
The difficulties encountered by the Caisse with the REM did not prevent the Legault government from awarding it three other infrastructure mandates this year.
ALSO A UNIVERSITY CAMPUS
In June, Quebec asked the institution to study the creation of a "world-class inter-university city" on part of the site of the former Royal Victoria Hospital in Montreal.
Then, in November, the government entrusted the Caisse with the task of trying to revive the Quebec City tramway project, whose estimated cost now exceeds $8 billion.
A few days later, Deputy Premier Genevive Guilbault added another review of the "third link" project between Quebec City and Lvis to this already hefty mandate.
"As is the case each time a new file is under review, a small dedicated team is assembled," says a Caisse spokeswoman, Kate Monfette.
"External firms are also retained to support the teams," she adds.
FINANCE AND POLITICS
Without really wanting to, the Caisse is thus immersed in an exercise with a strong political flavor, especially in the case of the two projects in the Quebec City region.The decision to call on the Caisse in so many cases may come as a surprise, given that the government asked the Caisse to withdraw from the REM East project in 2022. This was in response to widespread criticism of the Caisse's proposed route.Even so, Yan Cimon, professor of strategy at Universit Laval, believes the government was right to ask the Caisse for advice."It's always a good idea to have an outside opinion, especially since the Caisse is now very active in infrastructure," he points out.
In his opinion, the institution is well placed to work out a financial package "that could break the deadlock" in which the tramway project has become bogged down.In the longer term, it may be the infrastructure planning process that needs to be reviewed (again)."The Caisse cannot be the answer to all the ills associated with the development of major projects," asserts Mr. Cimon.