Asbestos and rot discovery hits Kilmarnock's Palace Theatre regeneration project

Kilmarnock’s Palace Theatre and Grand Hall project could face rising costs after asbestos and rot were uncovered during development of the site.

Officers told Cabinet that the impact of the discovery and the estimated costs to address the issues was not yet calculated, but promised an update report in August.

Councillors heard that work on the historic buildings is continuing as part of the wider Cultural Kilmarnock project, but that opening-up works have revealed unrecorded asbestos and additional areas of rot which were not identified before construction began.

Providing an update on the council’s capital programme, Simon Bell, strategic lead said: “Asset Investment said the extent of the issues currently being uncovered meant it was difficult to establish an accurate estimate of the overall project cost.”

He said that investigations were continuing and that a further report would be presented to Cabinet in August.

Council leader Douglas Reid questioned whether the original asbestos surveys had been sufficient.

Work on the building is part of the wider Cultural Kilmarnock project LDRS

He said: “I’m pleased we’re getting a report on the Palace Theatre and Grand Hall in August.

“I’m wondering about the original asbestos report. Did we commission a suitable asbestos survey?

“You would have hoped that would have picked some of these issues up in the original contract. Is that the case, or will that be covered in the report coming back in August?

“That’s obviously a concern.”

Mr Bell responded: “There were a significant number of asbestos surveys undertaken within the building prior to the contract being awarded and provisional sums had been included to account for asbestos expected to be found during construction.”

However, he said the extensive opening-up works now required for building services and other construction activities had revealed additional issues that had not been anticipated.

The update formed part of East Ayrshire Council’s annual outturn report, which showed capital expenditure of £72.8m during 2025/26 and highlighted approximately £95m of major capital projects either recently completed, currently under construction or expected to be on site within the next six months.

The Palace Theatre and Grand Hall redevelopment is one of the council’s flagship regeneration projects and forms a central element of plans to create a new cultural destination in Kilmarnock town centre.

Cabinet formally noted progress on the capital programme and agreed that a further report on the Palace Theatre and Grand Hall project would be brought forward once a clearer assessment of the emerging issues has been completed.