One floor, three consents and a plasterboard shortage: this developer is walking away

It’s just too risky to build, Auckland developer Sandra Cornwell says.

Plasterboard shortages, battling to swap out Winstone Wallboards-branded GIB, and battling with council to get sign off on consents means for the Cornwells this development will be their last.

The Cornwells, Andrew and Sandra, are converting floors on a central Auckland office building at 155 Queen Street into apartments in what is a $4-5 million redevelopment.

Sandra Cornwell says the first consent, for four apartments on one title of the sixth floor, was straightforward.

But following consent applications in the same building for similar work to create new apartments — and even for work on the same floor — were much more difficult and time consuming, although Cornwell says the plans were the same, the architect used was the same and the developer had called on the same engineers, including fire and acoustic engineers, to draw up the plans.

For the second consent for new apartments on the sixth floor Cornwell says the council officer requested “something like” 30 requests for information, which was a shock after their first consent which was approved quickly.

By the third consent application for the final apartments on the sixth floor, Cornwell says she couldn’t believe it when a council consent officer hit her with about 50 requests for information, on top of all the documentation already provided up front.

“It was totally bizarre,” Cornwell says. “This was the same project … Based on who was processing them it was totally different.”

She says her experience with Auckland Council is a clear example of how the consenting process is inconsistent, and causes costly delays and distress to developers and their contractors.

“It’s obviously just a very human approach, and just no consistency, which makes it very hard. You just ask for consistency from council.”

Consenting numbers in Auckland have been hitting record highs. The latest data from Statistics NZ shows the council issued 21,463 consents for the year ended August 2022, which was an increase of 7.7% on 2021.

There was also a rise in the number of new homes completed in Auckland in August, with Auckland Council issuing Code Compliance Certificates (CCCs) for 1320 new dwellings.

Stats NZ says that was the seventh-highest number of CCCs issued for new dwellings in the Auckland region in any month of the year since current records began in January 2013.

The Ministry of Building, Innovation and Employment (MBIE) is undertaking a wide-ranging consenting review, looking at the regulatory institutions involved in the building industry, how they are regulating, and how the overall regulatory system is performing.

Public submissions closed in September. MBIE says 264 submissions were received from industry stakeholders including consent authorities, architects, engineers, industry bodies, and product manufacturers. A summary of the submissions will be published online in the coming months, an MBIE spokesperson says.

The Registered Master Builders Association, which represents more than 3000 commercial and residential builders, said in its submission New Zealand's consenting system is “plagued” by issues that result in significant delays and inexcusable inefficiencies, “escalating development costs to homeowners and the sector”.

Auckland Council says while the construction industry is currently operating at record levels, it "remains committed to enabling compliant development, and playing its part to keep the industry operating to support sustainable growth".

It says it works to process all building consent applications within 20-working days; however, it may require further information if an application does not contain all the necessary information and documentation.

"If we do require further information, the 20-day clock is stopped, and it does not start again until we receive the information we request. This means that incomplete applications will take longer to process ... We aim to simplify the application process as much as possible for our customers, providing an easy to follow 10-step guide and offering a range of support services including a 15-minute free advice meeting, pre-application guidance meetings, an online enquiry service and a helpdesk available by phoning 09 301 0101.”

The Cornwells were handling the consents themselves, and Sandra Cornwell says the process probably cost them under $10,000. But if they had used a professional like an architect she estimates, with the council delays, it may have cost up to $30,000 to get consent.

The GIB shortage

Which brings us to level ten on 155 Queen Street, the Cornwell's newest development in the former language school building which will boast eight apartments once its complete.

This consent application went in in 2020. This time Cornwell thought she would ask for a pre-planning meeting with a council officer. She says she sent the council everything from its level six developments (again, level ten was going to use the same plans, designer, engineer), all previous requests for information from level six, and asked if there was anything they needed to ensure they would be approved.

She says she was told “just to apply”.

“It wasn’t helpful at all.”

With consent for ten ticked off, 2021 was about lining up contracts and getting everything ready to kick off in January this year.

But now, Cornwell was up against a plasterboard shortage. She says her builder told her that GIB plasterboard, which was specified in the plans, wouldn’t be available until September.

So Cornwell decided to look for a workaround. She thought she had found a solution; a plasterboard product made by one of the largest plasterboard manufacturers in the world, USG Boral, imported to New Zealand by building supplies co-operative ITM, seemed to tick all the boxes.

She put in a minor variation application to have council approve the change.

Cornwell says she was told by Auckland Council it wouldn’t allow a swap for a USG Boral product because the GIB product was part of a “proprietary wall system”, meaning each component had to be as specified, even though Cornwell says what that amounts to is steel framing, one sheet of plasterboard on either side, and insulation.

She says after council raised queries, she then withdrew the application to swap to USG.

“It seems ridiculous,” she says, “why is this a proprietary wall system that can be approved only if it uses GIB-branded product, and GIB cannot be substituted with equivalent, certified product? It is widely used in Australia. Why can’t we use it?”

A New Zealand-based USG Boral spokesperson declined to comment.

Auckland Council says the information provided by Cornwell relating to the system change from GIB to USB Boral was insufficient.

In a statement, a council spokesperson says both GIB and USG Boral have proprietary wall systems “for a range of uses”.

“In some uses it is OK to product swap one lining for another if the wall system is not expected to copy a tested prototype for fire or acoustic protection, the wall assembly can then be considered largely generic in makeup. But where these systems are to be used for fire and acoustic protection each system has been tested and is reliant on the complete wall assembly being exactly to GIB and USG Borals specifications and installation instructions. In these situations, the prototype of the tested wall must be faithfully copied.”

This strict adherence to New Zealand specifications is considered one of the key issues with building supplies, and was highlighted in the Commerce Commission’s draft market study.

In June, after the widely publicised shortage of branded GIB plasterboard saw work grinding to a halt on some building sites, Building Minister Megan Woods announced she had set up a plasterboard taskforce to work out how the crisis could be solved.

As part of that work, in July Woods said four GIB alternatives were able to be used including to meet specifications for structural bracing, a peculiarity in New Zealand’s construction industry. Plasterboard is not considered a structural element anywhere else in the world.

MBIE also released a substitution guideline for GIB to help architects and builders swap out the Fletcher plasterboard product.

It says substituting plasterboard with “additional performance requirements” such as for a fire-protection system or a bracing system should, in a majority of cases, be approved through a minor variation to an already approved consent.

But its been too hard of an ask for the Cornwells, who in their latest council saga has failed a framing inspection on the basis they hadn't filed a drawing they weren't asked for in the consent application.

Sandra Cornwell says this development will be their last.

After building about ten new homes, and now two floors of apartments, it is now too risky, too slow, too uncertain, and too expensive to build.

“[Council] just don’t care. I think they are very concerned about butt-covering, and not adding any value. We want to build safely, and good quality. I just feel like it's a box ticking, butt-covering exercise for them.”