Fletcher Building looking at modular timber and steel construction methods to crack the apartment market

Fletcher Building looking at modular timber and steel construction methods to crack the apartment market

Fletcher Building is looking at using modular construction systems to take a major stake in this country's apartment market.

In his speech to the company's annual meeting, Chief Executive Ross Taylor said modular construction provided an exciting opportunity for the company.

"We want to scale up the volume through our recently opened housing manufacturing plant, working on houses for our own business, as well as others,"Taylor said.

"This technology allows us to both increase quality and halve the time to build a house.

"It also provides a possible future next step into our Australian businesses.

"This is very exciting for us."

Taylor also saw an opportunity to expand into the apartment market.

"We are also actively working on tapping into the housing densification trend here, we are hoping to crack the apartment market through innovative modular construction systems," he said.

"To this end we are looking at both modular timber and modular steel construction systems, to see if we can't bring down construction time and price points to a level that we believe makes investment in this sector compelling.

"All in all this represents an exciting opportunity for Fletcher Building," he said.

But he also saw growth in its traditional residential development activities.

Taylor said the company's Residential Division achieved 755 sales in the 2019 financial year and he wanted to grow that base business to around 1000 homes a year.

He said the company currently had about 5000 future lots under its control and he expected to be able to steadily increase that.

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yeah apartments are a great way to house the workers that we need to build the apartments and the roads and the schools and the hospitals and the houses that we need to build to cater for the people we are bringing in to build the apartments and the roads and the schools and hospitals and the houses that we need to......

NZ's economic miracle.

Now that all parties across NZ's political spectrum have unanimously decided that mass migration is the way to go, we need to build accommodation for the burgeoning low-income underclass. Perhaps throw some WINZ offices and low decile schools in the area.

Jacinda and her team went full car-salesmen on their promises, where a Norwegian-like economy was promised and now we're heading towards a Dubai or Singapore model.

Well S'pore has been doing quite nicely, particularly with infrastructure. The public transport system is stunning. Also, while it's not a complete bed of roses, income growth is relatively high compared to NZ. Furthermore, the Singapore govt has a much better public housing solution for those who are disadvantaged in some way.

I agree.
We may have similar migrant numbers as Singapore does but our quality isn't remotely comparable.
For one, we have to offer residency permits and other lollies for foreign students to study at our institutions, whereas the top students in the world fight tooth-and-nail for a place at the likes of Nanyang, NUS or INSEAD.

What we could do, is set up a Winz "Portacom" office in the middle of every school's sportsfields. Start in the middle and work your way out with rows of tents/20ft shipping containers to house the lower class of society. Build 10 foot fences around the schools to keep the inhabitants safe from outsiders.

Anyone who has worked on modular construction projects would be aware of the design and construction problems they will face. This is a hard sell signal for Fletcher shares.

While I don't think it would work out the same there is a risk it could turn out like in the UK. Link below is to a full documentary on modular construction as a part of a Government building program.
https://www.youtube.com/watch?v=Ch5VorymiL4&fbclid=IwAR1Q8ahxSqCoz4MbY0S...

That is a great documentary about what happened in the UK. It truly was bad and probably contributed to UK Conservative politicians being able to destroy council housing thru 'right to buy'. There are alternative more positive state facilitated apartment building stories in Vienna, Singapore, Finland...

There are but my angle is on Fletchers. It is evident from the way they ran their construction sites that they were only interested in asking for extra money (through variations to the contract), or cut corners to reduce the money they were losing on a contract. They have lost anyone who knew what they were doing years ago, and through low pricing ran contract values into the ground. Their overly optimistic attitude stems from ignorance.

I am cynical on anything they say or do. To be frank, they are a dinosaur.

The secretary of state for trade was grilled by Andrew Neil over the number of social houses and starter homes built by the Conservatives as she attempted to criticise Labour's manifesto.

However, Andrew Neil said to Liz Truss: "In 2014 you promised to build 200,000 new starter homes. That was 5 years ago. How many did you build?"

Truss replied "I don't have the figures," before Andrew Neil said: "it's an easy number to remember, zero, you built zero new starter homes.

https://www.theneweuropean.co.uk/top-stories/liz-truss-stumbles-on-bbc-p...

I hope this goes well.
Here in the Hawkes' Bay, five or six years or so ago we had a modular apartment development. My understanding was that the modules were built in the Waikato and trucked down.
The apartments are currently encased in plastic for the second time around in two to three years. First time was to address leaky building syndrome and the second, as gossip has it, there are still problems.
Needless to say the apartment owners are over it, and even the labourers are over it as they are finding the work repetitive and lacking intrinsic value.
I hope that Fletchers do a good job. However when one talks of volumes, efficiencies, and price; standards tend to be one of the first things to be dropped. Fletchers may find the track record of other developers a perception that they need to overcome in their marketing.

Fifteen years ago in London a flatmate was on a job where they were floor by floor going through council flats and ripping them out and building new flats that were 10% smaller. So they could add 10% capacity to the building. He said it was pretty demoralising work. Not just the work itself but what it represented.

Interesting isn't it, just more finacialisation. Where will it stop? I had a friend over there who worked on massive projects where they jacked up defence force houses on former military bases and built a second level underneath. They were doing thousands of them across the country after some geezer picked them all up dirt cheap from the D.O.D. funny that...

It may work if Fletchers are taken over by the Chinese.

"Made in China" is not a stamp of quality though.

Anything Fletchers actually manage to get off the ground will be light years behind whats actually current practice in developed countries. I remember watching a tower block go up at Canary Wharf in the early naughties, all the concrete elements were precast and it went up two levels a night with the lower floor close in and fit outs following immediately behind. The best thing Fletchers could do is follow instead of reinvent. The prefab housing 'Core' they recently launched looks like something from the 1980s, real prefab house lines only have a handful of people and a truckload of technology...its called high productivity.

True we live in such pathetic size apartments they could all be built off site and then just trucked in and lifted by crane and stacked like a load of Lego blocks. Nice one, thats really living the Kiwi 1/4 acre dream.

10,000 kiwi builds, had a very nice ring to it. same people doing same things and expecting a newer result. we needs competence. we need substance.