'Green city' rules constrain Christchurch rebuild

Property

BusinessDesk: "There is insufficient incentive for property owners to rebuild or reinvest in the [Christchurch] CBD"

7th Feb 12, 5:42pm by BusinessDesk

Ideologically driven “green” restrictions on new commercial buildings are discouraging property investors from Christchurch rebuild projects, the Property Council of New Zealand says.

In a submission to the Canterbury Earthquake Recovery Authority, the council fears the loss of depreciation on commercial buildings since 2011 will combine with what it says are restrictive elements in the Christchurch City Council’s draft plan for the city to slow its recovery.

“The plan fails to acknowledge the challenges facing existing owners of commercial property in Christchurch, while placing increasing conditions on the construction of new buildings,” the council’s South Island branch president Graeme McDonald says.

“The current draft plan includes ideological restrictions on building height, placement, floor area and parking needs, favouring a ‘green’ city over an economically viable city. There is insufficient incentive for property owners to rebuild or reinvest in the CBD.”

The impact of the Canterbury earthquakes was “too great to leave responsibility for planning and decision-making to the CCC alone”, and Earthquake Recovery Minister Gerry Brownlee should direct the city council to “make significant amendments to the draft Plan in order to give effect to planning outcomes that will restore confidence to the commercial property investment community.”

Building height restrictions “appear to reflect the ideological preferences of planners rather than acknowledgement that the market will require floor area ratios that could trigger demand for bigger and taller buildings,” the submission says.

It also argues that commercial development in suburban areas is unduly restricted and will hurt Christchurch, which needs vibrant centres outside the central business district.

The property council also chances its arm with an appeal to the government to repeal Budget 2010 tax changes, which stopped commercial building owners being able to claim depreciation, arguing this is raising the cost of reconstruction and is out of step with other countries.

(BusinessDesk)

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10 Comments

by Chris_J | 7th Feb 12, 9:22pm 1328602936

What rubbish mist42nz.

Go hide under your desk.

by waymad | 7th Feb 12, 9:41pm 1328604060

The ChCh 'vision thang' has fallen into the classic traps of group-think, and mistaking popular volume for skin-in-the-game.

As was pointed out in many submissions, it ain't planners and architects who do the rebuild. It's owners and construction firms. Architects are, in Stewart Brand's delightful categorisation, little more than exterior decorators and planners are following whichever latest fad they have been schooled in. Both can be discounted, because they don't hold the two most important cards in the pack: land ownership and construction funding.

And apart from a few real estate types, lawyers and accountants, there isn't exactly a clamour of businesses busting their guts to re-enter the CBD. Retail will have to fit around the formidable first-mover-advantage anchor of Ballantynes, and everyone else with a business to tend is already doing so, in Riccarton, Addington, the airport's Business Parks, and the suburbs in general. Or they have gone bust and nobody's noticed yet.

The ultimate brake on all this hoo-ha is the fungibility of capital. Move across the boundary to Ashburton, Selwyn, Waimakariri or Hurunui, and the rules are fewer, the land is stabler and cheaper, and the local authorities functional, responsive and eager to eat Christchurch's lunch for them. Many businesses have heard and answered this call, and they aren't comin' back.

Which is, of course, what the Property Council is reminding CERA, playing the broken record yet again.

by iconoclast | 9th Feb 12, 10:17pm 1328779054

I really do like your style waymad ... how refreshing ..

by Chris_J | 7th Feb 12, 10:04pm 1328605448

The main reason that there won't be a rebuild any time soon is due to the shockingly poor Government response to the earthquakes.

Instead of consultation and co-operation with building owners, we have had confrontation and obstruction ... little wonder there is little motivation to rebuild.

Demolition of fixable buildings is not moving things forward ... we are heading backwards ... fast. Recovery now is looking bleak with most people I'm talking to scaling back any rebuild plans or looking at options to cash out as quickly as possible.

There are solutions, but they are not being undertaken. An absolute culture change is needed at CERA, the CCC and the Government if anything is going to happen.

Firstly, the hinderence that is EQC and the private insurance industry needs dealt with (initially in terms of settling existing claims, then dealing with new insurance). It is entirely unacceptable that after 17 months some houses which will inevitably be written off, are still sitting in EQC limbo with inaccurate assessments by unskilled, unqualified assessors underestimating repair cost.

Then demolition is crushing the heart of ChCh. And bureaucracy is squeezing the last of life out of it.

Check out the open areas of the CBD including Cashel Mall ... hardly the signs of recovery.

Stopping to look at the corner Gloucester and Durham today (the edge of the red zone) casting a view round at the modern high rises that look relatively intact, it is staggering to think what will be left once demolition is complete.

Starting in the south east corner, across the river Braniganns (about 8 levels plus) is already coming down, circling to the west, every big building you can see apart from the Rydges is coming down. The former HSBC, old Horticultural Hall, URS (former Landsborough House) and Amuri Court have recently been added to the demolition list. All that will be left is the severely damaged historic Provincial Chambers (virtually totally collapsed), some low rise units further along Armagh and that's about it. The library will inevitably be coming done too.

My feeling is that 80% of the lettable space in the CBD will be gone when demolition is complete.

We will be lucky if 10% of the amount lost is rebuilt by the 5th anniversary of the earthquake.

by iconoclast | 9th Feb 12, 10:19pm 1328779183

Try 10 years CJ

by alby | 9th Feb 12, 5:30pm 1328761829

God im sick of sob stories out of the property developers lol

Harden up bean counters!

Now that I have insulted you here is some feedback.

We, the young drinking partying adults of CHCH are all really enjoying the vacant lot pop-up bar scene in whats left of the city.

So whilst you are whinging about policy and process remember this.

We want new places to go and want them now. And and we want some new ones next week. They dont have to be new and flash and wow actually we prefer that they feel more like a kiwi backyard and.....

....they just need to be open.... OK?

This is Generation Y you are dealing with here .. the new owners of the city.

There has never been a time where "build it and they will come" has had any chance of working for decades.

Money will end up flowing here whether thats insurance or to service those that relocate here. So chill the flip out and get building your temp hospo facilities.

OK?

by moa man | 9th Feb 12, 6:54pm 1328766872

"This is Generation Y you are dealing with here .. the new owners of the city."

Ha Ha Ha. Most of Generation Y don't even own thier own car!

by Chris_J | 9th Feb 12, 9:59pm 1328777993

Ahem, I too am Generation Y (technically) but I'm also a grumpy curmudgeonly property developer.

I would have to say that despite Alby's confessed drunkenness and insolence, there is more than a degree of truth in the need for revival of the city.

However Alby is naive in the belief that it can be done with little money, without investment risk or led by the young. The revival can't happen in any short time frame with the current obstructiveness of CERA and lack of progress with both insurance settlement and coverage.

Unless there is significant change soon, we will still be having the same discussion, 18 months from now, 3 years after the first quakes - is that progress?

by alby | 9th Feb 12, 9:39pm 1328776776

Sorry I dont think they want to own the house or the car. They would like to use yours but dont want to have to pay for it.

The reality for Gen Y is that technology makes life more mobile and working in an office is done out of the habit of generations before. But that doesnt mean they want to or agree.

They are the new owners of the city as they are the market by the time you are all finished farting about deciding how when and what to build.

In the meantime open some damn bars up ............. and keep letting them use your car with your gas, living at your house eating your food so they can keep having disposable income to be connected, have the latest tech devices and all the other things they want.

by alby | 11th Feb 12, 9:01am 1328904101

Actually shall I endorse my previous comments on ownership of the rebuilt central city i.e. who its future really belongs to with these comments from John Suckling on reflection of his involvement in the Re:Start mall.

"The development of these facilities is essential if we are to attract back to Christchurch the many young people who have left.

Many of them have cited one of the reasons for leaving as the lack of entertainment after the quake.

The future of Christchurch is our youth. A vibrant central city is also essential if we are to attract tourists."

The full story is available here:

http://www.stuff.co.nz/the-press/opinion/perspective/6395119/Mall-start-of-a-miracle

I think John sums up my intent more eloquently than I ever could.

What an amazing, committed and graceful gentleman.