Rebuild optimism grows

ALAN WOOD
Last updated 05:00 11/06/2013

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Rebuilding Christchurch

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Optimism is riding high in the building industry though there is still doubt about when the Christchurch earthquake rebuild projects will peak.

That is the finding of an Aecom NZ survey showing 73 per cent of respondents associated with the infrastructure and buildings sector expect higher activity in New Zealand in the next year.

The May survey result from 400 respondents was a significant jump from 53 per cent in the previous national survey in November.

Those in the survey included those working directly in the industry or supporting it from within councils or providing banking, legal or design services.

About 60 per cent of respondents working in Canterbury believe that the peak of the rebuild will be in 2016 and beyond.

Aecom NZ managing director Dean Kimpton said the rebuild was a unique but challenging opportunity, but with some hurdles particularly in finding skilled staff in Canterbury.

"All parties are pushing hard to achieve long-term, sustained success for Christchurch.

"The uncertainty and frustration we're seeing in survey participants' responses is a natural and expected reaction due to the unprecedented scale and complexity of the rebuild," Kimpton said.

The Treasury has revised up the total cost of the wider rebuild efforts of $40 billion.

The lack of certainty was putting pressure on business leaders' hiring intentions for work further out, and staff were also hard to find.

In Canterbury 81 per cent of respondents were finding the recruitment of skilled professionals a significant hurdle.

The majority of national respondents - including more than 60 per cent of respondents working in Canterbury - believe the peak rebuild will be in 2016 or later.

About 35 per cent of those in Canterbury and the South Island thought the peak of the rebuild would be in 2015, and 30 per cent thought it would be 2016.

Also another 30 per cent believed that peak would be in 2017 or beyond.

More than half the respondents agreed New Zealand should be doing more to attract foreign investment, with tax incentives and a start to major projects in Christchurch.

Registered Master Builders chief executive Warwick Quinn said the peak of the residential rebuild would depend on work by insurance companies and their associated project management companies including Hawkins and Arrow International.

There were now "bigger numbers" of residential building consents going through council channels, and the residential work would ramp up to the end of this year and beyond.

"The general feeling, based on the work we've seen from Cera [Canterbury Earthquake Recovery Authority] and others is that late 2013, 2014, 2015 will be the peak years in residential.

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"And of course the tail on the commercial is a lot longer."

Kimpton said procurement of materials and work including tendering for projects was another area of concern, particularly from outside the region with some respondents concerned about "the closed shop nature of the traditional Canterbury market".

One suggestion was for a "prequalification" to broaden the engagement for bids.

Kimpton said many of those surveyed believed in a bold vision for Christchurch, favouring a city re-imagined, rather than a quick replication.

The greatest support for this approach came from the Canterbury region itself, with 52 per cent of Cantabrian respondents believing the rebuild should be bold and innovative. This was echoed by 41 per cent of respondents from the North Island.

Respondents in the horizontal infrastructure market including road, rail, water and marine telecommunications and land management were more cautious particularly potential investors in infrastructure, the survey found.

- BusinessDay.co.nz

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