In a city that has lost so much building heritage since the earthquakes, an innovative central Christchurch project is refurbishing a historic 120-year-old façade while creating a thoroughly modern and multi-purpose structure behind and around it.

A new three-level building proposed at 199-201 High Street in Christchurch consists of retail and commercial premises on the ground floor and offices on the upper floors. The $6 million project will provide new life in the city, with a cafe and shops at street level, and offices upstairs.

Shaun Stockman, Managing Director of the company behind the redevelopment, Stockman Group – which has previously featured in White Associates newsletters thanks to its excellent work on the nearby Billens Building – says that the existing heritage face at 201 High Street is being strengthened and retained as part of the northern elevation of the new building.

“The double-storey brick facade was built in the Victorian Free Style, with two bays at first-floor level, and arched windows flanked by pilasters adorned with relief work. Work to restore the facade, which is tied to the new structure, has involved renovating the facade’s bricks and stonework, and all leadlight windows repaired.”

White Associates again provided Stockman Group with bank funding representation and an initial due diligence review. Darin Bayer says that a key factor in the project’s success has been early contractor involvement.

“Things that have really made a difference on this project’s potential really have been early contractor engagement and the strong relationship between the borrower and contractor. Superb up-front planning from main contractor Canform Structures Limited, as well as the construction team’s attention to detail and uncompromising pursuit of quality, will lead to an exceptional outcome here, even as some of the challenges have been mighty, with 49-tonne beams cast on site and craned into place.”

“Superb up-front planning from the contractor, as well as their attention to detail and uncompromising pursuit of quality, will lead to an exceptional outcome here.”

Bayer says that the project is pushing along well, with the concrete floor and foundations complete, and ground floor precast panels installed. The project is due for on-target completion in early 2020.

Civil works are nearing completion on an inspirational new community housing project at Puhinui Park, off Barrowcliffe Place and Wiri Station Road in Manukau.

On a previously empty site, the project involves the establishment of a connected neighbourhood, creating a high quality, medium density residential community of some 300 affordable houses and apartments in the heart of Auckland’s south.  The whole development will be known as Kotuitui Place, and is a major step forward in the overall Transform Manukau plan for the wider community in Manukau.

Now one year into development, the project is being developed over five years by the Puhinui Park Limited Partnership (PPLP), whose partners also delivered the hugely successful Waimahia Inlet development.  The whole development has been planned in collaboration with Panuku as the previous land owner and with mana whenua Te Akitai Waihoua, who will build and manage 30% of the site (after the initial civil and earthworks stage by PPLP) through the Kotuitui Limited Partnership.

White Associates is providing bank funding representation to this experienced PPLP development team through the Bank of New Zealand, which comprises charitable entities Housing Foundation, CORT Community Housing, and Te Tumu Kainga (the Maori Trustee).

Darin Bayer says that this development team is a little different to the norm. “This PPLP team has a charitable intent, which means their focus is on delivering quality new homes that are affordable and attainable for working families. They are exclusively committed to supporting first home buyers, so they don’t sell to investors, with an aim that residents will live in a community of families who are committed to staying.

“Puhinui Park will be a real asset to the wider Manukau community, providing a wide range of housing types and tenures for the Housing Foundation programmes and other community housing providers, with a number of homes also available for private sale.”

Many of the dwellings will be three-bedroom terrace houses, but also on offer are some one-and two-bedroom apartments, and four-bedroom terraces. The range of purchase models include rent-to-buy and shared equity to help ensure affordability, with the Crown providing some significant funding also to add to the capital needed to provide this housing assistance.

The project is progressing well says Bayer, with civils works and infrastructure nearing completion to create the lots for housing construction to begin later this year. Overall, the project is due to be completed towards the end of 2022.

“Key factors behind the success of the project so far has been team continuity”, says Bayer. “The Housing Foundation development management team, with on-site construction works led by Frank Rientjes Project Management, are using HEB Construction straight from the Waimahia project to good effect.

“A key factor behind the success of the project so far has been team continuity. The project is progressing so well because the right team of people has been in place consistently over time.”

“Additionally, we applaud the team’s great planning, with realistic budgets and timeframes, and sufficient allowances for market escalation. The biggest challenge so far has been pushing ahead with work on site hand-in-hand with some design and approval processes still ongoing, but able to accelerate the work programme and delivery timelines while ensuring that the funding is all in place when needed.

“I often say that when you get a great team together – with the collective participation of all parties involved –  the client, its partners and funders, project manager, design consultants, quantity surveyor and the contractor – you’ll have a great job: if you have them in place, the right people generate the right outcome.”

“That didn’t take long!”

Following our article on 30 July on retentions, the very next day the media reported that Ebert Construction had gone into receivership.

Now, it has been reported that the receivers for Ebert are taking legal action to test the law (Construction Contracts Amendment Act 2015) as they attempt recovery for subcontractors. It is understood that receivers PwC have set aside $9.3m for this purpose, although much of the $36.1 million owed to unsecured creditors will go unpaid, according to the first receivers’ report.

The receivers’ first report on the Ebert Construction Limited (in receivership) has identified some interesting points and learnings:

1. The current law as drafted does not provide enough clarity

Firstly, as Ebert is the first significant insolvency requiring application of the new retentions regime, the receivers will request directions from the Court to confirm entitlements, methods for distribution and who funds the cost of these activities.

The potential here is for the court to request the government to redraft the law to clarify further.

The report also states ‘the pathway and funding for addressing these issues with the application of the legislation, we are unable to confirm the timeframe for resolution of this matter. In the interim the funds continue to be set aside.’

2. Time is against the subcontractors

The timeframe to resolve this matter could be a reasonably long duration, which would not be the most favourable result for the subcontractors that have retentions funds withheld, however necessary in the current circumstances.

This situation will provide the test case which we hope will speed up this process in future.

3. Is there a shortfall?

The report further states Ebert had been placing funds in a separate bank account in respect to retentions held on subcontracts signed after 31 March 2017, with an adjustment made on a monthly basis once subcontractor’s claims for the period had been finalised and invoices issued.

A total of $3.68m was withheld, with the last adjustment taking place in June 2018 for applicable retentions held up to the end of May 2018.

At the time of the receivership, invoices for June claims had been processed, but the adjusting transfer had not yet been made. Accordingly the balance of the separate account does not represent all retentions held for subcontracts.

This suggests there may be a shortfall, with the potential value not identified in the report. This will be an area of interest to look out for on any forthcoming reports.

4. Did diversification wound Ebert?

A further point of interest is around the sectors Ebert was operating in. The receivers state: `Ebert had two principal areas of operation, being construction of processing facilities (predominantly in the diary sector) and more general commercial (including multi-unit residential) construction. Based on the information provided to us, it appears that the company had been largely successful with the processing side of the business over many years but had mixed performance in its other commercial and residential projects.’

This seems to concur with industry insight, which has suggested the move by Ebert to more residential high-rise type projects with a higher

risk profile may have contributed to the pathway that has led to receivership.

The ability of contractors to undertake multi-unit residential apartment projects is an area of concern in the industry, as higher density requirements translates to more apartment projects being undertaken.

5. Did Ebert have the right resources and skills in place to build apartments?

Multi-unit residential apartment-type construction includes complexities not always evident in other commercial projects, such as:

• Normally smaller inner city sites with limited access and complicated traffic management restraints
• Smaller building footprints resulting in limited work fronts with a more linear workflow
• Given the increased size of the number apartments per development, an estimating omission or construction defect on one unit can multiply by the quantity of the apartments.
• High concentration of subcontractors in short periods of time with resourcing and personnel management essential tight timeframes requested to meet sunset date requirements for purchasers.

It is essential that contractors have the requisite resources and skills in place for this type of work, including highly experienced personnel who have previous apartment experience, to navigate through the challenges of this type of work.
There have been many experiences in the market lately where apartment projects have experienced issues as a result of:

• Inexperienced personnel
• Subcontractor supply demand pressures leading to delays
• Construction programmes with unrealistic durations for current market conditions
• Insufficient site management to ensure works are completed in a timely manner to the level of quality required.
• Façade complexity and procurement issues
• Cost escalation associated with the project durations as not all subcontractors can be let at the commencement of the project.

6. Do your contractor due diligence thoroughly

With the construction industry under supply constraints regarding labour, materials and subcontractor availability managing the risks above is increasingly difficult.

Our advice to our valued clients and the market in general is ensure you have completed sufficient due diligence during your contractor selection, including the site personnel who will deliver the works.

Given the projection by MBIE in the latest pipeline report that 60% of residential consents will be multi-level developments by 2023, the construction sector will have to quickly respond to the challenges on how to successfully deliver high rise projects, to avoid further company failures.

Left to right – Brett Zeiler Principal , Justin Maritz Associate Director

We’re thrilled to announce that we’ve appointed a new Associate Director and a new Principal as part of two internal promotions.

Justin Maritz will step up from Principal to the role of Associate Director which sees specialist quantity surveyor Brett Zeiler step into the Principal role.

White Associates Director Graham White says the appointments are testament to the calibre of skills and leadership within the company.

“Being able to appoint from within speaks volumes for the first-class team we’ve built at White Associates over the last 13 years.”

“Controlling cost has never been more important than it is today. Justin and Brett are two of the leading cost consultants in the field and what these appointments do is really strengthen the leadership we offer our clients and the wider team at White Associates,”

Justin has more than 19 years’ experience within construction and quantity surveying in South Africa, the United Kingdom and New Zealand. He’s been with White Associates since 2013 and has proven pre-contract and post contract expertise having worked on a plethora of high profile projects across various sectors including correctional facilities, education, industrial, retail and residential developments.

With more than 10 years of experience in construction, cost consultancy and quantity surveying himself, Brett joined White Associates in January last year and has quickly established a stellar reputation for providing expert advice that helps clients to mitigate risk and ensure the success of projects.

“As White Associates continues to grow, being able to call upon Justin and Brett’s wealth of expertise and leadership is going to be a huge asset as we move forward,” explains Graham.

With the number of New Zealanders battling with homelessness at an all-time high, the Auckland City Mission is in the process of redeveloping its central city premises to better serve our most vulnerable people.

The Mission is undertaking a landmark project to create what will be an iconic, multi-purpose facility that provides essential wrap-around health services, detox facilities and homeless residential accommodation for 80 people. This supportive housing model aspires to facilitate a successful transition into independent accommodation and supports the City Mission’s vision for sustained social change.

White Associates Director Konrad Trankels says that everyone in the White Associates team admires the approach being taken.

“The Auckland City Mission provides so many critical services to the wider Auckland community,” he says. “With the number of people streaming through the Auckland City Mission’s doors at 140 Hobson Street stretching the charity to its limits, it is really special to be part of what is a once-in-a-lifetime project.”

Auckland City Mission Chief Executive Chris Farrelly says that a great deal of thought, care and consultation is going into creating the new facility.

“It is going to provide high quality spaces within a homely and nurturing environment for generations to come. At the same time, the intelligent and sustainable design we have gone for has a distinctly New Zealand flavour and is going to really complement the CBD surroundings while reflecting the Mission’s values,” he explains.

 

“We have gone to great lengths to create a design which will meet our needs in years to come, recognises our city’s Maori and Pacific peoples, and integrates with our surroundings and local community.”

In conjunction with the project architects Stevens Lawson Architects, the Mission has been working in consultation with Ngāti Whātua to encompass Maori design principles to create a place of belonging and identity. There will be an overarching theme of ‘helping people to find their way home’ which marries with the Mission’s overriding purpose. This will be expressed through the building’s gabled roof which will evoke the image of a large house – a home for Auckland’s homeless people.

Given the Mission’s proximity to the historic St Matthew-In-The-City church and its relationship to the heritage Prince of Wales Hotel building, the facility has been carefully designed to fit its surroundings and support the community. The creation of community spaces, a medical centre, a pharmacy, a café, a group of small retail spaces on Federal Street and a rooftop meeting/conference room have all been designed to integrate with the fabric of the city.

Construction is due to begin in the new year and is being overseen by project management group Xigo. Project completion expected in 2020 – which will also mark the Mission’s 100 year anniversary.

We look forward to bringing you updates on this remarkable development over the next few years.