Construction problems – addressing ‘risky contracts’

At a time when a major construction boost is needed things look a bit shaky.

Fletcher Construction has had major problems – Roll call of Fletcher Buildings’ massive loss-making construction projects

Earlier this month: Ebert Construction in receivership, major apartment site locked down

26 Comments

  1. Alan Wilkinson

     /  August 17, 2018

    Govt building laws add huge risk and uncertainty and costs. If they want to fix it that is where to start.

  2. Gerrit

     /  August 17, 2018

    Mind you the building industry, especially the architects and developers, have to take equal blame with the building companies.

    To many designs not fully drawn or specified. No builder should even tender for such open ended contracts yet they do.

    So both guilty.

    Architects used to be responsible to make sure the build was done to plan and specifications, employing clerk of works to check on quality and compliance.

    But they got used and abused by the owners/developers to delay progress and final payments based on tenuous non compliance items.

    In my apprentice days I once had to repaint a single door four times as the “colour” was not correct. Once the developer sold a few more units by magic the progress payments were made and the door passed inspection (with the same colour paint as the first coat).

    .

    • Alan Wilkinson

       /  August 17, 2018

      Yes, architects used to be responsible for their work but the Govt shifted responsibility to Councils which has had all the negative consequences we now suffer.

  3. Alan Wilkinson

     /  August 17, 2018

    Foreign buyer ban already reducing housing investment and stock. Smaller developments likely to be cancelled:
    https://www.stuff.co.nz/business/106342139/chinese-investors-spooked-by-foreign-buyer-ban-website

    • Blazer

       /  August 17, 2018

      but why would anyone get in a lather over something that affects a mere 3% of buyers…does not ..compute!

      • Alan Wilkinson

         /  August 17, 2018

        3% of buyers may be a rather larger percentage of new apartment investors.

        • Blazer

           /  August 17, 2018

          no 3% is still only 3%…..97% is a bigger number.
          Hey maybe its only 3% of foreign investors that have got cold feet.
          The reality is this 3% love buying existing homes in good school zones.
          The last Govt didn’t know that,and nor do you.

          • Alan Wilkinson

             /  August 17, 2018

            You don’t know where this 3% buy. Remuera is full of Chinese who live there. They are not the non-resident foreign investors. The article points out developers need funding from cash buyers off the plans and the ban will hit those. That is exactly why the Government made an exemption for large developments but has left smaller ones in the lurch.

            • Blazer

               /  August 17, 2018

              I know exactly where they buy…Grammar Zones,Macleans College zone,all the top suburbs…leave the houses empty,doesn’t matter.

            • Alan Wilkinson

               /  August 17, 2018

              Rubbish. I’ve got family there and there are no empty houses.

            • Blazer

               /  August 17, 2018

              sorry Al you are way wrong.
              The 33,000 houses that are empty in Auckland aren’t all just being renovated or whatever other b/s excuses the liars in denial trot out.

            • Alan Wilkinson

               /  August 17, 2018

              It’s a normal percentage. You are talking out of your backside again.

            • Blazer

               /  August 17, 2018

              where can I confirm this ‘normal’ %?

              Hey Al why can’t we go to China and buy up their property as absentee owners…do they know something we ..don’t?

            • Alan Wilkinson

               /  August 17, 2018

              You should, B. I’m sure you would enjoy communism.

            • Alan Wilkinson

               /  August 17, 2018

              10% of houses are empty consistently across recent censuses. Auckland has 472,000 occupied hotels so about 6.6% of Auckland houses are empty. Normal. Renovation, vacation, for sale or rent. You are a recidivist idiot and congenital liar since all this has been traversed with you multiple times previously.

            • Blazer

               /  August 17, 2018

              usual Al..stumped AGAIN…’ I’m sure you would enjoy communism.’..

              so thats why we let them buy our housing stock but we can’t buy theirs…Al logic=go figure.

              ‘Auckland has 472,000 occupied hotels ‘…go to bed Al..you must have too much feijoa wine in the blood stream.

  4. Gezza

     /  August 17, 2018

    1ewes for a change was all interesting stuff for the 1st two segments.

    Hon Shane Geoffery Jones FCOTP, COTR, has apparently announced the creation of what 1ewes said could almost be the old Ministry of Works.

    An agency to coordinate & manage all the infrastructure developments that are to be got underway under the current administration.

    Kim Campbell got a 2-second sound bite sounding very enthusiastic about it.

    • Pink David

       /  August 18, 2018

      I’m sure the whole construction industry will be sleeping well knowing Shane Jones will shortly be taking control.

      • Gezza

         /  August 18, 2018

        Government to set up infrastructure agency to tackle deficit
        Minister for Regional Economic Development Shane Jones has announced the formation of a new independent infrastructure entity to help drive economic growth.

        Speaking at the Infrastructure New Zealand “building nations symposium 2018” on Friday, Jones said the new Government had quickly discerned a major infrastructure deficit when it came into power; with no plan to tackle it. “We’ve struggled to get a clear picture from officials of its scale, when it would hit us the worst and in which sectors.

        “Treasury is currently unable to properly quantify the value of the deficit we’re facing – it doesn’t hold accurate or up-to-date information about all infrastructure projects across all sectors and advises that agencies themselves may not necessarily know the extent of their future capital needs. The sector needed greater visibility of government’s infrastructure needs and the new entity would provide that, he said.

        Prime Minister Jacinda Ardern, also present at the forum … said the Government wanted to work with the private sector to better manage risk in construction.
        More, for the determined reader …
        https://www.stuff.co.nz/business/industries/106342622/government-to-set-up-infrastructure-agency-to-tackle-deficit

        1ewes may have over-hyped it a tad.

        Relax, Pinky. What could go wrong? The PM’s backing it. She only crashed a tractor once. It’s not like she crashes lots of things. Even Neve’s only crashed one Press Conference.

  5. Blazer

     /  August 18, 2018

    atypical property ‘investor’…NZH

    ‘ Plumber Yu Ping Gong declared income of $929 between 2011 and 2016

    • He is the sole director and 80% shareholder of a company, David 22 Trustee Ltd, which declared ZERO income.

    • Police allege Gong and his company earned $2.1m over those 5 years and purchased 8 properties worth $9.1m.

    • The 8 properties were restrained under the criminal proceeds law with the police alleging tax evasion.

    • Gong denies any tax evasion but agreed to a settlement with police.

    • He will keep 2 properties registered in his name, worth $3m.

    • The rest, worth $4.9m, have been forfeited for sale.

    • Mortgages of $1.4m will be paid to bank and unpaid tax of $1.2m to IRD.