Rankled ratepayers over building blowout

If I was an Auckland ratepayer this would rankle – the move to an office tower, claimed to save ratepayers millions over ten years, is going to cost the ratepayers more millions to repair.

NZ Herald: $31m to clad Auckland Council’s HQ

Ratepayers have already paid $128.5m to buy and fit out the 25-year-old building, described as robust and structurally sound with good bones when it was bought in 2012.

About $4m was set aside for stonework issues picked up during due diligence.

But…

The cost of cladding repairs at Auckland Council’s Albert St headquarters has blown out from $4 million to an estimated $31m, according to a confidential report.

Two sources yesterday confirmed the estimated $31m repair bill. Council staff would not confirm the figure.

The $27m increase in cost is the same figure senior council officers said would save ratepayers over 10 years moving from a mix of rented and owned CBD accommodation to the ASB Tower.

An estimate of $4m blowing out to an estimate of $31 million is horrendous.

The ‘due diligence’ does not appear to have been very diligent.

Home Owners & Buyers Association president John Gray said the $31m cost was in line with his experience of recladding large buildings.

He said the cost could rise once the cladding came off.

Building work could take more than two years, he said, and staff may have to vacate the tower. About 2080 council staff work in the building.

If Gray thinks the new estimate is in line with his experience how experienced were those suggesting a cost of $4m?

I expect their will be some rankled ratepayers in Auckland. And it could get worse.

That a 25 year old building should require major recladding work should also raise a few eyebrows in building and property circles.