JUST under two years ago, in September, 2010, an earthquake hit Christchurch causing extensive damage. It was followed by the more devastating quake in February, 2011, which accounted for 185 lives.
Most of us would consider Christchurch to be at best an extremely shaky proposition for investing in real estate. Not so Sydney developer John Hayson, who had already invested serious money in a residential sub-division development, Styx Mill Estate, 15 minutes from the city, and another near-city site at Kaiapoi in the Waimakariri District.
As two other major but less significant quakes hit in June and December, 2011, Hayson’s company Silverstream Estates took on the task of meeting the needs of dislocated Kiwis.
In doing so, and working closely with the New Zealand government, developer and administration have provided a model for slashing the red tape that has effectively tied the hands of NSW developers helping create the housing shortages that have made Sydney housing prices among the highest in the world.
Think of the challenge. The CBD was extensively damaged and still requires major reconstruction of infrastructure and buildings.
Tens of thousands of homes have been so extensively damaged that they have been placed in a “Red Zone” meaning that that underlying land is unsuitable for rebuilding.
When the underlying land is “Red Zoned”, the government offers to purchase the land and buildings at the most recent government valuation.
Those residents affected must then build or purchase another home elsewhere. The New Zealand government responded by setting up the Canterbury Earthquake Recovery (CERA pronounced Sarah) Authority.
Gerry Brownlee, Transport Minister and Leader of the House, was appointed Minister responsible for CERA and theEarthquake Commission (EQC).
He moved quickly to make available new land to meet the anticipated needs of residents needing to be re-housed.
Brownlee recognised the roadblocks to development and intelligently dealt with them without reducing the necessary safeguards required before permits could be issued in such a region.
Here’s how. CERA brought together the environmental oversight body, the regional council and the developer and all parties were required to sign an agreement to work together co-operatively to produce titled land to accommodate the displaced residents.
Kaiapoi development is the first greenfield site fast-tracked through this process, although Hayson had spent years having the land rezoned for housing.
Importantly, council agreed to speed up the approval process and the developer agreed to provide a minimum number of lots within a certain time and at certain prices.
To achieve lower price points, Hayson reduced the size of some lots from 650 to 1000 sqm down to 300 to 600sqm.
In new housing estates the building covenants require a certain size home to be built on the land. So the larger the block the larger the home required to be built which means the land is more expensive and so is the house.
The smaller lots suit older people with restricted budgets, particularly, and those who don’t want to maintain gardens. The subdivision has extensive open space and an adjacent stream with 2.8 kilometers of walkways.
The fast-tracked process allowed the developer to obtain approvals on a needs basis so they could commence earthworks while the sewer and storm water services were being designed and then other services as required.
According to Hayson, the integrity of the system has been adhered to. The design and approval process has run in parallel with the works rather than being completed before works commenced.
All work was undertaken with the full knowledge, support and approval of the council and in accordance with all the relevant standards and this was the reason the company was able to achieve its objective ahead of schedule.
The council appointed a special liaison officer, weekly meetings were held, almost immediate inspections were provided and all work was constantly checked to it could be signed-off without delay on completion.
The development has delivered the first 162 titled lots in five months, which included all sub division design and consents from a cold start excluding rezoning.
Much of the second stage has been completed, and infrastructure installed for further stages, 10 months earlier than promised.
Work that would normally take about years to complete has been knocked over by multiple teams of workers working in different areas of the development to speed up the construction process.
This means that residents can move in to their homes much faster.
Said Hayson: “It has taken an earthquake to create an environment where council and private enterprise have worked co operatively together to create a positive outcome for all parties.
“It is amazing to experience the feeling where a council is not road blocking development but is working with you and it is so much easier for all concerned.
“The meetings are constructive and everybody is much happier and productive. If this could translate into co-operation with all government departments without a disaster, there is no limit to what can be achieved and the economic boost to an economy.”
Prime Minister John Key joined Brownlee and Conservation and Labour Minister Kate Wilkinson at the launch of Stage 1 in June.
It’s not all atruism of course – Hayson stands to profit from his efforts. The cost of rebuilding Christchurch has been estimated at up to $30 billion and will require 25,000 additional construction workers. Accommodation in the near term will be in short supply for workers as well as residents seeking new homes.
But as a blueprint for solving the great Australian housing shortage, state governments should seize upon this disaster response and run with it.
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