The continuing saga of a beseiged building owner in the Christchurch CBD… part 130

There was an interesting article by Liz McDonald in the CHCH Press 30th October 2013,  talking about the potential for the oversupply of office space that looks like it may become an issue for the city. Link Here:

“Gary Sellars, director of valuation at Colliers in Christchurch added up the metres and warned care at a Property Council function last week.” “He predicted a requirement of 280,000sqm of office space for the whole city. One case scenario “if we build everything that is proposed” would lead to 350,000sqm of office space of which almost a fifth would be oversupply.”

Its simple really. Much of the new building activity is happening outside the frame. ( For obvious reasons. Our plight would stop anyone with any sense trying to rebuild in the CBD!).  It is unlikely that the businesses that have relocated outside the frame will be willing to move back to the CBD, they have long-term leases and the central city looks like Dresden. And given the fact that rebuilding inside the Frame is still at a standstill I can not see this changing. Also the rentals outside the frame will always be cheaper than inside the frame. The artificially created shortage of land has guaranteed this.

The articles in the press are coming thick and fast:

I confess that I was disappointed with the traffic plan.  Link Here:   I felt sorry for the new Mayor Lianne Dalziel having to rubber stamp Gerry’s transport plan. I know from the whispers from my sources within the council that they really wanted to see the removal of all the one way streets. The best the council could do was slow the traffic down as it speeds through the city. I suspect that sooner or later this plan will have to be revisited. It is a 1960’s failed solution to moving traffic. It does not serve the city well. Better use of the 4 avenues would solve many of these issues.  By the way, the properties in Tuam Street have just dropped in value ( particularly those on the south side, that is the side that will be most affected by the two lanes of traffic ie it is harder to park and this side of the street will suffer more “value loss” than the north side).  The properties in Lichfield street have just risen in value.  Guess which is the better buy???

From my point of view it traps the lower High Street block, one of the last heritage block left in the city, between 3 one way streets. Not really an enviable situation.

There was also an excellent article by John McCrone the Christchurch Press 2.11.13.  Titled “Legal Challenges Expose Hasty Process.”

He discusses the hasty decisions made by the government, re the rubber stamping of city boundary changes, the quake Outcasts decision/red zoning decision and the Phillipstown School case.

Meaty issues, that require a stong cup of tea and a few re reads.

McCrone discusses the red zoning of the residential areas. I note that the bullying done by Cera to force us to accept the red zone offers is started to be discussed openly.  I guess that progress.  (I am still very cross about being bullied into having to sell our red zone land in river road, the threats, bullying and constant CERA phone calls was a disgrace.)

By the way Arrow and Southern Response are using the same tactics, but that is the subject for another day.

I also notice that Anna Crighton says “It was absolute vandalism what happened”,  referring to the demolition of the heritage buildings.  She is referring to the 10 day make safe notices that we all received.  The dreaded Section 38’s.  We were exceptionally lucky that we had already engaged an Engineer prior to the earthquakes, we had building consent and had already, prior to the earthquakes, began the strengthening work that our building required.  Most building owner did not have a hope of finding an Engineer in 10 days and as they were not property developers or have any skills in project management they were quickly bullied by CERA into allowing the demolition of their buildings.  (In some cases without the courtesy of even a phone call or the chance of being inspected by either the owners Insurance company or an independent Engineer.)

We managed to get the correct paper work in place in more or less the time allowed and that was no mean feat.

I am starting to realise that by doing what we did we very likely saved the entire Duncans Block.  My logic being: that CERA could not pull one down with out pulling all 16 down as we have an interconnected universal I beam.  That must have been very galling for CERA.

I also had a laugh at Gough’s comment in this article:

“Investor-turned-developer Antony Gough said his Terrace precinct underway on Oxford Tce was costing him $5 million more to build than it would be worth complete.

“None of the projects stack up financially. That’s why we don’t see developers rushing into Christchurch – it’s only slightly nutty passionate Christchurch people doing it.”

Gough said he would be better off financially building in Tauranga or Auckland, but was a long-term investor in the city.”

I think he is correct, we must be slightly nutty.  For us the issue is that the cost of our repairs will be less than building a new building.  Our estimate for a new building our size is approximately $2.1 million, given the cost of foundations and builders etc.  The cost of repair will be less than $700.000  – give or take an arm and a leg.

I received another missive from the CCDU a few days ago.  A letter to inform me that 3 buildings in the South Frame have had their designations removed.  Not us of course. We have only 1368 more days to wait before they confirm or deny that we are going to be acquired.

What was interesting, was the list that accompanied this letter. It shows a list of approximately 200 other building owners in the South Frame in the same limbo land that we are in. (Some of these building owners own multiple sites, some are owned by the crown already so this is a rough tally up.)

Great PR is it not?  200 + other “pissed off” building owners in this frame alone! gee that is going to speed up the rebuild is it not. They need to make some decisions soon. There are very few building owners who have taken the gamble that we have taken and begun repairs prior to confirmation of acquisition being given.  Based on the 1368 more days to go before the designations are lifted I wonder if any action will occur until the situation is clarified. I suspect not. So where is the OVERDUE Innovation Precinct plan???? I am waiting……….

On a more practical note:  We now have an up and running upstairs toilet block. This required a new water cylinder( racked), toilet (cracked) and the replacement of some floor tiles- the tiles no longer match, but I guess we will call that trendy.  A sort of Mondrian look, though I must confess not as attractive as his works!

We also have a new problem, The new fencing installed by the CCC and authorised by CERA  is giving every tagger in the city “a ladder to our roof area”, as well as the full length of rooftops across the Duncans buildings. We have to get the paint out and try to clean the mess up. After a number of phone calls I get to CERA, the person in charge of our block.  I requested that CERA move the fencing slightly to make it more difficult to access the back of our building.  I am not holding much hope out here for a solution.  They seemed singularly disinterested, though they said they would look at the situation. The CERA man I spoke to said he would also “ask security to keep an eye out”.  yeah, the same sort of “eye out” they gave when the Billens building burnt down.

I suspect that as usual we will need to scrounge, beg, borrow or steal a roll of barbed wire.  (Offers gratefully accepted!)

I did offer to put up an electric fence….”We are not amused.”

Leaving this block in the condition it is in is criminal.  They just don’t get it do they?
One of the last heritage blocks left in the city, demolition by neglect. I throw my hands in the air in true European fashion and state “they are mad!”

We are also starting on the gib plastering next week. The stair walls are in danger of being gibbed as well!  No sign of the dreaded “Detailed Engineering Evaluation”, Producer Statement  and amended building consent. The less said about that the better. I guess I should hassle the poor Engineer again.

Oh my gosh, progress, our next door neighbour at 129 High Street,  has a contractor searching for steel beams in the concrete columns. (To get an idea of the strengthening work needed). The rule is: “if you can fly a canary between the reinforcing it does not have enough.” Very scientific I know!. That is the first action that has been taken in that building for 3 years.

Another day in the life of a slightly nutty building owner in Christchurch.


6 thoughts on “The continuing saga of a beseiged building owner in the Christchurch CBD… part 130

  1. Interesting how the general consensus is that land within the frame has now started to sky-rocket in value. Given that CERA have quite a few recalcitrant owners still to be “acquired”, perhaps we should not expect to be seeing their propaganda unit publishing an updated list of recent acquisition prices any time soon? It will no longer suit CERA’s purpose to brandish the most recent “willing sales”

    Those who have held out against the bullying to date will obviously benefit from having done so, as compulsory acquisitions will, by statute, be at values as of date of theft

    Figures in one of the recent articles (linked in your blog above) of $5500/sq metre are well above pre-quake maximums of around $3500 for the very prime locations! Lichfield Street has, as you point out, become far more valuable, as just one example

    I think I will enjoy this Christmas

    • I feel sorry for the land owners that got bullied by Cera. They were in a no win situation- needing to sort their own personal circumstances and forced into accepting low ball offers. Cera’s behaviour on this issue will come under some scrutiny later on. But Like Southern Response , CERA have only a 5 year shelf life, so they dont care about customer relations.!

      You are right, the figures are interesting, I am starting to wonder what we will come out at! lol

  2. “Global construction consultants Rider Levett Bucknell (RLB) said office construction costs in central Christchurch costs outstripped all other New Zealand cities plus Sydney and Melbourne, at up to $4590 a square metre and rising”

    Do keep in mind that in my experience these very same global experts could not even perform the most basic of quantity-surveying tasks (working out a percentage of land area) without making a huge error, when it came to apportioning demolition costs for CERA’s work in the CBD; …………… but that’s another story!

    • Corruption and profiteering is a subject that appears to be avoided by the govt and press at the moment.

      I suspect that it is off a similar scale to Katrina event.

      By the way: I reckon you should write a guest article. Your story is different from ours and equally interesting. And its time to get it out there! Your building is not a demo. and your experience with the demo companies mirrors that of others. And we wont even talk about the CCDU experience that you are dealing with.
      What about it?

  3. It will dawn on everyone in time that the red-zoning in the CBD, in the liquefaction areas to the East and in the Port Hills is one almighty land-grab designed to distract. It is actually being done to mask the ineptitude and lack of foresight by government around EQC levies.

    • Hi Bart. you are right. We are being treated like idiots. Voting in the next electioni s going to be critical for CHCH people. What worries me the most is that the rest of the country has no idea what a mess they have made here. somehow they have got to be made aware that this structure that they have put in place)CERA CCDU EQC Southern Response to name a few! -is not working. The government in my view seems more interested in protecting their rich mates. thanks for your thoughts.

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