Govt should consider more 'shovel ready' housing: developer

Monday, 8 June 2020

Calls are growing for the Government to support residential construction.

A Wellington apartment developer has called on the Government to include residential housing on its list of ''shovel ready'' projects.

Construction is soon to begin on The Paddington, a $125 million housing development in Wellington's Taranaki St, which will feature 151 terraced houses and a few ''live/work'' units.

Armstrong Downs Commercial have been appointed as the main contractor.

Inner city living in Wellington. If the Government doesn't support residential construction, a shortage could return later, Stephen Sutorius says.

The Paddington is being developed by Thames Pacific and developer Mark Dunajtschik on a 7500 square metre site on the corner of Taranaki and Jessie streets, which was formerly a car yard.

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Stephen Sutorius of Thames Pacific noted that the Government had been on the lookout for major projects it could get off the ground quickly, but the emphasis had been mostly on large infrastructure rather than residential or commercial construction.

Stephen Sutorius, owner of Thames Pacific which is building The Paddington with local developer Mark Dunajtschik.

“Covid-19 hasn’t fixed the housing supply issues in Wellington. The Government's response to build 8,000 state houses is fantastic and providing much needed social housing, but they only have so much capacity and are purely building their own portfolio.”

He believed residential projects created more employment, with half of the cost of low rise and vertical construction being made up of labour whereas infrastructure project costs were about only 20 to 25 per cent labour.

The Paddington will be built on the former Capital City Motors site at 97 Taranaki St.

''Then we have the add-ons being real estate agents, multiple solicitors, mortgage brokers, bankers that are active in every single horizontal and vertical project, but not in infrastructure.''

Apartments at The Paddington are now 98 per cent pre-sold.

With residential making up around half the overall construction market, New Zealand needed large-scale residential projects, Sutorius said, and the Government should be looking at public/private relationships outside of the Kiwibuild programme.

He suggested it could potentially introduce incentive schemes for buyers of off-the-plan property, similar to the $20,000 incentive the Australian federal government is looking to introduce.

“Both of which will create jobs and ease housing pressure. Without this, construction and property employment will decline, the market will simmer for a few years before boiling over again next cycle.”

Sutorius said The Paddington project would give work to local carpenters and plumbers in Wellington and to suppliers further afield.

Armstrong Downs Commercial's director Tony Doile said it was the largest residential project in central Wellington at present. ''It will bring a city living vibe into the heart of Wellington”.