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Current as of 26/05/17 10:40AM NZST
Property editor of the NZ Herald

Fletcher targets Auckland apartment market

New development division focused on more intensive, high-quality home-building projects in Auckland.

The Saltus apartment building being constructed at Stonefields, Mt Wellington, Auckland. Photo / Brett Phibbs
The Saltus apartment building being constructed at Stonefields, Mt Wellington, Auckland. Photo / Brett Phibbs

Fletcher Building is making a big push into Auckland's apartment development market, forming specialist new division Fletcher Developments this year to hunt down opportunities on big sites.

Graham Darlow, Fletcher Construction's chief executive, said this was a new area of focus but Fletcher was not interested in building infill housing.

Instead, it wants sites where amenities can be provided, such as open space and reserves.

As Auckland demand shifts towards higher density homes, Fletcher decided to focus on that area and the formation of Fletcher Developments was a response to that and the general housing shortages in the city.

"Developments is focused on delivering carefully targeted, desirable, high-quality apartment opportunities within Auckland," Fletcher Construction says on its website.

Fletcher's biggest housing project is Stonefields, the $2 billion new housing project in Mt Wellington where 2600 stand-alone houses, terrace-style residences and apartments will house 6500 people.

Stonefields Market is due to open this year, offering a food store and delicatessen, dining and offices.

A Fletcher spokesman said all 44 units in the five-level Saltus apartment block there had been sold.

Residents will move into the block on the corner of College Rd and Bluegrey Ave before the end of this year, the spokesman said.

Darlow said Stonefields was a good example of the type of demand in Auckland, with a range of housing sizes, styles and options.

"Have you seen Sydney lately?" Darlow asked, referring to the future shape of Auckland and opportunities for more intensive housing by Fletcher Developments and revealing that a task force had been established to examine opportunities for factory-built houses.

For Fletcher, one of its biggest opportunities is at the Manukau Golf Club off Great South Rd near the Southern Motorway at Manurewa, where the company paid about $40 million for a site for 500 to 800 houses, already zoned residential.

Bernie Chote, Fletcher Developments' general manager, said sites like this enabled the business to develop houses with large areas of open, green space.

Fletcher has also bought a large site at Beachlands where it is planning houses, Chote said.

Fletcher Developments is separate from Fletcher Residential, although both are divisions of Fletcher Building's Fletcher Construction. Residential, now run by Ken Lotu-liga after David Halsey retired, has nine separate house-building companies including Fyfe, Dempsey Morton, Ashton Marsh and Spaceline.

Geoff Cooper, Auckland Council's chief economist, said this month that 4764 residential building consents were lodged with the council in the 12 months to March 31.

"While that's down from the 10-year average of 6631, it is up from the year-earlier figure of 3976. This represents the early stages of a construction upswing in Auckland, which will need to continue before house prices ease," Cooper said.

The housing shortage did have an upside. "Strong house price growth across the Auckland region is boosting other parts of the economy including construction, finance and real estate industries."

Fletcher housing projects

*Stonefields, Mt Wellington.
*Beachlands, southeast Auckland.
*Manukau Golf Course.

This story has been corrected from an earlier version, which incorrectly quoted Geoff Cooper as saying 764 residential building consents had been issued in Auckland in the 12 months to March 31. The correct number is 4764.

- NZ Herald

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