Bay News Editor and reporter for NZME.

Rise in building consents shows city in growth mod

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Photo / Michael Cunningham
Photo / Michael Cunningham

The value of residential consents issued in Tauranga last month jumped 49 per cent to $41.4 million compared to May 2015, new figures show.

Data from Priority One revealed there were 112 residential consents issued as opposed to 79 in May 2015 valued at $27.7 million.

Priority One projects manager Annie Hill said growth in building consents was a strong indicator of economic growth as well as investor confidence.

The momentum hasn't stopped since 2013.
Mark Day, Golden Sands sales and marketing manager

"The strong growth in residential building consents shows the popularity of Tauranga as a place in which to live and work, and also the unparalleled growth in jobs that we have experienced over the last year or so - topping the country in this area.

"In turn, the job growth reflects the new businesses that have moved or established here, as well as the growth of existing businesses," she said.

There had been growth in the number of building consents issued each year since 2012, she said.

"However, the growth we have seen in the last year has been significant.

"There was a 44 per cent increase in building consents issued in the combined Western Bay sub-region last year compared to 2014, and as at May this year we are already tracking 49 per cent higher than for the first five months of 2015."

Tauranga Chamber of Commerce chief executive Stan Gregec said it was "confirmation of what we already know".

"The growth is coming from both business and residential investment.

"Businesses are confident about the future and so investing in new plant and equipment.

"This is a good sign that Tauranga is in sustained growth mode and we can expect more to come, I don't see it tapering off in a hurry."

Golden Sands sales and marketing manager Mark Day said the market was still strong.
"The momentum hasn't stopped since 2013."

One year ago the the average house and land package was about $630,000 but that had increased to $665,000, he said.

Frasers Property development manager Kranish Reddy said the firm predicted a three-fold increase in house completions at Coast Papamoa Beach in 2016 compared to 2015.

"We have had four land releases to the public this year, with the majority of sections in each release selling within the first few days. For the last three releases we have had people camping out overnight to secure their dream section."

The residential property market was certainly buoyant with strong demand for sections throughout the city and, at Coast Papamoa Beach, at a premium, he said.

"What we are noticing is it is not just the often-discussed Auckland market, but also includes prospective buyers from within Tauranga, Hamilton, Christchurch and a surprising number of Kiwis looking to return from Australia."

Sections at Coast Papamoa Beach were currently selling from $285,000, he said.

Venture Developments director Mark Fraser-Jones said its land and package sales had doubled over the last year.

It was selling a typical three bedroom, two bathroom home with double garage for about $550,000 compared to $500,000 a year ago.

He expected demand to remain strong due to immigration and low interest rates.

Master Builders Association Tauranga president Johnny Calley said the number of consents was likely to hit new levels later in the year when more land was released and consented at The Lakes.

"In September and October we are going to see a big spike on the current levels so the council will have its work cut out to process those consents in the required timeframes."

Builders were also upsizing to deal with the growth, he said.

Factory grows for bus builders

Richard Drummond.
Richard Drummond.

Kiwi Bus Builders is constructing another factory at Tauriko so that it can consolidate its business into one location.

Managing director Richard Drummond said the investment, which meant it could shift part of the operation from Greerton, was motivated by confidence in the future and low interest rates.

Its staff of 200 would build 60 coaches this year and the future was looking bright, he said.

That project was part of $19.2 million of commercial consents issued last month according to data from Priority One up from $18.5m in May 2015.

Records show there were 37 commercial consents issued last month, the biggest were for a warehouse/office development at Tauriko ($4m), Kiwibus at Tauriko ($2.6m), five dwellings at Pacific Coast retirement village ($1.1m) and the fit out of the IRD offices at Cameron Rd ($1.2m). In May 2015, 29 consents were issued.

Bayleys Tauranga commercial manager Dickie Burman said increased commercial activity was positive for the city.

"The spinoffs will be more money coming into the city through construction, roading and infrastructure development as well as more jobs and an increase in the service-related industry catering for the increased population we are witnessing."

Ray White Commercial Tauranga leasing and sales team leader Philip Hunt said low interest rates had made it more attractive for owners to build.

"The commercial market is strong and as good as I've known it in eight years."

There's a shortage of quality premises to lease, he said.

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