David is the business writer for the Bay of Plenty Times and Rotorua Daily Post.

$8.6m building surge for Rotorua

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A $980,000 new service station is being built on Te Ngae Rd. PHOTO/STEPHEN PARKER
A $980,000 new service station is being built on Te Ngae Rd. PHOTO/STEPHEN PARKER

A $1.2 million community project and a $980,000 new service station are the stars among the city's latest building projects worth more than $8.6 million.

Rotorua's construction industry is starting to sizzle with August residential and commercial building consents almost double the value 12 months ago, new figures show.

"All the indicators are big green arrows pointing upward," said Grow Rotorua chief executive Francis Pauwels about the latest data released by Rotorua Lakes Council.

He said the latest quarterly Infometrics data also confirmed strong net migration, GDP growth and building consents increases.

Availability of land remained an issue, but action was now beginning to be taken, he said.

"Because things have only really visibly taken off in the last year or two, that has certainly turned attention to the need to bring developments on a lot quicker.

"The key thing is it's giving the owners and the potential developers of land the confidence to bring those developments forward."

The August data saw 15 commercial consents, totalling $3 million, and 119 residential consents, totalling $5.6 million. This month's data included consents for 12 new dwellings at a total work value of $3.6 million.

By comparison, in August 2015, the figures were 18 commercial consents totalling $2 million, and 101 residential consents totalling $2.7 million.

The highest value commercial consents last month were $1.2 million for the Rotorua Community Hospice Trust, and $980,000 for the BP service station, which is understood to be part of Holmes Group's Lynmore Junction development.


The August 2016 commercial work value figures were up only slightly on July's $2.5 million (from 18 consents). However, the residential values were up significantly on July's $2.9 million and 94 consents.

Infometrics noted the upturn was continuing for Rotorua's construction sector, which had spillover benefits for supporting industries.

Meanwhile, net migration for the year to June 2016 showed a net gain of 917 people, up from a 509 gain in 2015, following almost a decade of net migration loss.

"These are the drivers," said Mr Pauwels.

"We get the ripple effect out of Auckland, Hamilton and Tauranga. Also I think people are looking at Rotorua a lot differently now. The perception now is that people are realising it has a lot of positives going for it."

Bill Clements, of W Clements Builders, the chairman of the Rotorua Master Builders Association, said the sector needed more subdivisions.

"We'd like to see things move faster." Mr Clements added that while builders understood the need to ensure workplace safety, new regulations had created an additional level of paperwork for the sector.

Grant Florence, Tauranga-based chief executive of the New Zealand Certified Builders association, said a shortage of developable land had been a longtime problem for Rotorua.

But overall consent numbers across the Bay of Plenty were very positive, though staffing shortages were still a problem.

"All the economic indicators and [Ministry of Business Innovation and Employment's] recent construction pipeline forecasts show that growth is going to continue on for some time, which is very positive for the industry.

"We've gone through this peak and trough cycle for some years. Hopefully, the current cycle will give builders the confidence to invest in their businesses more than they might have in the past."

- Rotorua Daily Post

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