A record 11,000-plus new Auckland apartments are rising and planned in the next three years, bringing enough new residences to house the entire Queenstown population in our biggest city if all projects go ahead.
Chris Dibble, Collier's national director of partnerships, research and communications, said 11,256 new residential units were either under construction, being marketed or in the planning and feasibility stages in the city.
All up, 197 new projects worth billions of dollars are rising or planned to be finished by 2023, he said.
The insights on market activity come from Colliers' upcoming Auckland apartment development report, due to be released in the next few weeks.
To get an idea of how much space is planned, the latest Census showed Queenstown has a population of 10,422 people.
So the amount of new building work planned for Auckland over those three years is the equivalent of creating enough new places to house the southern mecca's entire population.
Dibble said current work eclipsed previous apartment construction levels.
This year, 4927 new Auckland units are scheduled to be completed followed by 4398 units in 2022 and 1931 units by 2023, he said.
Never before has Auckland had so many new apartments rising, fuelled by factors Dibble said included:
• The Auckland Unitary Plan and its intensification call;
• The city's long-term housing shortage;
• Unprecedented demand for new residences;
• Record low-interest rates allowing buyers to borrow more easily;
• Record unemployment data giving widespread job stability;
• Closed borders and people's inability to travel;
• Popularity of residential property, estimated by CoreLogic to be now worth $1.5 trillion.
Dibble said most of the development work during the next three years was not planned to be in the CBD where apartment construction has previously been busiest but in suburban areas: a total of 2657 units could be built in the suburban areas, 1655 in the CBD and just 615 units on the fringe of the city during 2021.
That will continue next year when 2844 units are planned in suburban areas, followed by 1182 units in the CBD and just 372 on the fringes, Dibble said.
By 2023, suburban areas will become even more dominant: 1354 units compared to just 313 in the CBD and 264 on the city fringes.
Currently, 97 projects are on, 81 next year and another 19 scheduled by 2023 although new plans being put in place or deferred will keep 2022 and 2023 project numbers constantly changing, Dibble said.
"Despite these higher levels of projects and apartment developments scheduled over the next few years, this is unlikely to provide an oversupply in Auckland, especially given limited choice in the most desirable hotspots across Auckland," Dibble says
One builder said the $20,000/sq m price barrier was regularly being exceeded. That means a unit of only 50sq m which will often be one-bedroom or two is easily hitting $1.2m in more central locations.
"A few years ago, a lot of apartments were boring, bog-standard but these days, there's more marble and central air-con, bigger balconies, the blocks are in more central locations and just more up-spec," one insider said.
Apartment prices were rising, he said, due to demand and better quality buildings going up.
High-end apartments were now selling in the $25,000/sq m to $35,000/sq m bracket.
"A year ago, a lot of what we were building at the time were selling in the $10,000/sq m to $16,000/sq m range. We are now constructing buildings across the whole range, from $8000/sq m up to $35,000/sq m.
"But we are doing a lot more in the upper limits than we were a few years ago and a lot of what we are seeing coming in the front door are more high-end than low-end.
Building materials costs had become "eye-watering: reinforcing steel, structural steel, aluminium, timber have all increased well over 35 per cent this year. The costs and lead times of importing goods have significantly increased which has resulted in significant storage costs as builders procure goods early to minimise project time delays, which they are responsible for".
Auckland apartment projects include
Risland, one of China's largest developers has arrived in New Zealand for two big Auckland projects worth at least $189m.
Sunny Development New Zealand is part of the larger Risland, owned by Hong Kong Stock Exchange-listed Country Garden Holdings which trades at HK10.88. Country Garden's market capitalisation has been reported at US$296 billion and it is partly owned by China's richest woman, Yang Hiyan, 38.
Neo in Grafton
Also by the giant Risland, the project is at 5-9 Madeira Lane. Units as small as 38sq m are being marketed from $735,000.
Amaia of Takapuna
A 543-unit $350m scheme on what is now a church site, Esmonde Rd, Takapuna. The Herald reported on plans for the site in March.
KBS Capital, owned by Brilliant Stone, won approval to develop the first two of what will be three blocks on Esmonde Rd's Harbourside church near kuaka or bar tailed godwit grounds at Shoal Bay.
Initial plans for 48 Esmonde Rd are for two seven-level blocks on the 2.1ha site.
Units of one-bedroom plus a study are being advertised from $789,000, two-bedroom apartments for $989,000 and three bedrooms from $1.75m.
The new buildings will have 81 car parks.
The first building will have 37 one-bedroom, 32 two-bedroom, 17 three-bedroom and a 167sq m healthcare facility, 216sq m childcare centre, shop, with and 470sq m for communal and retail areas.
The second eastern-facing building will mainly be visitor accommodation. It will front Esmonde Rd and will have 164 studio and 18 one-bedroom units. On the ground and first floor will be a shared lobby, reception, cafe and a restaurant. The top floor will have four two to three-bedroom penthouse apartments and a shared roof garden.
Stage three will be a further 275 units.
A $30m 48-unit build to rent project. It is due to be finished next month. The owner is Kent Gardner who says this new model of ownership could help fix the broken rental system.
Wonder Apartments, 78 France St, Eden Terrace
An $88m project by Kelly McEwan and Steve Grove of Urban Collective which a few weeks ago also announced a big new Ponsonby project. This 10-floor, 90-unit development was in July reported getting 485 registrations of interest.
Pompallier on Ponsonby, 286-304 Ponsonby Rd
Five-level $120m commercial/retail/residential scheme also by Urban Collective. The site has three street frontages: Ponsonby Rd opposite Renall St, Pompallier Tce and Cowan St. All up, 14 apartments are planned and they could sell for $1.2m to $10m each.
This build-to-rent project at 26 Aroha Ave is completed completed in Sandringham: 13 units on an infill site replaced a bungalow. It won Jasmax a multi unit housing prize in this year's Te Kāhui Whaihanga New Zealand Institute of Architects' Auckland awards.
The jury described the apartments developed by Blair and Jules MacKinnon as "a labour of love that shows what you can do when the bottom line is not the only driver". The apartments are the first development in a recently re-zoned high-density area and feature a communal roof terrace where tenants do laundry, chill on the deck and entertain visitors, the jury said.