Bernard Hickey: The lure of the 'double Grammar zone'

None of the options to ease overcrowding at the Grammar schools will be popular. Photo / Brett Phibbs

Is there any more powerful phrase in the minds and spreadsheets of Auckland's real estate chatterati than "double Grammar zone"?

Just the thought of those three words plastered across a real estate billboard is enough to make any red-blooded agent salivate. It's also enough to make any property developer in the zones see stars and dollar signs. That's why as many as 1800 apartments are expected to be built in the Auckland Grammar zone over the next three years.

But those three words and the thought of all those apartments is also enough to make the principals of Epsom Girls Grammar School and Auckland Grammar School go green at the gills.

The schools are packed to the gunnels already and can't easily expand, given a lack of available land and restrictions on building heights.

They are also reaching the point where even if they could accept extra students, it would destroy their ability to operate cohesively. School assemblies would have to be held at Eden Park.

It is a problem common across the ages. An ostensibly free property right worth up to $500,000 each is now bundled to any property in the zone. The perfectly rational thing for any developer to do is to assemble as many of these bundles to make a killing. Even better if a piece of land with one of those rights can be turned into a set of townhouses or apartments.

Just buy a house in the Grammar zones and turn it into an apartment block stacked full of new students.

This tragedy of the commons is now playing out in apartment development advertisements displayed across the world and it's making a few of the old-timers in the Grammar zones and the Ministry of Education nervous.

So what is to be done? The obvious options would cause more than a few residents in the leafy zones to splutter into their flat whites.

The boundaries of the zones could be contracted. That is the riot option. Understandably, those on the fringes who paid top dollar for those three words would feel robbed.

The second would be to restrict out-of-zone admissions or to implement admission restrictions. That would break the ethos of state-funded schools and pose a significant challenge to the cultures of EGGS and AGS. That's the demi-riot option as it would create a type of two-tiered Grammar zone.

A third option has been floated by Epsom MP and Act leader David Seymour. That is to somehow change the Education Act to allow the boards of schools such as EGGS and AGS to restrict entrance based on the age of a house or residence.

Essentially, the residents of any apartments built after a certain date - say 2020 - would not be eligible.

They would perhaps be eligible for a new third school, which has yet to be built or even planned.

This is the land-rush option. It would be one way to accelerate the apartment building boom. It would also mean apartments built after 2020 would be much cheaper and available for those without secondary-age kids, which is an increasing proportion.

The fourth option is to make the developers and the owners of the new residences pay for entry to the schools.

The final option is to simply turn the schools private. There is certainly plenty of demand for such assets. Private equity group Pacific Equity Partners is reported to be in talks to buy Academic Colleges Group, which includes schools in Auckland, for $500 million.

Perhaps the free market Act party could get behind such a public asset sale? That would be a double-riot option with a sideshow lynching of the local MP.

All the options are ugly, but are the inevitable result of creating a resource with public money that is highly desirable and virtually free to all those able to buy into the zones.