Downer is part of a consortium tendering for the Northern Corridor public-private partnership that involves extending the four-lane highway 26km from Warkworth to Te Hana, including a tunnel section and interchanges. The project is part of the 100km-long Northland Corridor from Puhoi to Whangārei. Photo / Michael Cunningham
Downer is increasingly confident the infrastructure pipeline will deliver exciting new opportunities, writes Graham Skellern
Leading construction and infrastructure maintenance firm Downer is gearing up to play a key role in the New Zealand Government’s new pipeline of major projects.
Murray Robertson, Downer New Zealand managing director, says, “I’m cautiously optimistic about the certainty in the infrastructure pipeline.”
He says the New Zealand Infrastructure Commission reported that out of a $206.9 billion pipeline, $111.6b of projects are either fully or partially funded, as at March this year.
“It sends a strong signal to the market of a good pipeline that is funded or beginning to be well-funded. Within that pipeline is $70.9b of transport infrastructure spend over 10 years, which gives us the confidence there is good work coming and we can resource up.”
Robertson says a stable, bipartisan-backed pipeline is seen as critical to investor confidence. It reduces perceived risk and enables better financing terms for public-private partnerships. This is especially important for long-term asset management and maintenance investment.
“We are seeing a shift to design-and-construct projects, rather than construct-only, and this changes the type of workforce we need – such as more engineering and design management personnel.
“We are going through a review of the work expected to come through and making sure we are resourced to a sustainable level based on what we can secure through tender. We have to do this in a measured manner. The key thing is that the industry responds by having the right people to deliver well when the initiatives start flowing.
We are seeing a shift to design-and-construct projects, rather than construct-only, and this changes the type of workforce we need – such as more engineering and design management personnel.
“We acknowledge that the growth in public-private partnerships will likely see increased involvement from overseas contractors. However, it’s important to recognise that delivering these projects successfully will still rely heavily on the capabilities and support of strong local teams like ours – and those of Fulton Hogan, McConnell Dowell, HEB Construction, Higgins, Naylor Love and LT McGuinness.
“By moving away from the boom-bust cycle (for project development), we can retain key talent and skills,” says Robertson. “We are big with on-the-job training and bringing operational management up to speed with New Zealand regulations and compliance.”
Robertson says there’s a constant degree of interest from South Africa and the UK in terms of project and design management and onsite supervisors. Interest is also being shown from some of the bigger companies out of Australia and Europe for large public-private partnerships across the country.”
In transport infrastructure, the NZ Transport Agency has started procurement of the roads of national significance, each of which presents significant opportunity to the industry, says Robertson.
Downer is part of a consortium tendering for the Northern Corridor public-private partnership that involves extending the four-lane highway 26km from Warkworth to Te Hana, including a tunnel section and interchanges. The project is part of the 100km-long Northland Corridor from Puhoi to Whangārei.
Three consortia are bidding for the work and the preferred contractor is expected to be confirmed early next year, with detailed design and early construction starting mid-year.
For Downer-owned Hawkins, the commercial construction pipeline reflects substantial investment in key sectors, says Robertson.
Health NZ released its first long-term infrastructure plan earlier this year, outlining $20b worth of (new and upgrade) projects over 10 years. Health NZ said the plan provided “a consistent approach to how and when we invest in public health infrastructure across the country based on clinical service planning and equitable healthcare access.”
Downer-owned Hawkins has recently completed the new Totara Haumaru building, which includes 150 beds and eight operating theatres, as part of the $600m North Shore hospital upgrade.
Robertson says this highly successful project was preceded by a thorough early contractor involvement phase, during which Hawkins collaborated closely with the client to proactively identify risks and ensure that practical construction strategies were well established in advance.
He says fair risk allocation is important for any major project to ensure continuity of delivery. Clear, balanced risk-sharing avoids disputes and delays, and early risk clarity helps contractors plan and price accurately.
Structured risk registers and delegated authority frameworks ensure accountability and strengthen governance. The transparent risk model fosters collaboration with clients and stakeholders and builds trust.
Hawkins is delivering Auckland Airport’s $850 million domestic jet terminal, which will connect to the present international terminal, creating a smoother, more spacious experience for travellers. The project is expected to be completed in 2029.
Downer is a core member of the Link Alliance, contributing one-third of the management and construction effort for the Auckland City Rail Link (CRL).
“While there is a necessary degree of tension over delivery and cost, the project’s quality, safety and productivity are impressive relative to similar large rail builds in Australia and other parts of the world. That comes down to being very clear about risk allocation, and an excellent project team,” says Robertson.
“The alliance is in the final stages of delivering CRL and the public will be impressed when the project is released. The way the project has delivered on social impact and sustainability outcomes is world-class. The innovation and contributions have happened because of understanding and sharing the risks.”
Downer has 8000 people - both permanent and contingent workers - operating out of 73 locations in New Zealand, including the Chatham Islands. The transport and infrastructure business is half-and-half maintenance and construction.
“We are located around the country from tip to toe,” says Robertson. “It’s important, particularly for road maintenance, because many of the areas we service are quite remote and we provide reactive as well as routine maintenance.”
Downer has 50 staff in the Tasman region but that number more than tripled to 180 to support the recovery work following the recent flooding. “We deployed people from across the South Island – the team has been working long hours and we have had to carefully manage fatigue.”
Downer maintains more than 50,000km of urban and rural roads in New Zealand Australia. It has also stretched to the Pacific Islands, recently constructing airfields in Niue Solomon Islands and Nauru.
Other completed projects include the Court Theatre performing arts venue in Christchurch, the award-winning Auckland University Hiwa Recreation centre, the Burnham Health and Rehabilitation Centre for the New Zealand Defence Force, and stage two of the Wakefield private hospital in Wellington.
Hawkins is presently delivering the Manaaki Hohonu building at Waitakere Hospital – a modern, two-storey facility housing intensive care and inpatient wards and designed to support contemporary models of care and future clinical expansion.
Other current projects include a paediatric facility at the Tira Ora Child Health Centre in Whangārei, and the Kenepuru Science Centre for PHF Science in Porirua.
Robertson says aligning investment decisions with community wellbeing and long-term regional development reinforces confidence.
Downer has developed a New Zealand Infrastructure Resilience Index – a strategic tool designed to measure and strengthen infrastructure resilience across regions.
Created in collaboration with NZIER, the index helps identify vulnerabilities in the system and guides where investment should be prioritised to ensure infrastructure continues to function with minimal disruption during future shocks.
Robertson agrees there’s plenty going on. The infrastructure pipeline is growing with more than 8000 initiatives listed nationally.
“A level of confidence is building in the industry, and we want to see this flowing through to major projects that are not held up for any reason, whether it’s consenting or designing.
“The Government is intent on making New Zealand open to foreign direct investment, and substantiate special purpose vehicles for public-private partnerships. The first significant one is the Northern Corridor.
“New Zealand is an attractive place to do business and to live. We can deliver superb engineering and training capabilities. And a lot of people who might have gone away are now coming back, and this gives clients the confidence that contractors can deliver.”
Robertson says even though the overall sentiment in the infrastructure industry is positive, it is measured. “Confidence is at its highest when funding is confirmed, political alignment is strong and delivery capability is mature.”
Downer is an advertising sponsor of the Herald’s Infrastructure report.