KEY POINTS:
Auckland City's plans for steep new apartment charges will kill the city's high-density building market, say developers.
But others are delighted about the rise, saying developers should pay more.
Robert Holden of developer Conrad Properties said the fees were so extreme that he would move most of his
work to Australia.
He calculated the fees would rise from the present $6000 a unit to $80,000 in the worst-case scenario.
The Sydney-based developer said that as a result, he would scale back work here and instead concentrate on Sydney, Perth, Melbourne and Brisbane.
"This will kill growth," he said. "It will choke development but it will be boom-time for any existing apartment owners," he said.
Developers would not be able to afford to build, so the value of existing apartments would rise, he said.
But mortgage broker and investment adviser Kieran Trass of Hybrid welcomed the changes, saying higher fees would prevent more low-quality units being built.
Developers should pay more for infrastructure and other city services, he said, having made so much money out of the CBD.
"They've have had it too easy for too long and it's allowed them to build the cheap and nasty units."
Heritage architect Allan Matson said a decline in new apartment construction could mean Auckland City would give more protection to older buildings.
"This will give the city a breather and allow heritage staff to progress their assessment of heritage buildings, which has been found wanting," Matson said. "It's good to see the back of slum developers."
Hamish Firth of planner and developer Mt Hobson Group said the charges would put up apartment prices and penalise poorer people by cutting the amount of inner-city accommodation.
"The council is effectively killing off growth in the only area of intensive high-density residential development," he said.
Lyn Voyde, contributions co-ordinator at Auckland City, said there was little feedback so far on the proposal.
The council is consulting and calling for submissions during April and May and the proposed new charges are set to apply from July 1.
Voyde has written to interested parties, encouraging them to make written submissions.
On its website www.aucklandcity.govt.nz/developmentcontributions the council outlines the reasoning behind the proposal.
"Auckland is growing rapidly," it says. "The population is increasing and there is a significant amount of commercial development in the city. With growth comes a great deal of opportunity but it also brings increased costs to manage the growth of the city, and ensure we provide the assets and services that are needed for Auckland to remain a great place to live and work as the city grows."
Marcus Beveridge of Queen City Law said developers feared that Auckland City would push through the new levy charges.
"I'm hugely concerned about this," he said.
"This will knock over development by private individuals if Auckland City goes ahead with this."
Developers who got non-notified apartment tower consents through the system in just four weeks in 2002 were now faced with an unpalatable situation, he said.
Firth also said the proposals could have a drastic effect.
"A client of mine has cancelled a 200-unit $83 million residential development in the CBD."
The policy aimed to increase fees for storm water upgrades, the costs of parks, reserves and open-space areas, transport and for community amenities, Firth said.
"But the upshot is an approximate increase in charges in the CBD for a residential unit from $6000 to a minimum of about $25,000."
Proposed apartment levy increases calculated by Hamish Firth:
* Traffic levy to increase from $877 to $2600.
* Infrastructure levy of up to $10,125 to be introduced.
* Public space levy of up to $9000 to be introduced.
* Average levies will rise from $6000 to $25,000 for each apartment.
