Construction sector: shut down in level 4 alert. Photo / Greg Bowker
Construction sector: shut down in level 4 alert. Photo / Greg Bowker
Major construction and development businesses got more than $160 million from the Government's Covid-19 wage support package to tide them over during the alert level 4 lockdown.
The sector, which employs 240,000 to 300,000 of the country's workforce, was banned from operating during level 4, except for essential services andin the healthcare sector.
Fletcher Building was the sector's largest recipient of state money. New Zealand's biggest construction, manufacturing, distribution and supply services firm got $66m for 9485 staff, the Government website showed.
Downer NZ got $38m for 5,479 people and Downer Utilities got $3.5m for 504 people.
Downer is playing a major role in many projects including Auckland's new $4.4b City Rail Link by the Link Alliance which is Vinci Construction Grands Projects, Downer NZ, Soletanche Bachy International NZ, WSP Opus (NZ), AECOM New Zealand and Tonkin + Taylor.
Major civil maintenance and materials supply business Fulton Hogan got $34.2m for 4883 staff. It is owned by family and staff shareholders, is headquartered in Christchurch and has operations in Australia and the Pacific.
City Care Ltd got $9.3m for 1330 staff and industry experts said this service arm of the Christchurch City Council was unusual in that it bid for and won jobs throughout New Zealand.
Carter Holt Harvey is ultimately owned by businesses controlled by New Zealand's richest man Graeme Hart with an estimated $10b.
Three of its businesses got $7.4m. Carter Holt Harvey Building Products got $3.5m for 501 staff, Carter Holt Harvey got $2.1m for 312 staff and Carter Holt Harvey Plywood got $1.8m for 266 staff.
HEB Construction got $7m for 1018 staff. That business has been in New Zealand for more than 35 years and is owned by Vinci Group.
Victoria Park-headquartered CMP Construction got $400,687 for 57 staff. Its big projects include the new twin-block West Light for the Ted Manson Foundation in Glen Eden. It recently finished the new Life apartments on Liverpool St for that foundation. The business was established in 1989 by Ron McRae.
Icon Construction, the Australian-headquartered business which only arrived in New Zealand recently and is building the 57-level Pacifica, got $95,000 for 14 staff.
Canam Building got $281,000 for 40 staff. Canam Management Services got $288,000 for 41 staff.
Wellington-headquartered developer Willis Bond & Company headed by Mark McGuinness, is developing and selling Wynyard Quarter and Hobsonville Point apartments. It got $222,000 for 32 staff.
Associate L T McGuinness - also run by the McGuinness family from Wellington - got $154,000 for 22 staff. L T McGuinness Auckland got $548,000 for 78 staff.
Naylor Love People got $2.2m for 315 people and Naylor Love Enterprises got $2.7m for 389 people.
Rick Herd, chief executive of Nayor Love with around 700 staff, said of the subsidy: "It's helpful. It means that our $1.4m weekly wage bill has some of the pain taken away from it. We're continuing to pay our staff."
That business expected $700m gross revenue for the June 30, 2020 year: "It's not 2021 revenue because we've already secured projects but 2022 revenue. It's hard to assess what the effects will be on that."
Hawkins 2017 got $2.9m for 427 people. Most of that business was sold to Downer.
McConnell Dowell Constructors got $2.4m for 355 people.
Leighs Construction, headed by Anthony Leighs of Christchurch, got $1.8m for 268 people. That business has finished the new Les Mills carparking building on Wellesley St West.
Dominion Constructors, headed by Brett Russell of the Russell Group, got $1.8m for 260 staff.
Cost consultants and quantity surveyors Rider Levett Bucknall got $472,000 for 48 staff. That firm released the RLB Crane Index regularly, where it surveys large fixed and crawler cranes on sites for more than a month to give a fix on the state of the construction sector.
Shane Brealey did not apply for the subsidy. Photo / Jason Oxenham
Shane Brealey, a director of NZ Living building millions of dollars of new Auckland apartments, did not apply.
"You must have lost at least 30 per cent in your revenue. We are a developer/builder and all sales remain in place so technically we can't claim to have lost any revenue – just deferred. Our guys have been pretty busy planning next projects. Builders always bemoan not having enough planning time. Well, now we have. Our 120 to 140 subcontractor resources that were on our Fraser Avenue site at Northcote will have all claimed for the wage assistance scheme," he said.
The wage support package would perform financially like public hospitals to help people fight against the virus, he said.
"If you are a business with pre-existing conditions and in poor shape with too much debt, large overheads, inefficient or just unlucky to be in travel or F&B [food and beverage], then you are more susceptible," Brealey said.
"I have spoken to half a dozen builders and they are pretty upbeat. Sure, some layoffs where the company might have had a large portion of forward work with a sector in poor shape (airports). Most builders have agreed extension of time and holding costs with their clients which is encouraging. Responsible clients are recognising that this is the fair thing to do and they want their builders to be as financially whole as they can."
