Brady Nixon: Land scarcity dents plan for compact Auckland

Is a compact city a realistic expectation for all of Auckland? Photo / Paul Estcourt

Opinion

Council vision will strain communities and developers.

Proposing a compact city was always going to incite controversy. The draft Auckland Plan is ambitious, and there are many within the property industry wondering if some of its key aspirations are half way between a lucid dream and a near-death hallucination.

There is nothing wrong with a compact city and most people in the property industry would have no principal issue with the plan to intensify Auckland. There can be many great outcomes from a more intensively built environment, as have been discussed in this paper.

The draft Auckland city centre and waterfront plans are testament to the quality of environment that can be delivered with a compact city. But is that a realistic expectation for all of Auckland?

The issue at hand relates to the amount of intensification proposed and whether it can be delivered. The nexus of the plan is a strategy whereby 75 per cent of all new dwellings built over the next 30 years will be constructed within the current Metropolitan Urban Limit (city boundaries). The balance of new dwellings is proposed to be accommodated outside the MUL in specific study areas, and in expanded satellite towns and settlements.

In Auckland, there are about 380,000 existing dwellings covering 530sq km. Of that quantum, there are 311,000 houses and 110,000 apartments, terrace houses and single-level flats. That implies that the current rate of intensification is about 26 per cent of all dwellings. Projections of between 700,000 and one million additional residents by 2041 will mean an increase of at least another 350,000 dwellings in 30 years, which is effectively twice the number of homes that already exist now, in the same area.

That means every single part of Auckland will have to play its part in accommodating growth. No suburb can escape the fact that how it looks will change vastly. Suburban dwellings will make way for more intensive forms of development, such as apartments and terrace housing.

Auckland cannot expect that all future dwellings will be built as apartment buildings confined to small segments of Auckland's isthmus, because there simply is not enough land to enable that.

The debate for the spatial plan is going to focus upon this intensification target. Section 79 of council legislation requires that the spatial plan be based on empirical evidence, such as realistic quantifiable land supply quantum. There is no evidence that there is enough land to achieve the goal.

The property industry - developers, builders and property owners - believe that, historically, councils have got it wrong when matching growth predictions to supply of land. Councils always assume that 100 per cent of all land is available and that 100 per cent of rezoned land will be developed. This never happens. The current level of intensification (26 per cent) proves that to be so.

When evaluating capacity against historic trends for intensification and, after all land areas in Auckland that cannot be developed are eliminated from the equation (such as historic suburbs, brand-new suburbs and buildings, commercial land), a real concern exists that there simply is not enough land resource within the city limits to accommodate intensification at a target of 75 per cent, even if up-zoning for taller buildings occurs.

The council needs to undertake a fine-grained analysis of land supply and quantify what actually is available, rather than work on assumptions. If the council does not have sufficient land to support the target it risks not releasing enough land for development, putting pressure on land resources. The inevitable consequence is competition for limited land resources by everyone in the market, which results in increased land costs. The effects of high land costs are strangled development and decreased affordability, which creates shortfalls in housing stock.

As it happens, significant portions of Auckland would need to be changed to allow for the proposed apartment buildings and terrace houses to be built. This will naturally draw communities into the debate, which are often opposed to change and have deep-rooted fears about intensification. There are communities in Auckland which will be strongly opposed to local intensification and expect intensification to happen "somewhere else". The exacerbation of community opposition will place additional pressure on an intensification target of 75 per cent.

If the property industry and communities are successful in reducing the intensification target to something more realistic (a 50/50 split is preferred), then the spatial plan will be considerably different.

The council will have to consider more land outside the MUL for development, either in extensions of the MUL, coastal and rural settlements or perhaps by creating new settlements.

The debate over the intensification target is not an attack on the principle of a compact city. Rather, it is a rationalisation of the strategy to better align it with what the industry can deliver and what the communities will accept, allowing for a more rational debate about the quality and amenity that can be delivered.

HAVE YOUR SAY: theaucklandplan.govt.nz
Submissions close October 25

* Brady Nixon is an Auckland-based property executive and developer, and a member of the Property Council of New Zealand.