Neighbours living next to a stalled apartment project say it's an eyesore and is bringing down the character of the street. Photo / Alex Burton
Neighbours living next to a stalled apartment project say it's an eyesore and is bringing down the character of the street. Photo / Alex Burton
An Auckland woman fears her street could be left with unfinished, “eyesore” housing developments as developers battle to finish projects amid falling house prices.
Elena Inta lives next door to a planned five-storey, 27-apartment complex on Newington Rd in Henderson.
But after an initial burst of construction, work has been stalled for more than a year, she says.
The project sits unfinished on an overgrown block with “jagged” concrete, “rusted” steel and litter scattered about, Inta says.
Jane Tan, from developer Golden Circle Investment Ltd, says the project will be finished and she is confident more finance will soon be approved to complete it.
“People used to take pride in keeping our street looking nice.”
Developers across Auckland are increasingly finding it tough to complete projects as they battle a wave of challenges.
Neighbours are upset a five-storey, 27-apartment building in Newington Rd, Henderson has stalled mid-construction. Photo / Alex Burton
Not only are house prices falling because of slumping buyer demand, but construction costs have risen to record levels.
On top of that, interest rates have been rising, leading banks to increasingly scrutinise the finances of building companies they lend to.
Golden Circle Investment’s Tan told the Herald on Sunday in January she hoped to get new finance for the Henderson project approved soon.
A closer view of the construction site. Photo / Alex Burton
Christmas and Chinese New Year breaks had contributed to delaying the approval, she said.
Recently, lenders had become worried about interest rate rises and “are very careful to check everything” about a borrower’s finances, Tan said.
“So that is why we are still waiting.”
Yesterday, Tan said she was still seeking finance and that the Government’s push for tighter lending conditions was at odds with the need for more housing in Auckland.
The Covid-19 pandemic had dramatically slowed the project down due to rising labour and material costs, Tan said.
She said it is not easy in the New Zealand economy at the moment for people to get projects off the ground.
Reporting negative news only contributed to lowering confidence and making it harder, she said.
Photo / Alex Burton
“This is unfair for me, just because it takes some time,” she said.
Tan said she had tried her best to work positively with the neighbours, including paying for temporary fences between their properties and the construction site, as well as a commitment to build higher quality fences once the project is compete.
Tan also remained committed to finishing the project and was still in refinance discussions, she said.
Once the project restarted, she expected it would take nine months to complete because her team had done all the “difficult jobs” laying infrastructure and foundations, she said in January.
A development block of land for sale at 20 Newington Rd in Henderson.
Marketed by Golden Touch Investment, the complex is advertised as offering “sophisticated quality” studio and two-bedroom apartments in a “super location” a stone’s throw from shopping malls, bus and train stations.
The website shows a number of apartments as being already sold or under contract.
Next to the complex, another block also sits empty after a “lovely”, newly renovated home was demolished to make way for townhouses that are yet to be built, Inta said.
In the past year or two, there had been a lot of work on both sites, she said.
But that had now stopped. The block of land for the townhouses went on sale late last year, but is yet to find a buyer.
“A fantastic opportunity presents itself with this prime corner site of approximately 1034m2.”
The construction site. Photo / Alex Burton
“Resource consent has already been approved for nine terraced houses plus three apartments, so you can get started straight away with the next phase of development.”
Having seen the ‘for sale’ sign taken down from the site, and then watching work on the neighbouring apartment complex stall when workers disconnected from the electricity connection they were using on her property, Inta said she worried both projects might not get going again.
She had reconciled herself to living next door to a big complex, but not living next to an unfinished project.
Inta had already put up with “relentless” noise as diggers and pile drivers moved in, and claimed the construction had caused other issues, such as cracks in her house, damaged footpaths and a burst water pipe.
Fellow Newington Rd resident Romy Sargon said in her opinion, the site looked like it had been “bombed out” and it was bringing down nearby property prices.
Sargon was not confident in Tan’s comments that the project was close to securing more finance.
She claimed residents had been told finance was close to being secured six months ago.
It comes as the rate of inflation in the house-building sector halved in the latest quarter but in the latest study still hit a new annual high of 10.4 per cent, according to CoreLogic’s Cordell Construction Cost Index.
Kelvin Davidson, CoreLogic chief economist, blamed a range of factors for the unprecedented rise in construction costs, including material supply issues, labour shortages and completion delays.
