Wellington apartment owner Michael Cummins says his retirement plan is effectively wiped out after being dealt a $400,000 earthquake strengthening bill. Video / Mark Mitchell
There are fears a newly updated seismic hazard model, which reveals the risk of ground shaking in future earthquakes has doubled in some places, "won't play out well" for building owners.
Earlier this year Ministry of Business Innovation and Employment (MBIE) officials foreshadowed the model would likely result in buildingsgetting lower New Building Standard (NBS) ratings in future assessments.
The ministry has since told the Herald it is too early to commit to any outcomes, like what the changes might be and their impact.
But the ministry confirmed no changes were planned for the earthquake-prone building system.
Inner City Wellington spokeswoman Geraldine Murphy was concerned about the lack of clarity.
Murphy said any new standard would start a "flurry" of requests for fresh detailed seismic assessments.
"[There will be] corporates and public sector agencies bailing out of buildings because they're below 67 per cent and that drives a whole economic disaster, for Wellington particularly."
Building and Construction Minister Megan Woods said the updated hazard model did not automatically change how buildings were designed. Photo / Mark Mitchell
Anything less than 34 per cent NBS is considered earthquake-prone, but many tenants have taken a risk-adverse approach to buildings that goes far beyond minimum requirements.
There have been several high-profile building closures in Wellington this year, after fresh earthquake assessments revealed they more risky than first thought.
Patients and services occupying the main building at Hutt Hospital have been affected, as well as 1000 staff at the Ministry of Education's headquarters.
As a result, MBIE officials were told to fast-track new guidance clarifying most buildings with low earthquake ratings were not imminently dangerous and could remain occupied.
This guidance was released in July.
Now, even more buildings face a potentially uncertain future after the revised National Seismic Hazard Model (NSHM) was released this week.
MBIE officials warned in a ministerial briefing earlier this year the NBS would likely be raised as a result of the new hazard information.
"In turn, this will likely mean more buildings will get lower %NBS ratings in future assessments as the 2023 New Building Standard will use the new hazard information provided through the NSHM."
Michael Cummins faced a more than $400,000 bill to earthquake-strengthen his share of the apartment building he lived in. Photo / Mark Mitchell
The briefing was released to the Herald under the Official Information Act.
Building and Construction Minister Megan Woods said the updated hazard model did not automatically change how buildings were designed.
"Building professionals and practitioners should continue to use the existing law and technical standards and guidance to demonstrate that their work complies with the Building Code."
MBIE building performance and engineering manager Dave Gittings said the ministry would carefully consider what the updated model meant for new building design standards.
"MBIE is currently working with Engineering New Zealand to assess what changes to building design standards are required, and how to include the National Seismic Hazard Model results in regulatory settings for new buildings."
At this stage, MBIE was planning to consult on the initial proposed changes in mid-2023, Gittings said.
He stressed the new hazard model did not change requirements of the earthquake-prone building system and owners who have assessed or remediated their buildings cannot be asked to do so again.
Body Corporate Chairs' Group national president Tim Jones was concerned about any changes "moving the goal posts".
He said lower NBS ratings could have an impact on the insurability of buildings and increasing premiums.
"We've already suffered from significant insurance premium increases, certainly in the Wellington area anyway."
Michael Cummins is one of many apartment owners across Wellington who have faced sleepless nights, losing their home, and being on the brink of "financial disaster".
It was going to cost more than $400,000 to earthquake-strengthen his share of the apartment building he lived in on Kent Tce, effectively "wiping out" his retirement plan.
Since the Herald first reported on his case in 2020, the apartment owners in the building decided to sell, with the exception of one owner.
Cummins said they got a realistic and reasonable price for the apartment.
"It was a very big relief when we were finally able to walk away from that."
All but one apartment owner living in an earthquake-prone building in Wellington have decided to sell. Photo / Mark Mitchelll
Cummins said they loved their apartment, but the pressure and uncertainty meant strengthening the building wasn't an option for them.
At a JLL's Future of Real Estate conference in August, architects warned commercial property owners not to opt for the bare minimum when it came to strengthening their buildings.
Designgroup Stapleton Elliot director Emma Macann said any changes to the building standard in the future would be reflected in NBS ratings.
"So if you have a 80 per cent NBS building, that might drop over the years. Do what you can feasibly do and don't go for the bare minimum."
