Building and Housing Minister Dr Nick Smith has ordered an investigation into the collapse of a balcony during a Six60 concert which injured 18 university students.

The Ministry of Business, Innovation and Employment has been asked to prepare a report on the incident at the Castle Street townhouse on Friday night which will look at whether the balcony was up to the standards required by law under the Building Code.

"Structural failure of buildings are rare in New Zealand but every incident of this sort needs to be thoroughly investigated to establish whether there were failings and whether our building systems are working as they should," he said.

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"The investigation needs to look into whether the design, construction and maintenance of the balcony was up to the required standard, and to establish why it collapsed."

Dr Smith said it may have been possible that the balcony did meet standards but that the loading from the large number of students on it was in excess of what the Building Code required.

"I am open to all possibilities but want to ensure we do everything possible to avoid these sorts of building accidents."

Dunedin mayor Dave Cull welcomed the Government investigation.

"It should look at not only whether this balcony was built to standard, but whether the standards are robust enough."

A WorkSafe New Zealand spokeswoman said the department would decide whether to launch an investigation and were working with police.

A preliminary report on the balcony collapse is expected to be complete by the end of March.

Additional reporting: Otago Daily Times