National says $25m Waka Kotahi office fit-out wasteful

Waka Kotahi's lavish office fit-out has National concerned. Photo / NZPA

National is crying "waste" after Waka Kotahi - NZ Transport Agency spent $25 million on a fit-out for its new Wellington offices.

Questions to National transport spokesman Simeon Brown show the fit-out of 8700sq m of Wellington office space will cost $25m, or about $2870 a square metre. That's significantly higher than the roughly $1600 a square metre fit-out costs that got Kainga Ora in trouble earlier this year.

Transport Minister Michael Wood said Waka Kotahi needed to move from its current accommodation on Chews Lane for seismic reasons, as staying in that accommodation would have required extensive and expensive remediation work.

"I note that seismic issues with Waka Kotahi's Chews Lane office meant that significant and disruptive remediation work would have been required as part of any lease renewal at their current site. The new building at 44 Bowen St is safe and resilient and will achieve a minimum NBS rating of 100 per cent," Wood said.

He said a "full market assessment was also undertaken prior to development of the business case for the move, including the assessment of alternate options".

Wood said the fit-out itself was impacted by "cost escalation and delays largely attributable to Covid-19, however, the project remains within overall budget, and I expect Waka Kotahi to actively manage costs throughout this process".

Answers to Brown's questions described the fit-out as comprising six levels of a new office building, with internal stairs to four floors. The office will include "meeting rooms, collaboration, [and] amenities".

Brown did not dispute the need for a Waka Kotahi's office to have an "appropriate" fit-out.

"But the reality is what we see here is extravaganza rather than fit-outs which are meeting practical needs and fitting the expectation of taxpayers that we should be seeing
restraint," Brown said.

"What Kainga Ora was spending was still a lot of money, but it was far more reasonable," he said, of Kainga Ora's roughly $1600 per square metre cost of fit-outs.

He said the $25m cost would "fix a lot of potholes on our state highway network".

Wood said the new site had significant benefits.

"The Bowen St building also allows Waka Kotahi's 1,100 Wellington-based staff to work from a single site, and there is flexibility to sublease space should requirements change," Wood said

"Waka Kotahi has worked with Government Property Group to ensure that the site selection, commercial terms and fit-out of the new building at 44 Bowen St is consistent with the principles, standards and guidelines for Government office accommodation," he said.

A Waka Kotahi spokesman said that the agency reviewed its accommodation ahead of the expiry of its current lease in January 2024.

"Seismic issues with Chews Lane mean that significant, costly and disruptive remediation work would have been required as part of a lease renewal," he said.

"We've worked with the Government Property Group to ensure that the site selection, commercial terms and fit-out of the new building at 44 Bowen St is consistent with the principles, standards and guidelines for Government office accommodation," he said.