The Story Then
In June, Waikato Business News spoke to Thomas Gibbons, who is on the Property Council Waikato regional executive, about Hamilton City Council’s boost for urban design and he warned developer discontent was likely to persist.
As part of its 10-year plan, the council had overhauled its developer contribution (DC) settings while also proposing an average 8.9 percent rates rise.
Among a raft of changes, builds in the CBD of six storeys and higher are set to gain a full contribution remission, dropping to 50 percent for other buildings. The remissions depend on engagement with the urban design panel.He emphasised the city had engaged with his membership-based organisation over the changes.
Despite robust discussions about the changes there remained a view that the city’s DCs were still too high.
Gibbons said the Property Council supported remissions as a way of encouraging further development and was also supportive of the boosted role for the urban design panel.
Regional sprawl could also become an issue as DC costs are passed on to home buyers, he said, raising house prices in the city and potentially driving drift to smaller towns, in turn putting pressure on the roading system and commuter times.
The Story Now
A lot has been happening in the development world. At a policy level, RMA reform continues to emerge, with the National and Built Environments Bill being reported back from select committee. Hamilton City Council started consultation on a plan change that would allow for more intensification, as a way of meeting its NPS-UD responsibility to provide for more developable land.
Into this process came the hurricane of bipartisan RMA reforms around enabling more housing. The soundbite was that an existing section could allow three dwellings of three storeys each, which would seem a dramatic step towards greater intensification of high-growth areas like Hamilton, Waikato, and Waipa.
Local government was almost universally opposed to the reforms, with Hamilton City and FutureProof raising forceful concerns about the impacts on existing infrastructure, and on the well-being of the Waikato River.
Conversely, those who believe supply is an important part of the affordability puzzle have been more welcoming of the reforms. Others have accepted the idea that something needed to be done – which is perhaps an acceptance that the current planning system isn’t delivering the houses it needs to – though have seen the proposed reforms as a relatively blunt instrument.
There remains a critical problem of how our communities pay for growth. The Waikato remains a desirable place to live, and as we can’t stop babies being born, or people moving here, our housing needs will continue to increase.
So, there is a need for more infrastructure to service growth, while at the same time, there is limited appetite for rates increases or higher development contributions. Indeed, higher development contributions can worsen the affordability issues that already arise.
Some would say the basic answer is more central government spending on local infrastructure. Our local authorities and communities simply aren’t geared up to fund their growth needs.
Absent this kind of intervention, we need to be more innovative about how we approach infrastructure, with a closer look at targeted rates, Special Purpose Vehicles, and other tools.
Meanwhile, great developments continue to be done in Hamilton and across the region. We are seeing some great new apartment developments come onto the market. Greenfields development remains a challenge, because of the infrastructure issues highlighted above. Commercial development too seems to be coming on well, with premium new buildings going up, often with national tenants who are attracted to Hamilton for its centrality and safety. Union Square and the new ACC premises are leading the way here.”
Contributed by Thomas Gibbons