As we approach Christmas, it is not only household budgets that are feeling the strain. The development and construction sectors have been under pressure for a while, and one of the key concerns expressed across both sectors is whether projects are stacking up financially: do they have the financial underpinnings to get to the finish line?
There’s a lot of talk in the market about procurement, forms of contract and unfair sharing of risks causing major problems on construction projects for companies. Graham White shares his views about why problems are never about forms of procurement or contracts.
Now, it has been reported that the receivers for Ebert are taking legal action to test the law (Construction Contracts Amendment Act 2015) as they attempt recovery for subcontractors. It is understood that receivers PwC have set aside $9.3m for this purpose, although much of the $36.1 million owed to unsecured creditors will go unpaid, according to the first receivers’ report.
The receivers’ first report on the Ebert Construction Limited (in receivership) has identified some interesting points and learnings.
The pressure is on for construction companies large and small right now – and for their sub-contractors and suppliers.
Business news channels are buzzing with stories of finance and retention payments related cataclysms, such as the Matrix Homes receivership and the circa $30 million owed to Orange H Group creditors, to name only two.
In turn, this will no doubt cause a cash flow crisis or worse for supply chains, as companies have the biggest downward spiral.
When one of the most beloved buildings in Christchurch was destroyed, one man took it upon himself to raise it from the ashes.
The end result is something to behold.
White Associates are pleased to announce that they have been appointed to provide QS services during the construction of a new 20-bed unit at Christchurch Men’s Prison under the Department of Corrections’ Prison Capacity Programme.
Two young brothers in foster care are now riding around on brand new bikes as part of feel good initiative White Associates has been part of.
At a recent team retreat, one of our team building activities was to solve riddles that unlocked parcels containing bike pieces that then needed to be assembled. Our team built five brand new bikes that we then donated to charity.
In the adjoining photo, Director Mark Rothery and Principal Zoe Bashforth present new bikes to Sharmen Zondervan and Natalie Richardson of the Open Home Foundation.
We’re all acutely aware that it costs significantly more to build today than it did a few years ago, or even a few months ago for that matter. We’ve been carrying out insurance reinstatement estimates for some of our commercial clients recently and have unearthed a significant disparity between what a property is insured for compared to what it would cost in today’s market to rebuild. Alongside rising building costs, there are a number of components in the construction process that need to be taken into account.
There have been some exciting new developments on the Prison Capacity Programme with ground now broken at Mount Eden Corrections Facility for the new accommodation block (Building C) for the Department of Corrections.
After nearly 6 years, our work on the Ministry of Education’s Classroom Delivery Programme is coming to an end.
The comprehensive systems and processes we created have put the Ministry in a position where their internal Delivery Managers can now take over and run the projects . White Associates Director Mark Rothery says he’s thrilled for the Ministry that it’s now in a position to take over.
New Zealand’s prison population is soaring and in the last two years has increased at a rate considerably higher than what had been forecast. Consequently, there is significant pressure on prisoner accommodation which has required the government to increase its prison funding.
White Associates are pleased to announce their appointment as the Department of Corrections’ Cost Advisor for their Prison Capacity Programme.
The media is awash with stories about apartment developments falling over or asking for more money. We’ve all heard about banks shutting up shop and the desperate need for more houses hampered by the chronic shortage of labour, material delays and their fluctuating prices. Residential developments have been hit the hardest but commercial projects are not immune to these pressures.
There’s no escaping the fact that building in this market is going to cost you more money and your margins will be affected. However, that doesn’t mean you can’t deliver a successful, financially viable project.
The pressure is well and truly on for the development and construction community. Developers are seeing rising land prices, material prices are fluctuating, the labour force is stretched, and it’s putting increasing pressure on the feasibility of developments.
We are seeing clients across the development spectrum looking for the return on their investment and this is now largely dependent on early involvement from reputable contractors and the quality of procurement processes being used.
Delivering a high-quality industrial business park for our client Transocean Development, created the opportunity for the White Associates team to show off its expertise in the Christchurch industrial market.
We spoke to White Associates project leader Darin Bayer and Transocean Developments Director Jon Howard to find out more about the new, high-quality industrial development and to get some commentary on the challenges and opportunities of the Christchurch market.
The White Associates team recently attended a joint briefing led by James MacQueen (advisory partner, BDO) and Janine Stewart (partner, Minter Ellison Rudd Watts). Our clients and peers were invited to get under the skin of what the Construction Contracts Amendment Act 2015 means for New Zealand’s construction industry.
We spoke to Zoё Bashforth (Principal, White Associates) to get her takeaways from the BDO/MERW seminar and to get her views on how clients might use the new regime to win more work and redefine contract agreements.
The development of the Alexandra Park Apartments is an exciting sign of the possibilities and innovations in building design for Auckland’s booming residential apartment market.
Spread across 32,000sqm, the development sits on the club’s former Green Lane West car-park and overlooks the iconic Alexandra Park horse racing track. Once complete, Alexandra Park Apartments will feature three towers with 246 freehold apartments, close to 20 retail spaces, and a number of design features including public spaces, promenades and a central open plaza.
Seismic strengthening may be a necessary evil for heritage building owners, but when done well, it can create new value.
Justin Maritz, a principal of property and construction cost consultants White Associates, says that in order to get better seismic outcomes, building owners need to ask the question: can I do this differently? “The rules have relaxed, but building owners shouldn’t,” he says.
Construction for the project is already underway, and 92% of residences are already under contract despite only being on the market for 6 months.
White Associates’ have worked closely with BNZ and Conrad Properties on Victoria Residences, conducting due diligence on the project, and ensuring BNZ was comfortable to fund it. Now that construction has begun, White Associates is responsible for monitoring the project key deliverables.
Many kiwi kids and their families are affected by cancer, so we’re rallying our crew together to get behind the Child Cancer Foundation to take a stand against cancer.