Building boom hits new heights

Tasman Aluminium managing director Phil Coughlan. Photo/John Borren

Tauranga's construction boom continues to sizzle as building consents reach record levels and industry leaders say some companies have hit capacity and started to turn down work.

In November, 269 building consents were issued by Tauranga City Council with a total value of almost $61 million.

Of those, 151 were consents for new residential buildings worth $49,096,276.

Also approved were 26 commercial building consents worth $7,271,970.

Among the plans given the green light were three major projects worth more than $1 million each.

A $2 million warehouse and office building will go up at 47 Paerangi Place, 12 two-bedroom dwellings are planned at 2 Te Okuroa Drive worth $1.78 million and two two-bedroom dwellings and six one-bedroom apartments are to be built at 124 Levers Rd costing nearly $1.3 million.

Data from Priority One revealed in the 11 months from January to November the value of consents was 30 per cent above the previous peak of 2006 - and the highest since records began in 2003. The total value of consents so far for 2015 was $618 million, which included $177 million in commercial developments compared to a total of $430 million in consents last year.

Last month 269 consents were issued, slightly down on 289 in October but 176 consents ahead of November last year.

Priority One projects manager Annie Hill said the growth was great for the economy and "a result of the confidence of investors in the commercial and residential sectors".

Master Builders Association Tauranga president Johnny Calley, of Calley Homes, said a lot of companies were at capacity and had started to turn away work for the first time since 2007 because of the massive growth.

His business had employed five more staff this year, including three apprentices because qualified tradesmen were just not available, he said.

Land was also in short supply unlike during the last boom.

"The supply of land is very limited and the council is just under so much pressure to process everything, which is holding things up as well."

Meanwhile, the commercial sector had been slower to take off but he expected that to change as more people settled in the city.

"The population growth that we are getting is encouraging commercial developers to develop retail space."

All of its members were booked out into next year, he said.

Classic Builders director Peter Cooney said building activity was the "strongest I have seen in the 20 years I have been in business".

He believed the trend would continue into next year but ease later in the year corresponding with potential interest rate increases and the availability of more titled land.

The residential market was booming, however a lot of businesses were relocating and upgrading.

"I don't really see a lot of new industry or major businesses coming to town ... It will be interesting to see when all the relocations of businesses are complete what the activity will be."

But the current situation had created strong employment and increased overall amenity requirements, "which is a positive outcome for all".

Gartshore Group Tauranga director Jim Gartshore said the residential sector was buoyant while the commercial sector was steady.

The group had employed six contract gangs this year, he said.

Watts and Hughes construction director Mark Gutry said it was 25per cent busier than last year.

"It's been a couple of busy years but Tauranga has always been known for its peaks and troughs over the years."

The company was looking for project and site management staff.

Bright prospect

Tasman Aluminium managing director Phil Coughlan (pictured) said its new factory at
Tauriko Business Estate was near completion and would open early next year.

The company, which employed about 70 staff, had experienced a 30 per cent jump in growth this year and was relocating from Truman Lane due to demand.

It was currently looking for extra staff despite hiring 15 people this year and its biggest challenge was keeping up with that growth, he said.

"We have an extra 50per cent capacity in this factory and are predicting to fill it."

The company specialised in aluminum windows and doors for the residential and commercial sector and its books were full going forward, he said.

"We have never seen growth like this before."