Tauranga land needed as boom arrives

Site foreman Jared Campbell, 23 of Papamoa. Photo/George Novak

The Bay is on the cusp of a "golden era" in construction with a building boom worth nearly $2.5 billion and Tauranga's ready to cash in - but only if more land is made available.

Building and Housing Minister Nick Smith announced in the second National Construction Report, building and construction in New Zealand was set to reach unprecedented levels worth $100 billion by 2017.

According to the report, which was released yesterday, the Bay makes up 43 per cent of the Bay of Plenty-Waikato region, where construction is projected to peak at $2.3 billion in three years.

We haven't got enough land to keep up with the supply and demand.

Carrus Corporation chair Paul Adams

However, developers in the Bay are unsure of the projections, with land shortages, over-priced stock, inflated interest rates and lack of qualified labourers.

Classic Builders manager Peter Cooney said he wasn't sure how the growth would continue until 2017.

"There's probably a good 12 months of it. It will depend on availability of land, the price of that land, and where interest rates sit."

Mr Cooney said the steady growth would continue if enough land was freed up at more realistic prices.

"If land prices keep going up the same way they are at the moment, we won't be seeing the boom to the extent it deserves.

"The price and land availability is very relevant, can Tauranga do it, council is telling us we can do it but I am yet to see it," he said.

Carrus Corporation chairman Paul Adams said he welcomed the minister's announcement and confidence in the construction sector. But Mr Adams also questioned the availability of land to keep up with the predicted growth.

"I trust that our councils get the message and open up additional areas of land to allow the anticipated growth to flow into our economy.

"We haven't got enough land to keep up with the supply and demand."

Mr Adams said it was not only about having land available, but also at a price local home owners could afford.

... but the biggest problem we have this year is council is slow with getting titles and sections available.

Jardon Building and Developments' Jared Campbell

Bluehaven Management chief executive Bill Miller said Auckland, Hamilton and Tauranga were currently the "golden triangle" of construction, with the population across the centres looking to double under the SmartGrowth projections.

Mr Miller said he thought the New Zealand building and construction market was already thriving but New Zealanders returning from overseas and the end of the global financial crisis would be key factors driving the expected "golden era".

Jardon Building and Developments builder Jared Campbell said the report was good and bad news for Bay builders.

"It can mean a heap of work but a lack of workers, too. A lot of them are in Auckland or Christchurch or they left to Australia ... but the biggest problem we have this year is council is slow with getting titles and sections available."

Deputy mayor Kelvin Clout said new land opportunities would be determined under the new SmartGrowth review for both residential and industrial land for the future.