A building industry official has hit back at criticism about material pricing on big construction jobs and a threat to source concrete for the new Christchurch Convention Centre from Mexico.
Bruce Kohn, Building Industry Federation chief executive, took issue with Ngai Tahu Property chief executive Tony Sewell's NZ Institute of Building conference speech in Auckland last week, calling for more expertise to be applied to procurement methods when builders tender for jobs. Kohn said high material prices were not responsible for cost increases in the supply of new Canterbury housing.
Rising pre-construction costs, land prices, sub-contractor charges, petrol prices, regulatory changes and materials costs all had an influence on house costs, Kohn said, after Sewell told the conference new housing costs at Wigram had risen 16 per cent in one year primarily because of materials cost rises.
Kohn disagreed.
"We've had some industry analysis carried out that is based on a new build cost of $285,000, excluding land, at an average size of 190sq m and a cost rate of $1500sq m. It is normal for there to be a 40:60 split between materials and labour [carpentry and specialty trades] which gives attributable costs of $114,000 and $171,000 respectively. It is extremely difficult to accept that within this split there has been a lift in prices of materials over one year of anything near 16 per cent - approximately $45,000," Kohn said.
