Part four of the Project Auckland series looks at 'Prosperity and Profile'
World class cities need big commercial buildings along with incentives for people who plan and develop them in order to thrive and grow.
It is, after all, the towering commercial office blocks and large community structures that define city skylines and Auckland is no different.
The provision of suitable buildings to house office workers and retail outlets is also a key enabler of economic growth. Without the edifices to house them, businesses can't employ more people.
For these reasons commercial property developers, owners and agencies within the Auckland CBD and waterfront area are hoping the creation of a Super City administrative structure will significantly reduce the current tangle of red tape and competitive in-fighting between multiple local bodies which is currently hampering development projects.
"Economists tell us productivity improvements are the key to economic growth," says Alan McMahon, New Zealand chairman of the Royal Institution of Chartered Surveyors and director of Colliers International.
"Equally, productivity or efficiency improvements are the key to commercial property market growth. The more dynamic the city's economy is, the more opportunities there will be for retail and service providers," McMahon says.
He believes reduced cost for businesses is a required outcome of the council restructuring of Auckland.
"Without a reduction in their cost base it will be hard for businesses to grow employment.
"The commercial property market is hoping for better and faster decisions from the new council which will save time and cost on all sides and - in time - open the door to productivity gains."
McMahon says office occupiers also hoping that in time efficiencies realised will slow the growth of local taxes such as rates which are a significant cost for commercial property owners and their tenants.
"Disagreements on issues relating to district plans and other planning documents, has led to delays as Auckland Region and various city and district councils argued their cases.
"This has slowed down resolution of important decisions relating to development controls, parking provision, zoning and so on."
John Urlich, manager of Barfoot & Thompson Commercial, says it would be great with the creation of a Super City structure, if a commercial property agent could identify opportunities across Greater Auckland with some level of confidence in the constancy and uniformity of local body rules and regulations.
"Because of the varying rules and building codes, and the interpretations of them, developers and purchasers of commercial and industrial properties and land, tend to focus on their own patches where they have both established knowledge and relationships with local council staff," says Urlich.
"Similarly there are buyers who discriminate against certain areas of Auckland because of their perceptions about differing council regulations and rating systems.
"We are hoping that the amalgamation of Auckland's several local councils into a Super City will eliminate these problems for the development of the CBD and whole region."
McMahon emphasises Auckland, with its multiple local body structure, has resulted in different councils promoting the development of business office parks in their own areas to create employment opportunities resulting in the city having a number of "small but somewhat inefficient developments".
He says it would be much better for the city and region to concentrate resources and develop larger and world-class office and commercial facilities with greater longevity that reflect well on the city.
"Bigger developments typically attract bigger more efficient organisations with consequent positive implications for employment growth. For example, we only need one large exhibition and conference centre in the region. Decisions around that sort of city asset with the creation of the Super City structure are a good example of where improvements can be expected by ensuring it is in the right place, has the proper infrastructure to support its operational success, and is consistently promoted and managed by a single body."
The Auckland waterfront is an area where a sustained planning focus is already paying dividends in terms of creating an economic benefit for the region.
McMahon says progress will be further boosted by the establishment of the Waterfront Development Agency as a council controlled organisation. "It doesn't mean less political oversight in terms of the big decisions - Wellington Waterfront Limited is an example of continued political scrutiny - but it will allow proactive and expert management to really get things done."
Connal Townsend, chief executive of the Property Council agrees.
Council members have a vested interest in commercial property and include building owners, developers, real estate agents, construction companies, retail and shopping centre owners, investment companies, asset managers and service suppliers.
The council says its members are collectively responsible for around $14 billion worth of commercial property investment throughout the Auckland region and pay a substantial proportion of the total property rates that in turn fund capital and operating expenditure incurred by Auckland's three cities, four districts and one regional council.
In its submission to the Royal Commission on Auckland Governance, the council stated that "Auckland is over-taxed, over-governed and over-regulated.
"The current model reflects an absence of logical thinking and philosophy around how a regional economy should operate within a competitive global marketplace.
"We can no longer tolerate the culture of divergence, deferral, delay and inefficiency".
The council pointed out that Auckland represents New Zealand's single largest regional economy contributing $3.8 billion towards the government's $6.2 billion operating surplus (in 2005); accounting for over 44 per cent of New Zealand's employees in the finance sector, 38 per cent of employees in the property and business sectors; and attracting 70 per cent of inbound tourists.
One of the Property Council's recommended key outcomes for a "One Auckland" structure was "the integration of the information and processes necessary to process building and resource consent applications, and land information inquiries".
In this regard, Townsend believes Auckland's new governance structure will provide best practice, more certainty and streamlined planning processes for resource consent and building consent applications.
"The council-controlled organisations (CCOs), including the Waterfront Development Agency, will have a commercial focus to develop a major asset for the city. CCOs will allow for more private-sector involvement, so both the private sector and public sector can bring their strengths together."
Townsend says a recommended "spatial plan" for Auckland will be a great mechanism for a single, consistent approach to future" growth.
"Theoretically a unitary Auckland Council will eliminate the uncertainty that exists when two or more councils seek to litigate decisions due to ideological and parochial points of view.
"That has to be positive for the region as a whole, and will eventually contribute to a more seamless planning environment."
