Fletcher Building's purpose-built, off-site prefab house manufacturing facility Clever Core at the time it opened.
Video / Michael Craig
Fletcher Living’s Steve Evans has cited six reasons why the $15 million Clever Core pre-fab off-site house building plant is closing.
Fletcher Building said on March 31 that the Wiri plant would close by June 30 due to insufficient volumes, lack of commercial viability, the marketdownturn and the industry’s reluctance to adopt off-site manufacturing at scale.
Evans joined Fletcher Building in 2013 and heads up a division that builds nearly 1000 new houses annually.
Fletcher Building's Clever Core automated home manufacturing facility at Wiri. Photo / Michael Craig
“With regard to many who have worked in the off-site manufacturing space, the dream does not become the reality,” he said.
When the business envisaged Clever Core, Evans said the aim was to build homes quicker, safer, and to a better quality in a factory environment that would make it superior to any site.
Fletcher was attempting to accelerate house-building by producing core structural components within its factory at 232 Cavendish Drive.
And Evans said initial tests had proved the theory worked.
“This was proven with the first house we delivered in Hobsonville and with all subsequent homes. In fact, we got to the stage where we could assemble not just one home every two days, but three homes a day, using the principles of Kaizen [continuous improvement] to get better and better.”
Fletcher Building is to close its house-building factory at Wiri. Photo / Fletcher Building
That first three-bedroom house-in-a-day was erected on August 23, 2017.
The 170sq m, $800,000-plus house was put up between 7.30am and 5pm and Evans said at the time it usually took six to nine months to build such a place.
Fletcher Living’s panelised components could enable others in the sector to regularly put up a home in a single day, he said at the time.
Fletcher built this house in one day in 2017 at Hobsonville Point.
But today, Evans said new methods of work included being able to build scaffold-free.
“So where did it go wrong?” Evans asked.
“A lot of people don’t value time, safety or quality. Unless they are sold this, customers simply don’t know what is possible.
“Unlike the typical builders merchant market, you don’t get rebates/loyalty reward programmes or other incentives to use off-site manufacturing [OSM].
“The design times for OSM mean you need to choose it before you start the building consent process, and usually before you resource consent.
“Start-ups are hard work and they need time to be able to succeed. In a cyclical market, this can work against you.
“In a manufacturing environment, certainty of production and demand drives the business. In housing, and particularly on-site, numerous factors mean that availability of a site to accept the OSM product is far from certain. Think consenting delays, weather delays, customer/market fluctuations. The one thing that is almost certain about building a house today is that what you planned will not be the reality.
“Our internal demand has been steady and growing, but in the absence of an external builder market, Government demand surety is required to provide guarantees of demand to underpin minimal viable volumes through the factory. And when the Government work stops, or never really starts, like it has with Kāinga Ora, the demand dries up.”
Steve Evans back in October 2019 when Clever Core opened. Photo / Michael Craig
Evans said it was this combination of factors that resulted in the facility’s closure.
Some in the sector said Clever Core was ahead of its time, opening in 2019 before the 2021 downturn. Auckland crane numbers are down 23.5% in this year’s first quarter, compared to the last half of 2024, according to the RBL Crane Index out on April 3.
StatsNZ data out last week showed the number of new dwellings consented in the year to February was 33,595, down 7.4% annually. Non-residential building work values consented were $8.8 billion, down 11%.
Fletcher had hoped to shorten a 22-week build to six weeks via Clever Core.
How it looked when it opened: Clever Core back in 2019. Photo / Michael Craig
“Manufactured wall, floor and roof components, which contain locally sourced insulation, double-glazed windows and allowances for wiring and plumbing, are then transferred to build sites and constructed into the weather-tight core of a house by specially trained builders,” the company said in 2019.
Ross Taylor, the former chief executive, said six years ago that the factory was initially aiming to only support Fletcher Living but aimed eventually to offer its services to group home builders and retirement home operators.
“Once production is at scale, we believe Clever Core will play a pivotal role in helping the industry deliver more quality, healthy homes that Kiwis love, faster,” Taylor said in 2019.
On March 31, a Fletcher spokeswoman said a PlaceMakers frame and truss plant is to open next year in the Clever Core factory.
Evans concluded: “So, sadly, the end of this dream is now our reality. Thanks to all who believed in it like me, worked in it, and supported it. Perhaps another time.”
Anne Gibson has been the Herald’s property editor for 25 years, written books and covered property extensively here and overseas.
