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WHERE ARE THE RESIDENTS? Project 8011's goal is 20,000 people living in the city by 2028. After one year, a city councillor says there's no vision and developers say more needs doing.

By Steven Walton | METRONEWS Reporter

When James Gough was asked to sum-up Project 8011 - he replied, “outstanding document, crap implementation from gutless elected members.”

Gough, who chairs the Central City Development Forum, said it was "deeply troubling" there hadn't been bold and gutsy decision-making by the city council to ensure the project achieved its 10-year goal of 20,000 central city residents.

Now, a year after it was launched, the project, named Project 8011 after the central city postcode, has been deemed to "need support" and the first output deadline in September was missed.

"We desperately need more people living here, and if the council is a roadblock to this outcome, that's disgusting," Gough said.

Project 8011 was launched in September 2018 with nine different actions aimed at breaking down barriers to central city residential development. The actions will be implemented over the next two years and include an online developer portal, a residential advice service, a package of incentive opportunities, and support for alternative housing approaches.

Christchurch business leaders and residential property developers said achieving the target of 20,000 was possible, but it would take more incentives and support.

Lincoln University senior lecturer Suzanne Vallance, who specialises in urban planning, said acknowledging the central city as a place to live had been "a bit of an afterthought" in the Christchurch rebuild.

"It's been difficult to regain the traction we might have lost in those early days," she added.

This map shows central city residential developments that are currently being developed. Note, the map does not include places of residence that have already been developed.

'NEEDS SUPPORT'

Project 8011 was deemed as "needs support" in August's Central City Action Plan dashboard, a council document which tracks the progress of central city redevelopment.

The Christchurch City Council was not available for an interview for this story, but head of urban design and heritage, Carolyn Ingles, said in an email the project was behind because of "funding decisions and technical issues encountered over the past few months".

Ingles did not expand on what the funding or technical issues were, but said the 'needs support' designation indicates an "issue has been identified and that corrective action is being considered".

In June, Christchurch city councillors refused to fund a trial service that would provide advice and support to developers while five councillors voted against reviewing a rates remission policy for new central city residents.

Project 8011 also missed its first deadline when an online portal with research and guidance for public use wasn't implemented by September. The project's initial framework said the portal would be delivered within the first year.

Ingles did not explain why the online portal hadn't been released but did say the first outputs would go live this month. She said its delay would not affect the delivery of the entire project.

Council staff were also expected to present a package of incentives and funding mechanisms to the council at the end of July this year. When the end of July arrived, a package was "not yet ready for consideration" and further specialist advice was needed, a staff report said.

Ingles said council staff were still seeking the advice.

The Liverpool Terraces under construction. They are being developed as part of 'One Central' in the East Frame. The homes are being delivered by Fletchers.

'A GOAL WE CAN'T AFFORD TO MISS'

Central city business leaders said bringing 20,000 residents into the central city over the next ten years would create a vibrancy that was essential for the future prosperity of greater Christchurch.

Canterbury Employers' Chamber of Commerce chief executive Leeann Watson said it was important to attract tourists, businesses, and residents.

"If we've got people living in the central city, they tend to shop in the central city, they tend to eat out in the central city, and they create part of that vibrancy," she said.
This graph shows the significant population drop the central city suffered after the 2010 and 2011 Canterbury earthquakes. Today's population is still less than what it was pre-earthquake.

Last year there were 6010 residents living in central Christchurch, less than the pre-earthquake number of 7690. The population only began rising in 2014 and has grown at an average rate of 5.4% since then.

For the council to reach their goal of 20,000 residents by 2028, the resident growth in the next ten years needs to be an average of 12.8% per year.

In a 2018 report about barriers to residential development in central Christchurch, real estate agency JLL described the target as "unrealistic" and "incredibly ambitious".

Another report, published by Regenerate Christchurch in June 2018, recommended the city "relentlessly" pursued a mix of residents "to support a self-sustaining economy". It set a target of 6000 new residents over the next five years.

James Gough said Christchurch needs to "tip the scales" and make central city residential development more financially-attractive for the investment community. Then they will invest, he said.

Gough commented that 20,000 residents was an aspirational goal, "but I also think it's a goal we can't afford to miss".

"You've got to have a strong heart," he explained, adding that the heart draws people in, and without it, the rest of the city is never going to reach its potential.

"If someone wants to spend a weekend in Sydney, for example, and they jump on Wotif or Trivago, they immediately want to stay, Sydney, central city, CBD, around the harbour, because that's where all the action is," he said.

On the corner of Madras and Lichfield Street, a derelict brick building sits opposite the new Bedford Apartments, delivered by Fletchers.

'A LOT OF DUST BOWL SITES'

Central city developers listed a variety of reasons - including high costs and the underlying state of the rebuild - as to why residential development in central Christchurch hadn't prospered yet.

High construction and land costs were identified as "major barriers" in a research report prepared by real estate agency JLL in 2018.

"The development process is proving difficult and expensive, feasibility is tight and margins are low when compared to non-CBD projects and other locations in New Zealand," the report said.

DGM Group Principal Grant MacKinnon, who's developed apartments in central Christchurch since 1999, said alongside cost, the state of the rebuild was a deterrent for homebuyers.

The Juno Apartments (left) and the Rakaia Apartments (right) were both developed by DGM Group.

"There is still a lot of dust bowl sites around and no one wants to move into a new home next to a site that's a dust bowl," he said.

MacKinnon, who's developing four central city sites at the moment, noted the city's rebuild was making good progress with recently opened commercial developments, such as the Riverside Farmers Market.

Williams Corporation Managing Director Matthew Horncastle said New Zealand's construction industry as a whole was hard.

"You just feel like you're going to a war every day,'' Horncastle said.

His company, which he co-founded in 2012, has already built 14 developments across the central city and has five more currently in the works.

Horncastle didn't believe land costs were an issue in Christchurch.

Although construction costs were "extremely expensive", he said it would be narrow-minded to think they were the major problem because "so many little factors across so many different areas" make construction expensive, he said.

Suzanne Vallance, the urban planning lecturer from Lincoln University, said Christchurch city doesn't have a diverse range of housing.

She said this could be addressed with better financing of housing, creating relationships between developers and homebuyers, and building more creative infrastructure.

She said it would be "a fairly limited market" if only the top ten percent of earners could afford a central city home.

Williams Corporation Managing Director Matthew Horncastle. His company has delivered 190 central city homes in 2019.

'SOCIETY FUNCTIONS BETTER'

Central city developers agreed 20,000 residents was an achievable target but said the council needs to continue expanding its work in order to reach the goal.

Three central city developers currently building in the city - Grant MacKinnon, Matthew Horncastle, and Mike Sullivan - collectively agreed the council's development contributions rebate scheme was a great start for attracting homebuyers and developers to the city.

Under this scheme, developers don't pay a development contribution to the city council, which would normally be used to fund infrastructure.

Horncastle estimated this cost to be about $30,000 dollars per house, "and that being waved makes a serious difference," he said.

Top: A Williams Corporation development on Armagh Street. Bottom: The kitchen and living areas inside a Williams Corporation show-home on the corner of Manchester and Kilmore Street.

The Williams Corporation Managing Director said there needs to be more competition and variety in housing types. "Society functions better when lots of people bring in all their ideas," he said.

Horncastle didn't think a rates discount was the way to go because the council was already in debt.

"We have to charge rates because we need that income to reduce debt," Horncastle said.

Grant MacKinnon didn't agree with this point and thought a complete rates rebate was the "crucial thing that needs doing".

He thought the scheme would create a "substantial massive overnight impact" and although it might cost in the short term, it would be "positive financially" in the long run, he added.

DGM Group Principal Grant MacKinnon in front of the Juno Apartments he is developing in Cranmer Square. The Rakaia Apartments, which he also developed, are visible in the background too.

When MacKinnon was asked what he would say to the Christchurch City Council if he could deliver a message to them, he said, "I would just say more and faster."

Horncastle added he's not really seeing a lot of work from the city council. "I think they could be doing a lot more," he said.

Clearwater Construction founder, Mike Sullivan, who's developing 'The Spire' building on Kilmore Street with 36 apartments and a 96-room hotel, said the initiatives to help developers in Project 8011 were fantastic.

Sullivan thought cafes and restaurants would only survive if people began moving into the central city. "

Central City Development Forum Chairperson and Councillor for the Fendalton Ward, James Gough.

'SOMETHING THAT HAS TO HAPPEN'

James Gough's view was the council has multiple levers it could pull, such as the rates rebate, and those would help incentivise developers to develop and buyers to buy.

"Once you can line enough of these levers up, once you pull them in the right direction, it really starts to be a catalyst for positive change," Gough said.

He suggested a complete rates rebate for three years as an incentive for buyers and developers.

He explained how this scheme could charge the developer three years of pre-development level rates, which would give the homebuyer three years of free rates when they buy.

"If you've got the same product and one of them has no rates for three years and the other one does have rates for three years, then I know which one I'd go for, to be honest," Gough explained.

Leeann Watson, from the Chamber of Commerce, said the council had to provide the right incentives to get developers building homes and people buying them.

She thought Project 8011 was "a really good initiative", but wanted to see more work around the type of people who would buy property in the central city.

Canterbury Employers' Chamber of Commerce chief executive Leeann Watson said it was important to support private investors who were rebuilding the city.

"People tend to want a bit of land, now that is changing, and there are certain types of people that will naturally gravitate toward living in the central city, so we need to understand who they are, what they're looking for, and then build accordingly," Watson said.

She wanted a deliberate strategy around people, "as opposed to building and hoping that they'll come".

Gough, meanwhile, wanted to see "really really bold" decision-making. When he was asked what problems there had been with Project 8011, he replied "the councillors".

"I'm terrified to think there isn't the will or the guts or the brainpower from people around this [council] table to actually see this [residential population] is something that has to happen," he said.

"If it doesn't happen, Christchurch will suck."

CREDITS

Written, Photographed, and Produced by Steven Walton.

With special thanks to the New Zealand Broadcasting School, Daniel Nielsen, Vicki Wilkinson-Baker, Ross Patterson, and Paul Newell.

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