Tag Archives: Tauranga

Tauranga and Urban Development

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Council Considering Some Flexibility in Tauranga Urban Development

 

Tauranga like Auckland has Urban Limits drawn into its planning documents which usually dictate what urban development goes where, and what stays rural. These pencil drawings on the map (the urban limit) has been of much debate in both pro and against for as long as the term was coined.

While Auckland is still mucking around what and where to stick its Greenfield urban development – all in the name of Smart Growth (yawn), Tauranga decided to open up some dialogue and flexibility when it came to a Greenfield development outside of its existing urban limits (and land supply area for future development).

From The Bay of Plenty Times:

 

Glimmer of hope for Bob’s housing plan

by John Cousins | Tuesday, September 11, 2012 10:29

 

Planning rules could be loosened to allow former Tauranga MP Bob Clarkson to build a thousand fixed-price affordable homes at Tauriko.

The Tauranga City Council has swung its weight behind a review on whether to allow development outside the city’s urban limits.

Councillors were debating their response to some of the key issues driving the review of Smart Growth – the planning document that sets out where residential development can occur in the Western Bay in order to protect fertile soils.

Although the majority of the council supported retaining the controls on how far housing was allowed to spread, it also agreed to reconsider whether, in keeping urban limits, the correct balance has been struck between certainty and flexibility.

The council has asked that SmartGrowth’s implementation committee review the criteria for ongoing urban development.

Council growth funding and policy advisor Andrew Mead said the review of the criteria should apply to exceptional circumstances, such as if Mr Clarkson was able to convince the council that there was no other land for heavy buildings except his land.

Mr Clarkson told the Bay of Plenty Times that he was quite excited by the decision. “But I am getting older all the time and it needs some quick action.”

He said his meetings with SmartGrowth officials had seen them ask him questions, rather than the other way around. “I have noticed a change in the last six months. I am getting the feeling that maybe someone is listening.”

Council environmental policy manager Andy Ralph told the recent council that urban limits provided a high degree of certainty that infrastructure investments by the council and other authorities like the New Zealand Transport Agency would not be compromised by growth occurring in areas where it was not expected.

He said urban limits also promoted a more compact city with shorter travel distances, greater use of public transport and fewer greenhouse gas emissions.

Although there was an argument that urban limits drove up the cost of land where demand exceeded supply, he said this was not the case in the Western Bay of Plenty where there was enough residential zoned and serviced land to meet demand for many years. There was also land zoned for future development.

Councillor Rick Curach said removing urban limits would be a good move politically. It meant a developer outside the boundary could come to the council with a proposal that was currently in the “too hard basket”.

He was supported by Councillor Larry Baldock who said that “urban limits” was an old planning phrase.

Cr Baldock said he was not suggesting getting rid of planning controls. “Let’s look at more flexibility … let’s be at the cutting edge of new thinking.”

He said he did not want to throw all the fertile soils away but there had to be some flexibility. “Not an awful lot of ground will be gobbled up.”

Mayor Stuart Crosby said he was “quite nervous” about a carte-blanch removal of urban limits, saying it could send the council broke and create chaos.

“Is there a better way of doing it other than sequential development?” he asked.

 

Hmm actually it seems Tauranga is having the same debate we are having here in Auckland. Which reminds me to see what Auckland Council is up to seeming a good chunk of Greenfield development is due my way in Papakura, Takanini and Drury.

The link for Tauriko is HERE.

 

Link

A Tactical Victory with Port of Auckland

As I was doing my usual rounds on the Internet – the article from the NZ Herald (linked above) came up stating that Auckland Council had put the port expansion on hold – for now.

According to the article:

The Auckland Council has put the brakes on further expansion of the Auckland port into the Waitemata Harbour but stopped short of putting a permanent end to the expansion. The decision was made in a Council meeting this morning. They had planned to extend the port 250m into the prized harbour. The Port Development Plan proposed the larger site to cope with a 400 per cent increase in traffic before 2055. Today the Council voted to undertake an extensive review of the role of Ports of Auckland before deciding on whether to support further expansion into the harbour.

Councillors voted down an amendment from councillor Mike Lee not to support any further expansion beyond the reclamation already consented for.

Although I have been critical of Cllr Lee in the past – his amendment if it went through would have given Auckland some certainty and to which I would have backed. But at the same time I can see the merit of voting down the amendment for now with an “extensive review” now being promised by Auckland Council.

Now this is a tactical victory for people power here in Auckland – it really is, however for me personally it is also a case of a bitter victory at that. The Council has said it would now hold an extensive review – that is nice but while I was disappointed last Saturday after I got a letter from Auckland Council Investment Limited (who looks after Port of Auckland), now I am pretty pissed off that the Council is now deciding to hold a review.

Readers of this blog might recall last month I had sent a letter to every single Auckland Councillor and the Mayor calling for an enquiry into POAL. An enquiry looking at the industrial relations dispute, the ownership model AND location options for POAL. Question Five of the proposed enquiry was the following:

For the sake of optimal Return on Investment and Productivity in benefit to the wider economy and social environment: What location would be most suited for Port of Auckland:

  • Port stays where it is and infrastructure upgrades are committed
  • Port gets relocated to somewhere INSIDE Auckland, example south-east Auckland
  • Port is relocated somewhere OUTSIDE Auckland. That would mean Port of Tauranga, and Marsden Point in Northland – which would also give way to subsequent infrastructure upgrades as well.

On Saturday gone I had received a letter of reply from Gary Swift – CEO of ACIL stating that in regards to Question Five:

There are no plans to relocate the Port.  The cost of doing is estimated to be in the billions of dollars,  which  would  significantly  jeopardise  the Return  on  Equity  objective. It is  also important to note that to cater for future growth, both the Auckland and Tauranga ports will be needed, and both will need to expand to the full extent of their current plans, to prevent the upper North Island facing a future deficit in port infrastructure.

And as for the enquiry:

The POAL board began work last year to lift performance  across the entire organisation. For that reason, we do not see any need for an independent  inquiry into POAL.

Forgive me if I see a sense of irony in this, but ACIL have said NO to an enquiry that would look at the location options of the port INCLUDING KEEPING IT WHERE IT IS NOW! But Auckland Council are now deciding to stop any expansion for the moment and hold an:

Today the Council voted to undertake an extensive review of the role of Ports of Auckland before deciding on whether to support further expansion into the harbour.

Forgive Me, but what is going on Councillors and is there any forward thinking here? There does not seem to be in this instance although I am keen for any responses from councillors on that matter.

This issue could have been dealt with and a pile of agitation from the public and concerned interest groups PLUS any embarrassment if the enquiry was held in the first place. Also that enquiry could have given us ratepayers something a little more to go on for submissions to the Draft Long Term Plan 2012-2022 and 2015-2025 (when that comes up  in due time).

Never mind – the review is about to be set and I might send THAT LETTER again to every single Councillor and the Mayor’s Office asking for that enquiry.

Speaking of which, what is this review’s scope?

A piece from Campbell Live last night also featured a piece on the possible POAL expansion program.

Linked below is the letter I sent to Council, the reply from ACIL, and my “reply” post to ACIL on VOAKL.

The Original Letter to Council calling for that Enquiry

The Reply from ACIL

My Reply on VOAKL to ACIL

For some light relief – check out Your Port Your Call on Facebook. Richard Horton does a nice impression on what we could do with POAL at its current location.

Ok where Next with POAL

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Back to the Drawing Board with Port Of Auckland?

After reading the letter from the CEO of Auckland Council Investment Limited in reply to a letter I sent to Auckland Council last month (every single councillor, the mayor and I think the CEO – Doug McKay got the letter) I was having a review and a think  on the Port situation. A side note, the Mayor’s Office and a couple of councillors have personally replied to my letter via email – however I consider that private correspondence unless otherwise stated by the message sender. Needless to say they are aware of the issues (and hence referred me to ACIL which where the “reply” came back to) and have stated where they stand (whether I personally agree is another matter entirely). Thank you to the Mayor’s Office, the councillors who replied and ACIL for your replies – very much appreciated.

Just a recap quickly on where things are at.

All my postings on Port of Auckland can be found at the Port of Auckland Index tab at the top of every VOAKL page – the index is updated regularly when I post a new item on POAL. So for a comprehensive look at VOAKL commentary on POAL, check out the Index over your morning breakfast or your lunch break at work.

From the Auckland Council side there are two particular objectives running at the moment:

The first being the issue around the Return On Investment. According to ACIL and Auckland Council the current ROI is at 6%, Council have asked (I am being polite here) that POAL give a ROI of 12%. It can be widely assumed that the increased ROI in the form of dividends back to Council would be used to pay for mega projects such as the City Rail Link under the CBD and possibly the East-West link down at Onehunga/Southdown/Mt Wellington/Penrose. It can also be assumed that this demand for an increased ROI has been a catalyst for the current industrial relations dispute between Port of Auckland and Maritime Union New Zealand. No particular comment on that one as VOAKL has not been truly interested in the IR debate at POAL. However there are comments floating around that the true ROI on POAL is around 1% if the Books were reflecting accurately so they say.

The second issue being POAL growth. In the Draft Auckland Plan and Waterfront Plan there has been mention that the port will expand into the Waitemata Harbour, block view lines, upset the tidal flow of the harbour and disconnect the public from the waterfront even further. In saying that, the mention of the expansion program was buried in technical documents which one would have to fish out to go find it (in 800 pages of Draft Plans)  - so I say someone wanted it buried away from the average person’s eye and attention.

From the other side there has been numerous debates and calls against the two issues mentioned above.

With the ROI issue: this comment seems to be floating around quite a bit.

Residential land one kilometre from the Auckland central business district is valued at ~$22 million/ha…. compared with the $3 million/ha the POAL are using to value their 77ha. The valuation is justified as being taken “by reference to its highest and best use subject to current zoning” – which happens to be as a port. It then gets its figure on the basis of “industrial land values within the wider Auckland area.”
Any halfwit can see that the “highest and best use” of the land would be in mixed residential, commercial, retail, or public space. 
Once the real value of the land is inserted in the balance sheets, then the ROI is closer to 1%, unlike the 6% they claim, and the 12% they require. In economic terms, it’s not meeting the cost of capital so is losing money. 
They should immediately shut down the port and sell of the land and take pressure off housing prices in residential Auckland.

This will usually kick off to the second issue about the Port expanding in its current spot.

Multiple media articles touch on the expansion issue with the NZH running two particular pieces here and here, Metro Magazine running an article just recently, and The NBR running an excellent piece here. Beyond that there are other groups such as the Auckland Architecture Association, Your Port, Your Call Facebook campaign, and Heart of the City running various campaigns, lobbying and commentary on the POAL program.

For myself at VOAKL I have been running commentary along two main issues: ownership model and port location options. As I have said else where I personally believe the port should be relocated away from Down-town and to south-east Auckland to make use of open land, upcoming Greenfield urban development and upcoming Brownfield redevelopment including Down-Town at the waterfront itself.

However the letter from ACIL in its response was not unsurprising was still disturbing – particularly to the call for the enquiry and questions four and five.

Lets recap with excerpts from my letter to Auckland Council.

This letter and the request of enquiry are not interested in the current industrial relations dispute between Port of Auckland Limited management and the Maritime Union of New Zealand. This letter and request of enquiry looks at five fundamental questions into the state of affairs at Port of Auckland and how steps can be taken to return the port back to optimum health and productivity.

In setting up the enquiry, these five questions would be answered – they are:

4) For the sake of optimal Return on Investment and Productivity in benefit to the wider economy and social environment: Which ownership model would be considered best for Port of Auckland Limited.

  • 100% Council Owned
  • 75% Council Owned, 25% Private owned
  • Mixed Model: 51% Council Owned, 49% Private Owned
  • Minority Holding: 75% Private, 25% Council Owned
  • Full Privatisation

5) For the sake of optimal Return on Investment and Productivity in benefit to the wider economy and social environment: What location would be most suited for Port of Auckland:

  • Port stays where it is and infrastructure upgrades are committed
  • Port gets relocated to somewhere INSIDE Auckland, example south-east Auckland
  • Port is relocated somewhere OUTSIDE Auckland. That would mean Port of Tauranga, and Marsden Point in Northland – which would also give way to subsequent infrastructure upgrades as well.

These five above questions need to be answered sooner rather than later – especially as these questions and possible outcomes would have major bearing on The Draft Auckland Spatial Plan and The Draft Long Term Plan. Enough of a major bearing that no matter which way the enquiry recommends in questions four and five – it could basically force a total re-write of both draft plans.

The excerpt from the reply from ACIL

4. The  ownership  model  currently  in  place  is  100%  Council  owned  through  ACIL. The Auckland Council believes that this is the best ownership model and no plans to change that. 

5.   There are no plans to relocate the Port.  The cost of doing is estimated to be in the billions of dollars,  which  would  significantly  jeopardise  the Return  on  Equity  objective. It is  also important to note that to cater for future growth, both the Auckland and Tauranga ports will be needed, and both will need to expand to the full extent of their current plans, to prevent the upper North Island facing a future deficit in port infrastructure.

Ok with the answer to Question Four – that was entirely expected as Mayor Len Brown has from the outset said that POAL will remain 100% in public hands. However I never said the sell down was to occur NOW, I said the enquiry would look at the various ownership models so Auckland Council, the ratepayer and public, businesses, and associations can both give their opinions to (the enquiry), and have a comprehensive document to read to assist in making an informed decision especially with The Draft Long Term Plan calling for submissions and 2013 local government elections coming up. Without that enquiry I can safely say Auckland is blind to the benefits and costs of each mode of ownership for POAL. Not very good for a public institution when its constituents can not make informed decisions from full and open information – especially to a critical asset such as POAL.

With Question Five a more interesting situation arises. ACIL’s answer seems to be indicative of few things which should be of CRITICAL INTEREST to every single Aucklander, business and institution in this city and beyond. The letter from ACIL has said in response to Question Five that “both the Auckland and Tauranga ports will be needed, and both will need to expand to the full extent of their current plans, to prevent the upper North Island facing a future deficit in port infrastructure.” Well that effectively rules out “Port is relocated somewhere OUTSIDE Auckland. That would mean Port of Tauranga, and Marsden Point in Northland – which would also give way to subsequent infrastructure upgrades as well” – so for those vying for that option – it is truly dead in the water – so to speak as ACIL have said both POAL and POT are both needed. As for this: “Port gets relocated to somewhere INSIDE Auckland, example south-east Auckland;” that has also been ruled out – to a point  - for now. However in saying it leads to the next inductive point about investment.

  ”There are no plans to relocate the Port.  The cost of doing is estimated to be in the billions of dollars,  which  would  significantly  jeopardise  the Return  on  Equity  objective. It is  also important to note that to cater for future growth, both the Auckland and Tauranga ports will be needed, and both will need to expand to the full extent of their current plans, to prevent the upper North Island facing a future deficit in port infrastructure.” Oh my there seems to be an investment pickle here folks – on a rather grand scale. To cater for future growth both POAL and POT (Port of Tauranga) both need to grow and expand – ok that is a given – businesses grow to cater for future growth, that is easy to understand. However POT can expand easy – it has the land and water at its current location to do. As for Auckland – not so. Where POAL currently sits at the waterfront all the available land is taken, thus the proposal to extend into harbour to allow this catering for growth. Thus the reason why some of us want the port relocated (granted in different locations) – to allow the port to expand without consuming precious waterfront real estate both on land and the water (as well as environmental reasons).

But what is really confusing me is this Return on Equity jeopardy from the billions of dollars spent on port relocation. Expanding the port 250 metres into the harbour, upgrading the road and rail links, upgrading the Wiri Inland Port alone is going to cost at least $6 billion (or $3 billion minimum without the Eastern Highway) so I would say your RoE (ROI) would be in serious jeopardy as well as ACIL will be asked to stump up with some if not most of the cash for the POAL expansion program (although who am I kidding here – the tax and ratepayer will) :P . Look you have to spend money to make money pure and simple (cost cutting has its uses too) so ACIL and Auckland Council are really going to need to think super hard here on this POAL equation. The ROI (which is pathetically low any way (1% I believe)) might need a short-term hit for a long-term gain  - but can people see that. So the bit about no plans to relocate the port because of ROI/ROE jeopardy does not wash with VOAKL. It is also the reason why I called for an INDEPENDENT enquiry – to look at all the options available with POAL without interference.

And another thing that seems indicative that in response to Question Five, ACIL, POAL and Auckland Council are pretty much pursuing expanding POAL into the harbour even if submissions to the Waterfront Plan and Draft Long Term Plan say otherwise – so much for democracy there folks (and where is the cash coming from by the way?). Thus can Auckland really have a truly connected, vibrant waterfront and Down-town with a hulking huge port down at the mid and eastern ends of OUR waterfront? And is ACIL and council blowing an opportunity to relocate the port WITHIN Auckland on land and surroundings more suited (virgin bare land with good sheltered water access) to allow a potential billion dollar investment along the waterfront with new housing, commercial and public space precincts that could help “fund” other investments in the long-term while giving a decent shot in the arm in dealing with Auckland’s housing crisis. Remembering:

Residential land one kilometre from the Auckland central business district is valued at ~$22 million/ha…. compared with the $3 million/ha the POAL are using to value their 77ha. The valuation is justified as being taken “by reference to its highest and best use subject to current zoning” – which happens to be as a port. It then gets its figure on the basis of “industrial land values within the wider Auckland area.”

Any halfwit can see that the “highest and best use” of the land would be in mixed residential, commercial, retail, or public space. 
Once the real value of the land is inserted in the balance sheets, then the ROI is closer to 1%, unlike the 6% they claim, and the 12% they require. In economic terms, it’s not meeting the cost of capital so is losing money. 
They should immediately shut down the port and sell of the land and take pressure off housing prices in residential Auckland.

Which now brings me to the question – Where Next with POAL?

I have seem to come stuck at the moment as I watch a once in a lifetime opportunity have the real possibility get blown.

Time to consult that drawing board again.

A Reply to my Letter about POAL

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Auckland Council Investment Limited Replies

In February I had composed a letter asking five questions (two were mine and three from Andy Cawston) about the Port of Auckland and the current situations facing the port.

Today in my mail I had received a letter from Gary Swift – Chief Executive of Auckland Council Investment Limited (the Council Controlled Organisation responsible for “looking after” Port of Auckland’s affairs in the name and “benefit” of Auckland Council – on behalf of the ratepayers of Auckland) answering the five questions outlined in the original letter.

Thank you Mr Swift for your reply to the letter, very much appreciated. :)

Below is the embedded document containing the letter.

The answer to question five is the most interesting one and would be a matter of interest to those who are concerned about the Port of Auckland’s planned expansion in its current site. 

[Edit from voakl admin]. As in my comment below, ACIL believe an independent enquiry is not needed to look into the five questions asked (especially the ones in the comment box below) in my original letter. While unsurprising – this is deeply disappointing. Seems it is back to the drawing board on POAL  folks. Time to have a rethink on where next – do I push on with relocation draft workings, or give up and concede the port is going to expand where it is. OR money where my mouth is and run for Auckland Council next year on a platform (well part of a comprehensive wider platform) of getting the enquiry under way into those five questions – which could see the port moved. Because the port is sick and hamstrung folks it really is – and I do deeply believe a “second-opinion” is needed through the enquiry on POAL. So time for some options and thoughts – any from the reader out there?

I will be forming follow-up questions in due time as I prepare my presentation to the City Centre Master Plan, Waterfront Plan and submission Draft Long Term Plan. It seems the Return on Investment could be “blinding” ACIL and Auckland Council to what could be viable alternatives to POAL – that being relocation to south-east Auckland OR Marsden Point/Port of Tauranga. Still need to hold that enquiry folks – now more so than ever.

The reply from ACIL

From The NBR – POAL

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NBR Calls for Container Terminal at POAL to Move

After reading a piece from Metro Magazine on Port of Auckland, I came across this piece from The National Business Review (NBR) also on Port of Auckland. Ok granted – the article was published last week but the relevance from Professor Tim Hazeldine (Economics – University of Auckland) is still there. You can read both pages in the embeds below but the article struck me on one account; third column of page two about half way down. I see a figure of ONE BILLION DOLLARS! That is the potential value of 50-hectares of land/real estate redevelopment if the container terminal at Port of Auckland was moved else where such as south-east Auckland as I advocate, or Marsden Point/Port of Tauranga combo that is also advocated by others.

$1,000,000,000 – wow. Look, I take it the land is and would be under the Auckland Council Investment Limited CCO (Council Controlled Organisation) if the land was redeveloped. So Auckland Council sits on a gold mine if it redevelopments the container terminal  - “gold” to help REINVEST in some other investments this city sorely needs.

Redevelopment the container terminal for both private (residential and commercial) and public (civic or “parks”) use and the money from the investment there could be used to:

  • Help pay for Port relocation to south-east Auckland (with the assistance of a POAL sell down (not privatised))
  • “Deposit” on the City Rail Link
  • Eastern Highway (as a 2-lane thoroughfare)
  • Infrastructure like water and waste water that needs upgrades
  • Pay off some debt
  • That pesky cruise ship terminal (with some change to spare)
  • Probably some deposits on some capital expenditure outlined in The Draft Long Term Plan

All the while Auckland Council gets; a nice “dividends” back on rents from the redevelopment for further investment, a connected waterfront for ALL to enjoy, trucks and freight trains off the inner roads and rail and a few other benefits of a relocated port. [Edit from admin] I forgot to mention as in the NBR article, Auckland gets a shot in the arm with residential supply being able to increase in the prime CBD area which seems to have chronic housing facility shortages at the moment (if rent and house buying bidding wars in Central Auckland are anything to go by)!

So – we run with an election pitch to get The Enquiry under way and see where to relocate OUR PORT OF AUCKLAND?

Your Port – Your Call folks – so get submitting to The Draft Long Term Plan – for our Port’s future

The NBR Article (Two embeds)