Twenty-Sixteen / Twenty-Seventeen

When reviewing the past 12 months, it’s easy to see why the experts have been hailing it as a great success in most sectors. The economy has been stable, unemployment is low, interest rates are low. We have seen an emergence of start-up businesses in many sectors. Foreign investment is pouring in. That’s all good. sure.

However, NZ is an expensive place. Our housing woes have been well documented. We haven’t enough stock, especially Auckland with Wellington now also under pressure, and we are not addressing the problem fast enough. Prices are teetering dangerously high. Something has surely got to give. I feel someone will be losing out soon. Will it be the ones that are in the market? Will it be those currently locked out of the market? It will be interesting to see How the government responds.

About the Government, The Prime Minister resigned a couple weeks back, so It’s Bill English to the Helm. Having met him a few years back I would describe him as Vanilla. Yes, vanilla in a bad tie. Especially when compared to the outgoing John Key:) 2017 will be an interesting year.

Design and build
The number of major infrastructure projects set-up over the past few years seem to all be coming to a head. We are seeing massive Land Development, Civil and Building Projects right across the country. Occupational Health and safety became far more stringent, adding risk to every business owner. Certainly, a step in the right direction, but OHS is creating many issues, but equally opportunities, dependent on how you view it.

MASSIVE Tremors
Kaikoura got Rocked! Seriously reminding us how life can swing in a new direction, so quickly. We were very lucky this happened at midnight and not midday. The clean-up is underway.

Wellington has been shaken into submission. The Government has one option, and that is to invest massively in ensuring its property portfolios are safe. Commercial business and property owners have no choice but to follow suit. OHS dictates!

We have had some spectacular demolitions, more to come, and a host of refurb work commissioned overnight. Busy times.

The North Island
We have seen new developers, contractors and consultants move into the regions. When was the last time that these many tower cranes were seen on NZ soil? We are also on the Aussie radar in a big way. I have heard of many OZ businesses looking to capitalise on NZ prosperity. The Chinese have arrived too. From what I am lead to believe this is just the start of some very exciting investments from our Asian neighbours in the housing, industrial and commercial building markets.

The Capital
It seems no matter where you look every business describes massive gains year on year. Wellington has some sexy projects for the first time in a long time. All four corners of the city limits are changing shape with alterations to the skyline; An international conference centre; movie museum; hotels; buildings and apartment blocks. Add the Transmission Gully to the few motorway upgrades and extension; the transport sector is humming. Wellington construction has not been this buoyant since the eighties.

The Big Smoke
The Auckland market has gone crazy. They are building massive buildings all over the place; by NZ standards. The salaries demanded are equally nuts. It’s a boom. Let’s hope it is sustainable, but I feel that it is moving too quickly. There is a saying “make hay while the sun shines” many businesses are doing just that. 2017 is looking super sunny at this stage.

Ministry of Business and Innovation report:

  • Auckland dominates the national demand for building and construction, accounting for over a third of all building and construction, by value from 2015 to 2021.
  • Total value of activity in Auckland increased 9 per cent in 2015; this increase in value is forecast to continue and peak in 2018 at $17 billion and to remain above $16 billion for the remainder of the forecast period.
  • The report forecasts 94,200 new dwelling consents in Auckland between January 2014 and December 2021. Dwelling consents are forecast to stay at high levels per year throughout the forecast period.
  • The number of multi-unit dwellings consented each year in Auckland is forecast to continue to increase its share of all dwellings consented, and is expected to overtake detached dwellings by 2021.
  • All non-residential construction in Auckland grew 4 per cent over 2014/15 and is expected to steadily increase by 49 per cent to an elevated level of $7.3 billion in 2018.

The South Island
The Christchurch rebuild slowed down, many contractors have moved out of the region as the residential needs have largely been met. The insurance pay-outs were settled; not always without complaint. Regardless that work has mostly played out its course now, 5 years on from that infamous second earthquake.

Commercially 2016 was a slow start for new work in Christchurch. Many contractors secured their first project well past May. The last quarter when several large projects were awarded. 2017 is looking a stable year for the region. Dunedin and Queenstown especially have seen some massive growth too, which will continue well into next year.

The National Construction Pipeline Report

  • The National Construction Pipeline Report 2016 provides national and regional forecasts of activity in three categories; residential building, non-residential building, and other construction, such as roads and infrastructure, over a six-year period until December 2021.
  • Is one of few forecasts available that compare its results to the previous forecasts. Forecasts are given for four regions Auckland, Canterbury, Waikato/Bay of Plenty and Wellington, with aggregated data provided for the rest of New Zealand.
  • The report is commissioned by the Ministry of Business, Innovation and Employment, and is jointly prepared by BRANZ and Pacifecon (NZ) Ltd. 
  • Visibility of New Zealand’s forward construction pipeline is intended to improve the productivity of the building and construction sector and could help moderate its boom and bust cycle.

    National picture

  • The National Construction Pipeline forecasts from the third report were a good prediction of what happened in 2015, but were slightly high for residential construction, high for nonresidential building, and close to actual for other construction. There is a slight delay in the previously forecast growth for the next six years, but it retains a similar shape, with a smoother longer peak.
  • National construction value has experienced sustained growth averaging 7 per cent per year since 2011, and is forecast to grow to a peak of $37 billion in 2017. This represents a rate of growth not seen in 40 years. These forecasts indicate a 2017 peak that represents 20 per cent ($6.2 billion) more value than at the end of 2015. This peak is 28 per cent higher than the previous peak in 2007, and 59 per cent higher than the low of 2010.
  • The annual value of all construction nationally is forecast to remain above 2015 levels for the duration of the forecast period to 2021. Residential building growth in Auckland accounts for more than half of the total New Zealand construction growth.
  • The annual value of residential building is expected to increase by 22% to a peak in 2017 ($21 billion) and all non-residential construction forecast to grow by 20% to a peak in 2018 of $16.8 billion.
  • Actual data from 2015 shows our forecasts in previous reports have been reasonably accurate. Non-residential building actual data was however significantly lower than the 2015 report had expected. The 2016 report now expects this growth in non-residential building to be more gradual with a later and longer peak ($8.8 billion) in 2018.
  • The national non-residential building forecast continues to grow, however has become a less distinct peak, spread out over a longer term. Contributing factors are deferred construction in some of the Canterbury anchor projects, a number of new university developments nationally, and the continued increase in Auckland non-residential building (such as schools and retail) as new suburbs are established and existing ones expanded. Notable trends
  • Auckland residential building value grew by $0.7 billion in 2015, accounting for 58 per cent of the total national growth of $1.3 billion. Auckland residential building is projected to increase by another $3.3 billion by 2017, which represents 53 per cent of the total national peak of $6.2 billion in 2017.
  • Waikato and the Bay of Plenty combine to form the third largest region, by value of work and are predicted to become the second largest by the next report.
  • Higher density housing increases its share of national residential construction over the forecast period; multi-unit dwelling consents represented 30 per cent of consented dwellings in 2015, and are projected to be 40 per cent by 2021. Auckland’s construction sector is growing at an amazing rate
  • Auckland dominates the national demand for building and construction, accounting for over a third of all building and construction, by value from 2015 to 2021.
  • Total value of activity in Auckland increased 9 per cent in 2015; this increase in value is forecast to continue and peak in 2018 at $17 billion and to remain above $16 billion for the remainder of the forecast period.
  • The report forecasts 94,200 new dwelling consents in Auckland between January 2014 and December 2021. Dwelling consents are forecast to stay at high levels per year throughout the forecast period.
  • The number of multi-unit dwellings consented each year in Auckland is forecast to continue to increase its share of all dwellings consented, and is expected to overtake detached dwellings by 2021.
  • All non-residential construction in Auckland grew 4 per cent over 2014/15 and is expected to steadily increase by 49 per cent to an elevated level of $7.3 billion in 2018.

 

Risks
Who knows what is around the corner. It feels we are all just one disaster away from, well, disaster. The international political landscape is a bit dubious. The housing market is described as the perfect storm for a massive crash. Elevated prices, building restrictions, banks over lending. There are hundreds of events that could derail the current momentum. Let’s hope 2017 is all smooth sailing.

Recruitment
At this stage, it’s all go!! Call me…. No seriously…. Call
staff
http://jdt.co.nz/career-portal/#/jobs

 

The Venus Project – Making us all redundant

“Beyond politics, poverty and war” is their slogan and their vision is truly wonderful. No more money! No more work! The end of our modern “slavery”.

“The Venus Project proposes an alternative vision of what the future can be if we apply what we already know in order to achieve a sustainable new world civilization. It calls for a straightforward redesign of our culture in which the age-old inadequacies of war, poverty, hunger, debt and unnecessary human suffering are viewed not only as avoidable, but as totally unacceptable. Anything less will result in a continuation of the same catalog of problems inherent in today’s world.”

As far as any massive change in thinking a full revolution is required to get the masses onboard. This one makes absolute sense. Since becoming aware of this I can say it has been difficult accepting certain things that we consider normal.

Environmentally we have been warned that the future is bleak if we don’t take action. We have made massive strides in technology that show we can sustainably build advanced civil infrastructure. In theory we are able to address our power consumption requirements through geothermal, wind, solar, and tidal energy sources.

DEATH TO THE STATUS QUO

Ever feel like this life is a steady plummet into Dystopia? How the F**** can Trump or Clinton be revered as powerful decision makers in this world?

The Monetary system is broken –  I am forced to work, just as you are. I quite enjoy the work I do, but truly, I would prefer to spend my time in other ways, or at least diversely. Don’t get me started on the unstable economic system that feels like I am competing with “the house” at a prominent Vegas Casino.

Status Quo:  “Buy” land; acquire a house; pay for education; get a job. Then save for your death; only to set your children up for the same traps. It’s sad that the best part of our lives are spent in offices, on telephones, in front of computers, on-site, clipping the ticket, punching in and punching out. So that we can potentially have enough to live until the age of 75. Hopefully enjoy 5 years “retirement”. Then the  decline to death as we conserve our life savings in order to survive. Heaven forbid we have taken care of our health, we might live too long!

HOW WONDERFUL

Wouldn’t it be great if the system was designed to free us up to enjoy life. I have never wanted to be made redundant more in my life! I don’t shy away from work, but I want to see the fruits of my labour, for everyone! By using technology to build a life of abundance; a true collaboration of society is possible. No rat races. Would you not work willingly towards building UTOPIA.

I would work for “free”(not for money) knowing I was actually free (of slavery)

It seems a million miles away, and it probably is. But asking the right questions and investing in small steps towards a better world is something we can all do. Lets hope it gains momentum.

LET’S BUILD IT

Before we can enjoy Utopia, it has to be built. It takes artisans and technicians to achieve this. I would love to be part of the solution. Rejigging our education system to incorporate our future planning could make us all knowledgeable in how to achieve it.

Champagne or Razor Blades

The title of this post is a direct quote used by an experienced recruiter I met a few years back, to describe the contingency recruitment process. He was struggling at the time and I felt the need to hide the razor blades.

Since setting up JDT I have had my fair share of high and low points. Champagne or razor blades I tell you. However the brand is stronger and growing. We are in a position now to really sell our ability as a ‘proven entity’. And we are getting some good campaigns to work on now. I guess the same applies for any business; our new-found confidence is off the back of some laser focus and lots of hard work; blood, sweat and tears, Done with the smarter not ‘only’ harder mantra in place.

Our distraught experienced recruiter unfortunately lacked many of these elements and had placed himself somewhere between the Neolithic and Jurassic ages of generalist recruiting. I was only mildly sympathetic. I really look up to some of my industries best performing agencies, their approach, products and success. Carving out a mutually beneficial process for my clients, candidates and business is the sustainable business model we aim to achieve.

I am a specialist recruiter within the construction and property industries. Much of these industries and my clients are driven by the tender market to win work; ie: get paid. An extremely expensive process using their best resources to estimate, price and programme work they are hopeful to win. Usually this is between 2:1 and 6:1 chance of being awarded a project. This reminds me of the contingency recruitment process in many ways.

Construction contractors that are negotiating high percentages of their work are doing so on the back of their own proven track record. By avoiding the tender game, they are utilising their resources better, and are guaranteed to keep their cash flowing, which is the number one rule to business success. In freeing resources they also have bargaining power, more margin to play with, improving their price point. These types of relationships, built through trust, have their clients putting faith in their ability to deliver an end product that meets their high expectations. Repeat business looms for the succesful contractor.
You see how I could relate this back to my business.

Agency recruiter…. ooh sounds dirty!

Most of my clients really value my service, some less so but they are still engaged; I can respect that. Others seem to think fairly negatively and focus on cost of the recruitment process. The question I ask is “Do I bring you value?” Many unengaged managers are happy to register a job “for free”. I am happy to hear you out but I can’t guarantee my service on this basis.

Recruiting takes time, knowledge and timing. Lots of networking, hours of marketing, advertising, blogging, vlogging, editing, creating pretty pictures, networking, emailing, writing and most of all phoning. “Needles in haystacks” that is my daily grind. For all these reasons I need to gain some form of exclusivity to ensure my time is best spent for the end users.

Candidates are king, let’s be honest. If a recruiter is not treating people right, and adopts the attitudes used by some agencies, then you stand on the edge of transactional and unsustainable practice.
We don’t.
The same could be said for users of recruitment services. Engaging on a transactional basis with many recruiters may harm their employer brand, waste their time and potentially leave them in the same position they were at the start, with no real talent attraction. Conversely, engaging an exclusive process with a trusted business partner will yield results. Putting their full trust in a conscientious worker that has a vested interest in the successful placement of talented individuals in their business, trumps the alternative. Every time.

More Champagne please.

 

 

Facing a Candidate Shortage in an Industry Boom

This won’t come as a revelation; New Zealand’s construction industry is facing a striking candidate supply-demand crisis. Yes, there is a shortage of skilled staff employers face when looking for hiring new talent to expand their businesses.

As a nation, we’re currently in the middle of the largest construction boom in 40 years, described as ‘unprecedented’ and tipped to last for at least the next 6 years[1].

As the Christchurch rebuild starts to wind down, the flow back has resulted in increased residential demand throughout the country, particularly in Auckland, Wellington and the Waikato. The 2016 Budget has included approx. $358m for construction; namely social housing. Similarly, other commercial and civil work, such as clusters of multi-million-dollar retirement village developments, are well underway throughout our major cities in anticipation for the aging ‘baby boomer’ population.

All of this growth and development activity should provide the perfect opportunity for our construction industry to flourish and grow, but a shortage of staff – and in particular, a shortage of apprenticeships – has created “cut-throat” competition for talent.

But why is this the case when the BCITO lists their largest career-seeking audience as the 406,000 kiwi ‘millennials’[2], with 186,000 of them actively considering their career options right now?

Recognising this abundance of potential talent, the NZ Government has committed $28.6m towards attracting and training more apprentices for trades over the next four years. There is also a particular focus on developing our female workforce who are largely under-represented within the construction industry[3].

Although these studies are directly relating to carpentry and other blue-collar trade apprenticeships, I would personally like to see more females entering Quantity Surveying, Site Management and Commercial Project Management cadetships.

Time will tell whether the Governments directed focus results in a tangible increase in these areas to provide us with a skilled workforce, that will enable our industry can continue to grow from strength-to-strength.

However for now, I think we can be sure of three things;

  1. Employers can continue to expect fierce competition to attract and retain the best talent within a scarce market; and
  2. Employees with the most sought-after skills and capabilities can expect more interest during their job searching experience and potentially, as well as more opportunity to advance their careers and skillset.
  3. On-the-job training programs and public-private initiatives will help ‘close the gap’, but other recruiting and staffing solutions will be increasingly necessary.

[1] http://www.buildersbase.co.nz/#!NZ-Construction-Boom-Tipped-for-next-Six-Years/c1kod/55c126260cf265ef515e7a54

[2] BCITO Annual Report 2015

[3] http://www.newshub.co.nz/politics/budget-funding-for-trades-training-2016051915#axzz49cVwdC00

 

 

Procurement and logistics best practice – NZ edition

Many countries across world have implemented procurement strategies that frankly leave the NZ market seeming two steps behind them. We are seeing a shift in thinking on the topic, and the largest businesses that control construction programmes and supply chain are doing best. With the overall busyness we are experiencing in the industry, arguably more needs to be done to ensure the cost of construction does not skyrocket out of control.

Now I am no Procurement specialist myself, but having spoken to some seriously knowledgeable people over the past few years I see how this skill is becoming ever more important. I found some info published by the Chartered Institute of Building that really breaks down the entire topic nicely for the layperson; https://www.ciob.org/sites/default/files/CIOB%20research%20-%20Procurement%20in%20the%20Construction%20Industry%202010_1.pdf

Procurement and construction logistics is often viewed as part of the engineering process or project management duties, and seldom a standalone discipline. That will change.

Walter Glass of www.corplogistics.co.nz  is clear that this topic needs to be brought to the limelight. He wrote an article recently outlying some of the key points on the logistics topic are found at: http://www.constructionnews.co.nz/opinion/construction-logistics-an-emerging-perspective-by-walter-ass?A=SearchResult&SearchID=9251074&ObjectID=3339179&ObjectType=35

The businesses that are future proofing are developing strategies to buy the right materials, at the right times and the best price through best practices proven the world over. I look at the frightening scenario in the Wellington region, where the major civil projects alone, once in full swing in 2017-2018, will require more aggregate, asphalt, concrete, crane and transport services than actually exist. Add the building industry as well as the needs of Auckland and Christchurch and I foresee a hugely expensive problem for the entire country. That isn’t even looking at lack of tradesmen, engineers, site and project staff required to complete the work.

Those with the most foresight are building the right strategies to minimise risk and develop new methodologies, new materials and new supply chain relationships in the interest of minimising cost to the developers, and meeting the contractual timelines on future projects. Hopefully time is still on our side.

 

 

 

How will 3D printing affect the construction industry?

3D-printing – it’s being used to fabricate almost anything. Furniture, car parts, guns and even replacement organs.

So why not explore its use in the construction industry?

Firstly, 3D printing is considerably more eco-friendly than current traditional construction methods. The materials and processes used mean less waste during the build phase, and the ability to recycle + re-use them for new uses. The ink, made from construction waste such as concrete, fiberglass and sand, is also flexible, self-insulating, and resistant to strong earthquakes.

Then there’s the reduced build-time. Chinese company WinSun claims to have taken just 24 hours to produce 10 3D printed homes. Learn more at http://www.yhbm.com/index.php?siteid=3

Whilst wrapping your head around that, even more impressive is NASA’s plan to use 3D printing in it’s extra-terrestrial explorations.
http://www.nasa.gov/centers/marshall/news/news/releases/2015/piece-by-piece-nasa-team-moves-closer-to-building-a-3-d-printed-rocket-engine.html

And yet, like with any advancements made, there are always some potential disadvantages.

  • Will there be reduced employee numbers in the industry, since the 3D printer does most of the work?
  • Transportation – getting the printers for large in situ components to and from the site,
  • Storage of the printer on site,
  • Higher risks – any errors in the digital model can result in problematic issues on site during the printing/construction phase,
  • Would conventional product manufacturing companies and plant renting companies suffer, as their products are no longer required?

Regardless, construction sites will soon feature more technology. 3D-printing, robots and drones – that’s what’s heading our way soon. To build more economically. To build faster. To build with better quality.

Revolutionary and innovative. This is certainly exciting to think about and we will be investigating this more – stay tuned!

Find out more about how 3D-printing will affect your industry:
http://betterbusinesses.co.nz/how-will-3d-printing-change-your-workplace/

$50 million gondola proposal for Queenstown

A $50 million proposal has been made for the Queenstown-Remarkables alpine area, made by development company Porter Group Ltd.

The 9.8km long gondola would operate year-round; comprising of 140 eight-person cabins, with a vertical climb of 1270 metres.

“In winter the proposed gondola will give skiers, boarders and sightseers easy access to NZSki’s facilities. It will further boost Queenstown’s world-class visitor experience, and has the potential to deliver immeasurable economic benefits to the resort town’s many businesses,” says leading New Zealand tourism consultant Stephen Hamilton.

Submissions have been lodged with the Queenstown Lakes District Council, and a resource consent application will be lodged early next year. The gondola is estimated to take up to 18 months to build.

Read more: http://www.3news.co.nz/nznews/queenstown-gondola-proposal-links-downtown-to-the-remarkables-ski-field-2015111914#ixzz3vZPAGLab

Wynyard Quarter a winner in world waterfront awards

It’s great to see New Zealand projects continuing to win awards on the global stage.

Recently, Panuku Development Auckland won Excellence for the urban renewal of the Wynyard Quarter, at the Waterfront Awards in Washington, D.C.

Construction is underway on 500 apartments, townhouses and 48,000 sqm of commercial space.

Panuku Development Auckland chief executive John Dalzell has explained the huge honour the award is, as the entry was competing against some waterfront development projects in Europe, Asia and North America.

http://www.wynyard-quarter.co.nz/news/waterfront-plans-win-award

A tale of two cities – AECOM survey results

The latest AECOM nationwide construction industry sentiment survey has found New Zealand’s infrastructure and building industry is defined by two contrasting poles – Auckland and Christchurch.

AECOM has explained results show that four years on from the Christchurch earthquake disaster, recognition of a longer, slower rebuild rather than a peak is broadening. This is shown by a dip in confidence – by 27% over the past 18 months – and easing workload expectations.

Importantly, though, while sentiment has moderated for the region, it does remain strong overall and more in line with a long-term outlook. There is a slowing of residential construction as the rebuild moves into the commercial phase.

Comparatively, positive sentiment was strong for the upper North Island, with 97% of survey respondents anticipating continuing growth in the industry, while skills and materials shortages remain one of the industry’s most significant and persistent challenges. New Zealand faces ongoing difficulties in increasing the volume of workers with technical capabilities and creating a more productive, skilled workforce.

“Of note, [the survey] highlights a continued disconnect between those involved in the respective investment and delivery sides of the infrastructure market…

“As an industry, we are continually challenged to do ‘more-for-less’. Lifting productivity in an environment of financial constraint means we need to invest in innovation and technology to achieve these competitive advantages,” said John Bridgman, AECOM Managing Director – New Zealand.”

Credit: http://www.aecom.com/co/press/aecoms-bi-annual-new-zealand-construction-market-sentiment-survey-now-available/

‘Solar city’ living

A 4,000-dwelling development planned for Canberra is being called Australia’s first mandated solar community, as there is a minimum solar energy requirement for each dwelling.

Each residence in Capital Estate Developments’ project will be required to have a solar system capable of producing enough energy to cover half the average Australian annual household consumption.

Capital Estate estimates this will reduce the carbon footprint of the entire ‘suburb’ by a third.

Many countries around the world are setting targets, introducing polices for promoting renewable energy and reducing emissions, with Australia and USA leading the front on developing these so-called ‘solar cities’. Interestingly, India is also making great progress on the issue.

Essentially, through a combination of enhancing supply from renewable energy sources in the city and utilising energy efficiency measures, this really should be a minimum requirement for city-planning for all countries developing for the future.

A great read on harnessing solar power in NZ:
“Germany, on average, gets as much sunshine as Alaska yet last summer it harnessed 80% of its electricity from solar panels. Here’s why Auckland needs to seriously consider solar as a mainstream source of energy given the city produces more carbon emissions than New York and London. ”
http://www.solarcity.co.nz/blog/new-zealand-solar-news/kiwis-can-show-the-world-how-to-run-a-city-on-solar-power/

http://www.therealestateconversation.com.au/news/2015/10/22/the-first-solar-suburb/1445511600