059, 060, 062 and 063 - hrg - ockham holdings - (mark todd) _ corporate _ supplementary evidence _...

8/20/2019 059, 060, 062 and 063 - Hrg - Ockham Holdings - (Mark Todd) _ Corporate _ Supplementary Evidence _ Presentation

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OckhamResidential Investment and Development


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Who are we? The Ockham Building


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The Ockham Building


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The Isaac

Images here


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Station R

Images Here


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Station R


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The Turing Building

Images here


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The Turing Building


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The Two Questions

1. How to reduce the cost of housing for those whocan afford housing?

2. How to provide housing for those for whom all housing is unaffordable?

In this presentation a will address how the PAUP canaddress the first question.

The second issue is one that the private sector or

‘market’ cannot solve alone. There is a fundamentaldisconnect between the income of low income earnersand the cost of new housing.


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Density and Amenity – Are they Correlated?

• The current poorly defined density metric – titlesper hectare with out regard to size or occupancy –is not at all correlated with amenity.

Thesis

In the suburban context retention of green spaceis the key metric and closely associated withamenity.

• If green space is retained then what is the problemwith setting three levels as the standard for almostall existing suburban environments??


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OBSERVATONS

• Auckland Council Planners Got it right before politicalinterference removed unlimited density in the mixedhousing zone.

Unrestricted Density promotes diversity andaffordability.

• Auckland 2040, ‘Community Groups’, and the AucklandCouncillors Got it wrong.

Universal Density restrictions promote unaffordability,

a monochromatic housing supply, and socioeconomicstratification of our city.

Increased site coverage rules in the mixed housingzone destroy existing amenity.


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The two BIG Issues for the Unitary Plan

1. Supply.

How does the Unitary Plan make iteconomically viable for the private sectorto bring 13,000 consents p.a. to the

table?

2. Affordability.

How does the Unitary Plan make iteconomically viable for a large portion ofthese 13,000 units to be affordable?


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Two Comments

1. Putting Capacity issues aside, the privatesector will struggle to identify 13,000economically viable opportunities under thenew Unitary plan.

2. The Single House and Mixed Housing SuburbanZones which make up 7/8 of our currentsuburban housing will not provide A SINGLEAFFORDABLE HOUSE!

(I define affordable housing as a one, two or small three bedroom home. Ihave no comment to make on the supply of social housing which I defineas the disconnect between low wages and the cost of ANY HOUSE)


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High Level Criticism of Zoning

• Over 95% of residentially zoned land has out dateddensity provisions that are mistakenly motivated bya belief that density restrictions protectneighbourhood amenity.

• These density restrictions make it an economicimpossibility to build small one, two and threebedroom units.

•The economic reality of the PAUP densityrequirements in resdential zones (1 unit per200sqm or 1 unit per 300sqm) dictate that each ofthese units will be a large, unaffordable unit.


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SIZE MATTERS

• Lot Size

• House Size

• The politically sensitive subject of Density is

greatly debated.

• The metrics of Density are widelymisunderstood.

• With affordable housing size is all that matters.(Lot size and house size are intimately linked by financial necessity)


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Common Myths about Density.

• Density means more building coverage and lessgreen space.

• Density results in loss of green space.

• Density lowers capital values

• Density means low quality construction.

• Density means structures completely out of scalewith existing buildings.

• (In fact, increased site coverage is closely correlated with a reduction in suburban amenity- and thisthreat to community amenity has slipped in the back door while everyone is focussed on DENSITY!)


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Density Actually Promotes

• A diverse housing supply.

• A larger housing supply.• Affordable housing options.

• More green space, less concrete.

• Opportunities for inter-generational living.

• Vibrant local shops and facilities.• Better public transport opportunities and

viability.

• Creates value for existing residents.

• Increased density is clearly the bestuse of the urban environment.


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Case Study A: Mt Wellington. 1:300sqm


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Metrics

Total Cost: $5.80MTotal Floor area:1920

Cost per square metre: $3020 psm

Sale Price: $3,590 psm

Profitability (cost/value): 84.1%

Land: 25%

Design and Construction: 68%

Taxes: 9%

Increase over permitted density: 40%

Green space: 40%


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The Status Quo…..


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Case Study B: Ellerslie. 1:200sqm.


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Case Study B: Ellerslie. 1:200sqm.


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Metrics

Total Cost: $3.93MTotal Floor area: 918 sqm

Cost per square metre: $4281 psm

Sale Price: $5424 psm

Profitability (cost/value): 78.9%

Land: 20%


Taxes: 10%


Green space: 50%


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Case Study C: Ellerslie. 1:100sqm.

Wilkinson Road – 10 x 2 Bedroom Units


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Metrics

Cost: $3.71MFloor area:984 sqm

Cost/sqm: $3770

Sale Price: $5,254

Profitability (cost/value): 71.8%Land: 19%


Taxes and Consenting: 10%


Green Space: 50%


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The Status Quo….

Opposite Yours for $1,060,000.


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Comparative Table

Density 1:300 1:200 1:100Increase over permitted 40% 60% 333%Size(sqm) 160 114 74Green space 40% 50% 50%Profitability (cost/value) 84% 78% 71%

Bedrooms per 1000sqm 10.3 17.5 14

Density doesn’t mean Loss of Green Space or massiveincreases to infrastructure loading.Density does mean more, smaller affordable houses

where people actually want to live.Density does mean increased financial viability andhence opens the door to improved materials andurban design.


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Benefits of Removing Density LimitsMore Housing where people actually want to Live!!!.

-300% – 500% increases in density are possible.

More Green Space!-increase from 40% to 50% because concrete drives don’t dominate developments.

Smaller Houses.-Becomes economical to produce smaller units.

Cheaper Houses.-Size is all that matters in addressing affordability.

Better UD outcomes.-communal spaces, larger boundary setbacks more articulation, better quality materials.

Profitable for the developer.-There is an incentive to provide more affordable houses.-No trouble finding 13,000 economically viable opportunities.

No increase in storm water loading for large increases in density.

Minor increases in sewer loading relative to the large increase in density.

Avoids site aggregation problems.-can be done on small lots.

Helps with capacity issues in the construction sector.- this approach allows smaller companies to get involved in high density intensification.


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Conclusion

• Ensuring 13,000 consents are lodged each year,that is the challenge and it is ECONOMIC INNATURE.

• Before all else, the PAUP planning rules mustmake is financially possible for the privatesector to provide the range of affordablehousing typologies needed across the vast

majority of existing urban environments.


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OckhamResidential Investment and Development

059, 060, 062 and 063 - hrg - ockham holdings - (mark todd) _ corporate _ supplementary evidence _...

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