Transport & Urban Development Minister Phil Twyford called the development footprint for Drury “a break from the ad hoc way we have previously planned our towns & suburbs”, and Infrastructure NZ chief executive Paul Blair said it represented a much needed shift in the way New Zealand plans & funds urban growth.
But Mr Blair said the Government needed to go further, using the money it would make off this development to prepare more plans that would scale back house prices.
The Government’s $2.4 billion investment in roads & rail is intended to unlock growth in South Auckland and support not just the new town at Drury but further development at Paerata, Pukekohe & Karaka.
- $1.35 billion to build Mill Rd [arterial route]
- $371 million to extend the electrified rail network to Pukekohe
- $247 million for new railway stations, a park-&-ride facility, and a bus & rail interchange at Drury, and
- $423 million to improve State Highway 1 between Papakura & Drury South.
Mr Twyford said on Friday: “This is a break from the ad hoc way we have previously planned our towns & suburbs. Instead of transport infrastructure having the catch up with housing development, we are investing in the roads and rail from the outset. For the first time, we’re putting the horse before the cart.
“Drury will be a well planned community with all the jobs, facilities, retail & public spaces people want. Families who want to move there will be able to do so without needing to have a car as there will already be 2 train stations, and connecting walkways & cycleways.
“Developers are not only poised to start building homes around these transport connections, they are in discussions with the Green Building Council to adopt their Green Star community standards, which require outstanding & sustainable amenities for residents, workers & visitors.
“It would be the first time the Green Star community standards have been used in New Zealand and would make Drury an exemplar of urban development.
“A new town at Drury will need schools & social & health services, and talks to look at future amenities are already underway between government departments.
“Drury is located in the economic geographic centre of the golden triangle of Auckland, Tauranga & Hamilton. We know Auckland will expand south and that’s why we are future-proofing against congestion by building essential transport infrastructure first.
“We are laying the foundations for Drury to be a thriving future town.”
Blair says extra initiatives need to prevent wobbles
However, the Infrastructure NZ chief executive saw some wobbles along the way unless the Government took some extra initiatives to ensure land costs didn’t derail progress with housing:
“It is not yet clear whether housing in the new city will be affordable or supports Government aspirations for competitive land supply.
“The new Drury development takes some concepts from Infrastructure NZ’s October 2017 ‘Innovation City’ report on how to create a satellite city.
“The Government is integrating housing & employment via $2.4 billion in strategic transport links around Drury, which was announced in January as part of $6.8 billion in Government transport infrastructure investment.
“We applaud this new delivery partnership with local government & the private sector. The old model of permitting growth and then trying to retrofit transport & other infrastructure has resolutely failed, resulting in high infrastructure costs, constrained housing supply & poor urban outcomes.
“On the back of (Friday’s) announcements, property owners, developers & housing providers have been let off the leash and we should now see housing & development at scale and aligned with a shared vision for Auckland’s south.”
Return to Government way above its outlay
Mr Blair looked at costs of developing new suburbs, the money that would generate for the Government coffers and the initiatives the Government could take to ensure the best outcome:
“Of importance to all New Zealanders is that the $2.4 billion of Government transport investment will unlock over 40,000 homes. If these homes sold for Auckland’s median home value of around $900,000, $36 billion in residential development activity would be generated. The Government would yield $5.4 billion in gst alone – more than twice its transport investment.
“Add in commercial & other development and it’s no exaggeration to say that the Drury project is a $50 billion initiative built off just a $2.4 billion transport injection.
However, while this new approach is to be commended, it is still not clear whether it will materially shift the dial on Auckland’s housing crisis.
“Auckland does not need 40,000 $1 million homes, it needs 40,000 $500,000 homes.
“Unfortunately, land rezoning around Drury has been anticipated for many years, meaning land prices have already escalated in expectation of public investment.
“Construction of affordable housing will now be difficult, if not impossible, without public subsidy and developers will be under pressure to manage housing supply to maintain land values.
“For the Government to really get on top of housing in Auckland & other growth areas, more announcements like today’s will be required. This will generate competition in land markets, discouraging land banking & speculation, and will provide the Government with the ability to negotiate with landowners for shared benefit.
“We agree with Minister Twyford that this is a very rare New Zealand example of the infrastructure ‘cart’ coming before the housing ‘horse’. The Government should seize the chance to scale this model up dramatically to the regional level around new, co-designed spatial plans.
“Infrastructure NZ calls for most of the unspent $4 billion capital allowance to be applied in the May Budget to the fifth, unfunded limb of the Crown’s urban growth agenda, urban growth partnerships.
“Infrastructure New Zealand’s 2019 Building regions report provides a framework for how urban developments such as Drury can be incorporated into larger regional spatial plans to deliver cheaper, high quality housing but also co-designed & integrated schools, industrial areas, hospitals & transport links.
“If we can manage this in Drury, just imagine what cheaper, faster, better quality outcomes can be achieved for all New Zealanders through a regional growth partnership model.”
Government announcement, 6 March 2020: Transport investment for future Drury town
NZ Upgrade transport investments in South Auckland & timing of construction:
Upgrade package – rail
Upgrade package – Mill Rd
Upgrade package – Papakura-Drury South
Infrastructure NZ, August 2019: Building regions report
Attribution: Ministerial release, Infrastructure NZ.