Crane activity slows in Christchurch, hits record high in Wellington, RLB Index shows

Construction activity is slowing in Christchurch, Dunedin and Hamilton and picking up in Wellington, Auckland and Queenstown, based on the RLB Crane Index, which measures the construction industry's workload in key New Zealand cities by counting the number of cranes.

The bi-annual index fell to 162 in the fourth quarter of 2017 from 174 in the previous report in the second quarter of 2017, Rider Levett Bucknall said in the eighth edition of the index started in 2014.

The decline in crane activity is the first since the second quarter of 2015, RLB said. The total number of cranes counted in city skylines across the country fell to 123 in the fourth quarter from 132 in the second quarter, with the biggest decline in Christchurch where crane numbers dropped to 17 from 25 as 18 cranes were removed from projects and 10 cranes added for new developments. RLB noted rebuilding activity in Christchurch was slowing following the 2010 and 2011 earthquakes.

"The recent removal of cranes assisting key projects in Christchurch have contributed largely to the drop in cranes around the country," RLB said in the crane index report. "It is now over six years since the earthquakes hit Christchurch. Cranes have been removed from a number of significant rebuilding projects, which has caused the index fall to 55, the lowest index value since the index commenced."

Other key cities to record a decline include Hamilton, where the index fell to 43 from 114, and Dunedin, which fell to 200 from 300.

Bucking the trend, Auckland's crane index rose to 281 from 277. The number of cranes in Auckland increased to 73 from 72 as 24 cranes were removed and 25 added. Auckland accounts for almost 60% of the nation's cranes.

RLB noted residential cranes increasingly dominate the skyline of the country's largest city, with almost 70% of all cranes assisting to reduce the supply gap in residential housing. The number of residential cranes in Auckland increased to 50 from 43, while the number of commercial cranes dropped to 10 from 13.

"In Auckland, we continue to see strong economic growth driven by high inward migration and increasing tourist numbers, along with solid housing activity, manufacturing and consumer spending," said RLB director Chris Haines. "Current demand is continuing to put pressure on the current supply and the viability of some projects remains under pressure. Given this already busy sector, it will be interesting to understand where the finance, capacity and supply chain growth will come from to achieve the 10,000 homes a year the new coalition government has promised."

In Wellington, the crane index hit a high of 217 from 167 at its previous reading. A total of 13 cranes are now spread across the capital city, up from 10 at the previous reading, after two new cranes were added for residential projects and one added for an education site.

Meanwhile, in Queenstown, construction activity has seen consistent growth, with the index rising to 275 from 250 as an additional crane was added taking the total to 11.

Total crane numbers remained unchanged at four in Tauranga.

(BusinessDesk)