How will the medium-density proposals change Auckland’s urban landscape?

On 27 April, the New Zealand Chinese Building Industry Association (NZCBIA) joined experts from Auckland Council to hold a public webinar on the widely discussed Medium Density Residential Standards (MDRS). Experts and industry representatives explained the new medium-density rules in detail and guided participants through an online survey to gather the public’s genuine views and valuable feedback.

 

Requirements for urban intensification

In October last year, New Zealand’s Labour and National parties jointly announced the new Housing Supply Bill, aimed at increasing housing supply and addressing home affordability for ordinary people. On 19 April, the long-awaited draft planning proposals combining MDRS with the National Policy Statement on Urban Development (NPS-UD) were released for public consultation. This means medium-density housing rules will soon apply across most of Auckland, bringing changes to land zoning rules and design requirements for medium- and high-density housing.

In its draft proposals, Auckland Council said that under the government’s new planning rules, 4,000 to 5,000 homes currently within Auckland’s special character areas could be rezoned in response to the government’s medium- and high-density intensification policies. This forms part of Auckland Council’s planning to implement government requirements and encourage medium- and high-density housing developments, such as townhouses and apartments, across the city.

The draft proposes prioritising the release of high-density development potential in central Auckland, allowing developments of at least 6 storeys within a 15-minute walk of the city centre; applying high-density planning provisions within a 10-minute walk of train stations and bus stops in 10 major metropolitan centres (Newmarket, Manukau, New Lynn, Sylvia Park, Botany, Papakura, Takapuna, Henderson, Albany and Westgate); increasing density around larger town centres with good public transport access; and establishing Terrace Housing and Apartment Buildings Zones within 400 metres of larger urban centres and 200 metres of smaller town centres. The bill also requires implementation of the Medium Density Residential Standards, which allow housing of up to three storeys on most residential sites in the city.

Many people welcome higher-density development on Auckland’s limited land, describing it as the start of a new wave of public participation in shaping the city. Others point out that the new high-density zoning policies could lead to as many as 5,000 homes with heritage value being demolished and replaced. Many Auckland residents are cautious about the proposals, fearing changes to neighbourhood character and property values, and the loss of the distinctive atmosphere of older suburbs rich in history.

 

Qualifying matters for exceptions to medium- and high-density development

Where special circumstances or constraints prevent an area or property from accommodating the scale of development normally possible, the NPS-UD also allows us to limit intensification. These exceptions are known as qualifying matters. They can protect a site’s cultural, historical or ecologically significant features, or prevent development in areas exposed to natural hazards.

The government has already identified several qualifying matters that must be reflected in intensification proposals and protected, including:

 

• Matters of national importance specified in section 6 of the Resource Management Act
• Matters specified in other national policy statements
• Any matters necessary to ensure the safe and efficient operation of nationally significant infrastructure
• Public open space
• Areas subject to designations or heritage protection orders
• Matters that implement or ensure iwi participation legislation
• The requirement to provide suitable and sufficient business land for low-density uses

 

The council also considers the following to be qualifying matters:

• Special character residential areas
• Ridgeline protection areas
• Local public views
• Auckland War Memorial Museum viewshafts
• Stockade Hill viewshafts
• Character buildings in the city centre and Queen Street Valley Precinct
• Some existing city centre building form controls, such as protecting sunlight in public places and height restrictions around Aotea Square
• Areas with significant long-term infrastructure constraints

 

Members’ views: opportunities and challenges coexist

At the NZCBIA members’ forum on 28 April, members also discussed medium-density housing in depth:

 

Kanye Kang

I have been following the changes in Auckland Council’s draft proposals recently. We can see that most zoning has essentially been changed. Some land with particular characteristics is still being investigated, such as in Flat Bush and Massey, but most other areas have been changed to the Mixed Housing Urban Zone.

Another clear feature is that the council wants to make the Terrace Housing and Apartment Buildings Zone higher-density. We can see that the council wants to distinguish more clearly between the various residential zones, using more rational planning to better differentiate medium- and high-density development in the city’s core from development in its other centres.

Many people have recently asked me when the proposals will take effect. I take a relatively cautious view. The council’s current 18 August timeline covers updates to only some provisions and may relate only to implementing MDRS rules for projects of 3 homes and fewer than 3 homes. I therefore suggest that medium and large development projects weigh up the rules currently in force against those about to take effect, and avoid being too aggressive.

 

John Yan

As a planner, I prefer to interpret the draft proposals from a technical perspective. MDRS rules will soon have legal effect for projects of 3 homes or fewer, while projects of 3 homes or more currently require resource consent (RC). When an application is considered for approval, some people may object and others may support it, so changes and adjustments may be required at a hearing to meet current development provisions. As Kanye said, some rules remain very unclear, and we cannot be completely certain which provisions can be implemented immediately. Most current resource consent applications may place greater emphasis on the Auckland Unitary Plan provisions. This is much like 2016–2017, when we had to consider both old and new development rules. Some people may therefore ask me whether future developments of 3 homes or fewer will no longer need resource consent. The answer is clearly no. Normally, applications will still be needed for resource consent, building consent, engineering approval, subdivision consent, CCC and 224C documentation. The new proposals are simply intended to encourage higher-density development.

 

Frank Xu

I believe the newly released planning proposals are more than a draft: they herald a new era, the “medium-density era”. Since the COVID outbreak in 2020, medium-density property development, design, construction and sales have quietly become market favourites. When 70% of large projects were being cancelled, they even became a lifeline for the construction market. In 2021, medium density was a recurring theme throughout the year. Alongside the continual introduction of relevant policies, the figures spoke for themselves: in 2021, building consents were approved for 19000 homes in Auckland, of which 60% were medium- and high-density homes such as apartments, townhouses and retirement village units. For the first time, medium- and high-density units comprehensively outnumbered low-density construction projects typified by standalone houses.

In the future, many standalone houses in Auckland’s existing neighbourhoods will be demolished and replaced with medium-density townhouses and low-rise apartments. Auckland’s neighbourhoods will inevitably grow taller and denser. This will profoundly affect integration and development across the entire industry chain, from development management and capital operations to design, the formulation of building standards, construction contract administration and project management, through to workforce training and material supply services. Every link will inject substantial momentum into the property and construction industry.

But opportunities always come with challenges. The medium-density housing market remains in a state of “relative disorder”. Details of key building standards, such as fire protection systems and internal and external wall systems, depend on material manufacturers. Contract terms depend on the requirements of banks and industry associations, resulting in widely varying payment arrangements and many instances of unfair competition. Even the ownership system has gaps. To satisfy buyers’ strong preference for “freehold ownership”, most medium-density homes are marketed with individual fee simple titles. Unlike apartments with strata unit titles, they have no body corporate, leaving endless potential problems for future repairs and maintenance. This state of “relative disorder” poses enormous challenges for practitioners and companies. Self-discipline and continued improvement are the best responses in the current circumstances.

It must be emphasised that medium-density housing is a relatively new market, while the Chinese property and construction industry is also an emerging major force in Auckland’s market. Chinese property and construction practitioners and companies should seize the enormous opportunities brought by the medium-density era and act quickly to gain an early advantage. The association will also engage with the technical details at every stage and participate in developing the rules for each, helping the Chinese property and construction industry become a leader in Auckland’s medium-density era.