CBD Link & Urban Renewal

 

I recently wrote that one of the tragedies behind the Government’s refusal to approve the CBD TaniwhaLink is that it further delays much needed resurgence in needed parts of Auckland’s inner city.
The NZ Council for Infrastructure Development has released a thoughtful news release about this exact topicbut suggesting both the Council and the Government are right – but makes clear the CBD rail loop is one of the most significant investments that will shape the future development of Auckland.

Symonds St would be one area to get revitalised

 

What do you think of their argument?

Here is their release:

The recent furore over the merits of the Auckland CBD rail loop clearly illustrates the difficulties of planning major transport investments in isolation from land use planning and implementation. The CBD Loop has the potential to positively shape Auckland’s future form but it’s viability is dependent on the concurrent development of high quality, high density, mixed use residential and commercial development that will support the economics of the project.

In November last year a business case report commissioned by Auckland local government found that a CBD loop would return at least $1.10 for every dollar invested, and as much as $3.10 if ‘wider economic benefits’ were taken into consideration. Last week, a second report commissioned by the Government estimated the transport benefits of the loop were barely 30c for every dollar invested, or up to 40c including wider economic benefits.

When both parties broadly agree on the price of the project, the number of commuters using the service, the number of cars taken off the road and most other factors, how is it that the numbers are so wildly inconsistent?

The answer is in the land. In general, large transport projects raise the value of surrounding land as improved access makes living and working there more attractive. The Council, who strongly supports the project, has projected big things for surrounding land. The Government, who is more hesitant, doesn’t think the transport and land use returns stack up.

Who’s right? Well, it all depends on what actually happens to that land adjacent to stations.

The CBD loop business case is predicated on achieving a significant uplift in density, both residential and commercial along the new rail tunnel from Britomart through Albert Street, Karangahape and Newton.

However the Government’s recent review clearly shows that commitment to urban density and supporting land use does not yet justify the substantive $2.4 billion investment in the loop.

In essence both the Government and the Auckland Council are right. On the one hand Auckland Council rightly wants to optimise the contribution of rail to the overall transport solutions for Auckland and provide alternatives to traditional urban sprawl. On the other hand the Government is right to say that development of the business case and the supporting land use policies requires considerably more work by the council. Having already committed billions in electrification and rail and station upgrades the Government is wary about further investment until the benefits from existing investments are realised.

The CBD rail loop has the potential to link major land development opportunities not only in the CBD, Karangahape, and Newton but also leverage recent investment in rail infrastructure, at Newmarket and New Lynn. The former brewery site in Newmarket provides a fantastic location for intensified development adjacent to rail, the proposed CBD loop, shopping, the domain and other city amenities.

For the business case to stand up it is critical that the project is fully supported by a coherent land development plan for the corridor and the inner city. This necessarily means appropriate phasing of the development of commercial land, incentives to support development of land adjacent to the rail network such a streamlined planning approvals for developments that meet certain design standards, along with the commitment to investment in the rail system. Proactive support by the Council is central to giving the private sector confidence to invest.

But that level of commitment is not yet being demonstrated by the Council. For example, its Waterfront Development Agency is very successfully promoting the development of Wynyard Quarter. While not served by the inner city rail loop, this significant waterfront land development will compete in the same residential and commercial property market as the land adjacent to the CBD loop. Already the ASB Bank has committed to relocate its head office to Jellicoe Street in 2013, vacating considerable floor space in the existing ASB centre which is directly adjacent to the proposed new Aotea station. Given that the rail loop is designed to serve the CBD, perhaps Wynyard quarter should be put on the back burner? Alternatively, should the CBD loop also incorporate a connection to Wynyard quarter? These decisions are vital to the business cases for both the CBD rail loop and the Wynyard quarter Development.

The most recent decision to proceed with SkyCity’s proposal for a 3500-seat convention centre to be built between Hobson and Nelson Streets is a case in point. While no doubt the other proposals were meritorious, concentration of major projects like convention centres, shopping, residential and commercial density is exactly the kind of development that will be needed to support the economics of the CBD rail loop. It’s this kind of joined up infrastructure land development that drives the success of Melbourne. The integrated Southern Cross rail, bus and tram station in Spencer Street is central to major passenger generating attractions such as the 74,000 seat Etihad Stadium, a major shopping mall, the Southbank entertainment hub and the 5,560 seat Melbourne Convention and Exhibition Centre.

In comparison to Auckland, the key difference between Melbourne and similar successful cities like Vancouver is the calibre of the new high density neighbourhoods that have revitalized the downtown and offered a viable alternative to suburban living.

The CBD rail loop is one of the most significant investments that will shape the future development of Auckland. It is central to effective implementation of a more compact city as envisaged by the spatial plan.

Implemented properly it has the potential to contribute positively to the world’s most liveable city. Implemented poorly it could create a legacy that New Zealanders will regret for decades.

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6 Comments

 
  1. KarlHansen says:

    I’d agree with all that, except that I would rephrase the last sentence. It’s not between good or bad, just between okay and great.

    It is a choice between a getting a “it’s alright” and a “wow!” result. I don’t for one second believe a functional CBD tunnel would be a money-waster.

    We will never REGRET the investment – I think that statement is just thrown in there because like so many, they are a bit concerned that they might be seen as biased, when billions of investment are at stake (but our roading lobby isn’t shy about making such recommendations whole-heartedly!)

  2. Kel says:

    Excellent article. Jon, your articles are well researched, well backed up, are easy to read and are knowledgeable and interesting. They are of much better quality than TVNZ’s, which are becoming of very low quality (as if they are written by teenagers).

    Your blog is of better use sometimes. :) Thank you.

  3. James B says:

    I agree. Although I didn’t really think about it before. There really has been no plan to leverage the surrounding areas for greater value. The council has said this will happen. The government has said it will not. What the council should do is get together with property developers, business owners, government and any other interested parties and start to build plans on the best way of leveraging the stations. Then they can go to Steven Joyce et al and say we’ve got firm commitments for new development that are dependent on this tunnel. Money is what this government understands. Speak their language and they will support it.

  4. Mark says:

    I think it’s a good summary of the issues.

    I think Council is too rosy on the re-developments. But also this release, doesn’t deal with the releasing of the Britomart bottle neck. In that case redevlopment potential spreads throught out the network – eg Ellerslie / Panmure / Mt Albert.

    For the last 10 years the CBD has seen a waterfront drift. Gone are the days of ASB headquartered opposite the civic – it’s all about the water now. That and the move to large floor plate / open space offices is seeing major changes.

    The article is right to highlight that the rail loop redevelopment has an awful lot of competition.

    It will link to a convention centre – and also to existing entertainment such as Aotea centre. But no where on the route will it generate large multi storey office or residential developments. Partly because of the low rise / character nature of the areas, and also in the CBD / Hobson St, it’s already developed, or has limited commercial appeal.

    I’m note sure on route decisions, but Wynyard and up through new Rubbarb lane / type area, would possibly develop more large scale buildings, and connect to where offices are re-locating.

    On the other hand the existing route, may not drive new development, but it may stop decline in the B / C grade buildings. The recycling of uses is actually the biggest issue for the CBD. If we hadn’t had the foreign student sector, half the CBD would be tumbleweed town!

  5. Matt L says:

    Thats actually fairly positive from the NZCID who are generally pretty pro roads and sprawl. There were a few concerning comments but overall it was one of their better statements

  6. KarlHansen says:

    Mark – well, as others have said, I think it’s a fair comment that plans to leverage off the tunnel aren’t as fleshed out as can be (though note the complaints in a recent post on planning for Auckland, where people where moaning about “not another report – just do it”).

    That said, the Council has enormous amounts of things on their plate right now, what with having to create a Auckland Spatial Plan in a year (that’s where at least the generics for the intensification should go into), and then the new District Plan to follow. There will always be areas where “more study is required”. That shouldn’t paralyse us.

    Build it and they will come – without Britomart, there wouldn’t be a funky offices / restaurants / shops quarter east of the train station today. Likewise with the area around any new stations in midtown and uptown. They will develop big either way – though some guidance and mutual support to/from property owners would go a long way.

 

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