Just before Easter we learnt that the City Rail Link was to be around $1 billion more expensive than previously thought thanks to higher than expected construction cost inflation, additional contingency funds, future proofing for 9-car trains and some higher non-direct costs. With Auckland Council picking up half of the cost of the project, that means they need to find an extra $500 million to cover their share.

Tomorrow the council will decide on whether they will approve that extra money and the report provided to Councillors along with a presentation they had during a workshop on Monday gives a lot more detail about it all.

The report mentions that City Rail Link undertook three pieces of work to provide assurance around the project. There are four key areas covered off in the details that are of interest. These are:

  • More details on the new costs
  • A re-assessment of the benefits
  • A review of the scope of the project
  • More detail on how the council could pay their share of the extra $1 billion

Let’s look at each of these

Costs

As we know, the expected cost has increased to $4.4 billion. When this was announced it was noted that this was the P50 cost so they are 50% confident the final cost would not exceed this. The letter to the council informing them of the higher cost a week earlier, it also includes the P90 cost – they are 90% confident the cost will be lower than this.

Let’s hope it doesn’t push higher towards the P90 number.

Re-Assessment of the Benefits

After the cost announcement, one thing I was surprised we didn’t hear more about was a questioning of the benefits of the project. This is helpfully addressed in this slide to the Councillors workshop.

The scope change to include 9-car trains which was not included in the benefits includes the Beresford Entrance at the Karangahape Station and that alone is likely to see that station become much more useful and means that this assessment remains conservative.

The report also notes that PWC considered the assessment to be conservative because the benefits of the project will continue to accrue long after the 40-year assessment period. They say that if the assessment period was extended to 60 years, the gross benefits would increase by a further 24%

In short, the project still makes sense.

A further slide shows how the project has benefits for the entire region, not just those on rail lines.

Project Scope Review

The CRL project has already been subjected to three “comprehensive value engineering reviews”, in 2013, 2014 and 2015. However, given the cost increases, this was again looked at. They say

A significant effort has been undertaken to identify the widest possible range of options to find savings, while considering the impact on operations, network resilience, safety and benefits.

Three options were considered for this – although the third one contained a number of sub-options. The station considered for removal was Karangahape.

It’s good to see all of these options were rejected. The report further says

Crown and council staff consider that these options are not practical or desirable as they would severely limit functionality, operability, rail network resilience and passenger experience. Ultimately, doing this would severely inhibit the ability to deliver the benefits of the project. These options would also be impossible to change in the future unless the network were to be shut down for an extended period. Reducing the scope would also impact on the wider transport system, and increase longer term operating and capital costs of the system. KiwiRail and AT, as major stakeholders in the Auckland rail network, do not support the reduced scoping options identified.

Funding

The council need to find an extra $500 million for their share of the additional costs. This graph shows that without any changes, it would push council over their debt limit

As they said at the time, they think through a package of initiatives they can find the extra $500 million and bring that back down below the internal ceiling. These are:

  • Interest cost savings due to lower market interest rates – saving $120 million

  • A reduction in cash holdings from improved cash management – saving $100 million
  • Re-assessment of the valuation of operating commitments which impact on council’s debt policy limits, basically a better understanding of future commitments – saving $130 million

  • Flexibility around the timing of the council’s CRL contributions, allowing them to pay some of the costs later – saving $100 million

  • Progression of the off-street parking strategy – saving $50 million

The first four all just seem like good housekeeping and we can probably assume had the CRL cost not increased, would have gone towards bringing forward other projects. The last one is perhaps the most interesting though as it involves the potential sale of some of ATs carparks. AT this stage it seems to involve AT creating an off-street parking strategy that aligns with their overall parking strategy and “support a mode shift away from singleoccupant vehicles towards public transport“.

The report says the future off-street parking requirements are expected to include:

  • a significant increase in investment in new or expanded park and ride facilities to meet more of the projected demand and support increased public transport usage.
  • releasing value from some carpark buildings in areas such as the city centre, where the provision of public transport is increasing (particularly through CRL) and where the site may have a more productive alternative use. This could be via outright sale, partnership with a developer, or a long-term concession arrangement.
  • additional investment capacity that could be used to support the additional CRL  funding commitment required.

AT say they expect to get about $100 million by 2023/24 from this of which it is assumed $50 million would go towards Park and Ride facilities. Based on recent developments, that might provide somewhere between 1000 and $2,500 carparks.

AT has four carparks in the city that will be part of this, Downtown, Civic, Victoria and Fanshawe St. As part of the strategy work they will also decide if the carprks will be sold outright, partnered with a developer or leased on a long term concession to a parking operator. If they do decide to sell, $100 million seems a very low return for the as a quick calculation based on neighbouring properties suggests the land under the Downtown carpark alone is worth close to $100 million.

I assume the council will approve the funding but with elections later this year, it also wouldn’t surprise me if we see some Councillors try to use this as an opportunity for some point scoring.

Share this

79 comments

  1. Great to see the business case benefits as well, thank you. Revealing that we have never seen this side in any media coverage.

    Similarly, I agree some councillors will be unable to resist taking another shot, especially those who see only the cost but not the future.

  2. Thanks, Matt. All very interesting. Particularly good to see the benefits.

    The better housekeeping items originally seemed a bit flakey, but they actually don’t look so bad. Just wondering about this one: “Re-assessment of the valuation of operating commitments which impact on council’s debt policy limits, basically a better understanding of future commitments – saving $130 million”… I’m assuming this isn’t related to the CRL, but to all Council operations.

    Seems quite a bit. And that they would normally understand the value of their operating commitments. And wondering if there’s a bit of creativity going on that might impact the operating commitments.

    1. Yeah that’s the one that seems the least clear. Says it’s mainly about understanding future bus costs better but I worry it could be code for not increasing services in future

  3. I am sure it will work out OK if the project does push towards the P90 costs. they will just go back to PWC and ask them to increase the benefits again and PWC will lift them again and send in a very big invoice for their services.

    1. Exactly my thoughts.
      The CRL project cost management really deserve kudos for expertise in the emergent field of cost blowout economics.
      This places NZ at the forefront having successfully managed a 20 to 25 percent blowout as a precursor to starting the main CRL construction – the station boxes and tunnels.
      Internationally, major transport projects’ cost blowouts tend to emerge well into the construction phase with 30 percent or greater of total project costs as blowout component not uncommon. A managed 20-25 percent blowout indicates NZ struggling to reach international standards.
      This lower level can be ameliorated by knowledge that we are at an extremely early stage of the cost blowout forecast graph. Progressing into the construction phase will settle unease amongst project economists as the potential for normalised blowouts become clearer.
      Advanced indicators of this have been stated by CRLL management that major difficulties can be expected in the terminal project phase of installing rails signalling and associated advanced technology.
      The 2019 90% unlikely project costing of just on 6 billion combined with the easing completion date to end 2024 is just exactly on target for early stage cost blowout predictions. Using established international standards this shows a future predictable healthy CRL blowout inclusive total cost of over $8 billion and a normalised completion timetable extended to late 2027 (50% confidence level)
      Good work CRLL et al. Potential knighthoods for all. Kudos

      1. Improving aspects of the project is not a “blowout”, that’s doing it right the first time. Which is something Auckland has had a long history of not doing, mainly because of small minded, carping, myopic people and politicians whinging about the upfront cost without considering the long term benefits. $1 billion is a months spending on National Super to put it in perspective.

  4. Great that they’d reduce carparks but absolutely hopeless that they’d spend half of that money on providing new park and ride facilities. A sure fire way to exacerbate car dependency and undermine feeder bus service provision, while making stations unsafe for the modes they claim to be prioritising.

    Gotta get that changed, Council.

    It makes a complete mockery of the work being done on sustainability at Council. And it shouts “WE HATE YOU” to the city’s children.

    1. It shouts “re-elect me” to voters who have only been told that park and rides make sense and want one in their area.

    2. Perhaps they should update their slide about the regional benefits where they draw a long bow and claim people on the North shore will benefit from CRL. They could add a line that says ‘And we are getting rid of the parking you use but thanks for all your cash’.

      1. How about “We’ll take it off your tab for that busway you had a decade before anyone else in the region got one”?

        1. North Shore paid for all the bus stations, the parking and Shakespeare Rd Extension using rates. Which is more than the previous Auckland Council paid for any of the existing railway lines.
          Perhaps in the interests of regional equity we could build the Northern Busway Loop (NBL) which would be a dedicated bus tunnel on Fanshawe, Halsey, Wellesley, Queen and Victoria Streets for the exclusive use of Northern buses. Of course you would all have to pay to electrify our buses first.
          Do that and we will be equal.

        2. It’s a good example of how the multiplicity of local authorities encouraged this kind of ridiculous parochialism. Thankfully that’s now history so forget about the “North Shore Council” and the “old Auckland City Council” and look to the future

        3. miffy – it does sound a lot when you list all the things NSCC paid for doesn’t it. When you realise that these made up less than 20 % of the total cost and the serious expense, the busway was paid for by the NZTA’s predecessors it sounds more realistic.

          You would do a good job working at PWC on the business case with that sort of selective picking of facts.

        4. The region’s previous councils paid for rail station infrastructure in exactly the same way. The Shore needs to get over itself.

        5. Don’t forget not the new Northern Corridor project underway now, I’m guessing Auckland City must be paying at least something for it, whole new Rosedale Station. Besides there will be other things I’m sure coming if they allow them that is, eg Takapuna upgrade under Panuku.

      2. Miffy, one of the benefits for the North Shore is that the CRL may enable Auckland mode share to drop from 85% making it less likely that parts of the coastal areas will wash into the ocean.

        1. How many nanometres of sea level rise do you expect CRL will prevent? I know quantifying big claims is totally out of fashion but indulge me.

        2. If your heartfelt campaigning over in London doesn’t make political headway, miffy, maybe the CRL will make public transport work for more Aucklanders, who’ll eagerly take that leap into low carbon living. Dancing with the neighbours to keep us warm in winter, quaxing to the corner dairy because it’s too far to the big bad supermarket, home made kimchi, you know. Which will be infectious, and inspire more public transport and low carbon living all around the world. We could be seeing the CRL preventing LOTS of nanometres of sea level rise. 🙂

          Otherwise, I guess, it’ll be the age of aquarius…

        3. “… home made kimchi, you know. Which will be infectious …”

          Heidi, I sure hope your home made Kimchi is NOT that kind of infectious. Heaven help us if it is.

          But I know you intended that the idea of low carbon lifestyles such as “Quaxing locally” becomes infectious.

          To that I say – Bring it on.

        4. Heidi kimchi makes me fart and methane is an even stronger greenhouse gas so things are not going to get any better soon. Sorry to be so negative.

      3. Hey, not just North Shore, don’t forget North West too.
        I’d hate to think this CRL increased cost has swallowed up the NW Light Rail money.

      4. Well said Miffy. Regional equity is far from the council’s list of priorities. When the super-city was created we basically ended up with the former Auckland City Council grabbing rates from all the neighbouring councils and spending up large on themselves.

        That’s why there has been no investment in public transport infrastructure on the North Shore for ten years, no separated bike lanes, no new transit stations, and vast tracts without frequent bus services (only 30% of the North Shore has a regular bus service, compared with over 80% for the Auckland isthmus). It’s the same situation for what seem to be regarded as second-tier citizens in the former Manukau, Waitakere and North Shore councils.

        I hope that things can change, or we might not be remaining as a single city entity for long. There’s a reason that regions like Rodney and Waiheke have tried to leave the super-city, and why no new regions have knocked on the door to come in.

        1. The North Shore has the same representation per capita than the rest of the city, you might need to question your councillors as to why so much money is supposedly being spent in the old ACC area.

          Given the ARC would have been determining the new network routes not North Shore City I don’t see what this has to do with the amalgamation.

        2. Because there are more of them. I would have thought that much was obvious. The whole super city is predicated on grabbing money from the outer bits to pay for stuff for the inner bits. As for representation, I am represented by someone from Orewa because my part of North Shore got added to Orewa for no obvious reason. There are more people in that distant town than in my bit so they elect him. It means my representative lives further from me than I live from Mission Bay. Fair representation my arse!

        3. There’s more representatives from outside the old ACC area than from within it. If money is being hoovered up by the old ACC area then all the non-ACC councillors are either useless or so patch parochial they can’t work together to solve this.

        4. “no separated bike lanes” – I can name at last one out Queens St, Northcote. Also been shared paths, T2 lanes, safety upgrades on Albany Highway. Perhaps this is not the old council area though.

        5. David B
          What possible infrastructure does the Shore need apart from light rail? Better opex for frequencies, but capex?
          Does the new Devonport ferry terminal not count?
          Wasn’t there an upgraded terminal ferry terminal for Hobsonville Point?

          You might be pleased to learn that Panuku have proposed a $3 million bus terminal for Takapuna. I struggle to comprehend that there needs to be a terminal where it should be turn up and go – like Victoria Park.

          One of the reasons that Devonport Takapuna has more on opex than capex is that the local board thinks this should be the case. It makes sense – you can’t ride a bus shelter to the city.

        6. No separated bike lanes? By my estimate the north shore got more lane kilometers per person than any other firmer council area. Albany highway and the Northcite Safe Route have huge lengths of separated tracks.

  5. A lesser known AT asset currently tied up in parking is the smaller building right next to Beresford Square, currently on monthly leases – https://at.govt.nz/driving-parking/monthly-parking-leases/beresford-sq-car-park/

    The CRL plan is for Beresford as a public plaza out to the Samoa House lane corner this sits on. Imo it will be pretty valuable space on completion as some kind of retail/hospo with street activation, if possible. Something needs to be done about the bad ped environs here.

    1. So much parking across the road and on-street, too. The way the entry/exit splays out across the footpath is terrible. On streetview, is that really a car parked in the pedestrian entrance?

      1. lol yeah that happens a lot especially for motorbikes.
        Can’t wait for the closure to through traffic, such a bad rat run, a few people speeding in the mornings putting hundreds of peds walking down Pitt st at massive risk.

        It is interesting that it is now so car-oriented but will be one of the most people-dense areas. The Hopetoun Alpha carparking will also be developed after it is finished being used by crl. The new amenity and street activation will massively shift the focus here from ‘service’ to the rest of the K to the opportunities of the place itself.
        If you’re on street view, check out the view over lightpath to wynyard and the harbour. The developments should make the most of this.

  6. Is it possible that mom and pop investors could help here? And get a return by way of fares paid through usage?

      1. So we are agreed that carparks have a very high value because they provide a high level of benefit to people.

        1. I don’t know how you got that. The car parks are actually a terrible investment the land and location on the other had a great investment.

          The only thing Heidi is saying is that AT are undervaluing the amount of money they would get from selling it.

        2. Gosh they sound like an terrible investment if people are prepared to pay a fortune for them yet they have little benefit. Maybe the Council should build more carparks and sell them to these idiots and fund the Northwest light rail.

        3. “Maybe the Council should build more carparks and sell them to these idiots and fund the Northwest light rail.”

          Why don’t they sell all the existing car parks that they already have first?
          And maybe they are already following your strategy of building car parks to sell because they are currently building one in Takapuna. Based on past experience this will deliver little (or no) value to anyone apart from the users. Best to build it and sell it and put the money into better public transport, obviously in this case Takapuna.

        4. Supercity has been a failure and should be broken up. No other regions in NZ have followed suit, I’d prefer the Shore left, it’s dpne nothing for us, like it’s done nothing for Rodney.

        5. I’d hope that anything that’s allowed to impose huge externalities on others – as carparks do – would be earning good money for the owner.

  7. Do we know if extending Platform one and five at Britomart for 9 carriage trains will be part of this project. It would be silly if it wasn’t.
    Presumably the regional trains and maybe some express and limited stop trains will berth at platforms 2 or 3 or 4 which won’t be extended. But then they will need to reverse out but I suppose the tracks are already signaled for that.
    Surely the extra platform at Otahuhu will allow for through running in both directions. The trackwork and the signalling will be getting quite complex I expect. But if we are going to run express and limited stop trains greater flexibility will be needed. Each little detail adds to cost though. So its not going to be a simple railway anymore is it. This is one of reservations I have about the CRL. Project cost escalation, completion time escalation,diverting resources away from other projects and just the sheer political confrontation involved are others.

      1. It looks like the line at new platform 3 Otahuhu is a loop with crossovers to the main up and down running lines. Interesting that CRLL say it can also be used to store broken down trains so the 1.3 km new line must have crossovers closer to north end of Otahuhu station so that broke downs don’t block normal services making way to/from platform 3. Broken then get shunted to north end of the 1.3km. It must be too onerous to send a shunter from adjacent Westfield yard to pull brokes into yard out of the way of metro services.
        I have noticed that early stage of this work is pulling up the existing line that has become buried in soil. Interesting that lifted track sections of rails on sleepers show wood sleepers in relatively good Nick. The old line actually goes right from platform 3 north to around the main junction to eastern line. I wondered why KR could just not have cleaned up and reballasted this complete several Ks of existing line instead of laying a new 1.3km section. The only new part would have been the track at the new platform and slightly south to meet main line.

        1. Here are some items from their FB page and web site about the works there :-

          “City Rail Link
          6 hrs ·

          The Ōtāhuhu improvements as part of #crl #cityraillink are underway. Over a four-day period, KiwiRail staff and contractors have excavated and tested 21 locations for new traction mast structures foundations, installed ducts under the tracks for new signal cables, replaced two sections of the existing main line ready for the track crossovers that will connect the existing line with the new section of track.

          Over the next 11 months, KiwiRail will construct a new 1.3-kilometre-long section of track alongside the main line, four new cross-overs to allow trains to switch between tracks, and new overhead line and signal equipment between Ōtāhuhu Station and Portage Road.
          The work will allow a third platform to be used at Ōtāhuhu Station for improved train services when the City Rail Link opens in 2024.”

          And further links here ;-

          https://www.cityraillink.co.nz/otahuhu-improvements

          https://www.cityraillink.co.nz/city-rail-link-otahuhu-updates

          And looking at the sleepers they have removed the only place they are good for is the local garden centre’s , and with the new concrete ones that will put inn place will possibly be better for express services ?? .

    1. Yes, I’m intrigued as to how they plan to run the limited stops services given large parts of the Southern and Eastern lines will still be double tracked.

      My reservations about the impacts of not building CRL are far greater than any reservations about building it.

      1. Passing loops at Penrose and Tamaki I suppose. They would only need to be signalled one way. Penrose will be more complex because of the branch.

        1. They would need more than passing loops. Trains can’t travel much closer than minutes apart, to allow and express to pass, the all stops service would need to be stopped for a minimum of four minutes if everything is running to schedule, longer if there are delays.

          It really needs a third main for this to work well, but for reasons unexplained the express services will stop at all four stations along the only section that will have a third main.

        2. Not necessarily many minutes apart. It depends on how you run it – The Onehunga LS is 2 mins ahead of the Southern. It’s the tailing that makes LS tricky.

          Keeping in mind that ETCS will need to be updated for the CRL, perhaps they can tighten the timing to 1 or 1.5 minutes temporal separation…

        3. I’m pretty sure it’s the physical signal spacing that has the biggest impact and I don’t believe there is a significant upgrade planned for CRL. Even if I’m wrong we are still talking of a all-stops service being held for 2-3 mins to allow an express to pass. This might be acceptable on a country line, but not a metro service.

          The Onehunga line is a perfect example of the pitfalls of running express services with only two tracks. They frequently crawl along for sections between Newmarket and Ellerslie and often end up stopping at one of the stations in between even if the doors do not open.

      2. A limited stops (LS) train from Papakura to Britomart via Panmure could save 8 minutes by skipping Sylvia Park, Glen Innes, Meadowbank, and Oraki. This assumes the following:
        -Eastern Line only running at 10 minute frequency (the LS service would provide Panmure with 5 minutes frequencies),
        -A limited stops train can save 2 minutes per station skipped,
        – 1 minute headway is acceptable (the Eastern Line train departs Otahuhu 1 minute behind the LS service, and the LS service passes through Quay Junction 1 minute behind the previous Eastern Line service.

        In this situation it would make sense for the LS service to stop at Puhinui, Papatoetoe, Middlemore, and Otahuhu, this is because Puhinui and Otahuhu are important transfer stations, and it would not be worth using the Third Main to skip 2 stations. Also, I believe that the Third Main between Otahuhu and Puhinui is primarily intended for freight rather than metro trains anyway.

        It is unlikely that a further 8 minutes could be saved on the section from Papakura to Puhinui, due to freight, and other requirements, therefore further improvements in the running time of such an LS service would be best accomplished through construction of a third main, between Papakura and Wiri. A Papakura to Wiri third main would enable an LS service to run non-stop between Papakura and Puhinui, timed to arrive at Puhinui 1 minute before the Eastern Line service to Britomart. The LS service with a third main should be about 17 minutes faster between Papakura and Britomart than the regular service, that’s a similar time saving to what the CRL achieves on the Western Line!

        1. Looking at the Wellington timetables each missed stop saves the LS services one minute.

          As far as I’m aware the 3rd main will be additional capacity to be used as needed, it will be electrified and bidirectionally signaled. It will be used as the signalers see fit, for example an Eastern line service to Manukau might use the easternmost track, while a freight leaving Metroport to Tauranga at the same time might use the middle track to save them having to cross-over twice.

          The four stations on that section will already have 12tph without the expresses, it seems crazy for the expresses to stop there but not stop at Homai and Manurewa, which would have 6tph.

          I think the express services should stop at as many outer stations and as few inner stations as possible as it gives the best benefit to those who have to travel the furthest.

        2. the express trains pretty much always catch the all stoppers and dawdle along behind, certainly in the Hutt, they are popular but in reality mixed stopping patterns are a confusing pathway killers on our double line. Reducing frequency at many stations.

        3. Hopefully the Hutt expresses will be dumped when the double line north of Trentham is finished. Up the frequency to at least 10 min peak & 15 min interpeak all stations. Run a few extras to/from Taita at the peak of the peak if necessary for capacity reasons. Make it more attractive – this is supposed to be a core part of the public transport network.

          Bit less clear on the Kapiti line while the North-South Junctions single track remains – peak expresses stop the longer distance services being filled up with Tawa passengers (which is an issue while frequency remains relatively low).

  8. I see no inclusion in the “costs” side from the increased projected value of the “left over” land after CRL completes.

    The extensive portfolio of land and buildings on the land that AT compulsorily acquired in order for CRL to be tunnelled under them or for works yards (esp. at the Mt Eden end). That was all paid for years ago now and thus the costs of doing so are fixed.

    But their value is future value, and still going up year on year. And will increase year on year further and faster once CRL opens and the true scale of the “people fountains” around the CRL stations materialises.

    Those surplus sites, once CRL is built will have a tremendous development and activation potential, yet the cost-benefit side assumes there is absolutely zero residual benefit after it is purchased for CRL use.

    As we’re mostly tunnelling under the land, not putting a motorway on top it will have most of the price we paid for it. And will of course become extremely valuable due to its proximity to the CRL stations.

    So this assumption the CRL land is all used by building CRL is complete rubbish.

    Just like the present book value of the downtown car park building is stated as $100 million.

    Yeah right.

    Maybe for some Government bean counters rule book both of these low to zero values are true.

    But in reality, the truth is quite different.

    In any case, whether it be CBD council owned car park buildings, or left over CRL sites after CRL is built, the council can and should be ensuring they move heaven and earth to unlock the full benefits from those sites, for the medium to longer term benefit of Aucklanders.

    Because doing so will ensure council controls the outcome better than some fire sale option to “keep under some debt ceiling”.
    And also will ensure and orderly and well managed exit from the car parking business occurs.

    The benefits side of the ledger for both the car park buildings and surplus CRL sites will more than cover the increased council contributions required of CRL by the time CRL opens.

    And we’d be foolish in the extreme to:
    (a) hock them off now or anytime prior to CRL opening
    (b) invest the relative pennies of money we get in providing acres of PnR
    (c) assume that private developers alone will do a better job than what a proper council managed process could achieve.
    (d) assume council has no benefits in long term ownership of these sites
    (e) panic about asset sales – the more assets we sell the lower the council debt ceiling becomes. So we need more assets not less!

    The worst possible use for the car park buildings and left over CRL land is to flog it off to private developers for a song, who then continue to use it car parks and nothing else.

    That outcome or ones like it would be judged harshly by the future as a tragic mistake, far worse than if all the scope reduction scenarios were implemented to cheapen the cost.

    So we should ensure we:
    “Don’t be that city”

    1. Totally agree. The public must keep a stake in the value uplift from those sites, not hock them off now for a pittance. Yet we keep electing short-sighted numpties.

  9. GA absolutely needs to hold AT/AC to account regarding the value released from the car parks. This should not be a fire sale and should absolutely be about gaining the maximum dollar value out of the asset over a period of say 20 years. As you say the land alone under 1 car park is worth $100m if not more.

    Yes you are opposed to parking and cars. However they will likely still remain as parking buildings just with a different owner so you need to look at what can be done with the money they generate and/or the money they release to be used for other purposes (particularly PT projects).

    My personal view is that the overall best return (while keeping in mind the need for some upfront cash release) is to retain ownership but arrange a long term lease/operate similar to Sky City which I understand has got a lot more than $100m from their carpark while retaining ownership.

  10. Yes agree with the post & other comments that those carpark values need to be properly valued and not wasted. I agree that they are so easily going to end up a political football with the elections coming up….and PLEASE no stupid park & rides or increased size of P&R anywhere except possibly the very outer areas. Make the use of the land properly & increase feeder buses to any stations instead.

    1. The target for mode share in the city is 25% by 2045. That will mean less cars in the city and therefore less demand for car parks; and assuming other car parks aren’t removed; potentially reducing demand and therefore lower returns. That is why I see a staged sale sometime soon to be useful.

      If AC is genuine about reducing mode share then the land should be sold with a caveat that it is not to be used for car parks.

      Land in Auckland is currently in high demand.
      https://www.tvnz.co.nz/one-news/new-zealand/luxury-hotel-shortage-amid-tourism-boom-spurs-move-lure-overseas-investors-nz
      You are fooling yourself if you think that the price of the CRL is not factored into current land prices. We bought into Takapuna prior to the Unitary plan being passed and already land prices had surged dramatically in anticipation of the apartment zoning. It is the same here.

      Sites like the Victoria St car park are ideal for a hotel or two, with huge land value if they were of the scale of the Metropolis. There are great views and great location. Even better people can come and go using the Aotea Station.

      Running parking buildings in this area is problematic because of Sky City. Their early bird price, $22 has put a cap on the market and they will soon have 3500 car parks, putting further downward pressure on prices. Further, they discount parking prices if you spend at SkyCity or associated restaurants. It is difficult to compete if you want to make a reasonable return and that is evident perhaps by AT having the lowest parking prices in the city.
      For me, sell the car parks, implement a parking tax on the remainder and lets have mode share in the city of 25% by 2025 with a consequently safer environment, less pollution, less emissions and more public space.

      1. How long any concessions remain between the car parking operations at SkyCity and SkyCity operations last remain to be seen.

        I am sure the buyer of the carparks leasing rights did not agree to have to subsidise SkyCity operations for 30 years. They want to sell the carparks to early bid parkers at $22+ a head, then resell it again after 6pm to Casino users for a similar amount.

        Thats why they paid the price they did. If SkyCity wanted cheap parking, they would/should have continued to operate the carparks themselves.

        SkyCity didn’t so clearly they think they don’t need cheap car parks in their future. Time will tell who is right.

        In any case, land values adjacent stations will increase – but most of that is in private hands, currently AC never see a cent of that increase outside of rates.

        Whereas the land AT owns including car park building, can be leveraged by AC to capture the substantial land value increases from owning land adjacent such stations as Mt Eden and K’Rd. [and maybe some land around Aotea].

        1. Greg N
          I hope that you are right that Sky City won’t expect cheap parking for years because full car parks will be a huge contributor to carbon emissions in the city.
          We also need to remember that there will be a 5000 capacity convention centre next door and I am sure that their model is not based around public transport.
          Mostly though I think that we come from very different perspectives. I believe that it is way more helpful for the well being of Auckland that we invest in public transport than screw the last dollar out of a sale of a car park many years into the future; a sustainable future or a few dollars?
          Also the financial aspects work against retaining a car park. Say that Victoria St is worth $100 million now and $200 million in 5 years – $100 surplus. Compare this with starting a light rail project now for $3 billion and the cost of deferring it for five years while we wait to sell the car park. If the cost appreciates by a modest 10% then Auckland is behind by $300 million. Which one makes most sense?

          I agree with you that you only sell stuff if you can obtain a better return elsewhere. I think this is one of those cases.

  11. I am wondering how much of this cost is attributable to the latest design standards and safety standards – i.e. “nice-to-haves” which would not be found on most legacy metros around the world which none-the-less are still operating fine and have done so for decades.

    What would be the cost if built to the (lesser) standards of earlier systems? I am not sure what would need to be culled out to equate this (platform screen doors spring to mind, as do tunnels wide enough for foot-access alongside the trains). How many of the legacy-systems we take for granted today would not have been built had these extra requirements had been insisted upon back in the day? How many potential metro projects today never get over the starting line or maybe never even get considered because of “specification-creep”?

    No answers expected. Just food for thought, in the light of the burden of safety standards applying only to rail and not to its chief competitor, road – which is where the transport-task will default to for every rail project not built.

  12. The area I see as needing value engineering is Mt Eden. I think that instead of building the straight through platforms, platforms should be built on the tunnel-south tracks, with running pattern simplifed to have no west-south services. The platforms could be on two levels with esculators connecting directly to give a quick, easy, dry transfer. This way only a single straight through track needs to be provided for freight.
    I think the council should be looking at getting more money from landowners adjacent to stations, both from higher land rates, and for providing direct connections to their buildings (and walk by patronage). I’d hope there is a pedestrian tunnel connecting the commercial bay tower to Britomart. I’m sure Sky City would like a door from their basement to the Aotea concourse level, and on the other side to whatever is built on the rocket bungy site.

    1. The council should also be selling leases now for retail space to be developed at concourse level, particularly at Aotea in the void that is going to be backfilled above the tunnels. As a minimum I think each station should have a dairy/convenience store. Fast food, hair dressers, electronics stores, etc, are also common in overseas stations.

    2. “I’d hope there is a pedestrian tunnel connecting the commercial bay tower to Britomart.”

      The pre-existing pedestrian tunnel was removed as part of the CRL works and as far as I know is not being replaced. Since Queen St will be pedestrians only around Commercial Bay and Britomart (and also – AFAIK – there won’t be any significant basement shopping levels at Commercial Bay apart from the mens section of H&M), I guess it isn’t really necessary anymore. I would have liked it but I can see why they have chosen not to include it.

      “…I’m sure Sky City would like a door from their basement to the Aotea concourse level…”,

      According to Matt last year (https://www.greaterauckland.org.nz/2018/08/17/crl-station-fly-through-videos/), Sky City were considering it but decided against it.

      This link would have involved having to go up several levels via the existing link in the Sky City annex between Albert and Federal St. From memory it is a bit of a zig-zag (having to go up two sets of escalators I think) and not always open and accessible to public, so I can see why Sky City may have ultimately felt it wasn’t worth their while to add a third set of escalators etc to further connect the route to the station.

      There is an escalator planned on the western side of Victoria/Albert which will take people almost as far as Federal Street which will a quicker way to get to Sky City.

      “…and on the other side to whatever is built on the rocket bungy site.”

      This one may still happen, though if it does, it will be on an angle to connect to the ramp entrance/exit that will go under Victoria (avoiding the access road at the side of Albert St and also avoiding having to add another set of gates).

  13. Going by the news on 3 tonight the Council have decided not to sell the Parking Buildings but to lease them out long term and I hope they keep AT and Punakau and their grubby fingers away from that money .

Leave a Reply

Your email address will not be published. Required fields are marked *