Tauranga City Council has decided to abandon completion of the troubled Harington Street Transport Hub carpark building and will take action to recover as much of the cost of the project as possible.
Speaking after a public-excluded Council meeting today to consider the future of the building, Mayor Tenby Powell said independent expert advice indicated that the cost of addressing the structure’s seismic resistance design deficiencies would be prohibitive.
“As unpalatable as it is to abandon a project which has already cost $19 million, our expert advice makes it clear that the completion options available to us would simply be sending good money after bad.”
He said the cost of strengthening and completing the building would be significant, particularly when compared to the original $29 million budget approved by the Council in 2017. “That would mean that even under the most favourable conditions, we would end up with an ‘asset’ which ratepayers and people paying parking fees would have to subsidise for years to come.”
Council Infrastructure General Manager Nic Johansson said there would now be a pause to allow potential future uses of the Harington Street site to be evaluated.
“The existing structure cannot be used for purposes other than carparking, because of its sloping floors, but the basement and site could possibly contribute to a future development prospect.”
He said it would be some time before the net cost to the community would become clear, because that would depend on the outcomes of potential cost recovery processes and the future use of the site.
Mr Johansson stressed that when it made the decision to undertake the project in 2017, the council was fully entitled to rely upon the professional expertise of the building designer and the design peer reviewer and could not have foreseen the design deficiency issues which have arisen.
The intent of the 550-carpark transport hub was to support city centre development and commercial viability and address an expected reduction in parking capacity (of approximately 600 carparks) resulting from expected city centre developments. Construction of the transport hub commenced in June 2018. In May 2019, the council was informed of a technical construction problem and in July, that there was a potential issue relating to the structure’s seismic design strength. Work on the site was suspended in September last year while an engineering design review was undertaken. As a result of that review, it was confirmed that the structure design did not meet the required standard of seismic resistance; and that structure and foundation strengthening would be required.
“The estimated costs and financial outcomes of all of the completion options indicate that there is no economically feasible way of remedying the structural design flaws of the building,” Mr Johansson concluded. “Financial analysis is also very clear that the most prudent course, and the best way to limit losses for ratepayers, is to abandon completion of the building and take action to protect the interests of the community. We now have Council elected member support to get on with that job.”
In deciding not to complete the transport hub, the council has had to consider issues around future parking demand. Uncertainties about the impact on of new working practices adopted during the COVID-19 crisis, together with an anticipated shift in demand arising from the use of alternative transport modes, may have delayed the need for new parking capacity for some years. If demand does return to pre-COVID levels and city centre developments which reduce existing parking capacity do proceed, the council will take action to balance demand and supply.
Council unanimously adopted the recommendations before it and agreed to make the resolutions and meeting outcomes public. Expert reports and the report to Council will remain confidential for commercial sensitivity and legal privilege reasons.
Learn more about the background of this project here.