Author Archives: Simon Hendery

Real estate: Bay asking prices almost as high as Wellington

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A shortage of listings in the Bay has fuelled the expectations of people wanting to sell property here. They’re now asking almost as much for their homes as sellers in Wellington.

According to the latest Trade Me Property Price Index, Hawke’s Bay vendors are asking an average price of $545,100 for their properties, up a “staggering” 23.2 per cent from last year.

Across the entire country, the average asking price falling 1.4 per cent on June to $632,800. Hawke’s Bay and Nelson/Tasman were the only two regions where the average asking price went up significantly.

“The Nelson/Tasman region charged on to reach a new record asking price of $595,500, up 12.5 per cent on last year,” says Nigel Jeffries, Head of Trade Me Property.

“It was second only to Hawke’s Bay which led the way with the average asking price up a staggering 23.2 per cent to $545,100.

Mr Jeffries said Wellington also bucked the national downwards trend with the average asking price rose 0.2 per cent on June to $581,500 – meaning the gap between what vendors want in the Capital compared to Hawke’s Bay closed to only $36,400.

Meanwhile, the average asking price for an Auckland property fell 1.6 per cent in the year to July, landing at $895,500 and its lowest point in almost 12 months.

Mr Jeffries says this was the first time since September 2017 that the average asking price in Auckland had fallen below $900,000, a sign that the Auckland market was retreating.

“After the leaps and bounds the Auckland property market has become accustomed to over the last four years, we’re finally seeing prices start to ease which is great news for those on the house hunt,” he says.

“The Auckland region saw a surge of new listings come onto the market in July, up 7 per cent on last year and 42 per cent more than when the market peaked in July 2016.”

Roosters: 2 decades of brewing at the red shed

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From a business perspective, craft beer and coffee have a lot in common, says Chris Jarvis.

As the long-time owner of Hawke’s Bay’s Bay Espresso cafés and now also the proprietor of landmark Hastings brewpub Roosters, he should know.

Chris and his wife Jonelle bought the Roosters business – on the industrial fringes of Omahu Road, where it’s been brewing its own beer since 1994 – from founders Chris and Jill Harrison in early 2017.

“It’s an iconic place, it has history, it just needed some TLC,” he says.

And as he set about administering some of that TLC, he discovered the connection between running cafés and pubs.

“The brewpub business is very similar to the coffee business. You’re trying to create an environment where anybody can just come in and find a space for themselves. That’s how we’ve always tried to operate. That starts with how the place looks and feels when you walk in – your staff, how they meet and greet; your food offerings; your pricing. Like coffee, beer is a liquid, it’s an environment and you’ve got customer service, so there are a lot of synergies.”

He also sees the recent rise of craft beer as being similar to the growth of the coffee culture a decade ago.

“When we took over Karamu Rd [the original Bay Espresso café] there was one other coffee roaster in Hawke’s Bay – Hawthorne’s. No one else was roasting coffee to any degree, nor was the café scene even remotely what it is now. The pubs have gone through the same thing.”

Roosters’ beer production figures over the pub’s 24-year life tell a story about the evolution of the industry, Chris says.

“You can see a dip in production when the first change in drink-drive law occurred;

then you see the next dip when the global financial crisis came along; and then you can see another dip when the next drink-drive change was introduced. So as beer producers with a brewpub, you have to change your model because you just couldn’t survive on selling beer alone. Even excise tax 24 years ago was nothing compared to what it is now – it’s like having three extra staff members from a cost perspective.”

Since taking over, Chris has worked on making the Roosters environment more appealing to a wider base of customers and focused on introducing quality food.

“Hawke’s Bay is not big enough to say, right, I’m only going to focus on this particular market. You need a multi-functional kind of a place,” he says.

On the beer side, Chris says Roosters’ offering has always been about providing an approachable range of pure beers “made the Bavarian way – just water, malts, hops and yeast, that’s it, no additives or preservatives and nothing silly”.

Initially the range comprised a lager, a draft and a dark beer, later expanding to include Weissbier (wheat beer) and then an IPA, along with a seasonal beer (a dark one in winter and a light one in summer).

Roosters’ popular naturally brewed, ‘old school’, ginger beer has also always been a big part of the brand.

Since taking over, Chris has introduced a pilot brewing kit “giving us 100 litres to play around with”. This allows long-serving head brewer Darryl Tong, who has been with Roosters for 12 years, to experiment with new brews “which may or may not lead to becoming larger volume beers on our main taps”.

While Roosters beer has been available off- site in a limited way – the lager is on tap at Shed 2 in Ahuriri and the Common Room in Hastings generally pours the lager and IPA – Chris says he plans to start selling 330 ml bottles into local retail outlets.

As his plans to boost the Roosters brand take shape, Chris says Hawke’s Bay is well served by what he describes as an eclectic bunch of independent brewers.

“The region’s got an abundance of offerings, not just beer but also wine, food and coffee. I just think it’s awesome, considering how small the population is, it’s over-hosted; but that level of competition is exciting because you have to get your offering right and therefore customers get a really good choice of places to go, things to drink and experience.”

www.roosters.co.nz

Hawke’s Bay Brewing Co: from beer tankers to boutique bottles

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Craft beer wasn’t a big thing when Hawke’s Bay Brewing Co started out way back in 1996.

In fact, the company’s CEO Greg Forrest jokes that in those days, “craft” was probably a homebrew beer and drinkers didn’t even know how to spell the word.

It was a time when the brewing industry was all about volume production of a very limited range and style of brews.

Hawke’s Bay Brewing Co, or Hawke’s Bay Independent Brewery as it was previously known, was initially established to take on the big producers at their own game – in a small way.

The company built a new brewery in Onekawa, Napier, where it pumped out draught and lager under the Mates brand, which it distributed to pubs and clubs around the region via a small fleet of beer tankers and kegs.

“Back then you could only buy take-home beer from a wholesaler or bottle store and people would take their flagons in to be filled. That was the market when our brewery was built so that was the market we had to be in,” says Greg, who joined HBBC in 1998.

“We had to make beer styles equivalent to Tui and Speights. That was the style of the time and if we hadn’t made something in that vein we wouldn’t have stayed in business.”

Over the past 22 years the company has developed a strategy for surviving in what has been a constantly changing industry.

“We had to change our business model when supermarkets began selling beer,” Greg says.

“The whole scene changed in a short period of time. We lost a large percentage of our sales volume in the first six months after supermarkets got beer. People could pick up a variety of bottled beers from the supermarket, and we weren’t players in the packaged beer market.”

So by necessity, HBBC began to evolve. The brewery moved from Onekawa to the Ballydooley Cider brewery site on Awatoto Road, Meeanee, in late 2006 and opened The Filter Room in 2007. It also began producing bottled beverages.

“We had to be different to take on the big boys, hence the direction and investment in the bottle style – something Lion and DB weren’t doing.

“We also targeted a market they weren’t targeting: high-end restaurants and cafes.

Those establishments took on our products because it worked alongside what they were already selling – it complemented wine without affecting wine sales.”

Initially, the company feared the new strategy of packaging its products, in what people now recognise as its distinctive green bottle, may have been a disaster.

“While running The Filter Room, we had purchased 120,000 bottles and in the first month we sold one dozen. I wondered if I’d committed financial suicide. But then the craft evolution started and beer that had been $20 a dozen was suddenly selling for $60 a dozen and that helped us immensely. All of a sudden, we were in that price bracket. It made people start looking at our products more.”

The company also benefited by having a ‘cellar door’ next to the brewery. HBBC initially ran The Filter Room itself but it is now leased to an independent operator.

“Prior to moving to Meeanee we never sold direct to the public, but The Filter Room educated us about the market. Over the three years we ran it ourselves, we found out what the public were wanting, what styles were popular, what were not, and through that we developed a lot of our non-beer products that we found the public accepted.”

Like Greg, HBBC’s chief brewer Geoff Edwards had years of experience working for the major breweries before joining the Hawke’s Bay company.

HBBC is always looking for new product ideas and new formats for its existing products, which includes a range of ciders, ginger beers and sangria.

“We have recently released a new non- alcoholic sparkling apple juice and we are currently moving forward to a bigger size option from our 330 ml bottle that will fit nicely to satisfy our retail demands,” he says.

While there is always a need for innovation, don’t expect any “radical change” to HBBC’s business model, which Greg describes as solid.

“Our sales are consistent. We don’t change the world, but we want to be around for at least another 22 years to see what happens when the world does change. We’re about conservative brewing. Maybe that’s because Geoff and I, as a team, have been around a long time – we don’t operate on a whim or the latest fad.”

It’s a strategy that “comes with having a few miles on the clock” and it’s an approach that’s seen a major Hawke’s Bay brewery survive in an up-and-down industry for more than two decades.

“We are very lucky to have a team in the brewery and in sales that have been with us for a very long time and are all involved in our long-term development, from manufacturing to branding, as and when we feel a change is needed.

www.hbbc.co.nz

Bursting onto the global scene

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When disaster strikes, a growing number of air-borne emergency responders around the globe are fighting fires with helicopter fire buckets designed and built in Napier.

Fourteen years after starting a Hawke’s Bay engineering company with a $20,000 loan, Richard Lane now runs a specialist helicopter equipment business with a growing list of international customers.

“In 2004 I started off with myself and my toolbox, and I borrowed $20,000 off my auntie,” says Richard, a fitter and turner by trade.

“At that time I had three dependants, so starting a business probably wasn’t the smartest idea. I don’t know why I did it, other than that I must have had the confidence that it would work out.”

The business, Industrial Manufacturing Services, picked up work from local industries, with a focus on food processing work. Richard’s confidence proved to be well placed. In a short period of time he was able to pay back the original loan and start employing staff.

“Through hard work and long hours, including working weekends and doing jobs others didn’t want to do, we got ourselves established in the engineering business in Hawke’s Bay,” he says.

The company also gave Richard the opportunity to “start building products I’d always wanted to build”, with a focus on the helicopter industry. Progress was assisted by having a friend, Paul Greene, who owned a helicopter company and was willing to help with product testing.

“We started building products for people we knew, and people they knew. Our reputation grew and we attracted aviation clients around the country. The products were often designed by me at night and built in whatever spare time we had.”

The company exported its first Cloudburst firefighting bucket in 2007 and the following year Richard established a second business, IMS New Zealand, to focus on the international sales and marketing of the aviation products produced by Industrial Manufacturing Services.

The two companies now have a combined staff of 16 working across three workshops in Onekawa, with construction of a fourth workshop on a neighbouring site about to get underway.

On top of its Napier base, IMS also has an office in Auckland and is exporting around the world with representatives in China, Canada, the US, South America, Europe and South Africa.

Aside from its Cloudburst fire buckets, the Civil Aviation Authority-approved company’s other major product is the Ground-Effect spreading bucket, a bucket used for fertiliser spreading and grass seeding. IMS also manufactures aerial concrete skips under the Ground-Effect brand and sells a full range of related aviation products to support its buckets, including long-lines, swivels, remote hooks and specialist loading trailers.

Richard says the international reach the company has achieved is demonstrated by the fact that some of the helicopters it builds equipment for internationally have never been flown in New Zealand because they’re too big for local requirements.

IMS is currently selling about 40 fire buckets and 60 fertiliser buckets a year, along with associated equipment. Its Cloudburst customers include a number of militaries around the world.

The company’s latest growth strategy has involved sending a large shipment of its equipment to the US on consignment, enabling it to have a stronger presence with product on the ground in its largest market.

“It’s the first time we’ve invested a significant amount of money holding stock in America. For a small company it’s a huge financial commitment,” says Richard.

It’s a move intended to boost sales as IMS continues to grow its share of global markets.

“We’re doing pretty well in the marketplace. We believe that the Ground-Effect spreading bucket would be the most popular spreader in the world based on sales and technology, with the Cloudburst bucket definitely in the number-two position on sales only,” Richard says.

“That puts us behind a competitor in the fire bucket space who’s currently selling ten times what we sell, but they’ve been in the market since the 1980s and we’re cracking into that market now and starting to make some serious inroads. That competitor’s product is built in North America and we’re now selling a lot into North America so we’re offering an alternative – we’re excited.”

About 18 months ago IMS received a buyout offer from that same competitor, but after serious consideration, decided not to accept it – a decision Richard remains happy with given the company’s growth since then.

“We’re already looking back now and saying we’re possibly getting close to making their offer now every year,” he says.

www.imsheli.com

Getting our share of the Provincial Growth Fund lolly scramble

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The government has a billion dollars a year to dish out for regional development initiatives, so will this region get in on the action?

Hawke’s Bay is in line for tens, or possibly even hundreds, of millions of dollars’ worth of funding through the government’s $3 billion Provincial Growth Fund (PGF).

Local councils and other backers of several large projects aimed at stimulating economic growth in the region are hoping for multimillion-dollar contributions from the PGF. But no firm commitments have been made yet – other than $5 million to re-open the Napier–Wairoa rail link.

That’s because in most cases, the government wants to see comprehensive business plans ahead of backing the regional initiatives and the Hawke’s Bay projects that could be candidates for PGF funding are still in the process of drawing up their plans.

As part of the Labour-New Zealand First coalition agreement, the government has committed to investing $1 billion a year for the next three years into economic development initiatives aimed at lifting productivity in the provinces.

The PGF’s priorities are to: “enhance economic development opportunities, create sustainable jobs, enable Maori to reach full potential, boost social inclusion and participation, build resilient communities, and help meet New Zealand’s climate change targets”.

While all provinces (outside Auckland, Wellington and Christchurch) are eligible for funding, Hawke’s Bay is one of six ‘surge regions’ prioritised for early investment. (The other surge regions are Northland, Bay of Plenty, East Coast, Manawatu- Whanganui and the West Coast.)

The flow of PGF applications for this province is being overseen by the governance group for Matariki – Hawke’s Bay’s Regional Economic Development Strategy (REDS).

While the writing of multimillion-dollar cheques for Hawke’s Bay initiatives isn’t going to happen until detailed business cases are prepared and deals signed off by the government, the good news for the region

is the preparation of those business cases can also be funded through money from the fund.

An early recipient of business case funding is the proposed Hawke’s Bay Food Innovation Hub – a project identified by REDS as a regional priority – which in June received a $215,000 grant from the PGF.

The grant will help fund a feasibility study and business case for the project, which has the support of the Hastings District Council, Napier City Council, Hawke’s Bay Regional Council and businesses.

The councils and 13 other organisations engaged in the food, beverage and agri- tech sectors have contributed an additional $35,000 towards the study and business case.

The project also has support from other entities including Business Hawke’s Bay, Food Innovation Network (FINZ), Ministry of Business, Innovation and Employment, Central Hawke’s Bay District Council, Wairoa District Council and the University of Waikato.

If it goes ahead, the hub – expected to cost about $20 million and involve a further

application for substantive funding from the PGF – would bring together businesses and stakeholders in the food, beverage and agricultural technology sectors to collaborate and conduct research and development.

Hastings District Council’s economic development team is leading the current phase of the project, reporting to the REDS governance group. The council’s group manager, economic growth, Craig Cameron described the project as a “unique opportunity to potentially establish a food innovation hub facility that will ultimately facilitate business growth and innovation, drive investment and economic growth, and create jobs”.

The food hub is one of the council’s ‘Big Six’ focus areas for regional growth and prosperity, along with more social and affordable housing, industrial expansion, the relocation of government services to the district, residential growth, and improving rural productivity and roading.

In a recent call for government co-funding to promote the Big Six initiatives, Hastings Mayor Sandra Hazlehurst said the six broad areas of investment opportunity are all interlinked to enable rapid regional social and economic growth.

“Important in our social priorities is the increase of sustainable employment options for our community, with a focus on youth. By working closely with government, agencies and our neighbouring local authorities we can unlock and bring forward delivery on these investments in short-to-medium time frames (one to three years).”

Meanwhile, Napier City Council is also lobbying for its slice of the PGF pie. The council is working on plans for a $53 million upgrade of the National Aquarium through a partnership with Weta Workshop, Waikato University, Air New Zealand and others.

The council would contribute $102 million to the project, provided it can secure the remaining funding from other sources, and it says the government has indicated it is looking to contribute $20–25 million through the PGF.

Napier Mayor Bill Dalton said the potential to move ahead with the aquarium development and other significant regional development projects made for exciting times, but it was important that the PGF application process was managed “properly and professionally” as was happening through the oversight of the REDS governance group.

“We have our systems in place and we have some applications ready to go, but we’ll prioritise them in the governance group and they’ll go down to the government in the correct form.”

Skills shortage holds back growth

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Despite the great weather and lifestyle opportunities, Hawke’s Bay employers are struggling to fill key vacancies. What’s behind the region’s skills shortage?

It’s a problem that’s all too common across a range of Hawke’s Bay firms: business growth is being held back because companies simply can’t find the skilled staff they need to expand.

Richard Lane employs 16 people at his Napier engineering companies Industrial Manufacturing Services and IMS New Zealand.

To fill a growing order book, the businesses depend on skilled engineers, designers stainless steel fabricators and welders but Richard says his efforts to advertise for additional staff over the past two years have been fruitless.

“It’s a situation that’s definitely slowing our growth. We could add another five staff in the workshop and two in the office if we could find the right people.”

Rachel Cornwall, director of Red Consulting Group which recruits for a wide range of industries in both Hawke’s Bay and nationwide, says Richard’s predicament is common across the region, but is a reflection nationally as well.

Aside from engineering, other sectors where it is a struggle to fill Hawke’s Bay roles include medical/clinical, law and valuation. Experienced tradespeople including electricians and plumbers are also difficult to find.

The problem is not specific to Hawke’s Bay, Rachel says. A large number of candidates from other centres are keen to move to the region but with the country’s economy growing and unemployment at historically low levels, attracting and retaining skilled staff is a nationwide issue for businesses wherever they are.

“In fact, it’s even harder in the main centres. Where we might have to look at 50 candidates before we find the right one for a role in Hawke’s Bay, in Auckland our team could be dealing with 400 or 500 people before we find the right person to fill a position,” she says.

Over the past year,about half of the management and leadership appointments into Hawke’s Bay organisations Red has been involved with have been candidates from outside the region.

“Hawke’s Bay is a really appealing region for many job candidates in other centres and we’re successfully attracting people here but at the end of the day, specialised or highly skilled in- demand roles remain difficult to fill because we’re competing for talent with the rest of the country.”

And while Hawke’s Bay may have an enviable climate and lifestyle opportunities, Rachel says that doesn’t necessarily set it apart from other regions and employers need to realise that there are a range of complex factors that candidates weigh up during a job hunt.

Home-owning Aucklanders, for example, may be reluctant to move out of the city because of the capital gains they are currently enjoying on their homes, something that could be a significant factor when they weigh up the financial implications of taking a job in Hawke’s Bay.

It’s also generally difficult to get parents of teenagers to shift regions, she says, because it involves uplifting children who are settled in their current schools.

Hawke’s Bay Chamber of Commerce chief executive Wayne Walford says Hawke’s Bay engineering companies in particular are increasingly looking to bring in staff from overseas to fill their skill gaps – a reflection of the fact that the region is competing for talent not just with other parts of the country, but also internationally.

Wayne says Hawke’s Bay also has to deal with the issue that senior salaries are higher in the main centres, even if that doesn’t paint a full picture for prospective Hawke’s Bay arrivals, given their overall living costs are likely to be lower if they take up roles here.

He says a major local firm looking to recruit for a senior role recently conducted research that indicated someone on a $150,000 salary in Wellington would have more money in their pocket if they took up a $90,000 job in Hawke’s Bay.

The challenge, Wayne says, is for Hawke’s Bay to promote its “overall attractiveness” as a location with a great lifestyle, an affordable place to live with excellent schools and other facilities.

Richard from IMS says industries need to invest more in training, a belief he puts into practice: four of his 16 staff are apprentices.

“The main reason businesses don’t take on apprentices is they can’t afford to because the oversight required from senior staff slows their tradespeople down and that makes them less competitive in the market,” he says.

“If the government turned around tomorrow and said we’re putting a scheme in place that subsides apprenticeships there would be people jumping at it because wages are getting higher and higher but an apprentice is a cost on a business given they’re not fully productive compared to qualified tradespeople.”

Another local firm with a strong focus on training as a means to overcome its skill shortage issues is Unison Contracting Services which has taken on 24 trainees this year, up from its usual intake of six.

All but one of 12 apprentice line mechanics, electricians and cable jointers the company took on in March are being trained in partnership with Connexis, the Industry Training Organisation (ITO) for the Infrastructure sector.

A further 12 trainees are due to start around August.

Unison acting training manager Mike Wereta said the ITO-based training “ensures that at the end of the training programme we have newly qualified staff who are more than capable of taking their place in the field and being productive”.

Mike said the company wanted to take a pro-active approach to addressing the skills shortage in the Energy sector.

“We’ve changed the structure of our training to allow for full-time trainees. We now have three dedicated trade coaches and a purpose-built training facility to ensure our trainees gain targeted skills and knowledge.”Rachel from Red says part of the problem is that young people do not appear to be motivated to pursue certain career paths such as engineering and perhaps companies in that space with exciting growth stories need to spend more time visiting schools to promote the opportunities.

“There isn’t a magic answer but we can’t just rely on our lovely sunshine to attractive people to the region. Businesses have to be rewarding their staff fairly and offering a superior work culture in order to attract the best people,” she says.

“They also need to think about how to hold onto their staff for longer. The flip side of worrying about attracting skilled workers is thinking about why good staff are moving on. Why are you losing them? Have they gone for better money or a better work culture?”

Despite the challenges, Hawke’s Bay is still managing to attract very good people into the region.

“While certain skill sets are in short supply, there’s tonnes of potential for this region to continue growing through attracting the best people. Employers just need to ensure they pay well, and that they’re looking after their staff.”

Zeelandt Brewery – connecting the old and new

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It doesn’t get much more Kiwi than this: a brewery run out of a large steel shed just off the Napier–Taupo highway. There’s even a Kingswood ute parked outside.

But on closer inspection, there’s also a strong European vibe at Zeelandt Brewery in Eskdale.

Zeelandt is the Dutch province New Zealand is named after and founder Chris Barber says he picked it as his beer brand to signify a brewing connection between the old world and the new that dates back hundreds of years.

Chris has brewing in his blood. His great- great-grandfather,JessePrestidge,starteda brewery in Hororata near Christchurch in the late 1880s.

Chris was never a home-brewer but stepped into the industry through a job at Cornwell’s St Austell Brewery in the UK in 2004, followed by a spell at Auckland’s Hallertau Brewery, and then more time in the United Kingdom completing a diploma in brewing technology.

Chris’s family bought land in the Esk Valley in 2007, which is now home to Petane Station, the wine label run by his brother Phil, as well as the craft brewery that opened in 2012.

Zeelandt (pronounced “Zay-land”) is focused on producing “true to style” European-style beers, although that’s not all it does.

“Most of our beers have that European influence,” Chris says, “although we do have an American pale ale, Long Range Bomber, and our seasonal fresh hop pale ale, Pulling Cones.”

While Zeelandt’s brews are available at a number of Hawke’s Bay outlets and also in the main centres, Chris says one of his current priorities is to increase distribution to help grow the business.

And while craft beer enthusiasts can currently pop in and buy the beers, he also has plans to turn the Esk Valley headquarters into more of a visitor destination featuring both Zeelandt beers and Petane Station wines.

“It would be great to go down the beer garden route so we can showcase our products at the brewery and hold a few more festivals or events to highlight our seasonal beers.”

Chris believes Hawke’s Bay has developed a strong craft beer scene over the past few years and he’s confident enthusiasm for local brews will continue to grow.

“We’ve had great support over the years from Hawke’s Bay’s best restaurants and bars,” he says.

“Craft beers are continuing to chip away at the mainstream market. We’ve got a good mix of breweries in Hawke’s Bay, each doing their own thing.

“That can only help the market and hopefully it continues to inspire the region’s restaurants and bars to sell more local beers rather than just going down the mainstream channels.”

www.zeelandt.co.nz

Project a winner for business and charity

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It’s a fundraising mission with a difference: fitting out an aging 40-foot container to give it a new lease on life.

Repurposing the large, blue shipping container into a multipurpose, habitable and consented transportable building is a major task for the small team at Architecture & Interiors Ltd.

Once the months-long ‘Life Box’ project is complete, the container will be auctioned off by Bayleys Real Estate with the proceeds going to Look Good Feel Better (LGFB), a charity supporting people with cancer.

Architecture & Interiors’ managing director Melissa Burne says as well as supporting the charity, the project is an exercise in professional development for the Hawke’s Bay architectural firm and a way to build relationships with other industry professionals.

It would also help educate the public on the process involved and the true costs of completing such a container build project.

“With so many new builds and renovations on the go in Hawke’s Bay at the moment and with small living rising in popularity, we wanted to truly reflect the processes from consenting and compliance to working with many contractors and the council,” says Melissa.

“We are committed to best practice techniques and working with a shipping container has been a real eye opener for my staff and myself. It has been a fantastic team building exercise for us all.”

The company has set aside time every Friday to work on the project, which Melissa says has received incredible support from other businesses.

“A large number of suppliers and contractors have not hesitated in getting involved with us as we embark on this project.”

The team say they chose to partner with Look Good Feel Better because the effects of cancer are close to the hearts of many. LGFB Hawke’s Bay spokesperson Clare O’Higgins says the charity is excited to be involved in the project and really admires Melissa and her team for taking it on.

“As a charity we support those people going through cancer treatment to feel good about themselves again, and let’s face it, the container is getting a bit of a makeover as well, so this is a perfect fit,” Clare says.

Open days will be held at Architecture & Interiors’ Pakowhai Road base during the course of the construction to give the public opportunities to view progress on the container as the project proceeds.

Architecture & Interiors is documenting the project on a blog that can be found on the firm’s website: www.architectureandinteriors.co.nz.

Boxing clever: building a business out of a shipping container

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From coffee outlets to homes and offices, container buildings are springing up all over Hawke’s Bay. What’s driving this trend and what are the advantages of doing business out of a metal box?

It started in 2011 when Al Borrie opened ‘The Box’ – a modified shipping container transformed into a coffee outlet in Clive.

Another container café – Tamara and Pete Melville’s ‘Magnet’ – popped up on Napier’s Marine Parade in the summer of 2016/17.

Then last year Melissa and Ant Campbell opened their Red Bridge Coffee container shop just off Waimarama Road in the Tuki Tuki Valley. Its popularity prompted them to replicate the concept with a second container outlet that’s recently begun trading on Pakowhai Road, Hastings.

Meanwhile, a growing number of Bay residents are choosing to live or work out of the modified steel boxes and container suppliers and building industry professionals say they’re dealing with a growing number of inquiries from potential box-dwellers.

So, what’s the attraction from a business perspective?

Melissa Campbell says when she and Ant were initially looking to set up their Red Bridge venture, they wanted to do something with a bit more flexibility than a traditional coffee cart.

A 20-foot container offered more room, both for the layout of the kitchen and so that customers could stand and sit inside. It also meant an awning could easily be attached, expanding the available cover from the sun and rain.

Melissa says before buying the new container, she did a lot of research and due diligence, including searching Pinterest for container build design and fit-out ideas.

The resulting build wasn’t cheap compared to other options but has delivered a structure

that’s fit for purpose and is also easily relocatable, if they ever decide to move.

She says anyone thinking about undertaking a container build needs to ensure they consider all the costs involved – including aspects such as electrical supply and plumbing – to ensure a realistic budget is put together.

It’s also important to have detailed conversations with your builders to ensure they have the correct vision of what you’re looking to achieve, says Melissa.

Melissa’s advice is echoed by Brian Wynne, national sales manager for ContainerCo, a nationwide container depot operator and container hire and sales business.

Brian says ContainerCo has seen strong growth in the container modification side of its business as interest in container builds continues to grow.

He says a container can be turned into a cost-effective business building but, like Melissa, he advises anyone with a container build idea to prepare a comprehensive budget.

While the initial cost of buying a container may seem cheap, people are often surprised by the high cost of making the required modifications, he says.

If you have the trade skills necessary to do the fit-out work yourself, it can be a very cost-effective building option, Brian says.

“Whereas if you have to get people in to do the work for you, it can get expensive.”

Business people scoping out a possible container project also need to include in their budget costs such as electricity and water. Will you use generator power or mains on your site, and what will be the respective costs of either running the generator or installing an electricity supply? How much water will your business require each day, and where will you source it from?

Every council has different requirements for consenting container builds, Brian says, so it’s important to go to them with architectural drawings and as much information as possible to streamline the consenting process.

“If you have everything ready and you’ve thought about the process they’re more inclined to help you and pass it through.”

Landscape architect Willie Murphy of Pollen Workshop is into his third year working out of a 20-foot high cube container beside his Te Awanga home.

Pollen’s design philosophy is centred around the creation of simple, highly functional spaces and Willie says having an “up-cycled” repurposed shipping container as his office is “a beautiful reflection of this attitude”.

With ranchsliders running most of the length of one long side of the office, there is plenty of natural airflow to keep the office cool through the hot Hawke’s Bay summer.

Temperature control is also helped by the addition of a timber and coloursteel roof and timber slats on the outer walls to stop the metal frame of the container absorbing too much heat.

Brian says considerations around temperature control need to be top of mind with any container build because the interior of a closed, uninsulated container can hit 50 degrees in the hot sun. That said, there are various ways of cooling, insulating and achieving airflow, which need to be factored into the budget as part of the build.

Lighting is another key consideration and again there are a number of options, including installing a false ceiling with LED downlights.

“The more natural light you have the less it feels like you’re sitting in a container,” Brian says.

Melissa says when she and Ant decided to open their second Red Bridge Coffee café at Pakowhai Road, they were able to implement some design improvements as a result of what they had learned from the first container build.

That process was aided by engaging Hastings firm OTTO Engineering, which specialises in designing and manufacturing container builds.

OTTO Engineering managing director Matt Heeringa says making the most of the limited space available is a rewarding challenge when working on a container project.

“Some clients know exactly what they want while others give us very little in the way of a brief, so we have a lot of design freedom, which can be nice.”

As an engineer who has always loved working with steel and also enjoys the challenges of combining it with wood and other materials, Matt says he is excited by the current trend towards container builds, which has captured the public’s imagination.

For business owners, the novelty of a container conversion can even help attract customers, he says.

“It’s something with a different character. People are quite interested in having a look inside a container café because it’s a diversion away from what they were originally manufactured for, so it’s quite cool and interesting.”

Irongate Industrial Zone – Opening the gate to development

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Irongate, south of Hastings, has long been earmarked as a “dry industries” hub and as the regional economy continues to boom, that vision is finally being realised.

Head south out of Hastings along Maraekakaho Road and just outside the city limits you hit a busy industrial patchwork of large and small businesses – some old, some new – sprinkled between large tracts of bare land.

This is Irongate, a ‘dry industries’ zone envisaged by Hastings District Council as a magnet for new businesses as the region’s economy booms.

And while much of the zone remains undeveloped, the council’s vision is beginning to be realised, with several new companies spending millions on new facilities at Irongate over the past few years.

One of the most visually impressive new buildings is the Sunfruit Group packhouse and coolstore, a 12,000 sqm building on the SH 50A-side of the zone. It’s hard to miss it as you drive along the southern section of the expressway.

Sunfruit Group, which has growing and packing interest in Hawke’s Bay and the Waikato, built the new packhouse to enable the company’s expansion as pipfruit exports go through a period of strong growth.

The company told media last year the new facility would generate 50 new jobs and more could be added with future expansions.

It moved into the new property in time to begin processing this year’s crop.

Other fruit growers have their eyes on Irongate, including the Rockit Apple brand. In April the company was granted resource consent by the district council to build a substantial coolstore and packhouse facility on an 8.5-hectare property on Irongate Road East.

According to the company’s consent application, the development will include a 25,100 sqm industrial building and the site will also be Rockit Apple’s national and global headquarters.

The office facilities will be designed to house up to 50 staff, a number the company expects to be employing by 2023.

The packing and processing side of the business will employ up to 340 seasonal staff working over two shifts at peak times.

With hundreds of staff now employed at well over a dozen businesses in Irongate – and hundreds more set to flock to the area under planned new developments such as Apollo’s – the zone is clearly demonstrating its potential as a driver of economic growth for the Hastings district and the wider Hawke’s Bay region.

Hastings District Council Group Manager economic development and organisation improvement Craig Cameron says the overall vision for the 118-hectare Irongate Industrial Zone is to provide a suitable zone for ‘dry’ industries requiring a large land area and from small to large building areas. The required average lot size is one hectare, with a minimum of 5,000 sqm.

“Example industries include cold storage, logistics, processing, warehousing and distribution,” Craig says.

“The driver is to respond to increasing demand from industry, particularly those supporting our booming horticulture industry. Encouraging industrial development aids in council’s stated aim of growing sustainable jobs in the region.”

But the development has been slow and controversial, with landowners fighting a 15-year battle with the council over the level of development contributions that are appropriate to get water, wastewater and roading services built in the zone.

“I would say that Hastings missed out on at least 12 years of economic development potential due to the inaction and a lack of understandingofthebusinessopportunities it was losing,” says Irongate landowner John Roil.

“Council will say this was due to the economic downturn and the global financial crisis but if you ask any person that was involved with Council from the immediate area, they will advise you that the main reason was due to the development contribution policy,” and a lack of engagement with the stakeholders,” says John, himself a former Hastings district councillor.

“As an example of the development contributions as they were in 2015, to construct a 5,000 sqm shed would have set you back $540,000 per one-hectare site and you would be required to install sacrificial services if you wanted to develop before the council provided these services.”

“It took an Environmental Court case plus meetings with the affected landowners to provide the catalyst for council to change their view and as a consequence, a variation to the District Plan was signed off in February this year,” John says.

The development contributions (DCs), equivalent to $54 per square metre under the 2015 figures, have now been reduced to a proposed $8.57 per square metre under the council’s draft long-term plan.

Asked about the significance of reducing the DCs, Craig says the council was only able to recover costs with regard to development contributions.

“A number of elements have come together at Irongate to enable council to lower the DCs from the initial estimates. Those include developers paying early in the life of the project thereby lowering interest costs; the increased size of the zone, which spreads the cost over a wider area; the removal of storm water from the infrastructure after input from landowners; and bringing the infrastructure installation in under budget,” he says.

“The importance of bringing the DCs down is to fulfil council’s obligation to only cover costs and, of course, it makes development cheaper, thereby encouraging projects to go ahead,” he says.

Council has also appointed a key account manager to Irongate in Jennifer Bainbridge with the goal to streamline the council service delivery.

Improvements to the zone’s roading infrastructure include the rebuilding of Irongate Road West and the installation of a roundabout at the Maraekakaho Road and Irongate Road intersection. Those projects are expected to be completed during the 2018/19 financial year.

Meanwhile, one Irongate-based business enjoying the location and experiencing growth is Waipak NZ Ltd.

In May last year veteran plastic manufacturers Polymer Systems International Ltd stepped in to buy the assets and save the job losses of 20 or more Waipak staff.

General manager Dan Crawshaw says since then, they have made significant investments in overdue plant maintenance, and new plant and quality testing equipment at Waipak’s Maraekakaho Road premises, and “the team and the business are humming”.

Waipak has the capability to manufacture a wide range of injection and blow-moulded products such as bottles, food packaging, caps and closures.

Dan admits plastic bottles and closures were not part of Polymer’s business plan until they learned of the opportunity to purchase the Waipak assets.

“It was probably our passion to keep business in the Bay and provide jobs and fresh employment opportunities along with a fresh challenge that spurred us into action,” he says.

“We’ve expanded our production capacity massively since taking over to meet demand and position ourselves better for future growth.”

Dan says there are many advantages in doing business from Hawke’s Bay including easy access to Napier Port, competitive backload rates with carriers, and a strong base of automation and technical processing skills.

“Costs are generally lower than they are in major centres. Polymer Systems has thrived in this central location, and we’re pleased to report that Waipak NZ Ltd is headed in the same direction.”

It’s a sentiment that others will be hoping to echo as the Irongate industrial community continues to grow.