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GOVERNMENT ANNOUNCES CHANGES TO THE EARTHQUAKE STRENGTHENING POLICY
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This week Dr Nick Smith, the Minister for Building and Housing, announced the government’s proposals to change the timeframes for assessing and strengthening earthquake prone buildings.

This will be put forward as an amendment to the current Bill before the House.

What changed?

The proposed amendments deviate from the current one-size-fits-all assessment model to implementing a traffic light system that would divide New Zealand into three zones depending on the likelihood of an earthquake occurring (see below for a map of the zones and click here for a list of the revised timeframes for each region).

Within these zones, buildings have different requirements:

  • buildings in the high risk zone will need to be assessed within 5 years and upgraded within 15 years;
  • buildings in the medium risk zone will have to be assessed in 10 years and upgraded within 25 years;
  • buildings in the low risk zone will have 15 years to be assessed and 35 years to be upgraded.
  • A further time extension may be applied to listed heritage buildings.

Importantly, the Minister also said that older buildings under 34 % of the seismic standard will need to be strengthened earlier than the proposed timeframes where ‘significant alteration or upgrade work’ is being undertaken. He notes that this is similar to the existing Building Act that requires fire egress and disability upgrades to occur simultaneously with alterations and upgrades. This could be far-reaching, particularly the threshold for ‘significant’ works. For example, will it cover substantial fitouts being undertaken by tenants?

What it means to you

The proposal has major implications for commercial owners, landlords, tenants and insurers. Building owners will be able to spread the costs over a longer period. But upgrading to 34% in major cities will not meet tenant demand which is usually above 70%. For many owners, particularly in provincial areas, upgrading will be uneconomic. Also, not all owners will have the rights under their leases to effect the upgrades within the required timeframes.

Want to learn more about how this will impact you?

Kensington Swan has significant experience in advising owners, tenants and contractors on seismic issues and insurance implications in existing and new projects.

If you have any questions, do not hesitate to contact one of our experts: John Meads, Ish Fraser, Stuart Robertson, or Michelle Hill.

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Michelle Hill
Michelle Hill

Special Counsel

Auckland

+64 9 916 6374

Ish Fraser
Ish Fraser

Partner

Wellington

+64 4 498 0868

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