Post-quake works were a double-edged sword for local demolition companies.
Christchurch’s post-earthquake demolition boom appears over but not before companies pocketed nearly $90 million from government-managed contracts, figures reveal.
Figures from the latest financial review of the Canterbury Earthquake Recovery Authority (Cera) show it signed off 482 demolition contracts worth $89.15 million in the last four financial periods. That figure does not include private demolitions or the clearance of red-zoned residential properties.
A breakdown revealed Cera- sanctioned demolitions peaked in the 2011-12 financial year when more than half (276) of its contracts were awarded and more than $43.1 million of work was done.
One of the biggest contracts – $11.65 million – was awarded to Fletcher Construction to demolish the Hotel Grand Chancellor in Cashel St.
Southern Demolition owner Alan Edge said he prospered for a time but other companies fared worse. Some fell into liquidation as increased competition made tendering harder.
His company and a few others were the “mainstay” of demolition companies before the earthquakes but other companies, eyeing a slice of the lucrative demolition pie, set up business.
Edge cited “a big crash in the competitiveness of pricing” as the catalyst for many leaving the city or changing their operations. “Because, all of a sudden, there was not enough work to go around all these people.”
Some larger companies, which received lucrative Cera-endorsed contracts, had now taken a lot of their equipment out of the city.
Edge’s company ventured south to help clear the old Carisbrook rugby stadium in Dunedin as demolition work dried up in Christchurch. “The boom’s over, well and truly,” he said.
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