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Handle9
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  #1957017 14-Feb-2018 12:38
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I'm in the middle of delivering one of their problem projects as a sub contractor and it'd not a surprise in any way. This project has had at least 3 project teams go through it and is over a year late.

 

FCC used to be the best builder in the country to work for - they pushed you very hard but they were supportive in a way that most builders are not. In the last 4-5 years they have gone rapidly down hill. Huge numbers of very high quality staff have left due to the way they have bid and delivered projects. It's very sad.


kryptonjohn
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  #1957039 14-Feb-2018 13:12
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nickb800:

 

trig42:

 

I don't own shares (other than through Kiwisaver), but it, and last weeks US stock market 'correction' have caused a hit in my Kiwisaver funds.

 

Not any cause for panic, swings and roundabouts.

 

As for Fletcher Building - I hear from people I know in the industry (and related) that they bid for these jobs very aggressively, and for many, way under what the true costs are or will be (when you add in contingencies). Almost like they are bidding on these big jobs as 'loss leaders'. It has bitten them big time now.

 

 

Yes underbidding here to pick up follow on work at better rates is pretty common in construction. 

 

 

I think that doesn't apply to the Christchurch Justice Precinct project nor the Sky City Convention Centre project - they were the be-all and end-all in themselves.

 

 


 
 
 
 


mattwnz
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  #1957049 14-Feb-2018 13:20
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IMO there needs to be an inquiry and regulation into the whole building sector in NZ, and why we pay substantially more for materials than other countries. A case in point, I got a quote for some building materials late last year from a building supplies company/ wholesaler. I went to order them recently only to find that they had gone up about 30 percent since the quote, and we are talking 10s of thousands here in additional costs in just a few month. As there are only a few players in this material, they all appear to have put up their prices by similar amounts. They also put up their prices by a similar amount at the beginning of last year. Apparently their is so much demand for it due to the building boom, that raising prices reduces demand as people will look at alternative options. IMO that just isn't on.


Handle9
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  #1957053 14-Feb-2018 13:29
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kryptonjohn:

 

I think that doesn't apply to the Christchurch Justice Precinct project nor the Sky City Convention Centre project - they were the be-all and end-all in themselves.

 

 

There has been a fundamental shift in client behavior in large construction projects. Historically the client would engage a design team, they would tender on the design and then changes would be variation chargeable. What is happening now is that the client will engage a design team to take the project through to say 50% developed design. They will tender on this on the basis that the main contractor will then take over the design risk and complete the project on a design and construct, fixed lump sum or guaranteed maximum price (GMP) basis. They can't then claim for design elements that are missed as they are resonsible for them.

 

Buildings are also now much more complex than they used to be. I work in the technology side of the building industry and the jobs have become far more complex with much higher integration requirements.

 

With main contractors working on very very small margins (2-5% are typical for a large project) if they get the scope break up, design risk or contractor selections wrong, the risk is very high. 


MikeAqua
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  #1957096 14-Feb-2018 14:35
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You'd be pissed if you were a firm who were underbid by Fletcher's.





Mike


kryptonjohn
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  #1957101 14-Feb-2018 14:41
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Yep.

 

Or alternatively, you'd be overjoyed at dodging a bullet!

 

 


Fred99
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  #1958113 14-Feb-2018 15:58
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networkn:

 

Not sure I'd agree. It's possible, but Fletchers do have some great people.

 

 

If they do, then I don't know where they keep them.  

 

From what I've seen they have high turnover of possibly well (academically) qualified but inexperienced PMs on sites, few of whom could organise a p1ss-up in a brewery.  Add to this a lot of people in offices, making job-site rules - but having no idea at all of the consequences of enforcing things like an absolute ladder ban etc.

 

 


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