Christchurch: The £14bn development no-one wants to build

We have just passed the third anniversary of one of the largest natural disasters of modern times and no-one has really noticed.

The earthquake which rammed into the city of Christchurch, New Zealand, on 22 February 22, 2011, killed 185 people and demolished a city the size of Teesside.

Apart from the human tragedy, it is striking in economic terms because apart from the tragic loss of human life, the quake is probably one of the most commercially destructive events to occur in any Western population centre in modern times.

Three years on, the city is still not really off the starting blocks yet in terms of its commercial re-building programme, with a cost estimated to be over £14bn and a desperate shortage of skilled labour. There are seemingly no UK, European or US firms vying for work despite the obvious opportunities. The delay is proving costly and some are saying it could take New Zealand 50 to 100 years to recover unless there is a dramatic pace change.

Christchurch is hit by the perfect storm of delays in settling insurance claims, official inertia and lack of demand from many who have moved to the suburbs outside of Christchurch and re-built their lives

It has to be said however that as you weave your way between the cranes, the sound of Irish, Scottish and English accents is unmistakable, as many craftsmen and women have been attracted by New Zealand opening up its borders to construction professionals, whose skills they require desperately in the rebuilding programme. I spoke to a bricklayer from London who had been pleasantly surprised that the New Zealand government had smoothed his work visa application process making it much easier for him to travel there. He could not believe his luck having travelled to the country with virtually no knowledge of the region except that gained during his viewing of the in-flight movie of The Hobbit,which was famously shot in the country. He told me that he could imagine nowhere else on Earth where you could ski in the mountains in the morning and surf in the sea in the afternoon. And then pay for it all with some over-time in the evening.

As I walked around the parts of the city that are still accessible, my guide Jo O’Connor, a QS originally from Tunbridge Wells, now operating as an insurance assessor, explained that Christchurch is but one example of how even the wealthiest countries struggle to recover from large-scale catastrophes. Within two years of a 2004 tsunami, half the 100,000 permanent homes needed in Indonesia had been completed, and almost 700 schools had been built or repaired. But in Japan, nearly two years after the March 2011 tsunami flattened the north-east coast, few homes have been rebuilt. In human terms the developing countries have suffered unimaginable losses in terms of human casualties but the economic aftershocks may not be so pronounced.

On the ground with many folk still unable to enter the zoned off areas of the city deemed too dangerous to visit, this rebuilding programme cannot come quick enough

Jo said that Christchurch is hit by the perfect storm of delays in settling insurance claims, official inertia and lack of demand from many who have moved to the suburbs outside of Christchurch and re-built their lives with no hurry to return, mentally scarred by the events of Tuesday 22 February 2011, when the 6.3 magnitude shock struck the city at 12:51pm.

Nevertheless, Christchurch is gradually opening for business and it has a massive budget for a huge regeneration programme. The rebuilding of houses could take another two years to complete, while bigger projects such as a hospital, convention centre and performing arts centre may require six. The shipping-container mall, with bank branches, fashion shops and a two-storey cafe, has become a vibrant emblem of the city’s determination to operate with a “business as usual” mentality.

Australian engineering firms are seeing the opportunities but there are precious few UK companies that I could see vying for work although many of our much needed tradespeople have moved their families to take advantage of the booming construction jobs market.

The city’s population has declined by 13,500, or 3.6%, from the 380,000 people it had before the earthquake. Some have left by choice; others because they had nowhere left to live.

However local politicians predict a rebound as the NZ$35bn (£14bn) reconstruction programme gathers pace, powering an anticipated economic boom that they hope would draw in outside workers. On the ground with many folk still unable to enter the zoned off areas of the city deemed too dangerous to visit, this rebuilding programme cannot come quick enough.

The earthquake is the costliest natural disaster in New Zealand history. It is expected to exhaust the NZ$6bn held by the Earthquake Commission, the government insurer created after a 1931 quake that killed 256 and led private insurers to limit their coverage. In the meantime, if you fancy Middle Earth in the sun rather than Middleborough in the rain, want a pace of life that is more laid back with no shortage of tender opportunities, Christchurch could be for you.

Richard Steer is Chairman of Gleeds Worldwide