Monday 19th August 2013 1 Comment
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The central business district of New Zealand's capital has withstood two earthquakes that could have collapsed buildings in other places, letting insurers off the hook.
There are bits of damage to commercial buildings in Wellington after the magnitude 6.6 quake on Friday, says Ian Cassels, president of the Wellington branch of the New Zealand Property Council.
"I think there is some damage in buildings that are built on reclaimed land whether they are built well or not," he told BusinessDesk.
But the city wasn't badly damaged by the magnitude 6.5 shake in July and it quickly became obvious that Friday's jolt, estimated to be two-thirds of the acceleration of the July shake, has caused less damage.
"One way of looking at Friday's quake is that it has virtually said that Wellington hasn't got any earthquake-prone buildings that are likely to collapse in a moderate earthquake" Cassels said. "We have just had two more than moderate shakes, so we haven't got any earthquake-prone buildings, otherwise we would have had collapses."
Wellington's older commercial buildings are between 100 and 120 years old and a lot of work was done to them after an earthquake in 1942 of a similar size to the two just experienced.
"That sorted out quite a bit of the loose stuff. There was strengthening done," he said.
Listed property owners reported few problems on Monday.
Kiwi Income Property Trust found minor structural damage after inspections of the Majestic Centre, Unisys House and Aurora Chambers, 44 The Terrace and North City Shopping Centre.
Argosy Property reported only minor, mainly cosmetic damage to its Wellington properties, which include Stewart Dawsons Corner and 8-14 Willis Street.
DNZ Property Fund said inspections of its Wellington CBD and Johnsonville Shopping Centre properties found only superficial cosmetic damage.
Robert Jones Holdings, which owns 14 properties in the CBD, did not return calls but said on its website that its portfolio has been assessed by engineers and the results sent to lessees.
Insurance Council of New Zealand Chief Executive Tim Grafton said it will take weeks to assess the value of claims and a figure was not available yet for the cost of the July quake.
"The July figures will be low. What we do know is that there were no reports of substantial damage in Wellington city," he said.
Cassels says commercial building owners mostly have a 5 per cent excess on insurance policies so they suck up a lot of the cost of damage.
He said that when engineers assess buildings they talk about a percentage of the new building standard. They have difficulty assessing older materials and building methods and essential pretend they are new.
The percentage doesn't adequately say whether a building is likely to collapse.
"Wellington properties are really quite good," he said.
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