Hawke’s Bay is typically defined by its climate and landscape. Primary industry is clearly our region’s principal economic sector, and rightly so. We produce worldclass food and wine. It’s in our DNA.
Hawke’s Bay’s strong agrarian sector and abundant natural resources have dictated the economic performance of the region. However, the conundrum here is this also perpetuates a limited labour market and a low wage and low skill economy.
While there is no panacea for regional prosperity, part of our economic development model should seek to support and develop our ability to export professional services – our brainpower – to other regions, cities and countries.
Hawke’s Bay can be proud of a strong professional services sector, essentially built off our strong rural hinterland, but extending beyond. This sector ranges from architecture, engineering and construction firms to designers and marketing/advertising mavens to digital entrepreneurs. While we will always be reliant upon our primary sector, it is advantageous that we look to our highly-skilled services sector to generate better long-term growth opportunities and create a regional economic hub in Hawke’s Bay.
Some urgency is called for.
New Zealand is at a crossroads.
The growth in Auckland is massive, and this is set to continue. Furthermore the growth in Hamilton and Tauranga will galvanise their status as the ‘Golden Triangle’. Within the next decade these three centres will account for roughly 50% of New Zealand’s population.
Surely our proximity, comparatively cheap land and lifestyle appeal can be exploited to see us grow?
Let’s not complain about the two speed economy in New Zealand – let’s exploit it. Let us focus on the larger domestic markets and build ‘Brand Hawke’s Bay’ to mean more than quality fruit, veg, meat and sunshine. Let it mean quality, talented and intelligent people working in specialist areas. Let it mean a creative, knowledge-based economic resurgence. Let Hawke’s Bay’s iconic brand grow up.
The knowledge wave
Fifteen or so years ago, Helen Clark and her government placed significant emphasis on ‘a knowledge-based economy’. In 2001 Prime Minister Clark spoke about New Zealand ‘catching the knowledge wave’.
While the structure of the national economy has changed since then, and while New Zealand as a whole was not as affected as other OECD countries by the GFC, there is still much to be gained from rethinking and implementing knowledge-based economic development.
The sector I know best – architecture, engineering and construction (AEC) – is a dynamic one that demonstrates how we can be experts and leaders contributing to national and indeed international projects while based in Hawke’s Bay.
To give some background, Paris Magdalinos Architects (PMA), while domiciled in Napier is focused on New Zealand. We are one of a number of firms who have not added to the region’s brain drain, but who have grown, developed and prospered based upon the above model.
In 1989 Paris Magdalinos Architects Ltd was formed. For most of our history 80% of the company’s work has been outside of Hawke’s Bay. We have undertaken work nationally and internationally, and brought that back to Hawke’s Bay to employ highly skilled professional staff.
Today, our company employs over 20 staff, plus a number of external contractors. We are also a founding member of Designgroup New Zealand – an association of architectural firms which also works collectively and employs 170 staff. All technical staff have a minimum bachelors degree or equivalent industry registration and accreditation. Furthermore, all staff employed since 2008 have university degrees.
In 2007 our firm went through some significant structural changes. Through the work of our founder Paris, we had a national profile and a significant amount of national work. Our challenge was to implement a structure and succession plan which would allow us to continue to grow and develop over the coming decade, rather than stagnate within the local marketplace. Accordingly we sought to instil a more robust governance structure and to further develop our national networks.
When Paris passed away unexpectedly in 2008, we kept pushing forward, taking on projects internationally and nationally while focusing and developing our staff base in Hawke’s Bay. We are now seeing significant activity in all other regions, particularly in the main city centres and predominantly in Auckland.
PMA have office space in Auckland, Wellington and Queenstown. Our association with Designgroup has allowed us to compete and win commissions in these cities.
Currently we are working on key pieces of our national social infrastructure including the new Mangere Refugee Resettlement Centre, the Wellington International Airport new control tower and a host of multi-unit residential and significant commercial/retail work in Auckland, Christchurch and several large hotel and accommodation projects in Queenstown.
More AEC exporters
Other companies in the AEC sector are driving their growth through the larger domestic marketplace. Many of these are looking to establish satellite offices in Auckland and elsewhere.
The local engineering profession has a number of robust firms operating nationally.
Structural Concepts based in Napier has seen significant growth, practically since the Canterbury Earthquakes. Their company services the majority of their work from Hawke’s Bay, and also has an office in Christchurch.
Lead by engineering director Garry Newton and general manager Wayne Baird, Structural Concepts market profile sees a staggering 90% of their work outside of the Region.
Similarly, Hastings-based Strata Group have also grown significantly over the past decade.
Strata Group was established in 2008, when directors Guy Lethbridge & Russell Nettlingham merged their engineering practices (founded in Hawke’s Bay in the early 90s). The firm has expanded with the purchase of a local consultancy in Christchurch, and today employs around 25 staff in two offices and four locations across NZ.
In a unique response to their growing practice Strata Group and the accountancy practice Moore Stephens Markhams are investing in a new professional services hub in the former Bay Ford premises in Hastings. This commercial office development has been designed around these two primary tenants but has been designed to appeal and to draw together related disciplines and practices and to create their own knowledge hub in Hastings.
The construction sector in Hawke’s Bay also punches above its weight. In fact we at PMA rate the main contractors in Hawke’s Bay alongside the larger national construction companies.
Alexander Construction led by managing director Mark Hamilton has embraced the changing construction marketplace and recently purchased Amtec Hawke’s Bay & Taupo, as well as establishing a commercial firm in Palmerston North out of the ashes of the Mainzeal collapse.
For much of its history Gemco Group has had established work primarily in Wellington where they are a market leader in aged care construction.
Similarly Mackersey Construction has never seen its Hawke’s Bay base as an impediment to winning key national projects. Their experience in the Corrections sector has seen them work on some of New Zealand’s most innovative prison projects.
Atkin Construction and Stead Construction also continue the trend of well-managed firms able to compete and win projects outside of the region and staff them, support them, and manage them, from their Hawke’s Bay offices.
Redsteel, the large structural steel fabricators led by Bob Hawley also work on key national projects, including ‘The Cloud’ on Auckland’s waterfront.
Also excelling on the national stage is Your Solutions led by Adam Satherley and Troy Morgan, a firm specialising in shop fitting, joinery and construction. Their enviable client list includes national contracts with Burger Fuel, Big Save, Jetts Gyms and Starbucks Coffee.
These examples alone indicate a strong non-primary industry exporting sector.
But it is not just the AEC sector where we have companies that prove Hawke’s Bay brains are as good as any.
In the property sector, the Tremains Group has decades of credibility as a national brand. The Tremain family have grown this business to be a leader in the property sector and a significant employer locally.
Moreover Cam Ward, shareholder in Tremain Group and managing director of Colliers Hawke’s Bay, is a wonderful example of a regional player succeeding on the national stage. Cam has been the highest grossing Colliers Commercial agent nationally since 2012, selling circa $100M of commercial property per annum – a staggering number given the size of individual transactions in the larger city centres.
Other ‘brainwork’ companies that excel beyond Hawke’s Bay include the Giblin Group and Mogul.
Giblin Group provides central and local governments – as well as iwi, hapū and whānau – the specialist skills they need in order for them to deliver to their communities. Giblin Group secures millions of dollars for infrastructure; undertakes strategic planning, policy development and analysis; and assists with Māori development. Although based in Hastings, with an office in Wellington, 90% of their work is done outside of Hawke’s Bay.
Mogul, the web development firm operated by Matt and George Miller, does more business outside the region than within Hawke’s Bay – 39% of their client revenue comes from elsewhere in New Zealand, and 26% from overseas. And Sportsground.co.nz, managed fromHavelock North, supports the online presence of 40% of all sports clubs and organisations in New Zealand.
Our creative sector also deserves mention. This includes many of our prominent artists, including Martin Popplewell, whose national profile sees many of his commissions exported nationally and internationally.
Jacob Scott is another wonderful example of a creative exporter. Recently he completed working on the significant Australia War Memorial in Wellington and is working in Indonesia as the principal design consultant for a resort in Bali.
Film and video production company Indelible is also seeking to broaden their reach with Dan Brown establishing an office in Auckland and servicing the work out of Hawke’s Bay.
And of course lighting and furniture designer David Trubridge enjoys a stellar global reach and reputation.
In short, Hawke’s Bay can and must connect with the rest of NZ to sell its ‘brainpower’, to sell knowledge.
Even our largest tertiary provider EIT has an Auckland campus. EIT is one of the leading tertiary providers in NZ and their expansion into Auckland offers opportunity back to the region as it enables better prospects for skills, training and the attraction of skilled labour.
These are just a few examples that illustrate the potential of Hawke’s Bay’s brainpower at work. I believe we must utilise our proximity to national and international markets, our unique environment and corresponding lifestyle options to attract, retain and export professional services.
How can we expand and accelerate the success of Hawke’s Bay’s brainwork sector?
Rather than writing about what is wrong with Hawke’s Bay – we must focus on what is right.
We need to celebrate success and look to attract and foster those that are able to add highly skilled, high-paying jobs and prospects for those in Hawke’s Bay.
Our services sector must begin to work collaboratively. Rather than competing for a share of the work within Hawke’s Bay, related disciplines and companies would gain more by working together to win work outside of the region, bringing the economic benefit back to the Bay and sharing in success.
Our economic development agencies (councils and Business Hawke’s Bay) require a deliberate and coordinated strategy to help grow our services sector, attract and retain human capital, and export our services.
We have utilised our port well to export our primary produce, now we need to leverage our connectivity, ITC networks and skilled services sector to sell nationally and internationally.
We need to plant our flag more visibly and emphatically in Auckland. While it has been magnificent to launch a regional business hub in Ahuriri, why not set up a shared Hawke’s Bay office in Auckland? A base from where our companies can attract clients and service our largest domestic marketplace?
As a region we need to focus not just on our products, but our people.
We need to help our people bring work to the Bay. Let brand Hawke’s Bay mean an accessible, and naturally beautiful region – world class not just in food and wine, but in people, intelligent output and creativity.