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'Lego' hotels coming as developers chase cheaper, faster builds

With more than 11,000 hotel rooms planned or under construction, developers are eyeing up modular building systems to save time and money.

Colliers International's national director of hotels, Dean Humphries, said modular hotels were inevitable because traditional construction costs ranged from $300,000 to $500,000 per hotel room, depending on the level of services and amenities offered.

"It's very expensive, we're talking $5000 to $6000 per square metre to build, and that's excluding land costs.

"At Changi Airport in Singapore, the Crowne Plaza's recent extension is all containerised hotel rooms. When you go in there you can't tell; it's a beautiful hotel."

Work is already underway on the country's first modular hotel in Christchurch.

Developer Gary LePine said it would take nine to 12 months to build - less than half the time usually required for a hotel that size - and would cost considerably less.

Although reluctant to put a price on the five-storey, 3.5-star Christchurch hotel, LePine said it was 40 per cent lighter, which led to savings on the foundations.

The 88 hotel rooms manufactured in Vietnam will be delivered complete with bathrooms and fittings.

"The curtain tracks are in, the headboards, everything is all there, already wired and painted."

LePine has set up a company specialising in modular hotels and apartments - TLC Modular and Construction NZ - and expects to sign a deal for an Auckland hotel in the coming week.

He said he was also looking at other projects in Queenstown, Tekapo, Timaru and Ashburton.

EcoTech Homes, which has until now specialised in modular residential units, has nine hotels on the drawing board for possible builds in Tekapo, Wanaka, Christchurch and Queenstown.

Founder and chief executive Tony Frost said the Chinese-manufactured modules could be delivered for under $3000 per square metre, with high-end fittings, and he hoped to have the first 50-plus room hotel operational by the middle of next year.

"The factories are mind-blowing, you can't imagine the scale.

"Our focus will always be affordable housing, but the commercial sector has really woken up, driven mostly by prices per room, so large players in the hotel sector are talking to EcoTech about modules that can be stacked up as high as eight levels.

"We liken it to Lego; it's just a case of stacking one box on top another and connecting it."

Frost was involved with the eight-level Tribe hotel in Perth and said it took 20 days to put the modules in place.

EcoTech's first multi-storey unit had passed seismic testing in China up to the level of a 9.7 earthquake and Frost said a group of New Zealand construction companies was due to visit the Chinese production line next month.

Arrow International is also looking seriously at the hotel sector.

But its general manager of development and modular construction, Andrew McKenzie, said New Zealand seismic standards presented some definite challenges.

Senior staff had checked out an Australian design that could be fabricated there and brought here, but it didn't meet our structural standards.

"The Australians say 'our system will work because we deal with hurricanes and cyclones'.

"That's not the same as throwing your building up in the air and letting it drop down again, which is effectively what happened in Christchurch."

McKenzie said the company is still working on a solution and is confident we'll see more modular hotels here.

"Because hotels are generally nice and regular - typically you have a corridor down the middle and rooms off either side - so they are an absolute sitter for this."

PrefabNZ represents businesses specialising in off-site construction, and chief executive Pamela Bell said there were massive opportunities for multi-unit buildings such as hotels and student accommodation.

Most New Zealand building companies employed five staff or less, Bell said, so they could not pump out units at the rate of factories in China, but they could still specialise in the production of utility areas such as bathrooms.

"You've got something like 10 or 12 trades in each of those rooms.

"It makes a lot of sense to take that into a manufacturing facility and create 50 or 60 at once, rather than try to get the sub-contractors to cram into these spaces on site."

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