COST AND TIMELINE
The City Rail Link is due for completion in late 2024.
Aucklanders will have new world-class stations and a modern rail service that benefits the entire transport network for decades to come.
In April 2019, City Rail Link Ltd (CRL Ltd) announced a revised cost envelope for completing the entire Auckland City Rail Link project totalling $4.419 billion.
CRL Ltd’s Chief Executive, Dr Sean Sweeney, said in a statement at the time that after a rigorous and comprehensive review of project costs, a revised cost envelope has been submitted to the project’s sponsors – the Crown and Auckland Council - for approval.
“The $1 billion cost increase on the previous $3.4 billion estimate made in 2014 reflects significant changes impacting the project in the past five years,” says Dr Sweeney.
“No-one could have foreseen the competitive pressures that have occurred in the construction industry over the past few years and the impact that has on costs, particularly for a project the scale and complexity of the City Rail Link.”
“Eighteen months ago, the value of work in the infrastructure pipeline on both sides of the Tasman was $80 billion – the value of that work is now estimated at $230 billion.”
“Last year, a decision was made to increase the scope of the project to accommodate longer, nine-car trains at stations. Planning today for a city that will be much bigger in the future reinforces the benefits the City Rail Link City will deliver to the way people travel, work and live in Auckland.”
Other factors contributing to the revised cost envelope are higher escalation, or construction inflation costs, and an increase in the contingency risk allowance for any future unplanned events.
“Put together, they have all helped add costs to the project overall. Keeping a growing city moving is a serious challenge, but when we complete the City Rail Link it will double the number of Aucklanders within 30 minutes travel of the CBD.”
Dr Sweeney says CRL Ltd’s own cost review underwent a rigorous examination by two international assessors to ensure the project delivers the best value for money for Aucklanders.
The revised cost has since been endorsed by the project’s sponsors (the Crown and Auckland Council).
The revised cost envelope reflected higher costs in four key areas:
Contingency and escalation costs ($310 million)
Construction costs ($327 million)
Accommodating longer, nine-car trains ($250 million)
Non-direct cost ($152 million)
The cost of the City Rail Link project was previously estimated in 2014 and there has been significant change since that time.
The construction climate has experienced a significant increase in demand. Less than two years ago, the infrastructure pipeline in Australasia valued approximately $80 billion, whereas it is now valued at approximately $230 billion.
This is particularly evident in Auckland, where there are currently 98 cranes in the city – more than any city in the USA.
This kind of climate has significant impact on constructor availability and appetite for projects and risk as well as things like escalation.
In 2014 the project assumed an escalation of two percent. New Zealand is now experiencing escalation of more than six percent and will do so for the foreseeable future.
Allocation for contingency on the project was underestimated when the project was last estimated in 2014, an independent audit concluded that contingency on the City Rail Link project was below international benchmarking.
Changing the scope and future proofing the project to allow for Auckland’s growth and projected increase in passengers numbers, together with the establishment of City Rail Link Ltd as a Crown Entity, also contributed to the revised cost envelope.
Stations at Mt Eden, Karangahape Road and Aotea in the central CBD are being designed for longer, nine-car trains to allow up to 54,000 people to move in and out of Auckland’s CBD during the rush hours – the equivalent capacity of three Auckland Harbour Bridges or 16 extra traffic lanes. The original scope allowed for 36,000 people at peak times.
Creation of CRL Ltd – with the Crown and Auckland Council as the project’s sponsors – incurred set-up costs not included in the 2014 estimate.
A single Alliance is delivering the stations and tunnels.
After an exhaustive competitive tender process, the Link Alliance (Vinci Construction Grands Projets S.A.S,, Downer NZ Ltd, Soletanche Bachy International NZ Limited, WSP Opus (NZ) Limited, AECOM New Zealand Limited and Tonkin + Taylor Limited) was the successful bidder for the C3 contract – the project’s largest package of work.
In April 2015, two Joint Venture Design and Construction contracts were awarded to provide early input into the CRL design for two ‘early works’ or ‘enabling works’ packages to be undertaken in the Downtown area.
Contract 1: Downer NZ and Soletanche Bachy (DSBJV) were chosen to progress the CRL work through and under Britomart Station and Queen Street to the site of the former Downtown Shopping Centre site, now the Precinct Properties Commercial Bay development. Construction commenced in July 2016.
Contract 2: Connectus (McConnell Dowell and Downer JV) were chosen to construct the cut and cover tunnels under and along Albert St from Customs Street to Wyndham Street.
Contract 6: A contract for stormwater diversion works in Mt Eden was awarded to the March Bessac Joint Venture. This was for the construction of a new underground stormwater tunnel between Water and Nikau Streets to replace an existing adjacent pipe that would be in the way of the CRL tunnels.