The Rise of Engineered Timber in New Zealand

Engineered timber products, such as cross-laminated timber (CLT), laminated veneer lumber (LVL), and glulam, have gained significant traction in commercial construction due to their structural efficiency, sustainability, and aesthetic appeal. CLT, in particular, is revolutionising how buildings are designed and constructed. It is made by bonding layers of timber together at right angles, creating a highly stable and strong material that can be used in floors, walls, and roofs. This innovation allows for high-rise timber buildings and large-scale commercial structures, traditionally built using steel and concrete.

One of the key advantages of engineered timber is its lower environmental impact. Timber is a renewable resource, and when sourced sustainably, it has a much smaller carbon footprint than other building materials. Additionally, wood stores carbon, which helps to offset emissions produced during construction. This characteristic makes engineered timber a compelling option for the construction industry, particularly in New Zealand, which is known for its rich natural resources and commitment to sustainability.

Recent engineered timber projects include the 'A' grade offices at 211 High St in Christchurch under construction by Leigh's Construction for Portus Developments.

Another example is the world-class Sports Performance & Healthcare Centre, The Mill, currently under construction by Cook Brothers in Queenstown; the largest private sports centre of its kind in New Zealand at more than 2,500m2. The Mill will offer locals and visitors a world-class, integrated sports and fitness training and recovery experience. The mass timber was procured from WIEHAG Timber Construction in Austria, the company currently working with Leighs on their Christchurch office development.

With a limited local market holding a monopoly over the costs, New Zealand projects looking to deviate from traditional structural materials, have begun turning to European suppliers. Companies like Stora Ens (Finland), Binderholz, and KLH (Austrian) are the leading global manufacturers of CLT and other engineered timber products. They have decades of experience and have developed highly refined production processes that ensure the highest quality and durability standards.

Another Austrian company, Hasslacher Norica Timber, has recently invested in becoming CodeMark certified through BRANZ following a large mass timber project in central Auckland, which has struggled to get Resource Consent. A CodeMark will help clear the compliance pathway due to the Auckland Council's resistance to suppliers outside NZ. Hasslacher has nearly halved the costs compared to local suppliers, significantly disrupting the tight-knit local supply chain. With such impressive savings, timber can compete with traditional concrete and steel structures, making the conversation with clients much easier.

Furthermore, with steel and concrete trade restrictions and tariffs emerging, the business case for engineered timber as an alternative building material is strengthening globally.

As New Zealand looks to scale up its use of engineered timber, these European suppliers will play a crucial role in providing the necessary materials, technical expertise, and support for local projects. Disruption is needed to reduce costs, encourage adoption and stimulate local innovation and competition. Better still, collaboration with overseas innovators, with the technology and capital, would add value to our vast timber resources and help grow local and international demand for NZ-produced products.

Regulatory Changes in the Building Act

One of the most significant developments contributing to the rise of engineered timber in commercial construction is the recent changes to the Building Act announced in April 2024, which aims to streamline the compliance and building consent processes. Traditionally, building projects in New Zealand have had to navigate a complex and time-consuming regulatory environment, particularly when using innovative or non-traditional materials. However, the changes to the Building Act are designed to simplify this process, making it easier for developers and contractors to incorporate engineered timber into their designs.

Under the new provisions, engineered timber is now more clearly defined within the regulatory framework, and the approval process for its use has been significantly expedited. The government has introduced new guidelines and performance-based codes allowing engineered timber to be used more freely in construction projects without requiring extensive individual approvals for each project. This should reduce delays and lower the costs of obtaining building consents for engineered timber projects.

Additionally, the changes to the Building Act reflect a growing recognition of the importance of sustainability and environmental considerations in the construction industry. By making it easier to incorporate low-carbon materials like engineered timber into projects, the government is encouraging more sustainable building practices and supporting New Zealand's broader goals of reducing carbon emissions.

The updated regulatory framework is particularly beneficial for developers looking to build multi-storey buildings, as the new guidelines for engineered timber materials take into account their fire resistance, durability, and seismic performance. This will improve its risk and safety profile, providing developers, architects, and contractors with greater confidence.

Economic and Environmental Impact

Engineered timber is not just an environmental win but also an economic one.

By tapping into the growing global market for sustainable building materials, New Zealand is positioning itself as a leader in green construction. The demand for timber-based products is expected to grow rapidly. New Zealand's forestry industry can benefit from this shift, particularly if we continue encouraging and recognising engineered timber production and use innovation.

Its lightweight nature makes it easier to transport and handle, which can reduce logistical costs. Additionally, timber structures often require less energy to produce and manufacture than concrete or steel counterparts, reducing overall building costs. This economic benefit can make commercial developments more financially viable in an industry with rising costs.