Where there is a Commercial building, and a head lease, and therefore lots of smaller sub-leases, property is easily changed and adapted as you say, providing perfect breeding grounds for small innovative businesses. Much of Hong Kong is still like that – and its a hotbed of activity.

We won’t have the same thing going on with ex-Apartment buildings, however, including the monster going up next to you. In a strata-titled apartment building, knocking down walls and changing use to Commercial is all very much more difficult, if not near-impossible. Change of use conditions and requirement to get approvals from 75% of the Body Corporate will make it awkward to say the least. That, i suspect, is why owners of shitty flatettes in Scene 1, 2, 3 (Auckland disaster projects, as far as I understand), etc, can’t sell their properties.

No one wants to live in them, and banks now won’t loan on them, and so the market will keep on going down until someone comes along, buys the whole lot, and either demolishes internally or externally by having the majority shareholding in the Body Corp.

Which is why some people have been ranting on about them being such a bad idea… and why the WCC should not allow them to be built in the first place.

After the Chase bomb went off, all those eminently subdividable buildings were gone, replaced with open strata office blocks where 500m2 was a small tenancy and the niche enterprises were sent packing to the suburbs.

Perhaps now we will see a genuine urbanisation of our cities as the market is flooded with these latest real estate mistakes – small, cheap and well suited to 1, 2 or 3 person enterprises. The downsizees likely to be cast loose by the atomisation of corporate culture might colonise the speculators’ hulks to our mutual benefit.

Auckland’s inner-city property market is about to be flooded with up to 1000 cheap apartments, with distressed owners having to sell for half the amount they paid little more than two years ago, a real estate agent warns. Real estate advertisements declaring “city steal … vendor quits”, “downtown waterfront suite abandoned”, “vacant and abandoned” and “mortgagee wants this gone” indicate the state of the market.
……….snip
“The banks are being very, very cautious,” she said. “They are pessimists, they believe the prices are going to fall even further.”
………snip

All of which is very interesting, in terms of the complete reversal from a year or two ago, when it was argued that small cheap flats were the answer to NZ’s housing woes. Its very noticeable that the owners clearly don’t want to have to live in these squalid little holes themselves.

Wellington QV spokesman Kerry Buckeridge said…….

“The property market will need a considerable lift in sales-volume before any price recovery can commence. We don’t expect to see such a lift any time soon, given domestic job-security issues and the international economic situation.”

Personally, I think NZ would be headed towards an Icelandic default if it takes money out of opportunities to bolster innovation and the sharemarket, and giving it to people to help them keep up with the Joneses and further dig deeper in the hole known as the current accout debt. It’s all well and good for people to say it’s their god-given right to keep up with the Joneses – unless of course, the Joneses have just been visited by the repo men.