Earnscleugh Castle renovation blows out from $3m to $11m - owners explain what drove it
Central Otago’s Earnscleugh Castle renovations shot from an initial estimated $3 million to $11m, of which nearly $1m has been blamed on council opposition, causing delays.
Castle owners Marco Creemers and Ryan Sanders appeared on Grand Designs, screened on Sunday, April 12 on Television New Zealand’s One, telling of the eye-watering blowout.
The couple told how initially, they had anticipated spending $3m to $4m renovating the castle.
But instead, costs increased by 266% and still the exterior is not rendered and the stables are not renovated.
Readers emailed the Herald, blaming the Central Otago District Council’s opposition to the castle exterior being rendered as a reason for cost escalations and delays but the council strongly denied that.
As it was required to by law, the council notified the rendering application, resulting in 98 submissions in support and consent being granted, although that work is yet to be done.
The couple undertook extensive lobbying to get 100% public support for rendering, including contacting the Herald about the issue in 2023.
Creemers claimed the council planner’s opposition cost nearly $1m and delayed opening by about a year.
Asked how much cost was added by a council officer’s report against rendering, Creemers said the hearing cost $150,000 but the council denied that figure and said in fact it had waived a $15,000 fee.
Creemers said: “But on top of this, we were delayed one year in construction, which meant inflationary increases and extra works having to be done inside the house to make it weathertight from the inside.
“So maybe that effect was about $450,000 over the course of the entire job, but we have also been delayed a year from opening so one year’s extra mortgage payments and one year’s loss of income, which equates to say another circa $450,000,” he added.
Therefore, council delays added $900,000 or more and held up opening by a year, he claimed.
The council strongly denied costing the couple extra time.
Council principal policy planner Ann Rodgers said she could not comment on the $900,000 figure Creemers claimed.
“However, the $150,000 indicated for hearing costs was not council fees. We have a policy of waiving fees if the only reason a resource consent is required is in relation to the heritage classification.
“Council waived processing fees on the heritage application in accordance with the policy,” Rodgers said of the Earnscleugh application.
Statutory application processing timeframes were met, she said.
There was no council hold-up.
The Earnscleugh application was lodged on December 8, 2022 then put on hold by the applicant until January 23, 2023.
It was publicly notified on February 23, 2023 and a hearing was held on May 15, 2023, she said.
“A decision was issued on June 28, 2023 within statutory timeframes,” Rodgers said.
The building is Category 1 heritage-listed and the District Plan required a resource consent for any work, internal or external.
“It is not unusual for significant alterations to a Category 1 building to be subject to public notification, particularly in relation to alterations to the façade of a building,” Rodgers said.
The Herald asked Creemers how the Earnsleugh work could have cost $11m.
He cited many unexpected costs and a high inflationary environment post-Covid.
“We budgeted on Auckland contracting prices, but Central Otago had higher tradie pricing, which was a bit of a shock.”
A cost blow-out in the coach house was due to the full roof structure needing to be rebuilt to meet building code for the roof falls.
“Even our quantity surveyor got it wrong, pricing the castle at $5.7m. So we were not alone on the under-estimation.”
Broadly, the $11m costs were:
- Earnscleugh Castle $8.2m;
- Coach house $1.4m;
- Fees $810,000;
- Preliminary and general $440,000;
- Resource consent hearing costs $150,000.
For Earnscleugh Castle, the costs were:
- Building works $1.6m;
- External joinery $620,000;
- Roofing $600,000;
- Ground works $600,000;
- Furnishings, lights, curtains: $600,000;
- Building materials $600,000;
- Internal joinery $500,000;
- Painting and decorating $350,000;
- Waste $50,000;
- Electrical and IT, security $880,000;
- Ceilings $180,000;
- Plumbing and drainage $750,000;
- Heating $480,000;
- Courier $50,000;
- Fire and sprinklers $200,000;
- Tiling $170,000.
Asked what costs were added by unexpected elements, Creemers said these were:
- New power supply and underground power: $400,000;
- New water supply and irrigation works: $200,000;
- Fire rating and sprinkler system: $200,000;
- External joinery repairs: $280,000
- New roof: $600,000.
Despite the cost rises, the couple acknowledged Heritage New Zealand for its work on the initial application and allowing the resource consent application to be split in two, so that work could continue.
“Their joint acknowledgement of the adaptive reuse of the castle was commendable and we really appreciated this.
“What we hadn’t contemplated was we couldn’t start work on the house because our earthquake strengthening design included a carbon fibre mesh in the exterior plaster.
“The problem was that if we lost the hearing and weren’t allowed to plaster the house, then we would have to go back to the drawing board and have our earthquake strengthening re-designed.
“At that stage we had already spent $600k in getting that proposal to the council.”
Heritage NZ’s approval was valuable “and we are big fans of the work they do, its assessment could have been more strongly worded with reference to the exterior plastering,” Creemers said.
“This is because they did not explicitly state there were more positives than negatives as the plans intended, and recognising that an alternative strengthening design would be more intrusive to the interior of the house.
“The council planning department which did not accept Heritage NZ’s approval, our heritage architects and numerous consultants reports over their independent consultants advice, therefore it felt like a flaw in the process,” he said.
He and Sanders had a good ongoing working relationship with the council and Heritage NZ.
“But if anything can be learnt from this is that there should be more emphasis given to the recommendations from national bodies like Heritage NZ, and also the property rights and the economic effect it will have on the applicant and their ability to restore heritage properties like this,” Creemers said.
Asked how the couple could afford $11m, Creemers said it was from their life savings, the sale of two businesses and sale of a commercial investment property.
“We assumed we would have no mortgage on the property but have a $2.8m mortgage that we hadn’t banked on,” Creemers said.
Sanders learned about crypto and traded in that to make extra money, too.
Creemers worked for many years for Auckland billionaire Sir Michael Friedlander’s Samson Corporation but said that even after 30 years in the sector, the southern experience had surprised him.
The coach house opened to guests on November 1 last year. Rates are from $650/night to $750/night.
The castle will open on September 24 to coincide with the Alexandra Blossom Festival. Rates start from $899/night and include breakfast, pre-dinner charcuterie, house wine with unlimited access to the pool, sauna, spa and ice bath.
The entire castle is also available for conferences, leadership retreats and private events.
Earnscleugh’s seven-day wellness retreat is opening this coming spring.
Anne Gibson has been the Herald’s property editor for 26 years, written books and covered property extensively here and overseas.
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