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What HUB Does

HUB integrates all aspects of affordable home delivery to streamline the process, increase efficiency and reduces cost. HUB’s supply chain Designs, Builds, Funds, Manages and Operates.

DESIGN

Standard national designs and specifications that provide reliability and consistency.

BUILD

Simplified methodologies to drive improved speed and consistent, replicable build quality.

FUND

Investment return criteria is profiled in a financial model that is tailored for each HUB project.

MANAGE

Supply chain performance criteria is established and reported to participants monthly.

OPERATE

Rental levels are performance related and based on cohort, stability and usage or a blended approach.

By integrating every step of the process, HUB:

Improves procurement efficiency

Delivers economies of scale

Makes best use of public resources

Demonstrates continuous improvement

Promotes equal opportunities

Delivers services in accordance with HUB Method Statements and Work Instructions

Undertakes performance audits to drive continuous improvement

Process Stages

HUB provides participants with a fully resourced and coordinated Design-Build-Fund-Manage-Operate procurement platform, where all participants’ aims and objectives can be realised in a collaborative, mutually inclusive manner.

process

Process Steps

STEP 1: Establish Investment model structure

Financial modelling based on IRR project evaluation methodologies that timeline all costs and income flows together with rental profiles to meet target and capped investment returns.

STEP 2: Design project scope to schieve investment returns and social outcomes

Project scale and housing mix identified to meet market demand and to achieve optimum economy of scale through project bundling and mini-tendering within the supply chain.

STEP 3: Profile whole life cost

Whole life costs are modelled to include hard and soft facilities management costs throughout the life of the lease agreement.

STEP 4: Run all cashflows through the investment model

Financial modelling based on open book tendering and agreed rental levels and sales values.

STEP 5: Present viable and deliverable projects for Participant acceptance

Pre-agreed Project Agreement documentation presented to the Participant with all relevant project information to achieve transparency and auditability.

STEP 6: HUB and Participant conclude contracts

Conclude all inter-supply chain contractual documentation and Project Agreement.

STEP 7: Build phase

Construct in accordance with Project Agreement and tried and tested NZS contractual terms and conditions.

STEP 8: Performance based returns and Ongoing Management

Undertake operational management and hard and soft facilities management.

How the Pieces Fit Together

puzzle

HUB Methodology

HUB methodology is one where investor internal rate of return is adopted as the basis of identifying the optimum scale and configuration of community and affordable housing developments.

FUNDING

Investment returns established to inform each project’s IRR and rental income support needs.

 

MEDIAN HOUSEHOLD INCOME

Established demand side affordability based on identified Median Multiple.

 

AGGREGATION & SCALE

Optimum scale of project identified to meet investment return targets.

 

BEST VALUE

Median multiple based rents and sales values related to the Median Multiple.

 

RENT TO BUY

Mortgage products provided, including for ground lease tenure.

Principles to Application

HUB aims to simplify both price and delivery imperatives. To achieve the affordable price imperative, this requires the highest possible scale of production to capitalise on economies of scale – and it is this imperative that informs every choice in the design of HUB’s supply chain together with housing design and specifications and our manufacturing and construction methodologies.

HUB’s

Affordability targets are less encumbered by traditional developer’s profit, which are traditionally passed to the occupier, to maximise margin returns.

Community development and homes strategies are designed to benefit from scale and capacity and cost optimisation.

Organisational systems have been structured to make homes simpler and cheaper to manufacture and deliver through the adoption of standard construction grids, and components and off-site fabrication.

Quest for scale has led to the integration of design, production and construction linkages within a supply chain organisational structure to coordinate higher throughput of homes.

Supply chain has been configured to work at the national level to benefit from aggregation and scale as quickly as possible.

Structured for Long Term Partnership

For the public sector, HUB has been structured to act as the principal and long-term partner to public sector bodies that are tasked with meeting Government social housing targets and includes the provision of complimentary and supportive community related facilities and services.

The HUB replaces short-term local single project relationships with long-term multiple project relationships based on strategic partnering principles.

The Benefits of HUB’s Process & Structure

In breaking barriers to rental affordability and homeownership, HUB delivers a wide range of benefits to community members.

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