The developer is building 111 apartments in one of its largest projects. This shows progress by last November. Video / Supplied
A prominent property developer has trimmed his lifestyle to match the slowdown in the sector.
Matthew Horncastle, managing director of the Christchurch-headquartered apartment/townhouse developer Williams Corporation, no longer charters private jets from the South Island to Auckland and an 88-foot luxury superyacht is nowhired out to others.
The shift has come as the company’s annual new build rates have dropped 57% from 631 new homes in 2021 to 267, although it has picked up again this year.
“It’s all positive, but I’m pretty boring. You don’t have any exciting Matthew Horncastle stories‚” said the developer, who is also expecting a baby with his partner.
Matthew Horncastle of Williams Corporation in the Auckland office. Photo / Alex Burton
Williams’ workload has reduced with the downturn and with that came a big change of lifestyle for the 31-year-old, who with Blair Chappell founded the active development business.
The business has $87.7 million of wholesale investor funds, down from $152.4m in late 2022.
Via four funds, Williams has raised $283m since seeking wholesale investors from August, 2019, according to information Horncastle supplied.
Blair Chappell and Matthew Horncastle of Williams Corporation once chartered flights to Auckland but don't anymore.
Investors were able to be repaid within six months but when the market tanked, Williams extended that to a year. Thye company retains those terms.
“The key message is we’ve honoured all our commitments in terms of funding as well as in terms of housing and we’re still building,” says Horncastle.
Horncastle provided an update on Williams Corporation’s finances and activity levels:
Williams’ funds raised from wholesale investors
Started: August, 2019;
Total capital raised since then: $283m;
Capital returned to investors: $195.9m;
Dividends paid: $54m;
Funds currently under management: $87.7m.
Williams Corporation wholesale fund offerings
Williams Corporation Capital;
Williams Corporation First Mortgage Investments;
Williams Corporation Capital Partnership Limited Partnership;
Williams Corporation Completed Homes limited partnership.
Williams Corporation numbers of new homes built (years April 1-March 31)
2017: 3 for $1.1m;
2018: 87 for $35.7m;
2019: 108 for $46m;
2020: 322 for $155m;
2021: 631 for $353.5m;
2022: 477 for $354m;
2023: 186 for $118m;
2024: 206 for $129m;
2025 (to date): 267 for $154m.
Horncastle acknowledged the sharp market decline compared with Williams’ peak in 2021 when it built 631 new residences for $353.5m.
Williams Corporation founders Blair Chappell and Matthew Horncastle. Photo / Supplied
A Williams investor letter last month said March marked the completion of its 14th financial year in business, “a testament to our resilience and strategic focus”.
Williams Corporation’s largest project is its 111-unit, six-level Manchester Square project in Christchurch’s East Frame. That project has offices, too.
James Kellow, a director of Ponsonby-headquartered NZ Mortgages & Securities, has loaned money to Williams for years. He remains impressed with them.
“Looking from the outside, Williams has successfully right-sized the business to meet demand, dropping from 500 houses to 250 per annum. With the market improving lately, I would envisage it growing built volumes above the current 20/month,” Kellow said.
WW, the launch moored at the Viaduct but now chartered since the economic downturn.
“It is quite difficult to deliver over 250 units per year, particularly well-built ones without no major remedial works so Williams have done very well in this regard. They are definitely one of the larger/better New Zealand builders.”
Williams’ March newsletter said the business was expanding outside house building.
“We are growing our existing service companies – property management and external real estate sales – while laying the groundwork for a mortgage and insurance division. This addition aims to diversify revenue streams and drive profits well beyond our overhead base in the medium term."
A Riccarton project by Williams Corporation. Photo / Supplied
Williams employed 204 staff before the downturn. Horncastle said it now has 60 staff, of whom 25 are commission-only sales, 10 are in the Philippines and three are crew on the WW launch.
The March investor newsletter said Williams is anticipating moderate growth in sales and deliveries, “with completed home inventory decreasing as we transition to new projects”.
And what of Williams’ long-term holding of a vacant Herne Bay site on Shelly Beach Rd?
Horncastle said there were plans to build 17 residences on that valuable site and work is due to start this year. He will be able to talk about his own Christchurch home sale “in two months”.
And in a somewhat illustrative turn of events, Horncastle says the Auckland office at 10 Viaduct Harbour Ave has moved.
“ ... we used to be on the top floor. Now we’re on the bottom.”
Anne Gibson has been the Herald’s property editor for 25 years, written books and covered property extensively here and overseas.
