NZ’s busiest privately owned residential developer laying off 30% of staff - also still hiring

Blair Chappell and Matthew Horncastle of Williams Corporation. Photo / supplied

The Christchurch-headquartered apartment and townhouse developer making up to 30 per cent of its 200 staff redundant because of falling sales is also still advertising for staff to join the business.

“We still have positions available,” said Williams Corporation co-founder Matthew Horncastle today, referring to jobs in Christchurch and Wellington to head construction projects.

A project manager is being offered up to $120,000 in Christchurch and $150,000 in the capital and a client consultant is offered a base salary of $70,000 but with commissions of up to $750,000 a year.

Yesterday, the Herald reported Williams announcing it was seeking voluntary redundancies from staff, seeking to lay off 10 to 30 per cent of its 200 people.

Horncastle said 120 of Williams’ 200 staff are in New Zealand. The business also has offices in Australia and Singapore.

On social media, one follower wrote: “Please tell me the NZ Herald has it all wrong!” Horncastle replied, “the story is correct”, attributing the redundancies to sales falling from 800 homes this year to 500 homes next year.

“So we are currently overstaffed. We will reduce our staff by 10 to 30 per cent so we do not have staff with nothing to do next year. We are currently doing optional redundancy where any staff that want to leave get paid an extra month on top of their contract redundancy,” he said.

Staff will get two months’ pay under the redundancy offer.

Williams built 88 Peverel, Riccarton, Christchurch.

“Five per cent of the team have taken the offer,” Horncastle said today. He’s optimistic sales will pick up “so I think it will be minor and for a short time. It’s just sensible business.”

The Williams staff had an enjoyable lifestyle: a Herald feature this year referred to Horncastle as a 28-year-old Rolls Royce Wraith-driving, private jet-flying, $4m 87-foot launch-owning, inner-city Christchurch housing developer.

The feature said: “They have an Insta-splashed lifestyle synonymous with wealthy young developers, flush with an annual $520m turnover: a new boat, WW (guess why it’s called that?) brought down from the United States and moored in Viaduct Harbour, and luxury resort stays, most recently at Peter Cooper’s Mountain Landing in the Bay of Islands.

“They charter a white-leather-seat Bombardier Challenger 604 jet from Christchurch’s GCH Aviation for a fortnightly return Christchurch-Wellington-Auckland staff trip: “We bulk buy 100 hours at a time. I’ve always wanted to fly in a private jet,” Horncastle confessed in that January 15 feature.

Blair Chappell and Matthew Horncastle of Williams Corporation charter private jets to move staff around.

The letter Williams Corporation sent to staff was dated November 8 and signed by Horncastle.

“If at any time sales increase to a satisfactory level, this process may be paused or abandoned,” he wrote quoting Robert H. Schuller saying “tough times never last but tough people do”.

Staff had until 3pm on November 14 to accept the voluntary redundancy offer.

“In 2021 we sold circa 800 homes in a rolling 12 months. Historically the business has doubled in size each year, and therefore it was assumed, and it was reasonable to believe, that this would happen again and Williams Corporation would double - delivering circa 1600 homes a year and becoming the largest builder in New Zealand (larger than GJ Gardiner),” the letter said.

“In 2022 our sales have declined to between circa 400 - 500 homes in a rolling 12 months and we have taken all practical steps to increase sales but have not seen an increase, and sales are not increasing as expected. As a result, it will likely be proposed that a restructure and/or ‘right sizing’ of the business is required in order to adapt to market conditions, which may include a reduction in overheads by approximately 15 to 30 per cent to match our expected work in progress and activity,” the November 8 letter said.

Today, other property investors and developers said they were unsurprised by Williams’ moves: “So it starts,” said one Auckland investor with more than $100m invested in commercial real estate. He forecasts much more pain.

Williams developed 2 Jadewynn Drive, Massey.

Another said: “There will be total carnage. Apparently, some salespeople in businesses are trying to sell to family and friends. The market is toast. It’s all over and the music has stopped. Just nobody outside the industry can see it yet. It’s gonna be super ugly.”

Last month, Stuff published a story about townhouse sales slowing in which Horncastle said “we are trading in a quieter market but we are selling more than a house every day”.

StatsNZ data shows in the year to September, 50, 732 new dwellings were consented, up 7 per cent annually: in the month of September 1848 stand-alone houses were consented, 1688 townhouses, flats and units and 778 apartments.

Williams has three wholesale funds: Williams Corporation Capital, Williams Corporation Capital Partners and Williams Corporation First Mortgage Investments.

WW, the launch moored in Auckland where Williams Corporation bosses and staff often entertain.

Around $158.8m is in those funds, contributed by 337 investors, getting 10 per cent gross per annum, paid quarterly far above the bank rate, Horncastle said last month.

“That entire sum is invested in developing new houses, which makes us the largest privately owned builder of houses in New Zealand. These funds are critical for our ability to supply affordable housing for Kiwis,” he said.

He supported a Te Mana Tātai Hokohoko Financial Markets Authority investigation, which released its findings on October 20.

Formal warnings were issued to seven businesses, including Williams, raising millions for property schemes by making “non-compliant” documents for wholesale property investment offers.

The almost year-long investigation into the often high-risk schemes, found several conduct concerns in wholesale property investment.

It named Black Robin Equity and Westwood Terraces BRE, Du Val Capital Partners and Du Val BTR GP, E+O Property Syndication, Jasper NZ Investments, Provincia Property Fund, Williams Corporation Capital Partnership GP and Wolfbrook Capital.

The probe came after complaints and concerns about how such wholesale offers were being promoted and whether the appropriate investors were being targeted and accepted.

The authority now wants action from the professional organisations of lawyers, accountants and financial advisers.