High-end houses are rising fast

For Philip Lindesay's construction company, there has been no downturn - his order book for expensive houses is full and he's taken on more builders in the last 2 years. Photo / Brett Phibbs

Finding new building projects doesn't seem hard for the head of an Auckland residential construction firm specialising in the luxury end of the market.

Philip Lindesay of Lindesay Construction says the downturn is having little effect on his business.

Lindesay is building new houses in Auckland and the Bay of Islands and his forward-order work book shows few vacancies.

"We've got 15 contractors working on two sites in the Bay of Islands alone," Lindesay says from his offices in the basement of a Newton apartment.

His firm built Eagles Nest, the much-awarded resort near Russell where guests pay $37,000 to $42,000 a night - a rate which covers all activities including chef and butler. His firm also built the Mann house near Russell and is now working on a further six new houses.

With two teams of contractors working full time in the Bay of Islands, where he specialises in waterfront homes, Lindesay has carved out a specialist niche.

Some houses are more than 1000sq m, almost 10 times the size of an average Kiwi villa. Lindesay gets his work from verbal referrals, often through architects.

But the inverse applies, too.

"Sometimes we get the client and recommend the architect to them," Lindesay says.

Tilers, electricians, roofers, aluminium joiners and carpenters are all flat-out on his hot northern seaside sites, partly project managed from Auckland by Hamish Craig.

Lindesay was not hit by the recession: "The past two or three years, we have been busier than ever and taken on more builders. The coming year is very promising and we have inquiries coming in regularly. Our current projects include two large holiday homes in the Bay of Islands and four Auckland houses."

Dogs and radios are banned from his jobs. He cites neighbourhood irritation and lack of professionalism as reasons.

Lindesay is a leader in his $9 billion building sector, which has been hit hard in the last few years by the downturn. He won this year's Master Builders' supreme award in the house of the year competition for a big Arney Rd home in Remuera. With his wife, Lu, he will travel to New York with PlaceMakers chief executive John Beveridge to look at the best American housing - part of his Master Builders prize.

Beveridge says expensive new houses are not that rare, even in the downturn. "Things are happening at the top end of the property market. There are a lot of other builders, apart from [Lindesay], that would be as full in that high end of the market, including around Queenstown.

"New Zealand is a great place to build a house and now is a good time to be doing it ... This is a good news story in a property market devoid of good news," says Beveridge.

Statistics NZ figures show the value of house building is falling.

Consents were issued for buildings worth $9.8 billion in the October year, down from last year's $9.9 billion and 2008's $11.6 billion, although volumes are up lately from this decade's low of 12,311 in the year to October 2009, to 15,228 in the year to October 2010.

Ted Manson, arguably New Zealand's leading private developer, who built then sold Shortland St's Lumley tower and just finished Telecom's new headquarters, says he is also weathering the downturn well.

"This ongoing bad publicity is giving even us successful property developers a bad name.

"You should write an article about the property developers who are still developing real estate now and are still successful despite this worldwide meltdown. You can explain the hard work and dedication it takes to make it in this business and, of course, to come out on the right side of the ledger," Manson said.

Nick Horton of Luxury Real Estate is marketing some of New Zealand's iconic properties, including the $20 million-plus Paoneone Farm in the Bay of Islands, owned by interests associated with venture capitalist Bill Birnie.

"We have been getting solid inquiry from Australia and Asia and starting to get a few emails from Britain. The United States is still tough, the economy uncertain and the US dollar weak does not help promote urgency for buying New Zealand property. Secondary homes are still not under any buyer pressure.

"Primary homes in the city suburbs and fringe areas are selling well [with] multiple sales in the $8 to $10 million range for the last six months.

"I am also doing some trips promoting investor immigration. I have teamed with ANZ Private Bank, PricewaterhouseCoopers and Malcolm Pacific. We recently travelled to Asia running seminars and finding applicants for the new scheme. All of them are interested in luxury property," Horton said.

Although the downturn has been longer and deeper than many expected, not all projects have turned to custard. The successful developers are carrying on.