He loved the space it offered to build a garage for his classic cars. She fell in love with the history.

When Rosemarie and Matthew Dunning bought Emerald Lodge in a waterfront enclave of Parnell 12 years ago, they were effectively only the third owners since it was built by Captain James Lodge in 1857. Previous owners the Lillie family had lived here for 55 years.

"When we found it," says Rosemarie, "it was incredibly original, which is what we loved.

The substantial size of the property was unusual for Parnell. It meant we could do the garaging as we wanted. It hadn't been mucked around with so it was very simple. We basically opened it up for modern-day living, bringing in more light to create a better relationship with the outdoors."

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As a Category 1 heritage building, the handsome Edwardian home could be renovated but it had to be in character with the original. So the Dunnings worked with a heritage architect and the Historic Places Trust.

Sympathetic to the form of the original building, a generous gabled kitchen addition with a high-pitched ceiling adds more living space to the rear and opens to a sunny private terrace around a heated pool.

A sturdy industrial-size chef's oven now fills the chimney space where the old coal range sat, and the old meat safe in a wall boasts clever storage. Everything revolves around a huge black granite bench, reminiscent of the traditional refectory table.

"This area is fantastic for entertaining," says Rosemarie. "For large parties and family dinners, it can take a lot of people. But it doesn't feel cavernous. It retains that sense of intimacy. And with the deep verandah and the outdoor fire at the end, it doesn't matter if it rains."

Visitors are intrigued by the roman bath-style seating surrounding the pool. Fashioned from the same Travertine marble used in the new bathrooms as well as across the terrace, it is a simple but practical idea that means you don't have to bring chairs out from inside.

Rosemarie, whose job is in interiors, worked with former colleague Trudi Crerar on landscaping the massive lawn which has the feeling of a quiet, private country haven.

Together they created shady areas with nikau palms and fruit trees, and installed garden uplighting which makes it stunning at night.

The three original reception rooms on the street side of the house provide more living space, including a children's games room, a study and TV den. Although modernised, they retain gracious charm with high ceilings, fireplaces and French doors to the deep verandah with views over Hobson Bay.

When the Dunnings bought the property, the Lillie family handed over a roll of the original 1950s English wallpaper, which featured exquisite Japanese- inspired motifs.

Rosemarie had a length framed and it hangs in the hallway, an elegant reminder of the home's history. She also photographed original wallboards that show James Lodge's chalk drawings of the old house as it evolved. These feature as a row of stark graphic images in the new living area.

Upstairs, all three bedrooms have views of the sea. There is a self-contained guest suite in the loft above Matthew's four-car garaging, which the Dunnings have utilised for Airbnb accommodation.

The renovation has been a labour of love. Although the Dunnings worked with professionals, their input has been huge — turning the original house into a contemporary home has been a large part of their lives.

Since they came here with their young family, the location has rewarded them with a great lifestyle, making it easy to walk to their jobs. But now they are downsizing.