Property developer Ian Cassels on his plans for Shelly Bay

By John Bristed
Photography by Adrian Vercoe

Featured in Capital #77.
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Whether it’s for better or for worse, the controversial development at Shelly Bay has begun. John Bristed has a conversation with the property developer Ian Cassels.

They discuss the contentious development as well as life, business and money.

Who influenced your attitude to money?
Possibly my father, who was careful. I didn’t like that. I can’t stand money getting in the way of people.

Was your father short of money?

So what do you do differently?
Well, I vaguely ignore it. It’s never the point. If life was about money, wouldn’t it be wretched? Like if
the score was money?

Do your siblings feel the same way?
Not as avidly.

And your children have a similar attitude to you?
Yes I seem to have infected them reasonably well. Having four sons, theoretically in the same business,
is quite wonderful for a father.

What did you do when you left school?
At university I painted houses to get myself through, and played cards, and drank and generally led a proper good existence, which was required to teach
me that I had to go and do work one day.

What did you study?
Religious studies, maths, and philosophy. I got a BA. After university I painted a lot of houses, and I painted storage tanks all over New Zealand. I’ve breathed a bit of crap. I’ve got a lung condition, which is not excellent.

What got you started?
I had Auntie Doreen. When I was about six, I overheard her saying to my mother, “That boy will be good with property.” There would have been no reason why she said that. But it stuck in my mind. And it set my course.

I think that’s true of most people’s lives; there’s something that happens, often a little thing that gives them a clue about something and off they go, programmed, much deeper than they understand.

Did you start your own business?
Apart from five weeks as an employee, I’ve always worked on my own account.

So property; how did you get started?
I saw that inner Wellington was an ideal place to live, but it hadn’t been “seen”. I got stuck in subdividing city properties around Cuba St. Living in inner Wellington it was such an obvious idea. There was easy access to buildings which were reinforced, insulated, often air-conditioned, close to shops, and safe.

Wellington was the very best place to start again after the (financial) crash of 1987. The value of the city had quartered. The banks basically fled in fear and sold buildings whose owners had been unable to pay the mortgages because their tenants had gone broke or been unable to pay their rent, for nothing. It was a lack of bottle and common sense.

After that 87 crash we lost faith in our own city. One afternoon, government departments and various people came out and in 20 minutes leased buildings for 20 years at prices never dreamt of before. But that was just the way of markets, hysterically behaved. That’s what small people get obliterated by. It is totally not fair.

What made you decide that was the right thing to do?
Most careers are founded on accidents. I was there and the opportunity was there. In similar circumstances, other people might have gone nowhere, because, if you’re not in a field that’s growing, you don’t grow. A lot of people are trapped in those circumstances.

How did you actually start?
I bought a building and developed it into apartments.

Was the money you had enough?
It wasn’t much money, but if you’ve got a really good idea, you don’t need massive amounts of money to make money.

Did you have to borrow lots?
Ah, once we got going, we were recidivist borrowers. I’m the sort of borrowing version of an alcoholic. It’s just The More The Better.

Cheap credit is what rich New Zealand is having a hell of a party on at the moment, getting kitchens and cars. It’s not money. It’s cheap credit, because the banks have decided the rich people are the best bet to unload piles of money onto. The cheap credit benefit is all going to people who can borrow cheaply because they already have equity.

It’s not going to the first home buyers. It’s not going to the careful people. It’s going to people who can get it because they’re already wealthy at some level. The people who aren’t borrowing actually look as though they’re going to be paying.

What’s the Wellington Company?
My partner and me. It’s a conglomeration of property-owning entities with a reasonable set of ambitions.

Do you have investors?
We have banks. Some of our projects are done with my eldest son, Alexander. And some increasingly will be done with the younger ones.

What has the Wellington Company done?
Our buildings include the Spark building in Willis St, Xero (corner Taranaki and Wakefield Sts), ANZ Tory St, Conservation House in Manners St. People now live here in all sorts of rental apartments, hotels, and apartments that we built and sold. We believe we’re responsible for about 2,500 extra beds in various formats. That’s how Wellington becomes wealthy, encouraging and putting people up in the city.

What single decision has had the biggest financial impact on your life?
If you work a situation backwards, you find that you could have got to anything, let’s call it Nirvana, in probably five or six steps, as long as they were all the right steps.

If you choose the right gates, you can be wherever you want to be. It’s not always easy to pick the right one. You’ve got to find that it exists, and go through it. You’ve got to have courage and not give up easily.

But thinking about it drives you mad. For example, I continually ask myself: What should I be doing now in these circumstances which are so odd? This virus, this government, the way we’re going, what should I be doing?

If I make the right decisions I’ll be in a totally different position in two years’ time. If I make the wrong ones, I probably won’t be much worse off.

Have you an example of an important decision you got right?
We sold some buildings to some Australians very successfully.

How do you think people perceive you?
Poorly. I don’t communicate. I just spit it out as fast as I can. And I want to go to the answer, because I’m not interested in the process. I don’t want to negotiate. What’s the point in spending years crossing things out sending it forwards and back? I prefer to go straight to the end result. Unfortunately, people want to haggle.

Do you work hard?
I never really worked hard. I turn up at work and wait for the realisations to come. It sounds odd, but you need somebody who’s divorced from the panic and the noise to just say, we’re going to do this or that. Not because I’m any brighter. That’s just my particular role. And I love ideas.

Have you always worked alone?
Yes. Apart from fleeting joint-venture partnerships.

What about financial advice?
I get a little bit of financial advice from my eldest son, which is quite good. And from my partner.

Have you ever protested about anything?
I haven’t been happy about some things, but I’ve never gone out marching because it doesn’t do anything. I’ve written endless submissions to the Wellington City Council, but nobody takes any notice. “Consultation” when it’s not meant is a bitter process.

What’s the job of a developer?
To steer society into better places, really. To see what’s wrong.

Do you understand people’s concerns about Shelly Bay?
There’s been a lot of building of perception out there. There are genuine grievances and disagreements within the Port Nicholson Block Settlement Trust. They have 19,000 members, and some feel hacked off about the past and how they’ve got to where they are now. That’s understandable. It comes about from a lot of wilful and unwitting mistreatment by the Crown, and others, and misunderstandings.
It didn’t differ too much from the usual. The chiefs get to decide what they do. And the people are expected to follow. But actually, when enough people get together and talk about it, they don’t follow.

Why is it important to you to develop Shelly Bay?
My son Alexander has asked me this. It’s important to measure yourself against people in your field.

We do a lot of houses for low-to middle-income people, but now and again, we would like to do the stuff at the Willis Bond end of town, because we can. Just to flex a few muscles from time to time is good fun.

What is it that people don’t understand about the development in Shelly Bay?
Most of Wellington isn’t fiercely fighting for the Māori splinter group. We’ll help bring them back into the fold. And there will be a great result for everybody. It’s not a massive development, it’s a tiny percentage of eastern suburbs houses. It’s not a massive increase in the housing stock (which is needed anyway).

The historical reason for Peter (Jackson’s) opposition was that it was virtually understood that he was going to end up owning it. But the council told him it was going to cost $100 million for the roadway, which he thinks was a lie. But it wasn’t a lie because his scheme was huge and had buses going to and fro, and the motorway was going to be diverted out to Shelly Bay for Peter’s big thing.

What about the narrow road around Shelly Bay?
We love narrow roads in Wellington. The city is full of narrow streets. And we love it because that’s Wellington. Somebody says “the roads to Shelly Bay are too narrow. You’ve got to have a four-lane motorway.”

We don’t need anything like that. Most of the people who’ll live there will not be in traffic jams.

What about sewage and water?
Sewage and water has been uncared for by Wellington City Council for years. We’re going to fix it, but we shouldn’t have to.

I believe the city should be ready for development.

Would you redevelop the Shelly Bay wharf?
I want to; it’s very expensive. I see it as a huge shame that Wellington could build all those wharves, and hasn’t done anything to maintain them.

When building do you consider such things as the changing environment? Earthquakes? Climate change, sustainability?
Absolutely. We wanted to get into that electric revolution.

We got fibre into our buildings early, we got electric cars before anybody else. We bought three although we knew we were losing money hand over fist, because that was early generation stuff. We put a windmill on top of our building, which just about blew off.

Did it make electricity for you?
No, hopeless. But we are overly enthusiastic about such things.

Do you like your Tesla electric car?
Not really, it doesn’t let you decide anything. It’s like sitting on a big fat couch. They ought to supply them with radar detectors.

What is your opinion of the Wellington City Council?
Everybody’s well meaning and I think the council finds it hard to grapple with where we need to go and getting us there.

It’s complex. I’d prefer policy implemented by the officers. I think councillors tend to believe they’re qualified for things that perhaps some of them aren’t.

This will raise hackles. I quite like the old city fathers’ approach, where people who were interested in helping their business interests, but were generally also deeply interested in the quality and direction of the city, would run for council and didn’t get any money. And not getting any money is quite a good thing. I know there’s a difficulty because then it’s only for rich bastards and the city goes a particular way. But whichever system you use has problems.
“[Young people] must be allowed to get some of that cheap credit that everybody else is living on.”

How should young people get on the property ladder?
Shared equity should be the new rage. We’ve pulled the ladder up so far from where the young people are. They can usually afford the interest on a property which would be half as much as the rent they pay. They must be allowed to get some of that cheap credit that everybody else is living on.

The way to do that might be to give them $100,000 for five years, which they’ve got to pay back. And there’s got to be a calculation about any capital gain that accrues so the person who lent it to them gets some of that back; people who can do that will keep on investing. The churches for instance have money. They should be putting it into shared equity to let young people get onto the cheap credit ladder.

I know you’re doing something with prefab houses?
We’re doing panel houses. These are not cheap. They’re high tech, with one or two bedrooms, designed to be erected, ready to walk into, in less than a day. Insulation is at least 200% of the code, and the outside will need very little maintenance.

We are going to make thousands of these houses. The factory’s in Christchurch. We should be able to bring them on for less than $2,000 a square metre. We’re going to build basically one design.

In blocks?
Not a Soviet concentration camp but scattered around the place. We’re in prototype; we’ve built some in Wainuiomata. We’re slow but we’re very close to pressing the button on the machine.

Do you invest in anything other than property?
We do a lot of startup support for people. Most of those I couldn’t tell you whether they’re going well or badly.

What do you do for fun?
I’ve got a piece of land in Te Horo that I like to plant trees on, and mow the grass and lupins.

What’s the biggest frivolous luxury you’ve ever bought?
Probably that Tesla. I bought a McCahon painting for $30,000 at a charity auction which I felt awkward about because I don’t really like it that much.

Are you philanthropic?
We are very strong supporters of the City Mission.

Any interest in sport?
I’ve had a go at most things. I’m a keen Phoenix supporter; they’re fantastic for Wellington, they need support. I’ve enjoyed tennis, cricket, and so on. I play GO (a Chinese abstract board game invented 2,500 years ago, which has an estimated 20 million players worldwide).

You choose your own clothes?
Yeah, I’m not very good at it. Sometimes my partner gives me a hand. I need a hand.

Does money make you happy?
No, losing money makes me unhappy. Being successful in what I’m doing makes me happy. Money is the consequence. If you’re very good at what you do, and you’ve worked it out properly and you deliver it, then money comes.


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