A trend I am seeing throughout the country is that builders are stepping up their game relating to elevations. Why?
Ed Nikles Named NAHB Custom Home Builder of the Year
Always learning as well as teaching, Nikles stays profitable by setting himself apart from the competition
Home builder Edward S. Nikles sets a pace that would exhaust much younger individuals. On any given day, Nikles divides his time between his office in Milford, Pa.; visits to various construction sites; and meetings at the Chamber of Commerce, the Pike County Builders Association or one of the many other organizations he serves.
The indefatigable Nikles has been involved with the Pike County home-building scene for 45 years. In the Poconos, best known as a resort market, he’s done it all, from renovations and vacation cottages to modular homes and luxury custom homes. He was the first in the county to build green and still is the only full-service builder with an architectural designer, interior designers, home finance officers, real-estate agents and a huge showroom under one roof. And he’s generous with his time and expertise, speaking, teaching and writing as much as his jam-packed schedule will allow. Meet Ed Nikles, NAHB’s Custom Home Builder of the Year for 2008-2009.
Nikles worked for a local builder for about a year before co-founding a construction company in 1963 with a partner whose father was in the home improvement business. Initially they focused on remodeling. “At that time, there wasn’t a whole lot of home building going on in our area, so we did anything that came along. After a few years, we started building houses.”
In the mid-1960s, a land developer started buying up tracts for vacation homes in Pike County. The first project was just up the road from Nikles’ office. Recognizing an opportunity to capture the traffic passing by his door, Nikles put up a model home. “That took off, so we built a second model, then a third. Soon we were going head-to-head with the developer and, in fact, selling more homes than his in-house builder.” Eventually the developer made a deal with Nikles to build on his land.
Nikles and his partner went their separate ways in 1984, and he adopted a new strategy to take advantage of changes in the marketplace. Demand for vacation cottages was diminishing as more and more vacationers decided to build primary homes in the Poconos. Nikles began specializing in custom homes, with high-end remodeling jobs, some light commercial work and modular homes added to the mix. Along the way, he acquired a reputation for outstanding customer service. “We were one of the few builders who ever went back and fixed things,” he says wryly.
|Nikles (left) and his son and business partner, Ed Jr., talk shop over lunch every day at a local restaurant.|
Nikles branched out again in 1991, starting a real-estate sales division, Nikles Realty. Run by Ed Nikles Jr., who has been working full-time for his father since he graduated from college in 1987, Nikles Realty currently has a portfolio of 45 lots that are sold as a package deal with the homes. “We not only sell our own properties but take listings on resale lots and larger acreage as well as some resale homes, the majority of which we’ve built in the past,” he says.
Since the late 1980s, Nikles has operated as a design/build company. Nearly all design work is done in-house, except for the occasional partnership with an outside architect on larger, more design-intense luxury homes. The firm starts one or two one-of-a-kind custom homes per year. Other product lines fall into three price points: vacation homes; first-time and first move-up; and upscale move-up. There are six to eight different models in each line, any of which can be customized to the buyer’s specifications.
The company completed four custom homes in 2008, ranging from $500,000 to $700,000, and at press time had a $1.1 million custom home under construction. That’s pricey for the local market, considering that the average resale home sells for about $200,000. One of the area’s attractions is that land is fairly inexpensive. The lots in the Nikles Realty portfolio run from $17,900 to $59,000, “so it’s not really a big decision for somebody to plunk down under $30,000 for land,” says Ed Jr.
|Nikles' custom-home designs include modern Victorial, farmhouse and Cape. The Stone Estate, perched on a hill to capture views is one of his more elaborate homes. Photo by Tom Dwyer|
Nikles is one of the only custom builders in Pike County that subcontracts 100 percent of the work. Many subcontractors have worked for the company 15, 20, 30 or 40 years. Other than superintendents, the company has no field employees. A construction coordinator handles permitting and change orders and keeps customers informed of progress on their homes. There is also a production manager and a purchasing manager who does takeoffs, orders materials, schedules deliveries and works with the project superintendent. “We’ve found that it’s a much more efficient way for us to interact with field personnel and customers,” Nikles says.
Pike County is in the northeastern corner of Pennsylvania, bordered by New York and New Jersey. “We’re 85 miles from metropolitan New York, so most of our buyers come from there or New Jersey,” Nikles says. “They’re a mix of vacation-home buyers, retirees and young families that want to get away from the city.”
The county’s population comprises approximately 60,000 year-round residents, a number that grows to about 160,000 in the summer. Two-thirds of the permanent residents work elsewhere because there are few local businesses.
An estimated 80 percent of the company’s business is generated by referrals for both remodeling and new-construction projects. “Some of the people that we built a vacation home for 10, 15 or 20 years ago are retiring,” Ed Jr. says. “They’ll sell the vacation home and their primary home in New York or New Jersey and we’ll build them a custom home in Pike County.” Adds Ed Sr.: “Our clients shop around, and many, many times they’ll come back and say, 'We’ve decided to build with you because you’ve spent the most time talking with us and giving us information. We feel you’re the people who care.’”
Nikles often remodels the homes of past customers and their friends, finishing basements or bonus rooms or adding screen porches or sundecks. He prefers design/build contracts and rarely bids on a project. All custom and remodeling work is done on a fixed-price basis.
|Larger, more complicated custome homes warrant daily site visits from Nikles (far right).|
Three years ago, the company moved into a new 5,000-square-foot office building and design center. Nikles is the only builder in the area with a showroom. “By the time buyers sign their construction agreement, all decisions on the design are complete and most of the products have been selected, making the construction process run much smoother,” he says. On-staff salespeople, a designer/estimator and a product selections coordinator help buyers select exterior and interior products.
While the senior Nikles shows no signs of retiring just yet, son Ed, whose title is vice president, has been taking on more of the day-to-day operations of the company while his father focuses on growing the business. The company is still profitable but began taking steps last year to pull back. Ed Sr. had a talk with his office staff, some of whom have worked for him for over 20 years.
“I explained that we would have to cut back from a 40-hour week to a 35-hour week and freeze everybody’s wages,” says Nikles. “They seemed to be very understanding. They all want the business to weather the storm.”
Nikles built 53 homes in 2007 and was expecting to complete 31 homes in 2008. This year, of course, is an unknown. But it doesn’t take a crystal ball to figure out what Ed Nikles is going to do: monitor the market, research new technologies, look for business opportunities, and share his vast storehouse of knowledge with younger builders coming up the ranks.
|Graduates from Williamson Free School of Mechanical Trades in Media, Pa.||Co-founds a remodeling and construction company||Builds his first house||Co-founds Pike County Builders Association and serves as its charter president||Forms Ed Nikles Custom Builder with his wife, Beth||Begins operating as a design/build company||Founds Nikles Realty||Introduces line of modular homes for first-time buyers||Becomes a member of the first NAHB Remodeler 20 Club In Poland on a trade mission, teaches Polish builders how to utilize wood in home construction||NAHB publishes Nikles’ Policy and Procedure Manual for Trade Contractors||Moves company into new 5,000-square-foot office and design center||Introduces line of Green Country Homes|