Ed Nikles Named NAHB Custom Home Builder of the Year
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Ed Nikles
NAHB Custom Home Builder of the Year
Photo by Gabe Palacio/Getty Images 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.
Cottage IndustryNikles 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. Mixed Market
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.
| 1962 | 1963 | 1965 | 1978 | 1984 | 1986 | 1991 | 1993 | 1997 | 1998 | 2005 | 2008 |
| 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 |
Ed Nikles has long been proactive about education in the building industry. Since 1972, he has served on the Delaware Valley School District’s Vocational Board of Advisors and presently chairs the Building Trades Advisory Board. Nikles regularly addresses students at Career Days. He has mentored many of them and helped place them in jobs with area builders and trade contractors.
Nikles also likes to share what he’s learned about the business with other home builders. During the recession of 1989-1991, when he was using the same trade contractors for remodeling and new construction, he realized he would need to create written guidelines for those contractors. “We had to train them how to behave in someone’s home — not walk in with muddy shoes and play radios and leave soda cans lying around. If they wanted to work, they would have to adhere to the rules.”
Establishing those guidelines was the first step in developing a policies and procedures manual for trade contractors. In 1997, while president of the Pennsylvania Builders Association (PBA), Nikles donated the publishing rights to the manual to the PBA Training and Education Committee. The manual was sold to PBA members state-wide. The following year, NAHB bought the rights from PBA so it could publish the manual nationally and sell it through BuilderBooks.com. The national exposure led to Nikles’ speaking at 10 seminars over the next nine years. He subsequently wrote “Trade Contractor Relations” for the NAHB and was a contributing writer to “Business Basics for Builders.”
Last year marked yet another milestone in the history of Ed Nikles Custom Builder: green building. Both Ed Sr. and Ed Jr. received a Certified Green Professional designation in 2008. The company also introduced a line of Green Country Homes: four models ranging from 1,546 to 1,686 square feet and priced from $190,000 to $210,000, excluding lot. The first green homes in Pike County, Pa., they are Energy Star-rated and have a baseline silver rating under the NAHB Model Green Home Building Guidelines.
For Nikles, going green wasn’t a steep learning curve. “We found out that we were already building at a bronze or low silver level to begin with, so all we had to do was upgrade a few things.”
Features include triple-pane insulated glass, tankless hot water heaters, low-flush toilets, low-VOC carpet, no-VOC paint, formaldehyde-free fiberglass insulation and Energy Star appliances. Additional green options such as composite decking, bamboo flooring and recycled countertops are available. The focus is on getting to green without more expensive choices such as geothermal heat pumps and solar roof panels.
“Any of our houses can qualify [as green] by adding on certain features, but these models are specifically designed upfront to be green and energy-efficient,” he says. “Buyers can save 30 to 50 percent in heating and cooling costs.”
Nikles has already made one sale off a spec model and is well on the way to becoming Pike County’s green building expert. At press time, he was building a 4,500-square-foot custom home that is expected to score gold under the NAHB program and have a 5-star Energy Star rating. The company is also obtaining approvals for the county’s first all-green subdivision. Other Pike County builders are starting to get on the bandwagon, Nikles says, “but in most cases, there’s a little bit of greenwashing.”
One of Russia’s long-held traditions is the dacha, a seasonal or year-round second home located in the country. That tradition is very much alive with Russians living in America, and Ed Nikles found a way to tap into it.
About 10 years ago, Nikles met a New York City Realtor who had been buying up tax-sale lots in the Poconos. The Realtor planned to sell the lots to Russians looking for a country home. Nikles agreed to build the dachas. His Web site links to a page in Russian advertising lot and home sales (www.russianpoconos.com).
“In Russia, everybody lives in the city,” says Nikles. “There are no suburbs, so they get away by going to the country. To have a dacha means you’ve arrived.”
He estimates that 30 to 40 percent of his buyers are Russian. “The first thing you have to sell them is yourself — then you can start talking about the product.”
The 'how' behind Nikles' stellar customer service Ed Nikles Custom Builder advertises in Harmon Homes (a real-estate magazine) and local newspapers, on billboards and through its Web site. The company also has a booth at the Pike County Builders Association’s annual Home Show and publishes a yearly, full-color, 24-page magazine promoting both the builder and the region. But 80 percent of their business is generated by referrals from past customers and local real-estate agents, due in good part to a finely tuned customer service program. Since 1990, the company has been using a customer service software program that enables it to issue warranty service work orders to each trade contractor and track their progress on a weekly basis. “We use the same trade contractors all the time and know we can count on them for consistent, high-quality work,” says Nikles. “They also know that we’ll pay them every week, and therefore give our jobs priority.” At the final walkthrough and orientation, customers receive forms they can use for warranty requests 60 days and 11 months after move-in. Nikles reviews all requests with the homeowners and issues work orders. Trade contractors have seven days or less to complete a warranty service request; otherwise their check for that week is withheld until the work is completed. “We heard a lot of moans and groans about that in the beginning, but now that they understand the importance of getting the work done expeditiously, it’s rare that warranty service isn’t completed on time,” he says. Eleven-month warranty requests are usually minimal and covered under Nikles’ RWC 12-year structural warranty. “But a lot of times we’ll take care of them anyway, just to keep the customer happy.”
Awards and Affiliations 1978-1979 – Pike County Builders Association organizing member and charter president (also president 1984, 1985 and 1986 and life director) 1983, 1984 – Pike County Builders Association Builder of the Year 1985 – Pennsylvania Builders Association Builder of the Year 1992 – Builder magazine’s America’s Best Builder Award 1994 – NAHB Certified Master Builder 1994 – NAHB Certified Graduate Builder 1995 – Custom Home magazine’s Pacesetter Award for Customer Service 1997 – Remodeling magazine’s Big 50 Remodeler Award 1997 – NAHB Certified Graduate Remodeler 2003 – Pennsylvania Builders Association Distinguished Achievement Award 2006 – Pike County Chamber of Commerce Business of the Year Award 2008 – NAHB Certified Green Professional