Capital Gains that can't be Taxed

Probably the most often discussed aspect of any of our projects is the cost of building. Capital cost as opposed to cost in use or running costs. Clients are usually most concerned about 'overcapitalising' - spending too much on a commercial building to justify rentals or sales price, or a home owner investing so much that when it comes time to sell they won't 'get their money back'.

If you live on the Auckland Isthmus, where house prices have doubled pretty much every 8-10 years since 1960, then spending too much is not so much of an issue if you're intending to live in the same house for a while - affording it is the tricky bit. And even though the banks are generous nowadays in handing out money, they do tend to want it returned sometime unfortunately...

The greatest fear is that a person's capital will somehow be eroded over time, or even worse, taxed somehow. Yet this obsession with value defined from a monetary basis can distract us from the real capital that we have invested in our buildings.

So where is this 'real capital'? (If you said Wellington please stop reading right now and have a lie down for half an hour...)

If you run a school then your real capital is in your staff, your students, the community - and the value of that capital comes from the ease by which they interact, communicate, learn and grow together. These are all aspects that can be influenced by the architecture of the spaces those people inhabit, and that architecture need not be expensive, just correctly targeted for the right reasons.

At the beach, that capital lies in the ease by which the house allows an easy relationship with the seaside and coast - after all that's the reason for the house actually being there. It's about connection to, involvement with and enjoyment of that landscape - so those that might have built a Taj Mahal on the Omaha waterfront recently perhaps missed the point a bit...

At home, the aim should not be to create a sculptural masterpiece to 'wow' the neighbours. It's to design for family events over time, for those experiences that life offers us, to provide the best environment for us to feel safe, nurtured and cared for when we're there. That's where the 'wow' will come from - the real capital will spring from those relationships, experiences and events that are engendered by the spaces we live, work, meet or learn in. The buildings will feel great and will fit perfectly. It's not something to intellectualise about - that real sense of 'wow' needs to be experienced, and the enjoyment of that experience is not about how much (or little) the thing cost you.

Sure, we need to be pragmatic to a certain degree, and monetary issues are as important as ease of build, site characteristics, timing and even dealing with the Council, but these are functional aspects that can be dealt with by anyone with a modicum of grey matter. We all do that (and we probably analyse it all too much). The important thing is not what or how, even though we need to understand those things - it's why we're really doing it...

The real reason for our work is how buildings affect, inspire, assist and enlighten the people that use them. How the costs can be maximised in terms of the real values that are important to those people and their family, friends and workmates, and offset against the wonderful experiences and memories that are shared with those people most important to us.

It's about increasing the real capital value of a home, or a school, or a workplace - and those are capital gains that can never be eroded, or even taxed.



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