Cannot compile NB on a new Mac

I was trying to compile NB on my new Mac machine with Apple's default  
installation of Java and dev tools and it failed with a message:

compile:
     [mkdir] Created dir: /Users/tomslot/SUN/src/main/api.visual/build/
classes
     [javac] Compiling 207 source files to /Users/tomslot/SUN/src/main/
api.visual/build/classes
    [repeat]
   [nbmerge] Failed to build target: all-api.visual

(...)

/Users/tomslot/SUN/src/main/nbbuild/templates/common.xml:126: Error  
starting modern compiler

I am a long time Mac user, but I haven't come across this problem  
before. I guess I am using a wrong version of some tools. Anyways, it  
would be nice if the build system could check system compatibly  
beforehand and produce a meaningful error message.

I am using

$ javac -version
javac 1.5.0_13

$ ant -version
Apache Ant version 1.7.0 compiled on February 29 2008

-TS