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Speaker 1: Luke Alshwager, welcome to the mentor thanks for having us well,

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Speaker 1: but we're welcome back.

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Speaker 2: We have met before, yeah, yeah, maybe a year ago,

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Speaker 2: about twelve months ago. Yeah, and you came into a

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Speaker 2: weekend of small business owner of business owners generally come

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Speaker 2: to my farm and with our mate Jonathan Pas who

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Speaker 2: ran it, and you guys will guess you just say

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Speaker 2: my place.

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Speaker 3: Now. We stayed in town, right, he stayed in town,

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Speaker 3: and then we sort of used your house as the

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Speaker 3: retreat and sort of the business sort of peace. And yeah,

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Speaker 3: it was amazing.

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Speaker 1: And thank you very much.

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Speaker 2: And I remember, I remember you well, and I remember

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Speaker 2: what you were doing at the time, and that's one

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Speaker 2: of the.

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Speaker 1: Things I want to talk to you today. So you're

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Speaker 1: about today. You're the co founder and directed Palm Valley,

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Speaker 1: Gold Coast.

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Speaker 2: But maybe just explain the precinct we are in now.

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Speaker 3: So yeah, so I guess, well physically so we're located

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Speaker 3: on the Gold Coast. So Parkwood Village is formerly a

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Speaker 3: golf course called Parkwood International and I bought it with

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Speaker 3: some partners in twenty ten. Former golf professional you were, yeah,

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Speaker 3: had an opportunity like a lot of touring professionals. Create

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Speaker 3: didn't quite get there, and where I needed to move

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Speaker 3: to was into the golf industry. All I knew was

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Speaker 3: golf became the club professional here and had.

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Speaker 1: Not, so you were the pro in this club.

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Speaker 3: Yeah. I had an opportunity to buy the course and

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Speaker 3: this back in two thousand and nine, so I settled

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Speaker 3: it in twenty ten. And my sort of vision was

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Speaker 3: to create community golf courses traditionally had been very close shop,

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Speaker 3: very private, don't come in the front gate. And what

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Speaker 3: I saw when I was playing around the world was

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Speaker 3: it was the opposite. Let's bring him in, Let's bring

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Speaker 3: in whole of family. And so that's what Parkwood Village is.

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Speaker 3: And back in twenty sixteen, we I bought the Gold

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Speaker 3: Coast Titans in so it was an opportunity to really

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Speaker 3: diversify our customer base and create not only Alice Club,

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Speaker 3: but a high performance center for the footy club. And

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Speaker 3: they were going through some challenges.

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Speaker 1: This is an NROL club, National rugby league.

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Speaker 3: Club, yeah, and so the rugby league club obviously Land

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Speaker 3: Rugby League and the Gold Coast so it's a big

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Speaker 3: opportunity for us. It helped us reposition the site and yeah,

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Speaker 3: and that was really the unearthing of what the site

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Speaker 3: potential was. It's like, it's more than a golf course.

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Speaker 3: What does that look like?

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Speaker 2: So if I could just go back one step, because

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Speaker 2: you were being quite modest in your explanation, then so

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Speaker 2: there was here a golf club, it's probably Approach International

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Speaker 2: Pipe Put International Golf Club. And then you have integrated

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Speaker 2: into that the Gold Coast Titans and aural rugby league side.

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Speaker 2: This is there, what their head offers or their training

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Speaker 2: center or yeah.

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Speaker 3: So what we did was once we identified it. Obviously

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Speaker 3: golf golf as a business model is there's been some

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Speaker 3: challenges in it through the years, and so we've made

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Speaker 3: the golf course profitable. But really where the opportunity was

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Speaker 3: was in the land value, and that land value was

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Speaker 3: mixed use in commercial sport and rerec makes sense. So

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Speaker 3: we built a sport and rec center about four thousand

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Speaker 3: meters and we put the Gold Coast Titans High Performance

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Speaker 3: Center and their administration in there. So from a rugby

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Speaker 3: league point club, their head officers here, the hundredd staff

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Speaker 3: are based here, their training facilities are here.

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Speaker 2: This is the football club football club, not as a

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Speaker 2: league's club.

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Speaker 1: Not as a football club.

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Speaker 3: And then as a part of that deal, we said

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Speaker 3: to them, well you don't really have a league's club,

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Speaker 3: so why don't we become at least your community.

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Speaker 1: Club or that so premises.

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Speaker 3: Yeah, so the fans had a place to come and

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Speaker 3: hang out, and so that dialed up our hospitality menu.

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Speaker 3: So part of those two things, and then the ancillary

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Speaker 3: off that moved into like medical and ancillarious cuscan radiology, physiotherapy,

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Speaker 3: all of those things. So it was a really nice fit.

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Speaker 3: And I wouldn't say it was by design. It was

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Speaker 3: a little bit of we'll suck at and see and

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Speaker 3: it really started, Okay, there's something in this mixed use

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Speaker 3: within these green heartbeats of the city, and that's that's

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Speaker 3: how we got here.

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Speaker 2: So priborly, when it was before all those iterations.

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Speaker 3: Park Valley, Park Valley, so it was Parkwood International.

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Speaker 2: Parkwood International, park Wood International. It was just basically pro shopping.

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Speaker 3: Had a decent clubhouse. Like most clubs if you go

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Speaker 3: to a traditional golf club or a member based golf club,

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Speaker 3: it was a big clubhouse with not much going on. Firstly,

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Speaker 3: so you had a licensed premises that really wasn't being

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Speaker 3: run like a licensed premises. Then you had naden whole

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Speaker 3: golf course.

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Speaker 1: It means that's you're rating tole so to speak.

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Speaker 3: Yeah, yeah, clubhouse. You can have a beer.

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Speaker 2: It was just having a beer and biscuits or something.

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Speaker 3: And like most clubs, they weren't really making money, so

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Speaker 3: your shrink service barely a menu. And so through This

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Speaker 3: is back in twenty ten, and so the golf course

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Speaker 3: had been here since nine to eighty seven. The Japanese

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Speaker 3: built it.

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Speaker 1: So that was the Koma Goo Goomi days. This is

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Speaker 1: when the Japanese were investing.

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Speaker 3: Heavily in the golf course in the mid.

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Speaker 1: Eighties to ladies, yes, I remember it.

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Speaker 3: And then they exited en Mass and so what we

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Speaker 3: had was back in the late eighties and we had

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Speaker 3: all the major golf courses being built by the Japanese

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Speaker 3: at that point. And so we had par Meadows, which

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Speaker 3: was an iconic course that Greg Norman, they had the

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Speaker 3: first million dollar even and so they built Parmettos, they

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Speaker 3: built Parkwood, and we were the really first two resort

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Speaker 3: style facilities on the Gold Coast. Where Parkwood was sat

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Speaker 3: at that point was really rural bushland outside of the coast.

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Speaker 3: When we're three point ninek longis from Southport, so we're

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Speaker 3: in the middle of town. But back then for the

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Speaker 3: local gold Coasters, there was a town.

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Speaker 2: Yeah, and it was pretty It would have been pretty

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Speaker 2: pioneering stuff.

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Speaker 1: Then to build a golf course.

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Speaker 3: Totally, I mean, there was no commercial basis for it.

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Speaker 3: I mean, I think they'd owned it from eighty seven.

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Speaker 3: I think they sold it to a Korean group in

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Speaker 3: two thousand and five. They wouldn't have made profit through

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Speaker 3: that period. It was they built something, and it was

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Speaker 3: built well. I remember when we did some renovations, we

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Speaker 3: looked like a podium deck out the front of this

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Speaker 3: thing was a four hundred mili slab, like there was

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Speaker 3: no everything was built right, like the fridge Backer House

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Speaker 3: is still working today. Like when they did things, they

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Speaker 3: did it really well. So we're really fortunate there. The

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Speaker 3: base golf course, it was good, the route's good. It's

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Speaker 3: in the bottom of this little valley. And so as

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Speaker 3: a golf pro was I mean, for me, it was

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Speaker 3: a big opportunity. I'd sort of had a career that

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Speaker 3: didn't quite cut the mustard, and I need to get

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Speaker 3: a real job at the back end of my playing

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Speaker 3: and to have an opportunity to buy a course. At

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Speaker 3: the time, I was sort of reading a book about

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Speaker 3: what I now understand our options and how to buy

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Speaker 3: stuff with no money because I had no money.

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Speaker 1: Yeah, golf course wouldn't have been cheap.

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Speaker 3: And so at this point I probably wasn't thinking about

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Speaker 3: buying a golf course, but I was trying to trying

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Speaker 3: to sort of grind my way through and find my way.

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Speaker 3: But being a club pro here and then at an

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Speaker 3: international purchases international owners at the time they wanted to sell,

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Speaker 3: I'm like, I'll buy it.

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Speaker 2: Can we just stop there? From a lucas A lot

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Speaker 2: of people would like to know how this sort of

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Speaker 2: thing works. So just to paint the picture a little bit,

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Speaker 2: here are twenty years ago yep, round about twenty years

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Speaker 2: ago form a golf pro, still golf pro, being on

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Speaker 2: the professional circuit, but probably it wasn't making a.

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Speaker 1: Very well paid golf making the amount of money you

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Speaker 1: wanted to get.

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Speaker 2: And it's a tough business and it's very competitive obviously,

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Speaker 2: both on a global scales, not just here in Australia

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Speaker 2: and particularly here in the Gold Coast. An organization like

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Speaker 2: some Japanese or organization decides to as part of you know,

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Speaker 2: the investments in Queensland, which there was lots of them.

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Speaker 1: They built lots of golf courses here, but this is

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Speaker 1: one of the first ones they built.

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Speaker 2: Which, by the way, you know, to give people context,

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Speaker 2: if I go east from here for kilometers, I'm on

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Speaker 2: the coast. Yeah you're I'm I'm at in South Stralia. Yeah, yeah, correct, correct,

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Speaker 2: right there, right there, I'm in I'm swimming in the water.

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Speaker 2: So but then when this was built, you would have

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Speaker 2: been thinking to yourself, well, this is a back and

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Speaker 2: were really I'm now I've been now pointed to be

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Speaker 2: the surfer, the to be the golf pro here.

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Speaker 3: Yeah. Well, I mean there's a bit of a it's

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Speaker 3: for me, like for kids that grow up with the

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Speaker 3: aspirations of men. I mean I was the guy that

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Speaker 3: I want to be number one in the world. So

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Speaker 3: there's a bit of arrogance for I don't know what

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Speaker 3: you want to call it. If you can believe, yeah,

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Speaker 3: if you can believe, you can be the number one,

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Speaker 3: and I generally did, and I hung it all out there.

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Speaker 3: I left school young and that was all I wanted

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Speaker 3: to do, so to have the ambition or arrogance, whatever

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Speaker 3: you want to call it, to say that you're always

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Speaker 3: like it's hard to not look with a big lens.

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Speaker 3: And so coming back to being a golf pro is

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Speaker 3: a fall from grace a little bit, and it's not

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Speaker 3: I mean in my head at the time, it was

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Speaker 3: I look at the.

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Speaker 1: Visional Golf proposed for a professional.

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Speaker 3: Golfuring professional, so Greg Norman, you're out of Scots and

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Speaker 3: those guys through to a traditional club professional. And at

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Speaker 3: that point, if someone had asked me when I was

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Speaker 3: wanting to be a touring professional, you want to be

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Speaker 3: a club bro, I mean, that's the you nearly felt.

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Speaker 3: It was like the failed golf pro tour professional. So

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Speaker 3: so for me that transition, like a lot of athletes,

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Speaker 3: transitioning is sometimes not as easy. But I was very

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Speaker 3: hungry and I hadn't really tasted success as a player,

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Speaker 3: so I was like, what next, And so I think

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Speaker 3: as I took the club pro job on where I

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Speaker 3: was working for the club, I hadn't really turned that off, right,

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Speaker 3: It was like, what's next? And when I.

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Speaker 1: Am looking all the time forwards next.

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Speaker 3: I was at the time, Yeah, I couldn't. I was insatiable.

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Speaker 3: I wanted to find work. Yes, and I've been like

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Speaker 3: that even in my carrent I mean, how we got

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Speaker 3: to the wavepiol and when we get to that. But

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Speaker 3: I'm always looking for how to grow. And what I

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Speaker 3: had to do was temper that as well. Right, what

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Speaker 3: the club Pro job did put my feet on the ground.

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Speaker 3: It made me slow down. I had to serve the customer.

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Speaker 1: I had to earn a wage.

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Speaker 3: Yeah, I had to earn a wage, and it was

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Speaker 3: to be honest, it was the first time it had

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Speaker 3: to really earned a proper wage early days with your

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Speaker 3: little part time jobs and stuff like that, but it

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Speaker 3: was the first time I was paying rent. And because

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Speaker 3: you're bunking in houses your mum and dad anyway, you

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Speaker 3: can survive, and sponsors get you through year golf career.

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Speaker 3: And so the park would thing if I in the

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Speaker 3: revision mirror as the club Pro was like the making

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Speaker 3: of the early making of business knowledge for me because

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Speaker 3: it was simple as you walk in and selling you

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Speaker 3: a Mars bar a green fee and a bottle of

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Speaker 3: coke or a bottle of water. Lessons maybe, yeah, and

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Speaker 3: some lessons, but the primary income was I sell I

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Speaker 3: buy the bottle for two dollars. I sell it to

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Speaker 3: you for five dollars, and I do that a few

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Speaker 3: hundred times a day. I'm mostually making some good money

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Speaker 3: because that's how cloud pro contract works. You're not in

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Speaker 3: a salary scenario. You own the rights to the pro

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Speaker 3: shop revenue.

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Speaker 1: Wow, wow, I did you know that.

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Speaker 3: Yeah, So that's the traditional way of a club row.

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Speaker 3: So I had the I was servicing the golf course

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Speaker 3: and they outsourced that to a professional, and so I

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Speaker 3: was in a small business overnight with no overheads though, right,

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Speaker 3: I don't have to pay rent, don't.

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Speaker 1: Have to verable cost. It's a veriable cost.

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Speaker 3: Yeah.

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Speaker 1: As you as you own, you pay.

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Speaker 3: Yeah. And what was really interesting about that was it

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Speaker 3: taught me to first low down and you can't do

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Speaker 3: ninety things at once and getting and making a monthly

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Speaker 3: profit which then became my salary and ongoing. So there

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Speaker 3: was a real shift from that, which was partly what

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Speaker 3: I thought negative at the time, and in the revision

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Speaker 3: Merritor was the making of my base fundamental of how

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Speaker 3: to grab something that doesn't make profit and turn it

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Speaker 3: to profit.

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Speaker 1: That's interesting. They're too late every month.

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Speaker 2: It would have been accounting, so someone would have said, look,

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Speaker 2: you know you sold one hundred bttles of water.

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Speaker 1: And each bottle cost you two bucks.

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Speaker 2: It is two hundred, and you sold them for five

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Speaker 2: hundred and the surrounded profits like you would have got

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Speaker 2: into this mad.

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Speaker 3: I didn't know what a balance sheet was when I started.

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Speaker 3: I couldn't have told you what a balance sheet was

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Speaker 3: if you'd ask me. P and L, like I said,

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Speaker 3: left school young. So it was a real birth of fire.

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Speaker 3: But I got it quickly. I had that intuitive nature,

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Speaker 3: like you walk in, like how much money can I

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Speaker 3: extract out of you from my pros?

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Speaker 1: When the rents sort of hanging off it?

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Speaker 2: You know, you got to pay rend or whatever you

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Speaker 2: got to do, or you buy food, you got to

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Speaker 2: buy clothes, or you want to go down the pub

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Speaker 2: with your mates, you got to pay you away quick.

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Speaker 2: Right now, you work that shit out pretty fast. Yeah

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Speaker 2: and L has become second nature.

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Speaker 3: Yeah, and it really did. And I didn't even it

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Speaker 3: was non sophisticated, but it was commercially on point. And

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Speaker 3: as I've become more sophisticated, I look back and there

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Speaker 3: like I got that quick. I got the commercial side

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Speaker 3: of it quick. Scaling then was a whole different thing.

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Speaker 2: Yeah, but hard to scale one one of yourself. So

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Speaker 2: and then during that period, Luke, you do you get

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Speaker 2: to know the people who owned own the place a

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Speaker 2: little bit?

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Speaker 1: How did that all come?

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Speaker 3: So, like a lot of the international owners in many

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Speaker 3: asset classes, there's an owner's rep typically is the one

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Speaker 3: you're interfacing with. And so they had a couple on

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Speaker 3: the ground that really didn't know anything about their property.

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Speaker 3: And do you mean so that two staff that were

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Speaker 3: probably sent from at this point that was career and

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Speaker 3: I'd played a little bit on the career. I played

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Speaker 3: some events up in Korea at the right at the

289
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Speaker 3: back end of my career, and I loved it, love

290
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Speaker 3: the food, love the culture, And that's how I really

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Speaker 3: owended up here. And so there was a couple of

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Speaker 3: stuff that had here but really didn't know what golf

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Speaker 3: operations was. It was a hard business, right, Golf had

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Speaker 3: been overdeveloped and the revenues were declining at the time.

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Speaker 3: And so I knew the owner's reps and they had

296
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Speaker 3: a couple of purchases come through property buyers, yeah, potential

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Speaker 3: purchases of the property, and I went, well, I'm I

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Speaker 3: could see it was very difficult for them to sell it.

299
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Speaker 3: So for what they paid, they paid five point five

300
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Speaker 3: million dollars I think it was from the Japanese and

301
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Speaker 3: they were losing at least half of me and maybe

302
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Speaker 3: seven hundred a year. I didn't have full visibility on

303
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Speaker 3: the number, but they were definitely losing money and the

304
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Speaker 3: service are going down. The quality, of course is going down,

305
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Speaker 3: and so I could just see that vision I've had

306
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Speaker 3: from when I was living and working way. I just

307
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Speaker 3: need to open this gates up. They need to make

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Speaker 3: it full community and family.

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Speaker 1: Can I just stop?

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Speaker 3: It?

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Speaker 2: Is the reason why this place was losing money? Whatever

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Speaker 2: the amount doesn't really matter that much. But was losing money?

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Speaker 2: Is it because golf was on the decline or was

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Speaker 2: it because this place wasn't like at a standard where

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Speaker 2: you could get more people in.

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Speaker 3: So it's probably both both. Golf was declining, which at

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Speaker 3: the moment it's going the opposite. It's growing like I've

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Speaker 3: never seen it. Is it. It's blowing up COVID. What

319
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Speaker 3: COVID did golf and the young people, it's phenomenal, right,

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Speaker 3: And I'm really enjoying it too, as a kid who

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Speaker 3: grew up in the game and now I'm forty eight.

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Speaker 3: I'm like, this is awesome watching my son who because

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Speaker 3: Bronnie James and lebron James are playing, he wants to

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Speaker 3: play golf. Fantastic. But I think it was both. I

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Speaker 3: think when you have a tired asset this, when you're

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Speaker 3: not reinvesting, eventually it dies. If you just think of

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Speaker 3: it like a restaurant, right, if you're not doing an

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00:14:22,240 --> 00:14:24,880
Speaker 3: FF and sort of fit out properly every sort of

329
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Speaker 3: five to seven years, then you're not going to you're

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Speaker 3: not going to be there.

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Speaker 1: And you're talking about there is stuff in the inside

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Speaker 1: the clubhouse.

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00:14:31,200 --> 00:14:35,440
Speaker 3: Yeah, all the amenities, yeah, the amenities, new bathrooms, Yeah,

334
00:14:35,640 --> 00:14:37,080
Speaker 3: just if you don't walk in and if it's not

335
00:14:37,160 --> 00:14:39,320
Speaker 3: on point. If you look at the great hospitality people,

336
00:14:39,440 --> 00:14:41,920
Speaker 3: they do it well and they always do it really well,

337
00:14:42,040 --> 00:14:45,120
Speaker 3: and they are constantly innovating around that. Well. This golf

338
00:14:45,160 --> 00:14:46,800
Speaker 3: course win this since nineteen eighty seven and it was

339
00:14:46,840 --> 00:14:49,640
Speaker 3: now two thousand and ten. Yeah, and it hadn't had

340
00:14:49,680 --> 00:14:52,200
Speaker 3: a dollar spent on it in real terms, and so

341
00:14:52,480 --> 00:14:54,920
Speaker 3: that was part of the problem. The second part was

342
00:14:56,400 --> 00:14:58,920
Speaker 3: it was running a business model that didn't exist really anymore.

343
00:14:59,080 --> 00:15:00,480
Speaker 3: Like a lot of golf clubs. So it was all

344
00:15:00,560 --> 00:15:03,760
Speaker 3: members in private and a little bit of public occasionally.

345
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Speaker 1: So public weren't able to just turn up another game.

346
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Speaker 3: They could, but it was not advertised and branded like that,

347
00:15:08,480 --> 00:15:13,320
Speaker 3: like they were open. But most clubs, or most most

348
00:15:13,360 --> 00:15:15,440
Speaker 3: of the market believe like you have to have to

349
00:15:15,480 --> 00:15:17,800
Speaker 3: be a member to play golf most courses. There's a

350
00:15:17,840 --> 00:15:20,960
Speaker 3: few public courses in every city, and so it played

351
00:15:21,040 --> 00:15:24,000
Speaker 3: like a members club. And so as we got here

352
00:15:24,160 --> 00:15:27,520
Speaker 3: and were part of the shift was to how to

353
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Speaker 3: bring more people in. So immediately looking at things like

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Speaker 3: the hospitality elements.

355
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Speaker 1: This is before after you bought so well a little

356
00:15:35,480 --> 00:15:36,200
Speaker 1: while while before.

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Speaker 3: So that was but I was teetering on the edges.

358
00:15:37,960 --> 00:15:40,200
Speaker 3: I was playing with very little money. I think I

359
00:15:40,280 --> 00:15:43,400
Speaker 3: borrowed twenty grand from my parents to fit out my

360
00:15:43,480 --> 00:15:47,360
Speaker 3: pro shop, painted the walls myself, normal small business story.

361
00:15:48,440 --> 00:15:51,440
Speaker 3: But once we had control of it, then we could

362
00:15:51,480 --> 00:15:54,200
Speaker 3: start moving the big pieces on the paper. But at

363
00:15:54,240 --> 00:15:56,720
Speaker 3: that point we'd had a bit of momentum around membership,

364
00:15:56,760 --> 00:16:00,760
Speaker 3: and I felt at the time my vision was sort

365
00:16:00,800 --> 00:16:06,360
Speaker 3: of weddings, community, miniature golf, bringing other things in, things

366
00:16:06,400 --> 00:16:09,680
Speaker 3: that were very operationally focused, and my partners were incredible.

367
00:16:09,720 --> 00:16:11,320
Speaker 3: The guys that we bought the golf club with a

368
00:16:11,680 --> 00:16:16,840
Speaker 3: friends of a family, very high level pitch, I want

369
00:16:16,880 --> 00:16:19,360
Speaker 3: to buy golf course pretty much looking at me like

370
00:16:19,440 --> 00:16:23,800
Speaker 3: what are you thinking about? Like yeah, and under and

371
00:16:24,480 --> 00:16:26,560
Speaker 3: as you know when you bringing these guys were sophistical.

372
00:16:26,640 --> 00:16:28,760
Speaker 3: They founded a company called health World Inner Health plus

373
00:16:29,000 --> 00:16:32,800
Speaker 3: these guys Michael and Leon Brosnen and the Grant family

374
00:16:32,840 --> 00:16:35,280
Speaker 3: Allen Grant. So they sent old Alan Grant down, a

375
00:16:35,320 --> 00:16:37,360
Speaker 3: gritty accountant that had worked years and years for our

376
00:16:37,920 --> 00:16:39,920
Speaker 3: with the boys and helped them form this company that

377
00:16:40,720 --> 00:16:43,840
Speaker 3: was exceptional. And the brief was nearly like do whatever

378
00:16:43,840 --> 00:16:45,720
Speaker 3: you can to tell Luke when not buying it. And

379
00:16:45,800 --> 00:16:47,440
Speaker 3: by the time I'd had an hour with Alan, He's like,

380
00:16:47,520 --> 00:16:51,960
Speaker 3: we're buying it. But really what that was it was

381
00:16:52,000 --> 00:16:54,080
Speaker 3: a land purchase. You're buying fifty six hectares for not

382
00:16:54,160 --> 00:16:58,120
Speaker 3: a lot of money, but they gave me enough rope

383
00:16:59,080 --> 00:17:01,400
Speaker 3: to not blow it up and a lot of money

384
00:17:01,440 --> 00:17:03,160
Speaker 3: over the years over the first five or six years.

385
00:17:03,160 --> 00:17:05,280
Speaker 3: And it took us about that to really get it right.

386
00:17:05,320 --> 00:17:08,200
Speaker 3: And that was I think Michael has said it a

387
00:17:08,280 --> 00:17:10,160
Speaker 3: few times over the years. It's like we probably spent

388
00:17:10,200 --> 00:17:13,600
Speaker 3: three million on your education to understand how to unlock

389
00:17:13,640 --> 00:17:16,720
Speaker 3: the value of the site. But that was really where

390
00:17:16,720 --> 00:17:19,680
Speaker 3: the nuts and bolts were. Was the pro shop year

391
00:17:19,920 --> 00:17:22,879
Speaker 3: or eighteen months was really really critical for me. And

392
00:17:23,000 --> 00:17:24,520
Speaker 3: then it was a how to scale and grow it.

393
00:17:24,600 --> 00:17:26,479
Speaker 3: It's like, okay, we'll put weddings on. I think at

394
00:17:26,480 --> 00:17:28,240
Speaker 3: one point I got to sixty weddings, but I was

395
00:17:28,240 --> 00:17:30,919
Speaker 3: still losing money. Yeah, it was like I didn't understand

396
00:17:30,960 --> 00:17:32,920
Speaker 3: the control elements of the hospital. I understood golf, but

397
00:17:32,960 --> 00:17:35,240
Speaker 3: I didn't know hospital. So I was like, okay, now

398
00:17:35,280 --> 00:17:36,760
Speaker 3: I'm going to every hot So I was in every

399
00:17:36,840 --> 00:17:39,960
Speaker 3: wedding and a touch like get really dirty, understand it,

400
00:17:40,040 --> 00:17:42,560
Speaker 3: better tweak it a bit more. Okay that now profits

401
00:17:42,640 --> 00:17:44,480
Speaker 3: ad the mini golf and so we just started and

402
00:17:44,600 --> 00:17:48,159
Speaker 3: it was all operationally focused and that titans sort of

403
00:17:48,200 --> 00:17:51,240
Speaker 3: opportunity or the master planning opportunity was where it really.

404
00:17:51,440 --> 00:17:55,240
Speaker 1: So how did you think about I might just quickly

405
00:17:55,320 --> 00:17:56,640
Speaker 1: go back to the purchase.

406
00:17:58,240 --> 00:18:00,240
Speaker 2: What do you do when you're in an environment where

407
00:18:00,440 --> 00:18:02,640
Speaker 2: you see there's an opportunity, but at this stage you're

408
00:18:02,880 --> 00:18:05,720
Speaker 2: like an non employee that like, yeah, sort of like

409
00:18:05,760 --> 00:18:06,919
Speaker 2: an employee, you know, the.

410
00:18:06,960 --> 00:18:08,880
Speaker 1: Golf pro at a golf club.

411
00:18:10,400 --> 00:18:14,560
Speaker 2: How do you broach to the owners that, look, I

412
00:18:14,680 --> 00:18:15,639
Speaker 2: might be interested buying this.

413
00:18:16,160 --> 00:18:18,000
Speaker 3: I guess it's that same kid that wants to be

414
00:18:18,040 --> 00:18:20,960
Speaker 3: a golf professional, right, Like for me, it was I

415
00:18:21,040 --> 00:18:23,760
Speaker 3: probably didn't know what I was really asking what of

416
00:18:23,960 --> 00:18:26,240
Speaker 3: myself even like I'm going to buy this? There was

417
00:18:26,320 --> 00:18:26,560
Speaker 3: did you?

418
00:18:27,280 --> 00:18:27,480
Speaker 2: Yeah?

419
00:18:27,520 --> 00:18:29,520
Speaker 3: Yeah, I just went to the owner's rep and I said, look,

420
00:18:29,760 --> 00:18:31,560
Speaker 3: i've seen you taking that through. I'd love the opportunity

421
00:18:31,600 --> 00:18:33,439
Speaker 3: to buy it. And I had read I can't even

422
00:18:33,480 --> 00:18:34,800
Speaker 3: remember the name of the book, but it was it

423
00:18:34,920 --> 00:18:37,080
Speaker 3: was a book about options, and I was trying to

424
00:18:37,119 --> 00:18:39,479
Speaker 3: buy a house or real estate. How do I get

425
00:18:39,520 --> 00:18:43,520
Speaker 3: my foot on a piece of land? And so at

426
00:18:43,560 --> 00:18:46,639
Speaker 3: this point I'm reading the book and I'm pretty dyslexic,

427
00:18:46,720 --> 00:18:48,240
Speaker 3: and so a lot of my readings all being done

428
00:18:48,280 --> 00:18:52,399
Speaker 3: by ebooks and podcast audiobooks, and so I'm reading this

429
00:18:52,480 --> 00:18:54,000
Speaker 3: thing and when I grab something, and so I don't

430
00:18:54,000 --> 00:18:55,480
Speaker 3: often go through books like that. I don't think I

431
00:18:55,600 --> 00:18:58,280
Speaker 3: read a book at school. But when it when it

432
00:18:58,320 --> 00:19:00,440
Speaker 3: bites me, it bites me, and I'll read it. I

433
00:19:00,520 --> 00:19:05,400
Speaker 3: will hardly sleep that night. And that was me looking

434
00:19:05,440 --> 00:19:06,880
Speaker 3: for a thing I didn't think it was the golf course.

435
00:19:06,920 --> 00:19:09,399
Speaker 3: I probably thought it was a house or a flat

436
00:19:09,560 --> 00:19:12,240
Speaker 3: or something like that, and so, but it applied. I

437
00:19:12,359 --> 00:19:13,919
Speaker 3: was like, well, hang on, I'm the club pro. I've

438
00:19:13,920 --> 00:19:15,879
Speaker 3: got a contract over this. It's gonna be hard for

439
00:19:15,920 --> 00:19:19,000
Speaker 3: them to sell it without me embedded in it. So

440
00:19:19,119 --> 00:19:21,560
Speaker 3: I've sort of I've got some leverage here. I don't

441
00:19:21,560 --> 00:19:25,080
Speaker 3: really know what it is, but after the couple visits through,

442
00:19:25,160 --> 00:19:27,240
Speaker 3: it's dried up. No one wants it right, it's a

443
00:19:27,280 --> 00:19:31,400
Speaker 3: fifty six hectare loss making machine. And so we offered

444
00:19:31,440 --> 00:19:32,960
Speaker 3: him a price. We've got to agree on the option,

445
00:19:33,400 --> 00:19:35,199
Speaker 3: and I'm good to go. My partner's going to come

446
00:19:35,240 --> 00:19:36,959
Speaker 3: in and sort of spot me some cash. And then

447
00:19:37,160 --> 00:19:40,000
Speaker 3: just before the that we're done on that contract, they

448
00:19:40,040 --> 00:19:43,000
Speaker 3: pull out. They want a straight cash settlement. Well I'm

449
00:19:43,080 --> 00:19:47,160
Speaker 3: bugget I don't have four million dollars. So I called

450
00:19:47,520 --> 00:19:50,000
Speaker 3: Michael and the guys and I said, well, look that

451
00:19:50,119 --> 00:19:52,239
Speaker 3: one went out and they just said, we're a bit

452
00:19:52,320 --> 00:19:55,280
Speaker 3: high than that number, and they said, just offer them

453
00:19:55,320 --> 00:19:58,879
Speaker 3: a low bull. We'll pay cash. And within I remember

454
00:19:58,920 --> 00:20:01,000
Speaker 3: going from one minute be buying it under an option

455
00:20:01,119 --> 00:20:04,880
Speaker 3: to we're definitely not buying it to offer him a lobel. Yeah,

456
00:20:04,920 --> 00:20:08,119
Speaker 3: maybe we're in and and my partners are unbelievable with me.

457
00:20:08,240 --> 00:20:10,919
Speaker 3: I mean they were really good and they're still my partners.

458
00:20:10,920 --> 00:20:18,679
Speaker 3: They're great people. But they put Alan Grant put me around,

459
00:20:18,760 --> 00:20:21,639
Speaker 3: a really old school quality financial guy, and so they

460
00:20:21,680 --> 00:20:23,760
Speaker 3: grabbed that creativity and the kid that wants to do

461
00:20:23,840 --> 00:20:26,080
Speaker 3: everything at high energy and then go and put an

462
00:20:26,080 --> 00:20:29,400
Speaker 3: account next to him, who it makes me walk through

463
00:20:29,440 --> 00:20:31,639
Speaker 3: the panel line by line, adjust for every number as

464
00:20:31,720 --> 00:20:34,320
Speaker 3: it would. Right, Yeah, it was and it was exceptional.

465
00:20:34,880 --> 00:20:36,359
Speaker 3: And they knew what they were doing there, right, because

466
00:20:36,359 --> 00:20:38,480
Speaker 3: I think they knew my personality and a trustworthy sort

467
00:20:38,480 --> 00:20:41,000
Speaker 3: of person and so they got that. They just said, well,

468
00:20:41,119 --> 00:20:42,840
Speaker 3: we'll just leave Alan with him. And Alan was one

469
00:20:42,880 --> 00:20:44,399
Speaker 3: of if he passed away a few years back at

470
00:20:44,480 --> 00:20:48,520
Speaker 3: ninety three. And yeah, so that was the approach, the owners,

471
00:20:49,240 --> 00:20:53,560
Speaker 3: wrapping it up in a way that gave them some

472
00:20:53,640 --> 00:20:55,800
Speaker 3: security over it. At the end, he risted, yeah, and

473
00:20:55,880 --> 00:20:58,040
Speaker 3: they were these were these were handshake sort of deals too.

474
00:20:58,119 --> 00:21:00,680
Speaker 3: These boys were not we didn't have a shareholders we're talking.

475
00:21:00,800 --> 00:21:03,919
Speaker 3: I mean, I'm only forty eight only, but these were

476
00:21:04,000 --> 00:21:06,159
Speaker 3: like deals you hear about like that's the sort of

477
00:21:06,200 --> 00:21:08,280
Speaker 3: people they were. And it was like, but we'll back you, Luke.

478
00:21:08,359 --> 00:21:11,960
Speaker 3: And but once you get in for more than double digits,

479
00:21:11,960 --> 00:21:14,159
Speaker 3: once you pass ten, like, the deals get a little bit,

480
00:21:14,640 --> 00:21:15,200
Speaker 3: a little bit.

481
00:21:15,119 --> 00:21:16,520
Speaker 1: More robust's a bit more scary.

482
00:21:16,680 --> 00:21:18,760
Speaker 3: Yeah, And even then I'm saying, let's get some shareholders.

483
00:21:18,800 --> 00:21:20,840
Speaker 3: I wanted to protect them, right, and we've had this

484
00:21:20,920 --> 00:21:24,720
Speaker 3: wonderful partnership. But the Koreans were great to deal with.

485
00:21:24,760 --> 00:21:27,840
Speaker 3: They just didn't know the asset they had and the

486
00:21:27,920 --> 00:21:30,159
Speaker 3: planning piece. I remember going through the office and I

487
00:21:30,240 --> 00:21:32,760
Speaker 3: found this master plan and it had a name on

488
00:21:32,840 --> 00:21:34,520
Speaker 3: a dredge in Bell and it was a town planner.

489
00:21:34,560 --> 00:21:36,840
Speaker 3: And I didn't even know what a town planner was. Right,

490
00:21:37,400 --> 00:21:39,200
Speaker 3: I'll just hit a golf ball, right, and now I

491
00:21:39,280 --> 00:21:43,240
Speaker 3: serve a few beers and someone I'm gonna call this

492
00:21:43,320 --> 00:21:45,720
Speaker 3: guy and he moved on and Peter Bell as a

493
00:21:45,720 --> 00:21:47,440
Speaker 3: planner and he's like, let's And so I was just

494
00:21:47,600 --> 00:21:49,560
Speaker 3: very fortunate. When you call the right people, they know

495
00:21:50,400 --> 00:21:52,760
Speaker 3: high quality planner had been around for a long time.

496
00:21:52,920 --> 00:21:54,560
Speaker 3: Made sure I got the right consultants, and the same

497
00:21:54,600 --> 00:21:57,040
Speaker 3: thing with another engineering firm, and so that between two

498
00:21:57,080 --> 00:21:59,840
Speaker 3: consultants at adg and place designer. I was able to.

499
00:22:01,080 --> 00:22:04,119
Speaker 3: I was fortunate. I lucked into some really good quality

500
00:22:04,160 --> 00:22:07,320
Speaker 3: consultants that didn't gudge and gave me some generalist advice.

501
00:22:08,119 --> 00:22:11,160
Speaker 3: But it was master planning and town planning. And then

502
00:22:11,200 --> 00:22:14,840
Speaker 3: I just went for a few years and came up

503
00:22:14,880 --> 00:22:17,760
Speaker 3: come off games were coming, which is just around the corner.

504
00:22:17,800 --> 00:22:19,960
Speaker 3: The village was just around the corners, a couple kilometers

505
00:22:20,000 --> 00:22:24,120
Speaker 3: from here, and there were some of the I guess

506
00:22:24,119 --> 00:22:26,240
Speaker 3: you nell COmON community assets of being lost due to

507
00:22:26,280 --> 00:22:29,159
Speaker 3: the village indoor sport rec center, and he was a

508
00:22:29,240 --> 00:22:30,760
Speaker 3: member here. I'm like, yeah, I might be able to

509
00:22:30,800 --> 00:22:32,960
Speaker 3: build that. Let me see what my planner thinks. And

510
00:22:33,119 --> 00:22:34,840
Speaker 3: we just started to boult it together from there, and

511
00:22:34,880 --> 00:22:37,040
Speaker 3: I remember the first DA we got through. I mean

512
00:22:37,080 --> 00:22:39,800
Speaker 3: it was like, I think for my planner it was

513
00:22:39,800 --> 00:22:41,480
Speaker 3: a pretty VILLI other day, but for me it was

514
00:22:41,520 --> 00:22:43,119
Speaker 3: like you, me and my lamb went from A to

515
00:22:43,280 --> 00:22:45,639
Speaker 3: B in value with a town like I haven't done anything.

516
00:22:45,720 --> 00:22:47,560
Speaker 3: My paper shuffle right, Like I went from being able

517
00:22:47,600 --> 00:22:50,240
Speaker 3: to put golf on it only to medical and sport

518
00:22:50,280 --> 00:22:53,600
Speaker 3: and wreck and mixed use, and the land tripled in value.

519
00:22:54,200 --> 00:22:55,800
Speaker 3: I'm like, how long has this been going on? Like?

520
00:22:56,560 --> 00:22:58,840
Speaker 3: So I immediately then went well, there's more in this

521
00:22:59,040 --> 00:23:01,760
Speaker 3: land and we started to look at retirement and all

522
00:23:01,800 --> 00:23:06,840
Speaker 3: these others. So it was a fast well it felt fast,

523
00:23:06,880 --> 00:23:08,680
Speaker 3: but it was over about six or seven years. But

524
00:23:08,920 --> 00:23:12,320
Speaker 3: I was just hungry for I'd go to every networking breakfast,

525
00:23:12,359 --> 00:23:14,760
Speaker 3: from small business stuff to whether it was with the

526
00:23:14,840 --> 00:23:17,879
Speaker 3: state government at the time, I wouldn't miss an opportunity

527
00:23:17,920 --> 00:23:20,880
Speaker 3: of how would I could to unlock some more land.

528
00:23:21,040 --> 00:23:23,920
Speaker 3: And at the operational site, I was here from open

529
00:23:24,000 --> 00:23:25,520
Speaker 3: to close every day. I bought a house in my

530
00:23:25,560 --> 00:23:27,960
Speaker 3: golf course, me and my family here until I worked

531
00:23:27,960 --> 00:23:28,240
Speaker 3: it out.

532
00:23:28,760 --> 00:23:31,359
Speaker 1: And now what we've been doing today.

533
00:23:31,359 --> 00:23:32,639
Speaker 2: We walked around a bit of a look at some

534
00:23:32,680 --> 00:23:35,680
Speaker 2: stuff and you show me the master plan for was

535
00:23:36,240 --> 00:23:38,960
Speaker 2: we're talking and of course Mick Fanning I think is

536
00:23:39,000 --> 00:23:41,359
Speaker 2: like an ambassador or something somehow involved in the business.

537
00:23:41,400 --> 00:23:44,320
Speaker 2: And we're talking with Mick about it. We're talking about

538
00:23:44,960 --> 00:23:48,720
Speaker 2: you now turning the building here a wave pool.

539
00:23:49,119 --> 00:23:51,800
Speaker 3: Yeah, so what I mean, what is that about? It's

540
00:23:51,880 --> 00:23:54,080
Speaker 3: the evolution of really what we just talked about. I mean,

541
00:23:55,000 --> 00:23:57,720
Speaker 3: once we understood the sites value was in the land,

542
00:23:59,000 --> 00:24:00,920
Speaker 3: I'm a really I mean I'm a mad golfer still,

543
00:24:01,000 --> 00:24:03,000
Speaker 3: right when you start with a club in your hand.

544
00:24:03,840 --> 00:24:05,600
Speaker 3: Golf has always been at the central heartbeat of this.

545
00:24:05,640 --> 00:24:06,920
Speaker 3: For me, I was like, how do I build a

546
00:24:07,040 --> 00:24:10,040
Speaker 3: world class golf aset. What's a modern golfer cit He

547
00:24:10,080 --> 00:24:11,920
Speaker 3: look like you can't just build them and hope people

548
00:24:12,080 --> 00:24:15,080
Speaker 3: join and never play. You've got a couple of memberships

549
00:24:15,080 --> 00:24:16,879
Speaker 3: like that, so I'm about to get you on our

550
00:24:16,880 --> 00:24:21,040
Speaker 3: membership list. But what I realized is that it needed

551
00:24:21,080 --> 00:24:24,359
Speaker 3: to be different, and so that hasn't changed for probably

552
00:24:24,359 --> 00:24:26,160
Speaker 3: six raight years. And a few years ago we got

553
00:24:26,160 --> 00:24:29,520
Speaker 3: approached by a surf technology, particular surf technology, and it

554
00:24:29,560 --> 00:24:32,480
Speaker 3: tweaked me interest. I've never served in my life. But

555
00:24:32,680 --> 00:24:35,440
Speaker 3: Peter Bell, who was a planner but I hadn't engagement

556
00:24:35,440 --> 00:24:37,080
Speaker 3: at the time, had been asked to look for sites

557
00:24:37,119 --> 00:24:38,520
Speaker 3: and he's like, I know a guy that all like this,

558
00:24:39,080 --> 00:24:41,959
Speaker 3: pitched it to me. I'd already got some RESIE approval

559
00:24:42,000 --> 00:24:44,000
Speaker 3: at the time, and we looked at our master planment.

560
00:24:44,119 --> 00:24:46,680
Speaker 3: This is special. The deeper we got into tech, the

561
00:24:46,800 --> 00:24:49,440
Speaker 3: surf technology and what wavepools were, We're like, hang on,

562
00:24:49,520 --> 00:24:51,399
Speaker 3: this is just about to blow up globally. We are

563
00:24:51,520 --> 00:24:54,200
Speaker 3: right at the front of this. So I took a

564
00:24:54,280 --> 00:24:56,440
Speaker 3: couple of years to decide which tech. We've had a

565
00:24:56,480 --> 00:24:57,399
Speaker 3: few of them coming at us.

566
00:24:57,920 --> 00:24:59,320
Speaker 1: We said it as in wavepool tech.

567
00:24:59,400 --> 00:25:02,200
Speaker 3: He was in the wave technology and at that time

568
00:25:02,280 --> 00:25:06,080
Speaker 3: we were master planning. So I've been through the learning phase.

569
00:25:06,119 --> 00:25:08,840
Speaker 3: I really understood, like, let's master plan this is probably

570
00:25:08,880 --> 00:25:10,680
Speaker 3: look at it from an urban design. What are the

571
00:25:10,760 --> 00:25:13,680
Speaker 3: needs from the city met with the city. How do

572
00:25:13,760 --> 00:25:15,760
Speaker 3: I push and pull this a constraint site. So we've

573
00:25:15,760 --> 00:25:19,040
Speaker 3: got floodplane, all the normal geotechnical issues, all of the

574
00:25:19,119 --> 00:25:24,960
Speaker 3: normal environmental issues, all stuck in a flood plan, And well,

575
00:25:25,119 --> 00:25:26,920
Speaker 3: is it possible? It is probably the first question. And

576
00:25:26,960 --> 00:25:29,000
Speaker 3: so we as we unpacked that, we're like, okay, this

577
00:25:29,160 --> 00:25:33,320
Speaker 3: is real. I felt the same application I'd applied to

578
00:25:33,520 --> 00:25:37,840
Speaker 3: a golf course in its diversification of revenue. I wanted

579
00:25:37,880 --> 00:25:39,840
Speaker 3: to apply to these surf parks because these things were

580
00:25:39,880 --> 00:25:42,960
Speaker 3: popping up stand alone, and I'm like, that didn't feel

581
00:25:44,280 --> 00:25:46,560
Speaker 3: long term sustainable. It felt like this is going to

582
00:25:46,600 --> 00:25:48,240
Speaker 3: be an up and a down in regards to that.

583
00:25:48,359 --> 00:25:50,240
Speaker 3: And so I went, well, let's apply that lens to

584
00:25:50,280 --> 00:25:52,240
Speaker 3: I flew it. I went everywhere around the world. I

585
00:25:52,240 --> 00:25:53,600
Speaker 3: looked at every pool that was out of the ground.

586
00:25:53,600 --> 00:25:56,320
Speaker 3: I looked at every pool that was planned. I went

587
00:25:56,359 --> 00:25:59,639
Speaker 3: to this surf park summit probably six years ago, and

588
00:25:59,680 --> 00:26:01,720
Speaker 3: it was more like a bunch of cool surfers hanging

589
00:26:01,760 --> 00:26:04,760
Speaker 3: out was probably yeah maybe yeah, six years ago. But

590
00:26:05,000 --> 00:26:09,360
Speaker 3: now it's developers and property guys and so it's really

591
00:26:09,440 --> 00:26:12,880
Speaker 3: evolving and it's understanding of what the industry is. So yeah,

592
00:26:13,320 --> 00:26:17,240
Speaker 3: it the maturity of the surf and how it became

593
00:26:17,560 --> 00:26:19,639
Speaker 3: was a planner that asked me a question, would you

594
00:26:19,720 --> 00:26:21,600
Speaker 3: be interested? I did what I do is I get

595
00:26:21,760 --> 00:26:25,000
Speaker 3: under it, shake it, push it. We're went onto something here.

596
00:26:25,160 --> 00:26:29,399
Speaker 3: Approached Mick a little long. He'd been approached by a

597
00:26:29,440 --> 00:26:31,520
Speaker 3: lot of technologies, and I think what he really like

598
00:26:31,680 --> 00:26:35,320
Speaker 3: was our approach to masterplan and this wasn't a one

599
00:26:35,400 --> 00:26:40,440
Speaker 3: trick pony and so yeah, I mean mixed Mick. He's

600
00:26:41,200 --> 00:26:43,440
Speaker 3: an incredibly good human was as I got to know

601
00:26:43,560 --> 00:26:45,159
Speaker 3: him through the process, because we signed a sort of

602
00:26:45,240 --> 00:26:48,480
Speaker 3: term sheet like you do, but our DJA took nearly

603
00:26:48,560 --> 00:26:51,480
Speaker 3: three four years and it was running out and like

604
00:26:51,520 --> 00:26:54,080
Speaker 3: do we sign and it felt handshaky and we left

605
00:26:54,119 --> 00:26:55,879
Speaker 3: it like that, and I was able to build an

606
00:26:55,880 --> 00:26:58,639
Speaker 3: authentic relationship with Mick that it feels more like a

607
00:26:58,720 --> 00:27:01,800
Speaker 3: friendship than a business deal. And some mix inequity participant

608
00:27:01,840 --> 00:27:04,919
Speaker 3: in the Ambassador and it feels real. We got him

609
00:27:04,920 --> 00:27:05,800
Speaker 3: in the pool in Munich.

610
00:27:05,840 --> 00:27:08,359
Speaker 1: So the technology we're using he mentioned that, he said

611
00:27:08,359 --> 00:27:09,440
Speaker 1: he be the minting one.

612
00:27:09,600 --> 00:27:11,320
Speaker 3: And that was great for me. It was a big day. Right,

613
00:27:11,400 --> 00:27:14,160
Speaker 3: I've got my now partner Ambassador rolling in the pool.

614
00:27:14,200 --> 00:27:15,359
Speaker 3: I'm like, I hope he likes the product.

615
00:27:15,440 --> 00:27:18,600
Speaker 1: And Mick Fanning of course, yeah, and well renowned and.

616
00:27:18,600 --> 00:27:19,959
Speaker 3: If he doesn't like to surf, we've got a bit

617
00:27:19,960 --> 00:27:22,359
Speaker 3: of a problem in this master plan. Right, So that

618
00:27:22,520 --> 00:27:26,680
Speaker 3: was a big day and yeah, so really interesting. But

619
00:27:26,760 --> 00:27:28,119
Speaker 3: if I bring it back to me, it was just

620
00:27:28,240 --> 00:27:30,840
Speaker 3: good urban design, like what are these? These are inland

621
00:27:30,960 --> 00:27:37,440
Speaker 3: beaches that produce on demand every day, all day forever.

622
00:27:37,280 --> 00:27:40,480
Speaker 1: From the respect of Mother nature. Just keep doing it.

623
00:27:40,760 --> 00:27:42,520
Speaker 3: Yeah, and so for those surfers. And I didn't know

624
00:27:42,560 --> 00:27:45,320
Speaker 3: this at the time, but like nature's brutal, right, well, no,

625
00:27:45,440 --> 00:27:48,080
Speaker 3: nature's brutal, but I didn't know how often surf turns

626
00:27:48,160 --> 00:27:52,080
Speaker 3: off and how the conditions too much. Yeah, and even

627
00:27:52,119 --> 00:27:53,920
Speaker 3: for me now that I do love it a getting

628
00:27:53,920 --> 00:27:55,560
Speaker 3: out there as soon as it pumps properly. I can't

629
00:27:55,600 --> 00:27:58,240
Speaker 3: surf that either, So I've got this very small narrow

630
00:27:58,320 --> 00:28:01,080
Speaker 3: window and wave pools. I said this a couple of

631
00:28:01,119 --> 00:28:05,680
Speaker 3: times at where I've done some speaking for around the

632
00:28:05,760 --> 00:28:09,920
Speaker 3: surf piece. The way, the surf park industry is just

633
00:28:10,000 --> 00:28:13,040
Speaker 3: about to have its chairlift moment. So back in the

634
00:28:13,119 --> 00:28:16,680
Speaker 3: ski industry when it was really one gondola and there's

635
00:28:16,720 --> 00:28:19,359
Speaker 3: nothing else, and there's very little families going to these resorts,

636
00:28:19,400 --> 00:28:21,359
Speaker 3: when those chairlifts dropped in on scale and all the

637
00:28:21,400 --> 00:28:23,760
Speaker 3: tea barts and all that, it brought it to a

638
00:28:23,880 --> 00:28:26,920
Speaker 3: mass market. You can put a nonsurfer in one of

639
00:28:26,960 --> 00:28:29,320
Speaker 3: these lagoons and get them too genuinely surf very quick

640
00:28:29,480 --> 00:28:31,320
Speaker 3: in a short period. You can take a medium, a

641
00:28:31,400 --> 00:28:34,320
Speaker 3: good athlete, mediums to nonsurfer and turn them into a

642
00:28:34,359 --> 00:28:38,360
Speaker 3: reasonable because of the rints, it's a driving range for surfers.

643
00:28:38,800 --> 00:28:40,560
Speaker 3: Like if you and I go and take up golf,

644
00:28:40,600 --> 00:28:42,080
Speaker 3: we can't get a pro and we get a lesson

645
00:28:42,160 --> 00:28:43,960
Speaker 3: or two and me it balls every Tuesday and Thursday.

646
00:28:44,600 --> 00:28:46,160
Speaker 3: You can now do that with surfing, and.

647
00:28:46,200 --> 00:28:48,760
Speaker 1: Then you're going to have a residential element as well.

648
00:28:49,200 --> 00:28:51,280
Speaker 3: Yeah, and that was that master planning pieces like well,

649
00:28:51,320 --> 00:28:53,560
Speaker 3: people like living on golf courses and people like living

650
00:28:53,600 --> 00:28:56,920
Speaker 3: on beaches. And I flew to Brazil to check the

651
00:28:57,000 --> 00:28:59,160
Speaker 3: pool out. There was two pools, one in construction, well sorry,

652
00:28:59,160 --> 00:29:02,600
Speaker 3: two operational, one construction. And I got to this pool

653
00:29:02,600 --> 00:29:04,040
Speaker 3: in a Brazil and I'm walking in and I typically

654
00:29:04,120 --> 00:29:06,080
Speaker 3: video as i'm walking in, just so I can remember

655
00:29:06,440 --> 00:29:08,800
Speaker 3: what it was when you do these things. And I

656
00:29:08,920 --> 00:29:10,320
Speaker 3: had my head in the camera and I'm not really

657
00:29:10,360 --> 00:29:12,640
Speaker 3: paying much attention. I'm sort of walking through and the

658
00:29:12,720 --> 00:29:15,560
Speaker 3: broader spectrum and I dropped my my eyes lifted. It

659
00:29:15,640 --> 00:29:17,720
Speaker 3: felt like a beach. It was like, holy shit, this

660
00:29:17,880 --> 00:29:21,240
Speaker 3: thing's unbelievable. It felt like I was in a sort

661
00:29:21,240 --> 00:29:25,360
Speaker 3: of norsea of Hawaii. It was just crissand beautiful, like grass,

662
00:29:25,880 --> 00:29:28,600
Speaker 3: palm trees. And I'm like, this is different to the

663
00:29:28,600 --> 00:29:30,200
Speaker 3: pools I'd seen at this point. Most of them are

664
00:29:30,240 --> 00:29:34,200
Speaker 3: built like pool decks, nearly like a more built form,

665
00:29:35,000 --> 00:29:38,760
Speaker 3: constraints sites, no real element of that. And we'd had

666
00:29:38,800 --> 00:29:40,800
Speaker 3: a da in at that point, and I'm like, we're

667
00:29:40,840 --> 00:29:43,000
Speaker 3: blowing up our landscaping plan. We looked like a pool deck.

668
00:29:43,080 --> 00:29:45,520
Speaker 3: We need to look like this, and so I literally

669
00:29:45,880 --> 00:29:49,360
Speaker 3: held out for ninety days and re submitted our landscaping

670
00:29:49,360 --> 00:29:51,920
Speaker 3: to get the organic because I'm like, real estate sells

671
00:29:51,920 --> 00:29:54,320
Speaker 3: pretty good on beaches around the world. So if I

672
00:29:54,400 --> 00:29:57,440
Speaker 3: can have the two strong elements, and if I can

673
00:29:57,480 --> 00:30:01,360
Speaker 3: make the beach feel like a beach organically, that's more

674
00:30:01,440 --> 00:30:05,520
Speaker 3: pleasing than a hard stand. So yeah, that the real

675
00:30:05,600 --> 00:30:09,120
Speaker 3: estate for me has driven this project immensely because it's

676
00:30:10,440 --> 00:30:12,920
Speaker 3: it's the real balance sheet. It's the big ticket item,

677
00:30:13,880 --> 00:30:16,560
Speaker 3: and then the flip side of it is the operational

678
00:30:16,600 --> 00:30:19,040
Speaker 3: and how that works. But when we're master planning is like,

679
00:30:19,040 --> 00:30:20,560
Speaker 3: if it doesn't take the real estate box, if it

680
00:30:20,560 --> 00:30:22,280
Speaker 3: doesn't take the mixed use boss, and it doesn't take

681
00:30:22,280 --> 00:30:25,240
Speaker 3: the operational, then we keep going. We're just round in circles.

682
00:30:25,800 --> 00:30:28,080
Speaker 1: So where are you guys at now?

683
00:30:28,760 --> 00:30:32,840
Speaker 3: Yes, so we've now secured all the land security approvals.

684
00:30:32,960 --> 00:30:35,480
Speaker 3: We're in what I'm calling an off phrase, an off

685
00:30:35,560 --> 00:30:37,320
Speaker 3: market raise. At the moment, we're just going to some

686
00:30:37,400 --> 00:30:40,240
Speaker 3: family and friends and mine net worths to just talk

687
00:30:40,280 --> 00:30:42,840
Speaker 3: to them about We're calling it a little founders collective

688
00:30:42,960 --> 00:30:45,040
Speaker 3: and that's pretty cool. And a couple of the pools

689
00:30:45,040 --> 00:30:49,280
Speaker 3: in the us have raised all their equity in that

690
00:30:49,440 --> 00:30:52,160
Speaker 3: so we're in our equity raised debt, and equity evaluations

691
00:30:52,200 --> 00:30:54,040
Speaker 3: dropped next week. So I just had a little chat

692
00:30:54,080 --> 00:30:56,760
Speaker 3: with the value of last Thursday. It's feeling okay, it's

693
00:30:56,800 --> 00:30:58,720
Speaker 3: a nervous time, right. You sput a lot into a project.

694
00:30:58,720 --> 00:31:00,200
Speaker 3: You want to make sure those numbers stack so we

695
00:31:00,280 --> 00:31:01,840
Speaker 3: can unlock the debt. That's feeling.

696
00:31:02,480 --> 00:31:03,920
Speaker 1: The way you would go about it, though, Luke, is

697
00:31:03,960 --> 00:31:04,160
Speaker 1: that you.

698
00:31:04,360 --> 00:31:06,200
Speaker 2: I think what you're saying is that you'll raise some

699
00:31:06,320 --> 00:31:08,920
Speaker 2: equity and you'll borrow some money so that you can

700
00:31:09,000 --> 00:31:11,120
Speaker 2: get the people who put the wreck equity get some.

701
00:31:11,200 --> 00:31:12,479
Speaker 1: Leverage into the property.

702
00:31:12,960 --> 00:31:15,960
Speaker 2: And but a lot of it depends on the valuation

703
00:31:16,040 --> 00:31:17,200
Speaker 2: because you've got to know how much you're going to

704
00:31:17,240 --> 00:31:20,280
Speaker 2: give way. So like you walk out to an equity person,

705
00:31:20,360 --> 00:31:23,200
Speaker 2: you say, well, it's worth I know, half a billion

706
00:31:23,280 --> 00:31:26,200
Speaker 2: dollars for them, just picking a number. We want to

707
00:31:26,280 --> 00:31:29,160
Speaker 2: raise one hundred, so we're going to put out there.

708
00:31:30,080 --> 00:31:32,080
Speaker 2: We're want to raise twenty one hundred of equity, so

709
00:31:32,120 --> 00:31:33,920
Speaker 2: we're going to put out twenty percent. We're going to

710
00:31:33,960 --> 00:31:36,240
Speaker 2: eat twenty percent away. I'm just making numbers up for

711
00:31:36,320 --> 00:31:39,080
Speaker 2: the sake of the audience. But yeah, it's along those lines.

712
00:31:39,080 --> 00:31:40,560
Speaker 2: That's why the vowels are very important.

713
00:31:40,680 --> 00:31:42,320
Speaker 3: Yeah. So what we're doing right now with the vow

714
00:31:43,280 --> 00:31:46,160
Speaker 3: is so we're going to raise forty nine percent equity

715
00:31:47,320 --> 00:31:49,600
Speaker 3: in a press share. One of the things I really

716
00:31:49,720 --> 00:31:51,880
Speaker 3: like about my partners and how we bought the golf

717
00:31:51,920 --> 00:31:54,760
Speaker 3: club was I really respect the capital right we come from.

718
00:31:55,840 --> 00:31:57,640
Speaker 3: I mean, you put money into my business, you need

719
00:31:57,720 --> 00:32:00,120
Speaker 3: to be like, I shouldn't be getting paid before or

720
00:32:00,200 --> 00:32:01,880
Speaker 3: you get paid, and so making sure that pref is

721
00:32:01,920 --> 00:32:02,320
Speaker 3: done right.

722
00:32:02,440 --> 00:32:04,560
Speaker 2: So you need to explain, well, maybe we can both

723
00:32:05,480 --> 00:32:08,160
Speaker 2: to the listeners, but the issue of a pressure means

724
00:32:08,200 --> 00:32:10,440
Speaker 2: that they get preference. In other words, they get paid

725
00:32:10,440 --> 00:32:12,440
Speaker 2: a give it in first, where sometimes you don't even

726
00:32:12,440 --> 00:32:15,080
Speaker 2: get a divident and you get paid a return like

727
00:32:15,240 --> 00:32:15,800
Speaker 2: an interest rate.

728
00:32:16,080 --> 00:32:18,360
Speaker 3: Yeah. So the way we're structuring at the moment, there's

729
00:32:18,400 --> 00:32:20,280
Speaker 3: some final tweaking to that, but the way we're structuring

730
00:32:20,320 --> 00:32:22,160
Speaker 3: at like when you say that some of the audience

731
00:32:22,200 --> 00:32:24,480
Speaker 3: won't know this. I mean two years ago, I didn't

732
00:32:24,480 --> 00:32:26,160
Speaker 3: know what this was. I knew what the mechanism was

733
00:32:26,200 --> 00:32:27,920
Speaker 3: because for me, I called it a ratchet. If you

734
00:32:27,960 --> 00:32:29,800
Speaker 3: put money and you get paid before I get paid. Yeah,

735
00:32:30,480 --> 00:32:32,760
Speaker 3: and then you get to the lawyer structure of structure.

736
00:32:32,920 --> 00:32:35,080
Speaker 1: Legal structure is called a preference preference share.

737
00:32:35,400 --> 00:32:37,560
Speaker 3: And so that preference share for me was designed to

738
00:32:37,720 --> 00:32:41,000
Speaker 3: do the mechanism of making sure that your money what

739
00:32:41,160 --> 00:32:43,400
Speaker 3: happens if things don't go well, Like we can all

740
00:32:43,440 --> 00:32:45,320
Speaker 3: talk blue Skuy on this project, and it's so easy

741
00:32:45,400 --> 00:32:48,160
Speaker 3: to talk blue s guy, and they're sexy, and so

742
00:32:48,280 --> 00:32:50,120
Speaker 3: you can sort of you can bullshit your way through

743
00:32:50,200 --> 00:32:52,440
Speaker 3: the sexy stuff. What you can't bullshit your way when

744
00:32:52,480 --> 00:32:54,360
Speaker 3: someone asked ale we're talking about earlier, when someone to

745
00:32:54,680 --> 00:32:57,120
Speaker 3: show me where the risks are, because sophisticated money, that's

746
00:32:57,120 --> 00:32:59,800
Speaker 3: where they go looking. And so what I wanted to

747
00:32:59,840 --> 00:33:02,120
Speaker 3: do make sure that if this turned down and it

748
00:33:02,240 --> 00:33:05,800
Speaker 3: didn't work, let's say it legitimately didn't know we're forecasting

749
00:33:06,120 --> 00:33:10,040
Speaker 3: in the high twenties ebitdar and let's say it's fifteen

750
00:33:10,120 --> 00:33:13,520
Speaker 3: ebitdar return in the operating business. What does that look

751
00:33:13,600 --> 00:33:15,720
Speaker 3: like for my investor? So how does the pref shard

752
00:33:16,040 --> 00:33:17,920
Speaker 3: What you don't want me is me making a bunch

753
00:33:17,960 --> 00:33:19,680
Speaker 3: of money while you're being two to part And so

754
00:33:19,800 --> 00:33:21,880
Speaker 3: we got really so that was a big part of

755
00:33:22,040 --> 00:33:24,200
Speaker 3: the PREF and then ninety million debt.

756
00:33:24,160 --> 00:33:26,520
Speaker 1: Is the other side of our So debt always gets

757
00:33:26,560 --> 00:33:27,160
Speaker 1: paid first.

758
00:33:27,320 --> 00:33:29,880
Speaker 3: Yep, Debt first, PREF second, US third.

759
00:33:30,040 --> 00:33:32,280
Speaker 2: So in other words, the way you've structured it in

760
00:33:32,480 --> 00:33:35,960
Speaker 2: order to make it attractive in terms of risk mitigation

761
00:33:36,880 --> 00:33:40,520
Speaker 2: financial risk mitigations is that obviously debt's going to get

762
00:33:40,520 --> 00:33:42,360
Speaker 2: paid first because that's what the lender is going to

763
00:33:42,440 --> 00:33:45,280
Speaker 2: insist on lenders don't take do it anither way. But

764
00:33:45,400 --> 00:33:49,200
Speaker 2: then the first equity round that. Let's say in the

765
00:33:49,240 --> 00:33:52,880
Speaker 2: example you're saying to raise twenty twenty mili, they get

766
00:33:52,960 --> 00:33:55,480
Speaker 2: paid before you do. And if there's something leftover after

767
00:33:55,560 --> 00:33:57,960
Speaker 2: the else you get paid. Is it pref just to

768
00:33:58,200 --> 00:34:01,440
Speaker 2: dividends or is it pref tox as well on capital

769
00:34:01,480 --> 00:34:04,160
Speaker 2: as well. So if you sell, they get paid first.

770
00:34:04,800 --> 00:34:07,640
Speaker 2: If there is self for any reason, they always get

771
00:34:07,680 --> 00:34:08,279
Speaker 2: their money first.

772
00:34:08,360 --> 00:34:10,600
Speaker 3: Yeah. So part of that is, and it's what we've done,

773
00:34:10,719 --> 00:34:13,480
Speaker 3: is we've put a PREF on the exit to an

774
00:34:13,520 --> 00:34:15,759
Speaker 3: i RR of eight percent. And that's really not really

775
00:34:15,800 --> 00:34:19,120
Speaker 3: about when we're forecasting well above eight percent, but it

776
00:34:19,200 --> 00:34:21,120
Speaker 3: was really about the ugly if things go toast, you

777
00:34:21,600 --> 00:34:23,600
Speaker 3: get your money back in eight percent before I get paid.

778
00:34:24,800 --> 00:34:29,239
Speaker 3: And I'm not a typically pessimistic person, but the lens

779
00:34:29,280 --> 00:34:31,759
Speaker 3: I've really been focused on right now is it's so

780
00:34:31,920 --> 00:34:34,399
Speaker 3: easy to sell the upside of these things, but it's

781
00:34:34,480 --> 00:34:37,480
Speaker 3: like the money doesn't really need to that's the easy part.

782
00:34:37,560 --> 00:34:38,520
Speaker 3: What does it look like? Ugly?

783
00:34:38,680 --> 00:34:40,000
Speaker 1: And to mitigate the bad side?

784
00:34:40,160 --> 00:34:40,880
Speaker 3: Yeah, and what is that?

785
00:34:41,360 --> 00:34:43,239
Speaker 1: And that's you're right. I think that's too.

786
00:34:43,200 --> 00:34:47,440
Speaker 2: Many people don't concentrate on mitigating through structure, through the

787
00:34:47,520 --> 00:34:50,160
Speaker 2: legal structure, what is the downside?

788
00:34:50,600 --> 00:34:51,560
Speaker 1: And that's what prefs do.

789
00:34:52,040 --> 00:34:55,360
Speaker 3: And I've been so focused on clearly, if we deliver,

790
00:34:55,800 --> 00:34:57,600
Speaker 3: I want some gravy out of this, because that's me

791
00:34:57,760 --> 00:35:01,000
Speaker 3: delivering for you and I in an investment. But what's

792
00:35:01,040 --> 00:35:03,280
Speaker 3: the opposite of that is me not delivering well sorely,

793
00:35:03,360 --> 00:35:05,920
Speaker 3: I shouldn't get my big clip right. And look, we're

794
00:35:05,960 --> 00:35:08,200
Speaker 3: putting in some serious equity into this. We've spent five

795
00:35:08,239 --> 00:35:10,319
Speaker 3: and a half million a date on the das. We've

796
00:35:10,320 --> 00:35:12,080
Speaker 3: put two and a half million into detailed design that

797
00:35:12,160 --> 00:35:15,719
Speaker 3: started last week, and so we've got large capital. We're

798
00:35:15,719 --> 00:35:18,719
Speaker 3: tipping the existing operating businesses in, so we've got profitable

799
00:35:18,760 --> 00:35:21,839
Speaker 3: operating businesses that are both going in and we've got

800
00:35:21,880 --> 00:35:24,480
Speaker 3: our primary residential lot in this deal, so there's one

801
00:35:24,520 --> 00:35:27,680
Speaker 3: hundred and sixty residential apartments going in the freehold. So

802
00:35:27,800 --> 00:35:29,560
Speaker 3: there's a there's a full whack there and a lot

803
00:35:29,600 --> 00:35:32,200
Speaker 3: of equity going on on our side. But I still

804
00:35:32,200 --> 00:35:34,279
Speaker 3: say to the guys as like my partners, and we're

805
00:35:34,280 --> 00:35:36,800
Speaker 3: all on the same we need to respect that frontline

806
00:35:36,840 --> 00:35:39,440
Speaker 3: capital because they're taking We've been here for a long time,

807
00:35:39,560 --> 00:35:41,240
Speaker 3: we know it, we smell it, We're in the detail.

808
00:35:41,320 --> 00:35:43,680
Speaker 3: These people are putting money in and so we are

809
00:35:43,760 --> 00:35:46,880
Speaker 3: not being I guess over it's clearly not giving more

810
00:35:46,920 --> 00:35:48,560
Speaker 3: than we need to. But we've got to find that

811
00:35:48,680 --> 00:35:51,200
Speaker 3: middle balance to unlock made you don't unlock the money.

812
00:35:51,280 --> 00:35:54,080
Speaker 3: I don't have a wave pool. And so I have

813
00:35:54,200 --> 00:35:56,400
Speaker 3: been really and it's been I mean, I'm loving it.

814
00:35:56,480 --> 00:35:59,440
Speaker 3: I'm enjoying the learning. I mean KPMGM, I can never

815
00:35:59,480 --> 00:36:01,399
Speaker 3: run slow down and just tell me what that acronym means,

816
00:36:01,560 --> 00:36:05,040
Speaker 3: irs and like and for me, I can't go to

817
00:36:05,120 --> 00:36:07,880
Speaker 3: the next level until I understand it. And sometimes it

818
00:36:07,960 --> 00:36:09,920
Speaker 3: slows it. I wouldn't say it slows the project down,

819
00:36:09,960 --> 00:36:12,560
Speaker 3: but the guys in the room, the guys that went

820
00:36:13,040 --> 00:36:18,080
Speaker 3: to UNI I find it until you can tell me

821
00:36:18,200 --> 00:36:19,960
Speaker 3: in a simple way where I understand it.

822
00:36:20,160 --> 00:36:22,520
Speaker 2: Then it's too complex the structure you'd explain it, you're

823
00:36:22,520 --> 00:36:25,160
Speaker 2: going about explain so yeah, and if you're selling it

824
00:36:25,200 --> 00:36:27,719
Speaker 2: at the end of the day, and if it's too complex.

825
00:36:27,640 --> 00:36:29,880
Speaker 3: What I'm starting to smell With a few meetings. And

826
00:36:31,000 --> 00:36:32,600
Speaker 3: I remember one of the meetings I had earlier with

827
00:36:32,680 --> 00:36:36,240
Speaker 3: the guy down Byron. He looked at my early structure

828
00:36:36,239 --> 00:36:38,399
Speaker 3: and just said, from a real estate point of view,

829
00:36:38,480 --> 00:36:40,960
Speaker 3: like I love where you're at. But unless I got

830
00:36:41,000 --> 00:36:44,279
Speaker 3: some of that real estate in the deal, it's it

831
00:36:44,360 --> 00:36:46,200
Speaker 3: doesn't fly. It doesn't smell right. You can give me

832
00:36:46,239 --> 00:36:49,040
Speaker 3: a twenty percent IRR and maybe your numbers are awesome,

833
00:36:49,080 --> 00:36:51,120
Speaker 3: a pref the hell out of it. But if I'm

834
00:36:51,120 --> 00:36:53,000
Speaker 3: paying to improve your land that much, I want some

835
00:36:53,120 --> 00:36:55,200
Speaker 3: of the uplift in the land. And I drove back

836
00:36:55,239 --> 00:36:56,759
Speaker 3: that's an hour and twenty to where I am are

837
00:36:56,840 --> 00:37:01,279
Speaker 3: in Quarter. And he's a pretty substantial businessman and it's

838
00:37:01,320 --> 00:37:04,279
Speaker 3: been around, very well known guy, and I'm like, he's right,

839
00:37:04,719 --> 00:37:06,440
Speaker 3: And so I've got three partners. I now need to

840
00:37:06,480 --> 00:37:07,759
Speaker 3: go and say we've got to tip some of the

841
00:37:08,680 --> 00:37:11,560
Speaker 3: gravy of this in and they're smart people.

842
00:37:11,600 --> 00:37:13,400
Speaker 1: They get it, well, do you keep having iterations?

843
00:37:13,440 --> 00:37:15,120
Speaker 2: And I think that's and I think what most people

844
00:37:15,120 --> 00:37:16,920
Speaker 2: don't understand is that they always look at these deals

845
00:37:16,960 --> 00:37:18,799
Speaker 2: when they're done and think, well, I loved it about

846
00:37:18,880 --> 00:37:21,560
Speaker 2: do that deal. But really they've got to be prepared

847
00:37:21,560 --> 00:37:23,800
Speaker 2: to go through all the shitty iterations. You have to

848
00:37:23,920 --> 00:37:26,960
Speaker 2: keep going through iteration after iteration after iteration and see

849
00:37:27,000 --> 00:37:29,440
Speaker 2: it works few but also it works for the investors.

850
00:37:29,840 --> 00:37:32,520
Speaker 2: Without the investors' money, there's no deal at the end

851
00:37:32,560 --> 00:37:32,880
Speaker 2: of the day.

852
00:37:33,280 --> 00:37:37,000
Speaker 3: And that's that's come to light a lot more recently

853
00:37:37,080 --> 00:37:39,279
Speaker 3: for me, like a lot, and it's been a really

854
00:37:39,320 --> 00:37:42,640
Speaker 3: interesting learning curve because it's and you can call it

855
00:37:42,719 --> 00:37:45,080
Speaker 3: respective invester capital. I mean, if you don't respect, you're

856
00:37:45,120 --> 00:37:46,920
Speaker 3: not kidding that. It's as simple as that, right, and

857
00:37:47,320 --> 00:37:50,040
Speaker 3: the good investors you can get some passionate money and

858
00:37:50,120 --> 00:37:51,520
Speaker 3: that sort of fun money, and there is some of

859
00:37:51,560 --> 00:37:54,680
Speaker 3: that around, but it's rare. This is a really big

860
00:37:54,760 --> 00:37:57,479
Speaker 3: project and it deserves the right capital. Will go slow

861
00:37:57,480 --> 00:37:59,080
Speaker 3: if we have to, We will take our time to

862
00:37:59,120 --> 00:37:59,799
Speaker 3: get the right money.

863
00:38:00,120 --> 00:38:02,160
Speaker 2: If you own, don't raise it, if you don't get

864
00:38:02,200 --> 00:38:03,800
Speaker 2: the debt, does a twenty million have to go in.

865
00:38:04,560 --> 00:38:06,759
Speaker 2: So in other words, it's got a condition precedent. It

866
00:38:06,840 --> 00:38:09,759
Speaker 2: says your money, you the investor, don't put any money

867
00:38:09,760 --> 00:38:11,320
Speaker 2: in unless we can get the loan approved.

868
00:38:11,320 --> 00:38:13,560
Speaker 3: So yeah, so where it's say sixty million equity coming

869
00:38:13,600 --> 00:38:15,320
Speaker 3: in that will sit. So let's say you are my

870
00:38:15,400 --> 00:38:19,280
Speaker 3: investor at sixty that will sit in a lawyers trust account,

871
00:38:19,280 --> 00:38:23,120
Speaker 3: conditions precedent to unlock it. If we don't unlock it

872
00:38:23,160 --> 00:38:24,600
Speaker 3: within a period of time you get it back, you

873
00:38:24,680 --> 00:38:27,920
Speaker 3: won't zero risk including interest going back. And I think

874
00:38:27,960 --> 00:38:29,640
Speaker 3: there's been a couple of pools in Australia that have

875
00:38:29,760 --> 00:38:31,960
Speaker 3: tried that and chewed up a small amount, not big numbers,

876
00:38:32,040 --> 00:38:36,040
Speaker 3: but chewed up some investor capital. And we made a commitment.

877
00:38:36,040 --> 00:38:37,960
Speaker 3: A part of that detailed design. One of the conditions

878
00:38:38,000 --> 00:38:40,880
Speaker 3: precedent is build contracts in place. One of the biggest

879
00:38:40,960 --> 00:38:43,360
Speaker 3: risks at the moment to most jobs is construction. So

880
00:38:43,480 --> 00:38:45,279
Speaker 3: we've committed to making sure we get all the way

881
00:38:45,280 --> 00:38:49,280
Speaker 3: through to construction contracts, so we're not spending your new money,

882
00:38:49,600 --> 00:38:52,600
Speaker 3: investor cash on Maybe this is a job the day

883
00:38:52,680 --> 00:38:54,960
Speaker 3: your money drops in the excavator.

884
00:38:54,560 --> 00:38:57,279
Speaker 1: Because that's what built Sorry, That's what investors are worried about.

885
00:38:57,280 --> 00:39:00,440
Speaker 2: To say, what there's any building involved is the is

886
00:39:00,560 --> 00:39:04,240
Speaker 2: the cost blowouts? The construction cost because the constructions costs

887
00:39:04,280 --> 00:39:08,880
Speaker 2: these days are changing a lot of deals. So how

888
00:39:09,000 --> 00:39:10,360
Speaker 2: confident are you look that you're going to get this

889
00:39:10,400 --> 00:39:10,759
Speaker 2: deal away?

890
00:39:10,920 --> 00:39:12,840
Speaker 3: Yeah? What I'd say to people now is, I mean,

891
00:39:12,880 --> 00:39:14,200
Speaker 3: I've been on this for five and a half years.

892
00:39:15,120 --> 00:39:17,759
Speaker 3: We are now buildable and fundable the structures right. I

893
00:39:17,880 --> 00:39:20,440
Speaker 3: brought in a development director who's come from a popular

894
00:39:20,480 --> 00:39:24,200
Speaker 3: listed development company, ripping guy but really talented, and he

895
00:39:24,400 --> 00:39:27,000
Speaker 3: basically redlined every building I had in my master plant

896
00:39:27,400 --> 00:39:29,880
Speaker 3: red line, the titling red line, the structure. We've got

897
00:39:29,920 --> 00:39:33,480
Speaker 3: offers from energecs around power, all the non sexy stuff.

898
00:39:33,480 --> 00:39:35,160
Speaker 3: There's so much sex in this job that it's easy

899
00:39:35,200 --> 00:39:37,640
Speaker 3: to get what but how do you build it? Where's

900
00:39:37,680 --> 00:39:41,560
Speaker 3: the power coming from? So we are buildable and we

901
00:39:41,680 --> 00:39:45,840
Speaker 3: feel our structure, albeit with tweaks, is now fundable and

902
00:39:45,920 --> 00:39:49,480
Speaker 3: the way we've structured it, so yeah, I'm not confident

903
00:39:49,480 --> 00:39:50,439
Speaker 3: we'll get this out of the ground.

904
00:39:50,520 --> 00:39:51,680
Speaker 1: Like how many as you've been on it.

905
00:39:51,840 --> 00:39:54,040
Speaker 3: I've been on the surf park of this approach. I've

906
00:39:54,080 --> 00:39:56,239
Speaker 3: been here for sixteen years and I've been on the

907
00:39:56,280 --> 00:39:57,439
Speaker 3: surf park for five and a half.

908
00:39:57,680 --> 00:40:02,879
Speaker 2: Well that's a pretty long apprenticeship. Luke Schwager pretty hard

909
00:40:02,960 --> 00:40:05,839
Speaker 2: name to say, but good luck mate, Mark.

910
00:40:05,880 --> 00:40:07,960
Speaker 3: Thanks for having I really appreciate it and it's good

911
00:40:07,960 --> 00:40:08,200
Speaker 3: to see