1 00:00:00,120 --> 00:00:04,000 Speaker 1: Steamerant. Welcome to Property Insights. Thank you, mark mate. Tell 2 00:00:04,080 --> 00:00:08,680 Speaker 1: me that you are a director of lane Vick. Correct, 3 00:00:09,160 --> 00:00:12,280 Speaker 1: lane Vick's a probably developer. That's right, that's right. Tell 4 00:00:12,280 --> 00:00:13,920 Speaker 1: me about what you guys do, like, how did you 5 00:00:13,920 --> 00:00:17,279 Speaker 1: get first get involved in this business? What's it like 6 00:00:17,320 --> 00:00:19,840 Speaker 1: to be a director of Lanevick and what does Lanevik do? 7 00:00:19,880 --> 00:00:20,680 Speaker 1: What are you specialize in? 8 00:00:20,800 --> 00:00:24,320 Speaker 2: Yeah, beautiful, Thanks for Ferstie having us on the podcast. 9 00:00:24,360 --> 00:00:26,640 Speaker 2: Appreciate making that happen. 10 00:00:27,440 --> 00:00:29,040 Speaker 1: We didn't make it that modd well. 11 00:00:29,960 --> 00:00:31,320 Speaker 2: I guess I don't know if the boys have told 12 00:00:31,360 --> 00:00:33,320 Speaker 2: you the backstory of all we have to do to 13 00:00:33,320 --> 00:00:37,519 Speaker 2: get here, but we'll leave that for another conversation. But Lanevick, 14 00:00:37,600 --> 00:00:43,000 Speaker 2: Lanevik is a boutique developer. We specialize in luxury scale, 15 00:00:43,120 --> 00:00:45,760 Speaker 2: low density sort of higher end product. 16 00:00:46,040 --> 00:00:47,400 Speaker 1: Is that housing or apartments? 17 00:00:47,479 --> 00:00:52,880 Speaker 2: It's Terrace's apartments, owner occupy products. So we've come we've 18 00:00:52,880 --> 00:00:56,760 Speaker 2: transitioned from a larger scale, medium density developer over six 19 00:00:56,760 --> 00:01:00,000 Speaker 2: seven years ago. So it's family business. He started originally 20 00:01:00,360 --> 00:01:04,200 Speaker 2: with my father in the late nineties. Old man came 21 00:01:04,200 --> 00:01:08,760 Speaker 2: from overseas, started cement rendering in the late eighties, did 22 00:01:08,800 --> 00:01:11,360 Speaker 2: well in the business started developing with his brothers in 23 00:01:11,400 --> 00:01:14,040 Speaker 2: the late nineties, wrote the Olympic boom, did very well, 24 00:01:14,040 --> 00:01:16,640 Speaker 2: and then GFC came and pretty much wiped everything out 25 00:01:16,680 --> 00:01:20,160 Speaker 2: except the family home. That coincided with me sort of 26 00:01:20,160 --> 00:01:23,399 Speaker 2: finishing school. I finished school academically, I did well, but 27 00:01:23,440 --> 00:01:24,920 Speaker 2: I didn't know what I wanted to do in school. 28 00:01:24,959 --> 00:01:28,160 Speaker 2: I just knew I wanted to be in business, top 29 00:01:28,240 --> 00:01:30,039 Speaker 2: legal studies. So I thought, you know what, let's just 30 00:01:30,080 --> 00:01:33,640 Speaker 2: go into law. There's a quite a there's a strong 31 00:01:33,800 --> 00:01:36,880 Speaker 2: sort of attitude in our community to go to university. 32 00:01:37,680 --> 00:01:39,440 Speaker 2: So I didn't want to let down the parents, being 33 00:01:39,440 --> 00:01:43,440 Speaker 2: the eldest, and so walked into my first legal class, 34 00:01:43,520 --> 00:01:46,280 Speaker 2: Fundamentals of Law at UTS and I was like, man, 35 00:01:46,319 --> 00:01:48,240 Speaker 2: I didn't want to wait four years up a business. 36 00:01:48,280 --> 00:01:50,960 Speaker 2: So I was like, what can I do to something 37 00:01:51,000 --> 00:01:55,680 Speaker 2: now whilst keeping my parents happy? Going to UNI so 38 00:01:55,720 --> 00:01:57,440 Speaker 2: that I can, you know, get it, get into it. 39 00:01:57,480 --> 00:02:01,080 Speaker 2: And so I thought, you know, during high school, I'd 40 00:02:01,240 --> 00:02:03,880 Speaker 2: gone to work with my father with my relatives, and 41 00:02:03,960 --> 00:02:06,440 Speaker 2: we had some I had some basic cans on experience, 42 00:02:06,480 --> 00:02:08,400 Speaker 2: and so I thought, you know, do knocks and real 43 00:02:08,480 --> 00:02:10,800 Speaker 2: estates and maybe I'll just pick up some property maintenance 44 00:02:10,880 --> 00:02:13,560 Speaker 2: jobs and what started as doorknock I think like a 45 00:02:13,639 --> 00:02:15,799 Speaker 2: nine year real estates and I think one of them, 46 00:02:16,080 --> 00:02:17,600 Speaker 2: you know, gave me a game, you a shot and 47 00:02:17,760 --> 00:02:19,079 Speaker 2: O the way said you look so young, You look 48 00:02:19,120 --> 00:02:21,840 Speaker 2: so young, and I had to grow this little bit and. 49 00:02:21,520 --> 00:02:22,480 Speaker 1: Made me look a bit more. 50 00:02:22,520 --> 00:02:24,040 Speaker 2: Maybe that's what the game of the shot And what 51 00:02:24,160 --> 00:02:27,360 Speaker 2: started as a fence paling job grew into bathroom reno's 52 00:02:27,440 --> 00:02:30,120 Speaker 2: kitchen renos. Then we picked up a contract for social 53 00:02:30,160 --> 00:02:34,320 Speaker 2: inspecting Social housing and what's that twenty one so inspecting 54 00:02:34,600 --> 00:02:37,160 Speaker 2: Social house inspect for the for the government. 55 00:02:37,919 --> 00:02:40,560 Speaker 1: Correct correct, correct? Correct? 56 00:02:40,600 --> 00:02:44,000 Speaker 2: So government has a substantial man of social homes every 57 00:02:44,080 --> 00:02:46,720 Speaker 2: year as part of their maintenance requirements. They need to 58 00:02:46,760 --> 00:02:49,440 Speaker 2: fire checks, safety checks and all that good stuff. And 59 00:02:49,520 --> 00:02:52,080 Speaker 2: so what was twenty one years old? And I remember 60 00:02:52,240 --> 00:02:54,440 Speaker 2: the opportunity came up next door to the family house 61 00:02:54,480 --> 00:02:59,480 Speaker 2: and we're in a position financially to acquire it, and 62 00:02:59,560 --> 00:03:02,280 Speaker 2: that became my degree on property development commission, the first 63 00:03:02,320 --> 00:03:04,240 Speaker 2: of our to go out on site to start the 64 00:03:04,400 --> 00:03:08,760 Speaker 2: due diligence to start the development application process. And five 65 00:03:08,840 --> 00:03:13,520 Speaker 2: six years later that sort of became the foundation block 66 00:03:13,680 --> 00:03:19,760 Speaker 2: of where Lanevik sort of rein reincarnated from from the 67 00:03:19,880 --> 00:03:20,600 Speaker 2: from the previous. 68 00:03:20,639 --> 00:03:23,320 Speaker 1: So yeah, so what did you build there? 69 00:03:23,560 --> 00:03:28,080 Speaker 2: So twenty four parliaments area cord it's Wettville, next Paramatunta's 70 00:03:28,080 --> 00:03:32,520 Speaker 2: Akas seven seven minutes so from the from there and 71 00:03:32,800 --> 00:03:36,000 Speaker 2: it coincided with well, that's got a story in itself. 72 00:03:36,000 --> 00:03:37,400 Speaker 2: I don't want to always you drag into it, but 73 00:03:37,440 --> 00:03:40,080 Speaker 2: we literally had four years of legwork getting to this point. 74 00:03:40,120 --> 00:03:42,600 Speaker 2: And you can imagine working and just pumping money in this 75 00:03:42,600 --> 00:03:44,720 Speaker 2: day working part money is in the DA. Got to 76 00:03:44,760 --> 00:03:47,480 Speaker 2: the point where we had achieved the DA now to 77 00:03:47,480 --> 00:03:50,760 Speaker 2: go get sstruction funding and you're obviously very well, very 78 00:03:50,800 --> 00:03:53,280 Speaker 2: well learned in this space, but you've only got an asset, 79 00:03:53,320 --> 00:03:56,920 Speaker 2: but you've got basically shut off shit or income and 80 00:03:56,960 --> 00:03:59,600 Speaker 2: you want to borrow, you know, seven million bucks to 81 00:03:59,640 --> 00:04:02,160 Speaker 2: build this. Who the hell are you? So we had 82 00:04:02,160 --> 00:04:05,480 Speaker 2: to raise money creatively. So we raised them. We raised 83 00:04:05,520 --> 00:04:09,280 Speaker 2: them debt and then we financed. We the finance through 84 00:04:09,320 --> 00:04:13,560 Speaker 2: seeing your debt and we were we broke dirt. On 85 00:04:13,600 --> 00:04:17,599 Speaker 2: the day the government declared a national pandemic. We looked 86 00:04:17,640 --> 00:04:19,640 Speaker 2: at each other, old man and I and were like, 87 00:04:19,760 --> 00:04:21,359 Speaker 2: what the hell are we going to do? And he 88 00:04:21,400 --> 00:04:22,840 Speaker 2: looked down me and he said, look, there's only one 89 00:04:22,880 --> 00:04:24,400 Speaker 2: way to go. Put your head down and just just 90 00:04:24,480 --> 00:04:26,560 Speaker 2: go forward. To just go forward, and turned out to 91 00:04:26,600 --> 00:04:29,080 Speaker 2: be the best time, the best time, and I think 92 00:04:29,120 --> 00:04:32,839 Speaker 2: the last time ever to build Sundays opened up labels 93 00:04:33,080 --> 00:04:35,159 Speaker 2: at all time low, supplies at an all time low, 94 00:04:35,440 --> 00:04:39,320 Speaker 2: were able to build boxes there for a price that 95 00:04:39,400 --> 00:04:42,400 Speaker 2: I think will never ever be seen again, so in 96 00:04:42,520 --> 00:04:46,120 Speaker 2: terms of labor or in terms of labor and material. 97 00:04:46,279 --> 00:04:48,359 Speaker 2: So you can imagine the sentiment at the time. So 98 00:04:48,360 --> 00:04:50,840 Speaker 2: we're talking March twenty twenty, where the whole world is 99 00:04:51,880 --> 00:04:56,159 Speaker 2: going over. He's going to blow up, and the labor 100 00:04:56,279 --> 00:05:00,320 Speaker 2: so tradesmen were just they didn't know what to do, right, 101 00:05:00,360 --> 00:05:04,719 Speaker 2: So they were just honestly just negotiating against each other 102 00:05:04,760 --> 00:05:06,640 Speaker 2: on give me the job, so just give me a job, 103 00:05:06,680 --> 00:05:09,039 Speaker 2: correct career. And it wasn't even just about to work. 104 00:05:09,080 --> 00:05:10,440 Speaker 2: It was about to get out of the house. Like 105 00:05:10,520 --> 00:05:12,400 Speaker 2: construction was one of the only industries that was a 106 00:05:12,400 --> 00:05:15,680 Speaker 2: critical industry. And so we were the first COVID run 107 00:05:15,800 --> 00:05:18,640 Speaker 2: that I think that eleven twelve months. We didn't know 108 00:05:18,640 --> 00:05:20,920 Speaker 2: what was going on. We were literally like on the 109 00:05:21,000 --> 00:05:24,080 Speaker 2: job site doing what we're doing and all around us, 110 00:05:24,160 --> 00:05:26,880 Speaker 2: you know, was foreign to us. So it turned out 111 00:05:26,920 --> 00:05:29,760 Speaker 2: to actually be quite a turning point for the business 112 00:05:29,800 --> 00:05:32,280 Speaker 2: because we were able to deliver I think it was 113 00:05:32,320 --> 00:05:34,839 Speaker 2: four stories in a basement in ten and a half months, 114 00:05:35,200 --> 00:05:38,679 Speaker 2: where traditionally that's an eighteen month, sixteen eighteen month process. 115 00:05:39,720 --> 00:05:42,320 Speaker 2: And so that sort of became the foundation and the 116 00:05:42,360 --> 00:05:45,320 Speaker 2: building block of what was what was to what was 117 00:05:45,360 --> 00:05:50,080 Speaker 2: to eventuate from that, and were fortunate enough as we 118 00:05:50,120 --> 00:05:53,200 Speaker 2: were also coming out the governments just absolutely stimulating the 119 00:05:53,200 --> 00:05:56,280 Speaker 2: economy with you know, the home builder first home bio grants. 120 00:05:55,960 --> 00:05:59,440 Speaker 1: And one point nine nine or two percent homelans. 121 00:05:59,000 --> 00:06:01,120 Speaker 2: Two percent home loans, and you know, our product was 122 00:06:01,200 --> 00:06:03,440 Speaker 2: just perfectly placed. You know, that's six hundred thousand, six 123 00:06:03,480 --> 00:06:06,080 Speaker 2: hundred and five thousand dollars market. They just got eaten 124 00:06:06,200 --> 00:06:09,160 Speaker 2: up and we were Look, honestly, we're very fortunate where 125 00:06:09,240 --> 00:06:11,600 Speaker 2: there's you know, you look back and you think, you know, like, 126 00:06:13,240 --> 00:06:15,200 Speaker 2: how did we get here? And I think, you know, 127 00:06:15,920 --> 00:06:18,159 Speaker 2: there's there's an element of luck. But at the same time, 128 00:06:18,160 --> 00:06:20,320 Speaker 2: I think you've got to put yourself in that in 129 00:06:20,360 --> 00:06:23,159 Speaker 2: that in that driving seat to to to be the 130 00:06:23,200 --> 00:06:26,080 Speaker 2: benefit of that. So yeah, so now we've transitioned. So 131 00:06:26,480 --> 00:06:28,240 Speaker 2: at the back end of that we started, you know, 132 00:06:28,440 --> 00:06:31,600 Speaker 2: that's that's our bread and butter. And we've sort of 133 00:06:31,760 --> 00:06:33,880 Speaker 2: had to transition with the market. The last four years 134 00:06:33,920 --> 00:06:37,840 Speaker 2: five years, we've seen the market has moved away from 135 00:06:37,920 --> 00:06:41,840 Speaker 2: investment product. Investment stock. To deliver investment stock right now 136 00:06:41,920 --> 00:06:43,000 Speaker 2: just does not stack up. 137 00:06:43,560 --> 00:06:46,039 Speaker 1: What do you mean? So there are the feasibility. 138 00:06:45,960 --> 00:06:49,400 Speaker 2: Not necessarily there aren't investors, but to deliver the product, 139 00:06:49,520 --> 00:06:51,160 Speaker 2: you've got to build the thing right. And to build 140 00:06:51,200 --> 00:06:53,560 Speaker 2: the thing, it's on a portion of labor and supply. 141 00:06:54,200 --> 00:06:57,320 Speaker 2: And when you look at labor and supply, supply through 142 00:06:57,360 --> 00:07:00,440 Speaker 2: COVID obviously is very well noted. You know, thepply chain 143 00:07:00,480 --> 00:07:03,560 Speaker 2: has got absolutely smashed like pross iron or price timber, 144 00:07:03,760 --> 00:07:06,560 Speaker 2: price of correct correct absolute shot through the roof. And 145 00:07:06,600 --> 00:07:09,840 Speaker 2: then the labor, right, labor. We don't have an homegrown 146 00:07:10,680 --> 00:07:14,160 Speaker 2: community of trades here last you know, twenty thirty years. 147 00:07:14,200 --> 00:07:16,640 Speaker 2: I think it's always been the goal of parents to 148 00:07:16,800 --> 00:07:18,960 Speaker 2: get their children to go to university, and it's always 149 00:07:19,000 --> 00:07:20,760 Speaker 2: been seen as a trade has been seen as a 150 00:07:20,800 --> 00:07:24,320 Speaker 2: substandard way to go and so we have to import 151 00:07:24,360 --> 00:07:27,000 Speaker 2: them in right, and I think the government hasn't really 152 00:07:27,680 --> 00:07:32,600 Speaker 2: focused much on prioritizing that that skill, that that workforce there. 153 00:07:32,640 --> 00:07:37,000 Speaker 2: So labor is a skilled labor, right, Like like anyone 154 00:07:37,000 --> 00:07:38,680 Speaker 2: can go and get a builder's license, anyone can go 155 00:07:38,680 --> 00:07:41,520 Speaker 2: and be electrician algemy. But like we're talking skilled trade, 156 00:07:41,560 --> 00:07:43,360 Speaker 2: Like there's a way that you know, there's a plumber 157 00:07:43,360 --> 00:07:47,800 Speaker 2: and there's a plumber, right, So I think that's contributed 158 00:07:48,240 --> 00:07:52,000 Speaker 2: to this thirty thirty five percent increase in construction cost. 159 00:07:52,120 --> 00:07:54,560 Speaker 2: And when you say thirty thirty five percent, it's not 160 00:07:54,560 --> 00:07:56,440 Speaker 2: necessarily you're not going and buying a chewing gum for 161 00:07:56,480 --> 00:07:58,840 Speaker 2: a dollar that's an our dollar thirty you're talking a 162 00:07:58,920 --> 00:08:02,559 Speaker 2: standard house or standardrouplex that that cost prior to COVID 163 00:08:02,560 --> 00:08:05,320 Speaker 2: at one point two one point one to build is 164 00:08:05,360 --> 00:08:07,760 Speaker 2: now like one point six. That's five hundred thousand dollars 165 00:08:07,800 --> 00:08:10,080 Speaker 2: to the bottom line. So that's not going to your 166 00:08:10,440 --> 00:08:13,240 Speaker 2: that's straight to the bottom line. And so that has 167 00:08:13,280 --> 00:08:16,840 Speaker 2: basically resulted in this in this in this economy right now, 168 00:08:16,880 --> 00:08:20,320 Speaker 2: where we're seeing is ninety five percent of developments do 169 00:08:20,400 --> 00:08:24,000 Speaker 2: not stack up to deliver the product at a price, 170 00:08:24,120 --> 00:08:28,000 Speaker 2: at a price that first time buyers upsizes can afford. 171 00:08:29,880 --> 00:08:34,920 Speaker 2: You're breaking even your dawn work experience ifnosic. So there's 172 00:08:34,920 --> 00:08:36,559 Speaker 2: two things. There's two ways that this has got to 173 00:08:36,600 --> 00:08:39,480 Speaker 2: go right. And one construction cross either have to come 174 00:08:39,720 --> 00:08:40,640 Speaker 2: either have to come down. 175 00:08:41,280 --> 00:08:44,719 Speaker 1: Is that possible? Has it ever happened in your life? When? 176 00:08:44,760 --> 00:08:46,640 Speaker 1: When was the last time you saw deflation happening in 177 00:08:47,520 --> 00:08:51,160 Speaker 1: terms of paying I can't imagine that a develop a 178 00:08:51,320 --> 00:08:53,840 Speaker 1: builder or a carpenter is going to take more less 179 00:08:53,840 --> 00:08:56,520 Speaker 1: money off you, correct, because he's got a wife's john 180 00:08:56,880 --> 00:08:59,320 Speaker 1: get more money for BAXT hundred percent. 181 00:08:59,360 --> 00:09:04,080 Speaker 2: And second thing is or purchase prices have to move up, 182 00:09:04,320 --> 00:09:06,959 Speaker 2: and prices is link to borrowing capacity and borrowing capaccies 183 00:09:06,960 --> 00:09:09,760 Speaker 2: links to interest rates, and interest rates is linked to inflation. 184 00:09:10,280 --> 00:09:15,240 Speaker 2: And so we're in this perfect storm right now against us. Correct, 185 00:09:15,320 --> 00:09:19,640 Speaker 2: And the industry at large is not just having this 186 00:09:19,720 --> 00:09:22,640 Speaker 2: issue from these two factors here, you know, you've got 187 00:09:23,200 --> 00:09:26,600 Speaker 2: a once in generation building regulation going on in the 188 00:09:26,640 --> 00:09:31,840 Speaker 2: construction industry. The state government, if you're well known, they've 189 00:09:31,880 --> 00:09:35,320 Speaker 2: created a commission a bit building a commission that is 190 00:09:35,360 --> 00:09:38,480 Speaker 2: pretty much changing the way regulation has ever been for 191 00:09:38,520 --> 00:09:41,960 Speaker 2: New South Wales. And the regulation was much needed, but 192 00:09:42,040 --> 00:09:46,080 Speaker 2: the timing of it which coincided with COVID, which coincided 193 00:09:46,160 --> 00:09:50,400 Speaker 2: with all these interest rates has resulted in a perfect storm. 194 00:09:50,520 --> 00:09:52,360 Speaker 2: It is literally a perfect storm right now. 195 00:09:52,200 --> 00:09:53,400 Speaker 1: Where regulations do that. 196 00:09:53,679 --> 00:09:57,880 Speaker 2: So there's regulations are pretty much they've overhauled the planning 197 00:09:58,840 --> 00:10:02,960 Speaker 2: and the construction processes the way that they were prior. 198 00:10:03,040 --> 00:10:03,199 Speaker 1: Right. 199 00:10:03,240 --> 00:10:09,319 Speaker 2: So the biggest overhaul has been accountability. So Mascot Towers 200 00:10:09,320 --> 00:10:14,280 Speaker 2: Opal Towers were to hydro examples of correct right, and 201 00:10:15,480 --> 00:10:18,840 Speaker 2: what the state government through their findings. What they found 202 00:10:18,920 --> 00:10:22,080 Speaker 2: was that there was a lack of accountability on consultants 203 00:10:22,120 --> 00:10:27,040 Speaker 2: and on building practitioners, right. And so in a nutshell, 204 00:10:26,800 --> 00:10:31,760 Speaker 2: what this regulation wanted to do was pretty much have 205 00:10:32,040 --> 00:10:34,440 Speaker 2: a person that they can point the finger on that 206 00:10:34,480 --> 00:10:39,319 Speaker 2: has any insurance policy that that vulnerable consumers can claim 207 00:10:39,600 --> 00:10:42,160 Speaker 2: can claim on. So in simple english, I don't want 208 00:10:42,200 --> 00:10:46,280 Speaker 2: to get to the technical the technicality of that. That's 209 00:10:46,320 --> 00:10:49,960 Speaker 2: been the aim in my opinion of the regulation. And 210 00:10:50,120 --> 00:10:52,920 Speaker 2: don't get me wrong, you're making the biggest purchase of 211 00:10:52,960 --> 00:10:54,800 Speaker 2: your life as a first home buyer, right, and I 212 00:10:54,840 --> 00:10:57,440 Speaker 2: think you deserve the right to know that what you're 213 00:10:57,559 --> 00:10:59,320 Speaker 2: moving in and what you're buying is fit for purpose. 214 00:11:00,040 --> 00:11:02,360 Speaker 2: But I think the timing of that has. 215 00:11:02,360 --> 00:11:03,960 Speaker 1: What does it do that? Does it cost more? Does 216 00:11:03,960 --> 00:11:07,360 Speaker 1: it cost you more? Exactly exactly the regulation costs you more? 217 00:11:07,480 --> 00:11:08,600 Speaker 1: Is it the insurance policy? 218 00:11:08,720 --> 00:11:14,280 Speaker 2: Compliance? The compliance insurance policy. So our our designers, their 219 00:11:14,320 --> 00:11:19,280 Speaker 2: public their their PI has shot up like a ridiculous amount, right, 220 00:11:19,320 --> 00:11:21,480 Speaker 2: Like you're talking the structure engineers that have a say 221 00:11:21,480 --> 00:11:23,920 Speaker 2: two million policies. Probably I don't know, don't don't come, 222 00:11:24,000 --> 00:11:27,160 Speaker 2: it's probably thirty forty percent that's increased, right, And that's 223 00:11:27,200 --> 00:11:31,319 Speaker 2: just because now insurance companies are obviously more they're they're 224 00:11:31,400 --> 00:11:35,400 Speaker 2: they're focusing and lasering more on the risks that that 225 00:11:35,480 --> 00:11:38,800 Speaker 2: this that that that their work produces. And so insurance 226 00:11:38,840 --> 00:11:42,079 Speaker 2: policies are shot through the roof the compliance the premiums 227 00:11:42,120 --> 00:11:44,200 Speaker 2: there the premium sorry, I shot through the roof. And 228 00:11:44,240 --> 00:11:49,000 Speaker 2: then we're talking also in terms of our compliance costs. 229 00:11:49,240 --> 00:11:52,720 Speaker 2: So when we talk about you know, need like the documentation, 230 00:11:53,240 --> 00:11:55,920 Speaker 2: right Like traditionally, when you have you have a process 231 00:11:55,920 --> 00:11:59,000 Speaker 2: where you acquire a development application, then you move into 232 00:11:59,000 --> 00:12:04,600 Speaker 2: a construction stify that process. Now the documentation required to 233 00:12:04,760 --> 00:12:09,760 Speaker 2: provide to meet the standards has has doubled and tripled, 234 00:12:10,160 --> 00:12:12,800 Speaker 2: and it's it's it's got to a point where you know, 235 00:12:12,840 --> 00:12:17,439 Speaker 2: there's minor things where if say a simple construction joint 236 00:12:17,520 --> 00:12:20,120 Speaker 2: on one plan has the line going this way and 237 00:12:20,160 --> 00:12:22,480 Speaker 2: a construction joint on another plan has the line going 238 00:12:22,520 --> 00:12:28,360 Speaker 2: this way, it needs it requires a coordination. Where long 239 00:12:28,400 --> 00:12:34,079 Speaker 2: story short is it's it's created a huge hurdle to 240 00:12:35,480 --> 00:12:40,400 Speaker 2: achieving a permit to start the construction and has created 241 00:12:40,360 --> 00:12:43,960 Speaker 2: a delay. It's created a huge delay and obviously costs 242 00:12:44,000 --> 00:12:46,720 Speaker 2: and costs correct and look rightly so, and it's still 243 00:12:46,760 --> 00:12:49,040 Speaker 2: it's still in tethering, it's still in the teething process. 244 00:12:49,080 --> 00:12:50,920 Speaker 2: It's still relatively very very new. 245 00:12:51,400 --> 00:12:53,600 Speaker 1: And also what does it mean then, So does that 246 00:12:53,640 --> 00:12:55,160 Speaker 1: mean that therefore it's going to be a lot less 247 00:12:55,160 --> 00:12:59,719 Speaker 1: properly supplied In a nutshell, yes, and what happens to 248 00:12:59,720 --> 00:13:00,840 Speaker 1: build it? They got broke. 249 00:13:01,120 --> 00:13:05,840 Speaker 2: So I think business, I think builders have to adjust 250 00:13:05,880 --> 00:13:09,680 Speaker 2: for that risk. And there's a whole school of thought 251 00:13:09,760 --> 00:13:13,160 Speaker 2: right now where it's it's thought where it's being said 252 00:13:13,200 --> 00:13:16,520 Speaker 2: that builders have the wrong business model. And you know 253 00:13:16,600 --> 00:13:19,600 Speaker 2: these fixed price contracts that are that are you know 254 00:13:19,640 --> 00:13:24,920 Speaker 2: traditional in the industry, a too too heavily favored towards developers. 255 00:13:24,960 --> 00:13:28,400 Speaker 2: And this this new world of cost plus, right, of 256 00:13:28,480 --> 00:13:29,880 Speaker 2: this is what it's going to cost, and we'll just 257 00:13:29,920 --> 00:13:33,280 Speaker 2: put a margin and and and you know, splitting that 258 00:13:33,360 --> 00:13:36,200 Speaker 2: risk between the developer and the builder. So it's starting 259 00:13:36,200 --> 00:13:37,480 Speaker 2: to is starting to happen, right, But. 260 00:13:37,520 --> 00:13:40,120 Speaker 1: A book system, so you know, I can I can 261 00:13:40,120 --> 00:13:42,520 Speaker 1: now order if you're you're building for me, I'm the developmer, 262 00:13:42,559 --> 00:13:44,240 Speaker 1: I can actually order your costs because I don't want 263 00:13:44,240 --> 00:13:47,640 Speaker 1: you just ruding me. Correct, correct the cost You're going. 264 00:13:47,559 --> 00:13:49,680 Speaker 2: To have your accounting, You're going to have your structures 265 00:13:49,720 --> 00:13:52,560 Speaker 2: and your systems in place to ensure that you're not 266 00:13:52,640 --> 00:13:55,680 Speaker 2: getting obviously rowed it of course, But I mean the 267 00:13:55,800 --> 00:14:00,839 Speaker 2: principle is that cost plus sort of base rather than 268 00:14:00,840 --> 00:14:03,680 Speaker 2: this lump sump. We'll take on all the risks. You 269 00:14:03,760 --> 00:14:05,079 Speaker 2: leave it to us and we'll sort it out. 270 00:14:05,160 --> 00:14:06,640 Speaker 1: So what are you guys doing to manage it? So 271 00:14:07,160 --> 00:14:08,880 Speaker 1: how do you compete in this environment? Yeah? 272 00:14:08,920 --> 00:14:12,440 Speaker 2: Perfect, great question. We're very fortunate enough that we're actual 273 00:14:12,440 --> 00:14:16,000 Speaker 2: builders as well, so we have construction in house, so 274 00:14:16,040 --> 00:14:20,360 Speaker 2: we're building developers. We've originated from from builders, and so 275 00:14:20,480 --> 00:14:23,080 Speaker 2: we've been fortunate enough where we've been able to mitigate 276 00:14:23,080 --> 00:14:25,360 Speaker 2: that risk by controlling the process. 277 00:14:25,360 --> 00:14:25,880 Speaker 1: In house. 278 00:14:27,080 --> 00:14:30,440 Speaker 2: Has that meant that it's a lot more it's a 279 00:14:30,440 --> 00:14:34,200 Speaker 2: lot more difficult to scale and grow and expand. It has, 280 00:14:34,600 --> 00:14:36,760 Speaker 2: But for us, we've in simple English, been able to 281 00:14:36,760 --> 00:14:38,400 Speaker 2: mitigate it by controlling it in house. 282 00:14:38,840 --> 00:14:40,880 Speaker 1: So in terms of the investment market that you're talking 283 00:14:40,880 --> 00:14:43,480 Speaker 1: about before, Yeah, that's sort of disappeared a little bit. 284 00:14:45,320 --> 00:14:48,560 Speaker 1: Then I therefore expect you again to be your market 285 00:14:48,640 --> 00:14:51,280 Speaker 1: is the under occupied market? Correct? Correct? So what's the 286 00:14:51,280 --> 00:14:54,160 Speaker 1: difference between building for developing and building for an unoccupy 287 00:14:54,240 --> 00:14:56,600 Speaker 1: market than it is, to say, building and developing for 288 00:14:56,680 --> 00:14:58,120 Speaker 1: an investment market. 289 00:14:58,200 --> 00:15:01,520 Speaker 2: Yeah, great question, Great question. I think it's the goals 290 00:15:01,560 --> 00:15:03,720 Speaker 2: and the outcomes of those two different markets. And owner 291 00:15:03,720 --> 00:15:06,560 Speaker 2: occupiers obviously looking for a place that they call home 292 00:15:07,240 --> 00:15:09,000 Speaker 2: and a place that they know is going to stand 293 00:15:09,040 --> 00:15:11,280 Speaker 2: the test of time, a place whether they can entertain, 294 00:15:11,320 --> 00:15:14,680 Speaker 2: a place where they can securely live in a place 295 00:15:14,720 --> 00:15:17,600 Speaker 2: whether they can call home. Whereas an investment market is 296 00:15:17,960 --> 00:15:20,040 Speaker 2: more looking for a yield, you know, they're more looking 297 00:15:20,080 --> 00:15:22,920 Speaker 2: for a return on investment. So I guess the same 298 00:15:22,960 --> 00:15:26,840 Speaker 2: way you weigh up a business opportunity, the same way 299 00:15:26,840 --> 00:15:31,080 Speaker 2: you weigh up like any sort of investment is a 300 00:15:31,160 --> 00:15:34,040 Speaker 2: return on income. Right, and so this property is going 301 00:15:34,080 --> 00:15:36,000 Speaker 2: to cost me a million dollars, it's going to give 302 00:15:36,040 --> 00:15:38,200 Speaker 2: me a fifty grand in income. That's a five percent 303 00:15:38,400 --> 00:15:40,960 Speaker 2: gross yield. I compare that to the other opportunities I 304 00:15:41,000 --> 00:15:42,320 Speaker 2: have and I'll make a decision. 305 00:15:42,360 --> 00:15:44,400 Speaker 1: But when you're building for the when you're building for 306 00:15:44,560 --> 00:15:47,880 Speaker 1: the unoccupiers posed to investors, Yeah, do you say, well, 307 00:15:48,240 --> 00:15:53,240 Speaker 1: the ironer occupier wants I don't know, a different topic, cook, Yeah, 308 00:15:53,320 --> 00:15:57,600 Speaker 1: great question. They want water filters, yeah, great question, backyard 309 00:15:57,720 --> 00:16:01,040 Speaker 1: yeah yeah. Look, own occupiers a lout lot more custom right. 310 00:16:01,120 --> 00:16:03,880 Speaker 2: So there you've got to be a lot more detailed, 311 00:16:03,920 --> 00:16:06,000 Speaker 2: and you've got to have your research needs to be 312 00:16:06,120 --> 00:16:08,880 Speaker 2: spot on because you really need to understand who you're 313 00:16:08,920 --> 00:16:13,280 Speaker 2: building for, right, Whereas an investment market is quite broader 314 00:16:13,560 --> 00:16:17,040 Speaker 2: and it's more about durability, it's more about sustainability. It's 315 00:16:17,040 --> 00:16:20,480 Speaker 2: more about understanding that this investment product that I'm putting 316 00:16:20,520 --> 00:16:23,360 Speaker 2: my hard earned money in is going to give me 317 00:16:23,400 --> 00:16:26,160 Speaker 2: the thirty years of appreciation that it's that it's actually 318 00:16:26,640 --> 00:16:29,320 Speaker 2: that it comes with it. So it's a it's two 319 00:16:29,360 --> 00:16:34,600 Speaker 2: different two different types of avatars. I guess you could 320 00:16:34,600 --> 00:16:38,240 Speaker 2: call them with two different two different requirements there. 321 00:16:38,360 --> 00:16:41,800 Speaker 1: So maybe just a little bit more detail. Yeah, of course, 322 00:16:42,680 --> 00:16:45,920 Speaker 1: given that I guess the first question though before we 323 00:16:45,960 --> 00:16:47,720 Speaker 1: go into that part, I will park that for a second. 324 00:16:48,640 --> 00:16:52,280 Speaker 1: Are all developers dash builders looking at this the same way? 325 00:16:52,280 --> 00:16:55,840 Speaker 1: And are we therefore going to have less investment properties 326 00:16:55,880 --> 00:16:59,840 Speaker 1: for sale and more iron rocket buyer properties? Is there 327 00:16:59,840 --> 00:17:01,000 Speaker 1: a thinking the same way as you? 328 00:17:01,240 --> 00:17:04,080 Speaker 2: Well, I think look at the heart of developers is 329 00:17:04,119 --> 00:17:06,600 Speaker 2: that there is It is a business right, and if 330 00:17:06,600 --> 00:17:09,600 Speaker 2: a business can't turn a profit, then that business goes 331 00:17:09,640 --> 00:17:12,399 Speaker 2: out out of business. And I think it's fair to 332 00:17:12,440 --> 00:17:17,600 Speaker 2: say that many developers are looking at the development sphere 333 00:17:17,680 --> 00:17:21,480 Speaker 2: right now in the same lens. The productivity the state 334 00:17:21,520 --> 00:17:24,680 Speaker 2: government commission the Productivity Commission to write a report on 335 00:17:24,960 --> 00:17:28,840 Speaker 2: what's actually creating these biggest hurdles to construction, and it 336 00:17:29,080 --> 00:17:33,360 Speaker 2: contacted the COE, the center currentber the name on top 337 00:17:33,359 --> 00:17:36,200 Speaker 2: of my head, and they conducted a feasibility analysis on 338 00:17:36,800 --> 00:17:38,840 Speaker 2: what an apartment costs to deliver today and what an 339 00:17:38,880 --> 00:17:41,600 Speaker 2: apartment costs deliver in twenty eighteen. And what I found 340 00:17:41,720 --> 00:17:46,879 Speaker 2: was that to deliver an apartment in twenty eighteen versus 341 00:17:46,880 --> 00:17:50,280 Speaker 2: to deliver an apartment in twenty twenty Street investor to 342 00:17:51,400 --> 00:17:54,160 Speaker 2: the investor or the owner occupier, or to whoever first 343 00:17:54,200 --> 00:17:58,240 Speaker 2: home buyer, investment investors in first home buyers and upsides, 344 00:17:58,280 --> 00:17:59,800 Speaker 2: they could be in the same market. But when I 345 00:17:59,800 --> 00:18:02,199 Speaker 2: say investment, I mean that more you know that seventy 346 00:18:02,200 --> 00:18:05,080 Speaker 2: five square meter two bedroom, two bathroom sort of you know, 347 00:18:05,160 --> 00:18:07,880 Speaker 2: you know blocks. And what they found was ninety five 348 00:18:07,880 --> 00:18:10,720 Speaker 2: percent of areas today unfeasible compared to I think it 349 00:18:10,800 --> 00:18:13,000 Speaker 2: was like thirty five percent of areas in twenty eight 350 00:18:13,000 --> 00:18:13,679 Speaker 2: And don't quote me. 351 00:18:14,720 --> 00:18:15,080 Speaker 1: And so. 352 00:18:16,840 --> 00:18:19,159 Speaker 2: To answer your question, I believe, Yeah, I think I 353 00:18:19,160 --> 00:18:21,960 Speaker 2: think you know where we are right now. You're seeing 354 00:18:22,560 --> 00:18:26,159 Speaker 2: the only product that's working is owner occupied product. 355 00:18:26,359 --> 00:18:29,200 Speaker 1: So where does that leave us? And so we talk 356 00:18:29,200 --> 00:18:32,280 Speaker 1: about Sydney, you guys just SAE Sydney City metro. So 357 00:18:32,520 --> 00:18:35,400 Speaker 1: where does that leave us? So if that's the new 358 00:18:35,440 --> 00:18:39,159 Speaker 1: model they're developed, but the development model is underrock biased 359 00:18:39,320 --> 00:18:44,159 Speaker 1: is more the marketplace, then therefore we it seems like 360 00:18:44,200 --> 00:18:47,960 Speaker 1: we're going to have a less supply of rent to 361 00:18:48,359 --> 00:18:51,400 Speaker 1: style properties, correct, and therefore we're going to have more 362 00:18:51,400 --> 00:18:54,639 Speaker 1: pressure on the rental market, correct, because they're going to 363 00:18:54,640 --> 00:18:57,320 Speaker 1: be less proper for people to rent correct, correct, is 364 00:18:57,320 --> 00:18:58,720 Speaker 1: going to keep pushing the costs of living up. 365 00:18:58,840 --> 00:19:01,399 Speaker 2: That's right more that that's right, and that's why the 366 00:19:01,480 --> 00:19:04,520 Speaker 2: state government has really made it a key focus over 367 00:19:04,520 --> 00:19:05,680 Speaker 2: the last twelve months to. 368 00:19:06,119 --> 00:19:07,680 Speaker 1: Well what can they do well? 369 00:19:07,680 --> 00:19:10,879 Speaker 2: Look, I think the biggest one of the recommendations was 370 00:19:10,920 --> 00:19:12,960 Speaker 2: that the state government right now has one of the 371 00:19:12,960 --> 00:19:18,359 Speaker 2: most ambitious infrastructure programs right now. And what's that. What 372 00:19:18,480 --> 00:19:22,119 Speaker 2: that has been doing has been draining labor, critical labor 373 00:19:22,359 --> 00:19:23,720 Speaker 2: from the domestic. 374 00:19:24,119 --> 00:19:26,680 Speaker 1: From housing across two infrastructure infratructure. 375 00:19:26,720 --> 00:19:29,240 Speaker 2: They make an example in the report. You know an 376 00:19:29,320 --> 00:19:34,159 Speaker 2: unskilled laborer TRUCT, unskilled truck driver driving on the Snowy 377 00:19:34,200 --> 00:19:36,680 Speaker 2: Mountains project is making one hundred and eighty thousand dollars 378 00:19:36,720 --> 00:19:37,000 Speaker 2: a year. 379 00:19:37,040 --> 00:19:37,280 Speaker 1: Wow. 380 00:19:38,000 --> 00:19:41,840 Speaker 2: You know you compare that to a private domestic industry. 381 00:19:42,119 --> 00:19:44,960 Speaker 2: It's half of that, right, and so you can't we 382 00:19:44,960 --> 00:19:47,359 Speaker 2: can't compete with the government in terms of their demand 383 00:19:47,440 --> 00:19:52,320 Speaker 2: for resources. And so I think that's one one one 384 00:19:52,359 --> 00:19:55,760 Speaker 2: way is you know, the government's take a not necessarily 385 00:19:55,760 --> 00:19:58,320 Speaker 2: to stop infrastructure, but to focus on the areas that's 386 00:19:58,320 --> 00:20:01,480 Speaker 2: going to deliver more housing. Think that's one one way. 387 00:20:01,320 --> 00:20:03,879 Speaker 1: A recommendation or from them or they just it was. 388 00:20:03,880 --> 00:20:07,520 Speaker 2: A recommendation, if I'm not mistaken, because they delved into 389 00:20:07,560 --> 00:20:09,920 Speaker 2: it in quite in quite a bit of detail. And 390 00:20:10,240 --> 00:20:13,919 Speaker 2: second to that was opening up the migration of skilled 391 00:20:13,920 --> 00:20:16,879 Speaker 2: migration to to skill the trades. 392 00:20:16,920 --> 00:20:21,679 Speaker 1: People think, I mean, yeah, is that possible, Like you know, 393 00:20:21,840 --> 00:20:25,480 Speaker 1: like somebody comes in from India or whatever. Yeah, China, India, 394 00:20:25,560 --> 00:20:27,680 Speaker 1: I don't care where they come from. Yeah, South Korea 395 00:20:28,240 --> 00:20:30,840 Speaker 1: and they were a carpet to there. They say they're 396 00:20:30,840 --> 00:20:34,720 Speaker 1: a carpenter there. Yeah. Yeah, how do you vet that? Yeah? 397 00:20:34,840 --> 00:20:37,200 Speaker 2: Look, and that's obviously a whole other issue, right, I mean, 398 00:20:37,600 --> 00:20:39,359 Speaker 2: you know, it's one thing saying we can do this, 399 00:20:39,440 --> 00:20:42,840 Speaker 2: but it's a whole other thing enforcing it if they 400 00:20:42,920 --> 00:20:44,720 Speaker 2: might have been a carbon in the village. But look, 401 00:20:44,760 --> 00:20:48,520 Speaker 2: I mean, look, of course we've all experienced on a construction, 402 00:20:48,600 --> 00:20:51,119 Speaker 2: so you can imagine it's you know, there's there's people 403 00:20:51,160 --> 00:20:53,080 Speaker 2: saying they can do things that they can't do on 404 00:20:53,119 --> 00:20:56,000 Speaker 2: this and vice versa. I mean, look, the vetting process 405 00:20:56,000 --> 00:20:59,320 Speaker 2: of how that works, the logistics of that obviously it's 406 00:20:59,320 --> 00:21:02,760 Speaker 2: for people much smarter than me. But I can tell 407 00:21:02,800 --> 00:21:05,360 Speaker 2: you in terms of on the ground that in the trenches, 408 00:21:05,960 --> 00:21:07,960 Speaker 2: it's a true it's a real issue. It's a real issue, 409 00:21:07,960 --> 00:21:12,040 Speaker 2: this lack of skilled skilled skilled trades people. So I 410 00:21:12,040 --> 00:21:13,160 Speaker 2: think you have to answer your question. 411 00:21:13,240 --> 00:21:15,480 Speaker 1: I think that's probably if I'm a skilled trades person 412 00:21:15,680 --> 00:21:19,360 Speaker 1: and I'm a truck driver, I'm an experienced truck driver. Yeah. 413 00:21:19,520 --> 00:21:22,560 Speaker 1: On the example, yeah before Yeah, Well, if they're asking 414 00:21:22,680 --> 00:21:26,000 Speaker 1: for new staff in the Snowy Mountain scheme, I'm going 415 00:21:26,040 --> 00:21:28,280 Speaker 1: to go down there for undern eighty grand most definitely. 416 00:21:28,680 --> 00:21:30,320 Speaker 1: I'll say for a couple of years. I think I'll 417 00:21:30,320 --> 00:21:33,239 Speaker 1: go with your business or not, save some day and 418 00:21:33,520 --> 00:21:36,720 Speaker 1: come back here and with plenty of cash. Correct, So 419 00:21:37,000 --> 00:21:39,159 Speaker 1: it doesn't really matter. So a couple of things that 420 00:21:39,359 --> 00:21:40,919 Speaker 1: happen here, by the sound of things, in terms of 421 00:21:40,960 --> 00:21:44,159 Speaker 1: being able to make housing development affordable for people like 422 00:21:44,200 --> 00:21:47,879 Speaker 1: you who create supply of new housing is to fix this, 423 00:21:48,400 --> 00:21:54,240 Speaker 1: not only fix the skills, import of skills in Australia, and. 424 00:21:53,600 --> 00:21:57,399 Speaker 2: To change this, change this sentiment around trades people in 425 00:21:58,080 --> 00:22:01,160 Speaker 2: our country here. You know this the like reinvesting back 426 00:22:01,160 --> 00:22:04,080 Speaker 2: in our tape system. I think it's been it's been 427 00:22:04,160 --> 00:22:07,080 Speaker 2: left to the site to the benefit of the university. 428 00:22:07,119 --> 00:22:09,240 Speaker 2: Isn't like, Let's be honest, I think today I don't 429 00:22:09,240 --> 00:22:10,600 Speaker 2: know the numbers. I don't know the stats, but I 430 00:22:10,600 --> 00:22:14,679 Speaker 2: think we're probably the highest percentage of graduates that are 431 00:22:14,720 --> 00:22:17,400 Speaker 2: not working in what they started one of them. I'm 432 00:22:17,400 --> 00:22:20,880 Speaker 2: actually a lawyer by profession, so I think as well 433 00:22:21,000 --> 00:22:26,040 Speaker 2: is another one of those. So I think refocusing that 434 00:22:26,119 --> 00:22:29,919 Speaker 2: investment in local trades people, I think is. 435 00:22:31,400 --> 00:22:36,320 Speaker 1: Imperative. So where to from here for your organization? So 436 00:22:36,480 --> 00:22:37,520 Speaker 1: what are you guys going to do? 437 00:22:37,880 --> 00:22:40,880 Speaker 2: Yeah? Great question, great question. Look for us obviously, where 438 00:22:42,840 --> 00:22:46,080 Speaker 2: we'll continue to, I guess analyze and will continue to research, 439 00:22:46,080 --> 00:22:47,920 Speaker 2: and we'll continue to look at what the market wants. 440 00:22:48,240 --> 00:22:50,760 Speaker 2: I mean, we're developers and our job is to create 441 00:22:50,840 --> 00:22:54,960 Speaker 2: and provide the highest investuous block of dirt, block of land. 442 00:22:55,600 --> 00:22:58,560 Speaker 2: Who is going to benefit the most from what we 443 00:22:58,600 --> 00:23:01,720 Speaker 2: want to build here? So continu're focusing on the fundamentals, 444 00:23:02,280 --> 00:23:06,040 Speaker 2: and those fundamentals will you know, steer the business in 445 00:23:06,640 --> 00:23:08,920 Speaker 2: the ways that it's that it will And I think 446 00:23:09,040 --> 00:23:11,440 Speaker 2: unoccupiers will be a huge part of that. I think 447 00:23:11,440 --> 00:23:16,080 Speaker 2: we've been very fortunate that, you know, our business is 448 00:23:16,119 --> 00:23:19,840 Speaker 2: able to deliver in a time where we can reduce 449 00:23:19,880 --> 00:23:22,240 Speaker 2: the risk of construction by having it in house. So 450 00:23:22,440 --> 00:23:25,240 Speaker 2: having a builder in house, having our development arm in 451 00:23:25,280 --> 00:23:27,640 Speaker 2: house as well, and having our acquisition in house has 452 00:23:27,680 --> 00:23:31,600 Speaker 2: really given us a competitive advantage. Or Prior to the COVID, 453 00:23:32,040 --> 00:23:35,960 Speaker 2: builder developers were looked at as banks the biggest risk 454 00:23:36,000 --> 00:23:38,359 Speaker 2: in the industry. Now they're looked at the only people 455 00:23:38,400 --> 00:23:40,720 Speaker 2: to fund. So it's always and I've always had this 456 00:23:40,800 --> 00:23:43,560 Speaker 2: question and one I'm like, why are building developers, you know, 457 00:23:43,760 --> 00:23:46,280 Speaker 2: seen as higher risk And obviously they got more to 458 00:23:46,280 --> 00:23:48,800 Speaker 2: lose because they're concentrated and whatnot, Like from an investment 459 00:23:48,800 --> 00:23:51,679 Speaker 2: point of view, it makes sense, but now it's like, well, 460 00:23:52,000 --> 00:23:54,320 Speaker 2: they're the only ones that can pass on the margin 461 00:23:54,320 --> 00:23:56,560 Speaker 2: from the construction and the and the and the development 462 00:23:56,640 --> 00:23:59,760 Speaker 2: to come out alive, not even to make, just to 463 00:23:59,800 --> 00:24:03,880 Speaker 2: come out of life to the other end. So so yeah, So. 464 00:24:04,840 --> 00:24:06,879 Speaker 1: If I was if you were to make a prediction 465 00:24:08,440 --> 00:24:10,560 Speaker 1: where the property market is going to be in a 466 00:24:10,640 --> 00:24:13,240 Speaker 1: year's time in terms of pricing and availability, what do 467 00:24:13,240 --> 00:24:13,520 Speaker 1: you say. 468 00:24:13,760 --> 00:24:17,040 Speaker 2: I think right now, land prices will continue doing what 469 00:24:17,080 --> 00:24:18,800 Speaker 2: they're doing. I think will stay steady. But I think 470 00:24:18,840 --> 00:24:23,879 Speaker 2: apartment prices are ripe for for for a milig value 471 00:24:23,600 --> 00:24:28,240 Speaker 2: or I think I think replace just purely from replacement costs. 472 00:24:28,320 --> 00:24:29,600 Speaker 1: Yeah, you can't rebuild what. 473 00:24:29,720 --> 00:24:32,320 Speaker 2: You can't rebuild what someone's rebualt. So you're building a box, 474 00:24:32,359 --> 00:24:34,680 Speaker 2: you're building an apartment, say four and fifty thousand dollars 475 00:24:34,960 --> 00:24:37,560 Speaker 2: four years ago, Now that's six fifty seven hundred thousand. 476 00:24:38,160 --> 00:24:41,280 Speaker 2: That's going to naturally push everything up. But this stigma 477 00:24:41,640 --> 00:24:44,320 Speaker 2: of purchasing off the plan in this purchasing apartments and 478 00:24:44,800 --> 00:24:47,320 Speaker 2: is still holding that back. But I think with time 479 00:24:47,400 --> 00:24:50,000 Speaker 2: there's just going to be no other option but buying apartments. 480 00:24:50,080 --> 00:24:51,639 Speaker 2: And the government has made it clear they want to 481 00:24:51,640 --> 00:24:53,159 Speaker 2: go up, they don't want to go out. Yeah, and 482 00:24:53,200 --> 00:24:55,600 Speaker 2: so there's going to be no other choice. And this 483 00:24:55,680 --> 00:24:56,879 Speaker 2: is going to this is going to you know, this 484 00:24:56,920 --> 00:25:00,000 Speaker 2: will calm down, this regulation, all these, all these issues, 485 00:25:00,280 --> 00:25:02,840 Speaker 2: all these you're more experienced than I am, right, and 486 00:25:02,880 --> 00:25:05,600 Speaker 2: you've seen its cycles, right, It's all cycles. And so 487 00:25:06,000 --> 00:25:08,000 Speaker 2: I think, you know, the smart money. I think the 488 00:25:08,040 --> 00:25:10,199 Speaker 2: smart money is coming in and has been coming in 489 00:25:10,200 --> 00:25:12,600 Speaker 2: the last couple of months, and I think you know 490 00:25:13,040 --> 00:25:16,880 Speaker 2: the next two three years that the industry is ripe, 491 00:25:17,000 --> 00:25:17,320 Speaker 2: is right? 492 00:25:17,520 --> 00:25:17,800 Speaker 1: Is right? 493 00:25:17,920 --> 00:25:17,960 Speaker 2: For? 494 00:25:18,160 --> 00:25:20,359 Speaker 1: So should people be thinking about buying an apartment now? 495 00:25:20,440 --> 00:25:22,320 Speaker 1: Is in it? I found a new apartment. 496 00:25:22,480 --> 00:25:26,080 Speaker 2: Look, I the cost to deliver them today is the 497 00:25:26,119 --> 00:25:28,080 Speaker 2: cheap is going to be the cheapest ever to deliver it. 498 00:25:28,400 --> 00:25:30,480 Speaker 2: So you're buying something today for a dollar in three 499 00:25:30,560 --> 00:25:32,520 Speaker 2: years time, if you just look at inflation, that's going 500 00:25:32,560 --> 00:25:34,960 Speaker 2: to cost a dollar ten Yeah, so you're going to 501 00:25:34,960 --> 00:25:37,200 Speaker 2: get a ten percent discount as of today. 502 00:25:37,280 --> 00:25:39,840 Speaker 1: So relative to three years now, relative to three is 503 00:25:39,840 --> 00:25:43,360 Speaker 1: from today? Correct? Correct? Correct? So I'd say yes, I'd 504 00:25:43,400 --> 00:25:46,080 Speaker 1: say yes. Well, I mean I've have been saying that. 505 00:25:46,119 --> 00:25:49,600 Speaker 1: I think the unseen, unsung heroes of the property market 506 00:25:49,600 --> 00:25:54,040 Speaker 1: are apartments. Yeah, good quality apartments, correct, well built, because 507 00:25:54,080 --> 00:25:55,439 Speaker 1: we've got so many people come in the country for 508 00:25:55,440 --> 00:25:57,200 Speaker 1: a start. They're going to live somewhere, correct, And where 509 00:25:57,200 --> 00:25:59,359 Speaker 1: are those people used to living in apartments? Correct? Not? 510 00:25:59,440 --> 00:26:01,480 Speaker 2: It's a start, right, So when you come from overseas, 511 00:26:01,560 --> 00:26:03,680 Speaker 2: that first two three is you're at and you set 512 00:26:03,680 --> 00:26:05,119 Speaker 2: yourself up, you make it. 513 00:26:05,040 --> 00:26:06,840 Speaker 1: It's just happy to be, correct, happy to be. It's 514 00:26:06,840 --> 00:26:07,600 Speaker 1: a roof over your head. 515 00:26:07,640 --> 00:26:11,080 Speaker 2: And this is that's that's how housing at its fundamental, 516 00:26:11,119 --> 00:26:13,440 Speaker 2: it's a roof over your head. But it becomes you know, politicized, 517 00:26:13,480 --> 00:26:16,320 Speaker 2: becomes sort of traumatized, but it's it's a roof over 518 00:26:16,359 --> 00:26:19,080 Speaker 2: your head. It's it's at its based form. Sorry to 519 00:26:19,119 --> 00:26:19,520 Speaker 2: cut you off. 520 00:26:20,160 --> 00:26:22,560 Speaker 1: It's probably no problem because I mean I think that 521 00:26:22,600 --> 00:26:27,360 Speaker 1: those apartments will represent good value in time, assuming the immigration. 522 00:26:27,440 --> 00:26:29,119 Speaker 1: I must keep rolling out the way I have been 523 00:26:29,200 --> 00:26:32,320 Speaker 1: rolling it or summer from Lane Vick. Do you call 524 00:26:32,359 --> 00:26:34,840 Speaker 1: yourself Lamevic Developers or just Lamee Vickers? The name, oh, 525 00:26:34,960 --> 00:26:37,440 Speaker 1: Lamee Vick is the is the name of the Thanks 526 00:26:37,520 --> 00:26:40,280 Speaker 1: very much for coming in. I've enjoyed a lot and 527 00:26:40,400 --> 00:26:44,560 Speaker 1: it's interesting to find out from a developer's point of view, 528 00:26:44,720 --> 00:26:46,600 Speaker 1: and you're a builder as well, but from your point 529 00:26:46,640 --> 00:26:48,840 Speaker 1: of view, where this market's going to. Because it's easier 530 00:26:48,840 --> 00:26:51,040 Speaker 1: to talk to mortgage brokers, it's easier to talk to lenders, 531 00:26:51,040 --> 00:26:54,240 Speaker 1: it's easy to talk to even small builders. It's easier 532 00:26:54,240 --> 00:26:56,800 Speaker 1: to talk to consumers or people have big portfolios. But 533 00:26:56,920 --> 00:26:59,000 Speaker 1: rarely do we get the chance to talk to a developer. 534 00:26:59,240 --> 00:27:01,200 Speaker 1: And that's the calf. Yeah, and I appreciate it. I 535 00:27:01,240 --> 00:27:01,680 Speaker 1: appreciate it. 536 00:27:01,720 --> 00:27:03,320 Speaker 2: Look, that's been I guess the benefit of being in 537 00:27:03,359 --> 00:27:05,359 Speaker 2: the trenches and not necessarily, as you said, being on 538 00:27:05,400 --> 00:27:07,320 Speaker 2: the finance side, of being on the construction side, but 539 00:27:07,600 --> 00:27:09,760 Speaker 2: being in the planning, being in the acquisition, being in 540 00:27:09,800 --> 00:27:13,800 Speaker 2: the construction really gives us we're dealing with every day, 541 00:27:14,080 --> 00:27:18,400 Speaker 2: everyday people in these different departments and industries, and so yeah, 542 00:27:18,440 --> 00:27:21,320 Speaker 2: we're able to really give a true on the ground, 543 00:27:21,320 --> 00:27:25,040 Speaker 2: the experience alive from what's going on. 544 00:27:25,119 --> 00:27:27,280 Speaker 1: So appreciate it. Thank you very much. Good job mate, 545 00:27:27,320 --> 00:27:29,320 Speaker 1: Thanks Steve. Thanks I appreciate all the best.