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Speaker 1: John Rivera. Welcome to Property Insights. Mate. When we have

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Speaker 1: maybe four you are at the opening of one of

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Speaker 1: our better ybur branches down there in adelaide As. I

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Speaker 1: recall you're the currently the director and you get someone's

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Speaker 1: gonna say why Adelaide. But while we're labor the director

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Speaker 1: of residential Project Marketing and Sales Queensland for Colliers, one

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Speaker 1: of the great real estate agents in this country, colleagues

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Speaker 1: are that is, and you're the director of residential project Marketing,

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Speaker 1: And for a start, I think maybe you could tell

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Speaker 1: you what does project marketing mean?

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Speaker 2: Well, thanks for having me mark Project marketing is it's

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Speaker 2: a really interesting term now because it's it's almost you're

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Speaker 2: an advisor. I'd say it's it's to the to the developer,

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Speaker 2: to the demand where where they're from almost site acquisition

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Speaker 2: through to completion of a project. And that means that

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Speaker 2: we're getting, you know, the product ready to meet a market,

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Speaker 2: sell the product and then i'll they delivered that product

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Speaker 2: with the developer.

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Speaker 1: Do you say to the developer, you know, what made

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Speaker 1: those two bedrooms one bathroom apartments in terms of the

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Speaker 1: design phase just won't work out here in this particular area.

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Speaker 1: Of wherever it is you need to have two bathrooms

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Speaker 1: and a guest bathroom.

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Speaker 2: We get involved in everything like that, so it's always new.

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Speaker 2: So project marketing in a sense you know in Australia

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Speaker 2: is always a new community, either master planning community out

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Speaker 2: in the suburbs or a mega tower and that's everything

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Speaker 2: brand new. So that's involved in every form of that

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Speaker 2: product from a delivery point of view, you know, with

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Speaker 2: the design, as you said about looking at a two

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Speaker 2: bedroom from a square meter rate, how big the balcony is,

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Speaker 2: where the bathroom should go, the aspect pricing it, looking

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Speaker 2: at the competition everything. So you've got to be pretty

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Speaker 2: well rounded in a market, more so than say a

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Speaker 2: general real estate agent.

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Speaker 1: Well, the general estate agents just selling for the price

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Speaker 1: on the day.

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Speaker 2: If as an auction correct, we've got to tell the future.

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Speaker 1: You've got to tell future because because you know, generally speaking,

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Speaker 1: the developer, in order to spend the first dollar from

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Speaker 1: the from his funding source the banks, usually has to

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Speaker 1: have a certain level of presles and so if you can't,

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Speaker 1: if you have got the wrong product, the developer's got

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Speaker 1: the wrong product, or you've got the wrong pricing, you

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Speaker 1: might not be to down a dollar.

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Speaker 2: Yep, it all goes back.

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Speaker 1: Maybe you could explain how that works. So minderstanding, well,

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Speaker 1: since I've done one of these. But the developer maybe

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Speaker 1: acquires the land, maybe he's always had the land his

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Speaker 1: family or whatever. The developer then says, you know, it's

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Speaker 1: time to put a tower on here because they changed

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Speaker 1: the planning rules perhaps and the developers is usually allowed

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Speaker 1: to put that land in as percentage of the funding.

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Speaker 1: And then but they've got to go on to a bank.

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Speaker 1: They go onto the bank. This is over simplifying things.

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Speaker 1: We going on to the bank and bank says, this

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Speaker 1: will will lend you seventy percent of the total of

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Speaker 1: the completed total value straight away. That means or what's

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Speaker 1: the complete total value? How much Resilise departments for a

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Speaker 1: lot of times the developers settle but knows what he

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Speaker 1: or she would like to sell it for. But they

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Speaker 1: don't really know. They need research and the bank so

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Speaker 1: I can accept it just because the dude says it,

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Speaker 1: because you can put any number in front of that.

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Speaker 1: They come along and see you, guys, what's your first

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Speaker 1: what's the first thing that colleagues would do?

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Speaker 2: Well, the first thing that colleagues would do, And what

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Speaker 2: I would do is we'd look at the project. We'd

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Speaker 2: look at the product and what their mix is, what

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Speaker 2: the size is, we look at the detail and then

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Speaker 2: obviously the location of where we're going to sell this.

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Speaker 2: You know, we have to get to an ultimate selling point,

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Speaker 2: which is what is that product worth when we're going

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Speaker 2: to sell it? And so you work backwards from that.

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Speaker 2: And it's also about site optimization, you know, that's that's

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Speaker 2: probably the most critical and there's some real there's some

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Speaker 2: real challenges facing developers now, like probably more so selling's easy, well,

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Speaker 2: selling's easy now right now, it's probably the easiest. Construction

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Speaker 2: is probably i'd say the lynchpin in everything with residential

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Speaker 2: development right now.

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Speaker 1: You mean the quality construction, like whether I pro marble

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Speaker 1: costs or.

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Speaker 2: Cost absolute cost is getting a price that a developer

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Speaker 2: can actually go and say that's what it's going to

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Speaker 2: cost me, and a bank as well, Like a bank's

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Speaker 2: going to say, well, it's going to cost me one

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Speaker 2: hundred million to build this, but is it going to

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Speaker 2: cost me one hundred and twenty million to build it?

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Speaker 2: And that's the challenge is that we're seeing so much

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Speaker 2: pressure on that construction market. And it's probably the toughest

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Speaker 2: thing right now, I think in Australia, and it's going

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Speaker 2: to impact everything we do from a residential supply point.

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Speaker 2: It's already doing it.

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Speaker 1: And is that partly because like when you're advising the developer,

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Speaker 1: look mate, you know we're developing in the beach front

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Speaker 1: of the Gold Coast. The expectation of the buyer is

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Speaker 1: it has marble in the bathrooms and a good good

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Speaker 1: cooking equipment like melai or something like that, you know,

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Speaker 1: and a certain type of plush carpet and a few

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Speaker 1: really cool finishes and it needs to have a nice tile,

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Speaker 1: nicely tiled balcony and et cetera. And that of course

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Speaker 1: their premium premium costs to the developer. And then the

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Speaker 1: developer's got to get a builder to do the building.

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Speaker 2: Yep.

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Speaker 1: One that's not going to get broke, by the way,

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Speaker 1: and that's pretty important. And can get built on time, yes,

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Speaker 1: because if it's supposed to take two years, you're saying, well,

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Speaker 1: we reckon, you can sell these in two years time.

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Speaker 1: You know, you're predicting the future. We can reckon you

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Speaker 1: sell these for twenty five thousand dollars square meter but

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Speaker 1: if all of a sudden it becomes three years time,

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Speaker 1: the market could tank and that might not only be

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Speaker 1: worth twenty thousand dollars a square meter, in which case

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Speaker 1: the whole thing is it's going to fall like a stone.

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Speaker 2: Well, look, that's the probably the if we take a

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Speaker 2: couple of steps back in that and we go if

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Speaker 2: it's going to take you three years, you know, and

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Speaker 2: let's actually say that we've got a side, we've done

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Speaker 2: the development application, we've got an approval, and we're ready

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Speaker 2: to go. We've got a builder locked in and that

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Speaker 2: build is going to take a year to finish this.

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Speaker 2: But what if it takes you two years to finish it?

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Speaker 1: Yeah, supply problems correct, oh cefu problems exactly.

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Speaker 2: And that's where the huge problem is right now, because

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Speaker 2: the cost of a construction to hold their price for

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Speaker 2: over a year and to continue, like the cost of

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Speaker 2: saying you know, you said marble or even the subby

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Speaker 2: is from electrical plumbing. Like their prices are just going up,

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Speaker 2: up and up every month that you wait, it's going up.

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Speaker 1: Yeah, so you better do it now.

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Speaker 2: So you better do it now. But then that's the

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Speaker 2: thing who wants to lock in, right now and so

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Speaker 2: this is I think this is the most I've never

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Speaker 2: seen this market before. What we're in right now now

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Speaker 2: we don't need.

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Speaker 1: Is this an ex extential threat to supply of real

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Speaker 1: estate by virtue of new developments? Yes, being pretty much

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Speaker 1: stopped because of the uncertainty that exists.

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Speaker 2: Yep, this is this is you know, we're got to

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Speaker 2: think the apartment mark it right now, I'd say on

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Speaker 2: the East coast of Australia is under threat. And when

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Speaker 2: I say that is because it's kind of now limited

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Speaker 2: to a very small market where you can actually supply

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Speaker 2: it and where you can build it. And you've got

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Speaker 2: to think mark, like, when what was the apartment like

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Speaker 2: to say, twenty years ago for you, when you you know,

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Speaker 2: you're looking at the loans that you were doing. What

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Speaker 2: was an apartment for someone? It was a first home. Yeah,

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Speaker 2: it was something affordable in a good location maybe for

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Speaker 2: a young couple.

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Speaker 1: Yeah, but two bedrooms, maybe a bathroom a half exactly.

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Speaker 2: And that was and that serves a huge purpose because

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Speaker 2: you didn't need to go to a home, you know,

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Speaker 2: out in the suburbs or buy that big block of

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Speaker 2: dirt and that market right now, that that affordable apartment

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Speaker 2: market has disappeared, right, and so we're not supplying that.

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Speaker 1: Why has it disappeared though, because we can't build it. Yeah,

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Speaker 1: when you say you can't build it is because you

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Speaker 1: can't find developers not preparate the risk in relations to

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Speaker 1: the building exactly.

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Speaker 2: It just feasibility wise, it doesn't work.

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Speaker 1: It doesn't work.

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Speaker 2: It doesn't work.

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Speaker 1: Yeah, because and maybe we just we could just go

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Speaker 1: back a step. If the total development costs in the

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Speaker 1: example you gave is one hundred million, for example, and

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Speaker 1: the land is worth twenty, so it's all I'm going

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Speaker 1: to cost one hundred No total development costs a hundred million,

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Speaker 1: the land coast of twenty. The building's going to cost

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Speaker 1: you eighty. So the U TWODC is one hundred million.

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Speaker 1: Generally speaking, as I recall, the developers want to see

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Speaker 1: like a twenty to twenty five percent return. If you

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Speaker 1: have to now put a contingency in there for I

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Speaker 1: know ten to fifteen percent, that eads into your return

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Speaker 1: pretty quickly.

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Speaker 2: Well, the banks don't like that.

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Speaker 1: The battle even if you're going to assume the banks

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Speaker 1: are gone and accepted, because you've got enough enough other

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Speaker 1: assets that they could jump all over. Even if you

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Speaker 1: could assume that developer is going to say, well, I'm

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Speaker 1: not going to risk borrowing one hundred million to get

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Speaker 1: fifteen percent return after you take your contingency out, because

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Speaker 1: it's just not worth the headache. Correct, And if all

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Speaker 1: you need is a delay for another year, and that

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Speaker 1: fifteen percent fifteen percent now is going to be faked

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Speaker 1: by ten percent interest on one hundred million, which is

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Speaker 1: another ten so that ten can take your fifteen percent

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Speaker 1: down to five percent really fast.

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Speaker 2: And that's happened exactly. And that's what happens.

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Speaker 1: And sometimes these guys, these developers take the risk. And

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Speaker 1: actually that's the reason Gone broke.

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Speaker 2: Highly lucrative industry. Yeah, good returns, but also when you

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Speaker 2: play that lucative game, are you going to expect some

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Speaker 2: pretty high risk.

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Speaker 1: So his mobs like you, you guys, Richard Ella still exists,

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Speaker 1: but CBREB theyre called CBRE right because I use Colliers

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Speaker 1: and CBRI or they'll call Richard Ellison, but I used

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Speaker 1: Colliers and Richard Ellis in nineteen ninety six, I think

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Speaker 1: it was to do what was the first big development

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Speaker 1: to ever be taken to Hong Kong and Singapore for presales,

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Speaker 1: and there was a guy I can't remember their names. Actually,

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Speaker 1: there was a guy from Richardel's. His name was believe

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Speaker 1: it or not, Tony Yellous, but not related to the

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Speaker 1: rich Els. It just happened at the same surname. And

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Speaker 1: the guy from colas I Something. His name was David

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Speaker 1: something rather Milton No, but anyway, it doesn't matter. But

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Speaker 1: they they helped us with everything, right down to full

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Speaker 1: choi because we're selling in common and see everything, because

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Speaker 1: I never heard of this thing called full child was

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Speaker 1: like in my thirties, late twenties, early thirties, and we

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Speaker 1: were running the project when another guy and and right

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Speaker 1: down to things like all Chinese people buy this if

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Speaker 1: you've got a mirror at the entrance, or if the

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Speaker 1: front door faces the back door, because apparently all the

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Speaker 1: good luck just flows and flows straight out. And a

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Speaker 1: Chinese person my bike. I don't if there's still superstition

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Speaker 1: like that. Even things like we didn't have a fourth law.

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Speaker 1: It was a twenty story building and there was no

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Speaker 1: fourth law. There was no fourteenth law. It was like

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Speaker 1: we went from three to five silly little things. We

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Speaker 1: didn't have fours anywhere because four apparently it's bad. Number

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Speaker 1: still exist the Chinese right, still a deal still exist.

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Speaker 1: But the agents told us all this stuff. We didn't

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Speaker 1: know we were the developer, the agent. They just told

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Speaker 1: us all of this stuff, and then they helped us

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Speaker 1: pre sell it. And we had I recall, we had

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Speaker 1: to sell like we had to sell one hundred percent.

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Speaker 1: We had to pre sell one hundred at that time,

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Speaker 1: one hundred percent of our total development cost, not the

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Speaker 1: total value, but the total development costs of the whole project.

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Speaker 1: Otherwise you couldn't draw down a dollar of our bank funding.

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Speaker 1: We had three bank syndicated to do the whole thing.

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Speaker 1: And today, if you today, the position would be you

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Speaker 1: would never do that development. We hardly made any money

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Speaker 1: because by the time we had people drop out. By

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Speaker 1: the time we got up, you know, we had bloody

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Speaker 1: union problems, all sorts of things happened. It took a year,

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Speaker 1: took nearly four years, two years, four years, et cetera,

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Speaker 1: et cetera. And I can sort of understand why developers

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Speaker 1: do anything, which is the reason why the AFI recently

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Speaker 1: held the big summit. I think it was the beginning

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Speaker 1: of this year. I went anyway, was about the housing crisis.

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Speaker 1: Everyone keeps talking about this housing crisis, but there's no solution.

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Speaker 1: What do you think they should do?

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Speaker 2: It is? This is this is the silver bullet right

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Speaker 2: in terms of what everybody's asking. And you know, flying

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Speaker 2: down here today, I was thinking about because I thought

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Speaker 2: you were going to ask me this question. What is

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Speaker 2: the solution to a housing crisis, the affordability crisis? And

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Speaker 2: everything that comes down to my very being at the

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Speaker 2: moment and my experience in this market is always going

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Speaker 2: to do. They've got to stop meddling in it. It's

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Speaker 2: it's it's its own ecosystem. You know, we fall part

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Speaker 2: of this ecosystem of supplying and the demand and et cetera.

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Speaker 2: The government. The more the government keeps getting involved and

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Speaker 2: they're saying they want to deliver one point two million

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Speaker 2: dollars out houses, dwellings, dwellings, And I go years place

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Speaker 2: sim city with this, you put one point two million,

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Speaker 2: Where do you do it? What hospitals you do? What

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Speaker 2: water do you need? What energy do you need? All

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Speaker 2: the things that equals a body building it which creates

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Speaker 2: more inflation, et cetera, bah blah. And so I just

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Speaker 2: go and look at this, and we've caused a huge

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Speaker 2: like COVID. COVID was like a catalyst event for me

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Speaker 2: that changed everything the way that we looked at residential property.

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Speaker 2: And it's also the problem starter. And you go, okay, well,

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Speaker 2: how do we fix this solution of housing affordabillion and supply?

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Speaker 2: And I go, well, this apartment market is actually critical.

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Speaker 2: It's so critical because we can't no longer go horizontally

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Speaker 2: in this country. It just costs too much, like to

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Speaker 2: build a hospital, to make a city, to bring one

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Speaker 2: point two million dwellings into an area, or like five thousand.

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Speaker 2: You know, I'm working with Bob Belt on a project

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Speaker 2: where he's got five thousand dwellings that in northern New

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Speaker 2: South Wales, and that project's taken over a decade. He's

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Speaker 2: been fighting it for over a decade, Like how are

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Speaker 2: you going to do?

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Speaker 1: Liver?

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Speaker 2: How are they going to do?

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Speaker 1: Live? There's any people like Bobby Hill who have got

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Speaker 1: the bloody ability to survive these things and the determination

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Speaker 1: anyone else coming in this mark wouldn't bother.

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Speaker 2: We're still trying. Yeah, we're still trying. And that's only

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Speaker 2: got five thousand. So the thing I look at it,

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Speaker 2: there's no silver bullet here. But they've got to stop

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Speaker 2: meddling in it. And the more they keep doing it,

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Speaker 2: it just keeps increasing.

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Speaker 1: So what about Okay, what about things like why when

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Speaker 1: you talk about meddling, when they start having conversations about

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Speaker 1: getting rid of a couple of games tax discount or

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Speaker 1: they start talking about getting rid of negative gearing, what

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Speaker 1: effect does that to have on a developer?

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Speaker 2: It has huge effects. It has a huge effects for

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Speaker 2: the renter. And that's the thing, Like, the more that

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Speaker 2: they keep getting involved in trying to.

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Speaker 1: There's an example where you don't want to meddle, I.

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Speaker 2: Just exactly planning, you know, financially where they do obviously

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Speaker 2: the negative gearing. You know, probably the biggest constraint I

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Speaker 2: think that developers are facing is actually the local council

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Speaker 2: and a state council. Because the federal governments go, yeah,

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Speaker 2: let's let's go and deliver some he but that it

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Speaker 2: comes down to a state and a local and that's

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Speaker 2: where it gets in the glue.

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Speaker 1: Yeah, because because what's interesting about this, John, is that

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Speaker 1: the federal government has no jurisdiction over this stuff anyway. Exactly,

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Speaker 1: it's a state planning makes the rules and then the

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Speaker 1: local council approves under those rules, but the federal government

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Speaker 1: doesn't have any do with those rules exactly.

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Speaker 2: And you've got to think, like the people behind that

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Speaker 2: don't necessarily want five thousand homes in this area.

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Speaker 1: You know why because they want to get re elected

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Speaker 1: into the council exactly. And if I already live there,

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Speaker 1: I'm going to be saying, ag, I don't want five

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Speaker 1: thousand more cars here. He's a four year thinking or

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Speaker 1: ten year more ten thousand more cars because it's voting votes.

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Speaker 1: And I like being on the council because I like

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Speaker 1: to be the local alderman. And everybody says I'm a

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Speaker 1: good dude.

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Speaker 2: And that's and that's actually a really good point because

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Speaker 2: this is where I'd say to your answer it, you

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Speaker 2: know about how do we fix it? And it's stop

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Speaker 2: thinking it like a share market. Stop looking at it

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Speaker 2: every day. It's a long term asset. That's from an

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Speaker 2: investment point, but then from a from a you know,

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Speaker 2: from a government point or a or I guess you know,

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Speaker 2: a private sector point. The more that the more that

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Speaker 2: we keep affecting this ecosystem from a supply point, and

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Speaker 2: that's the local council, the state government. You basically just

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Speaker 2: keep holding it up, you keep adding costs, you keep

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Speaker 2: making it more challenging, and that just goes to a

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Speaker 2: buyer at the end of the day.

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Speaker 1: It gets passed on.

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Speaker 2: It gets passed on. And you've got to remember, like

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Speaker 2: Australia is a pretty lucky country. People want to live here.

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Speaker 2: And I always remember this, and this is really early

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Speaker 2: on in my career. I met a politician and he

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Speaker 2: goes John. You know, one of the things that I

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Speaker 2: can always do and I feel safe in Australia is

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Speaker 2: that if the economy goes down, we just pull a

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Speaker 2: lever and we let migration in. And what do we

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Speaker 2: need for residential We just need bodies. Yeah, and that's

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Speaker 2: where it always happens. Like you know, look at you

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Speaker 2: look at what's happened from a population point since COVID, Like,

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Speaker 2: how do we fix that? There is there's been say,

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Speaker 2: for example, in Queensland since COVID mark.

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Speaker 1: This queens has been the biggest four.

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Speaker 2: Four hundred and thirty thousand new people have come in

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Speaker 2: you know, into that time frame, more than any state.

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Speaker 1: And that's interesting. And by the way, thirty thousand people

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Speaker 1: not necessarily immigrants, a lot of them. Just people come

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Speaker 1: from Victoria in New South Wales too.

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Speaker 2: Yeah, it's interstate, it's overseas and.

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Speaker 1: One of the great areas that I must say, I'm

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Speaker 1: surprised by it. But the Gold Coast or service paradise

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Speaker 1: that Southeast queenslandt's call this below Brisbane's type of once

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Speaker 1: my time, when it was a boom, it was going up,

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Speaker 1: when it was a bus it was the worst affected.

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Speaker 1: But for some reason, all of a sudden, this is

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Speaker 1: not the case for a Southeast Queensland. It's just going

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Speaker 1: up and up and up and up and up and

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Speaker 1: up and up. And can you give me some sense

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Speaker 1: around that there's.

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Speaker 2: No supply down there and this is and you know,

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Speaker 2: I can tell you like you know, I was in

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Speaker 2: the GFC on the Gold Coast working that market, and

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Speaker 2: you're right, like it was. As soon as it went bad,

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Speaker 2: everybody sold up.

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Speaker 1: I'm out.

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Speaker 2: I'm out. Yeah, you saw it right, super got hit

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Speaker 2: all my holiday.

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Speaker 1: Oh we got a prepared join where we wouldn't lend

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Speaker 1: to people exactly we said, I'm going to lending more

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Speaker 1: money into Gold Coast and.

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Speaker 2: Why would you It wasn't as it wasn't as diversified

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Speaker 2: as an economy. You know, there's been lots of changes

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Speaker 2: there where it's been able to hold its own now.

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Speaker 2: And the challenge that we've got very similar to Sydney

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Speaker 2: in that in that respect, in terms of South of

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Speaker 2: Queens and particularly the Gold Coast, it's geography. It's got

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Speaker 2: mountains to the west, it's got water to the east,

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Speaker 2: and then you've got a very small slither of where

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Speaker 2: you can actually do development.

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Speaker 1: It's got a border to the border, and then that's

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Speaker 1: got Brisbane to exactly.

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Speaker 2: And you know, you think about COVID. Obviously people said

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Speaker 2: I'm out, I'm going to going to go to the

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Speaker 2: Sun and I could afford to go and live in

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Speaker 2: a pretty good area and have some money in the bank,

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Speaker 2: and that's what they did. And I think the Gold Coast,

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Speaker 2: you know, the Gold Coast, I think is probably more

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Speaker 2: known internationally than Brisbane.

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Speaker 1: Do you think it allow our price itself, the Gold Coast,

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Speaker 1: because it's gone fairly, it's gone hard.

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Speaker 2: But you know what, this is the way I look

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Speaker 2: at it. And just this is again from working on that.

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Speaker 1: I'm not talking about Labrador either, I'm not about it.

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Speaker 1: I'm talking about Lake the Coast the whole thing.

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Speaker 2: And look, this is where I'd say, and I just

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Speaker 2: had to look at the stat when I came in

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Speaker 2: at the moment. From a registration point of view, the

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Speaker 2: Gold Coast is sitting on about you know, if you

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Speaker 2: think about it, supply pipeline, it has no land, zero land.

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Speaker 2: So from a housing point of view, it's vertical. It's

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Speaker 2: a vertical area. And so you know, I look at

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Speaker 2: that and I go, well, what's the biggest thing we've

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Speaker 2: just been talking about is trying to supply a market?

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Speaker 2: How hard is it to supply a vertical tower right now?

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Speaker 2: Not everything is a triple a beachfront apartment. And that's

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Speaker 2: where the Gold Coast at the moment is suffering. It

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Speaker 2: is it is needing huge amounts of supply because the

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Speaker 2: demand is so strong. The vacancy rates in some cases

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Speaker 2: are like one below below one percent, zero percent. That

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Speaker 2: shows you like a future, you know, And this is

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Speaker 2: a great thing. This is probably this is probably the

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Speaker 2: most interesting is New South Wales government just delivered a

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Speaker 2: brand new mega hospital at Kingscliffe, which is just south

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Speaker 2: yeah southeast tweet yeah, right on the border right, eight

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Speaker 2: hundred million huge. They can't get workers because people like

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Speaker 2: people are queuing up, nurses, everybody trying to go and work.

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Speaker 2: It'd be great to work in Kingscliff. The thing's beautiful

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Speaker 2: and they're there and they're like, where do I rent?

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Speaker 1: Yeah, I can't where I'm gonna live?

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Speaker 2: And Bob's They're going, I've got five thousand waiting for you.

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Speaker 1: Because that that kind of lock. It that that area

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Speaker 1: Kingscliff has exploded. Yep.

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Speaker 2: It's it's prices. It used to be affordable. Yeah, it

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Speaker 2: used to be like a you know, quiet place to go.

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Speaker 2: But that whole, that whole movement has just pushed south

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Speaker 2: and then you know what, it's actually pushed north into

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Speaker 2: Logan and Logan, which is between the rib Logan Logan.

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Speaker 2: I'm seeing million dollar resales in Logan for for areas

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Speaker 2: that we were selling, you know, pre COVID sub five

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Speaker 2: hundred thousand for a house in.

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Speaker 1: Land Camera Smith cannot any longer say you come from

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Speaker 1: the tough Logan hills of Logan.

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Speaker 2: I'm a Logan boy as well.

437
00:20:47,880 --> 00:20:49,560
Speaker 1: It's a bit like where I come from. Punchwell, there's

438
00:20:49,640 --> 00:20:51,040
Speaker 1: like one and a half million of the average price

439
00:20:51,119 --> 00:20:53,560
Speaker 1: is one half million, Like I can't believe it, but like,

440
00:20:54,520 --> 00:20:57,600
Speaker 1: but Logans is selling but Pummers houses for a million bucks.

441
00:20:57,680 --> 00:20:59,879
Speaker 2: I'm selling in markets there right now, house and l

442
00:21:00,000 --> 00:21:01,840
Speaker 2: and brand new house land, four bedroom, two bath, and

443
00:21:01,840 --> 00:21:05,040
Speaker 2: say four hundred square meters and that product is going now.

444
00:21:05,000 --> 00:21:06,280
Speaker 1: For the lands foreign and square meters.

445
00:21:06,320 --> 00:21:07,879
Speaker 2: Yeah, the land is fine and square meters. The house

446
00:21:07,880 --> 00:21:11,719
Speaker 2: is about one ninety square meters. We're selling right now

447
00:21:11,920 --> 00:21:14,080
Speaker 2: brand new homes that aren't built. They've got to get

448
00:21:14,119 --> 00:21:18,000
Speaker 2: built with everything included for over eight hundred thousand.

449
00:21:18,080 --> 00:21:18,280
Speaker 1: Wow.

450
00:21:19,040 --> 00:21:20,800
Speaker 2: That and that's why I'm saying this is how important.

451
00:21:21,600 --> 00:21:23,920
Speaker 2: You know, we've we've got to We don't have a

452
00:21:23,960 --> 00:21:27,040
Speaker 2: lot of land up there. And then you think, you think, well,

453
00:21:27,080 --> 00:21:29,040
Speaker 2: how do we supply it without having to go and

454
00:21:29,080 --> 00:21:30,760
Speaker 2: put all the road and you know, you talk about

455
00:21:30,880 --> 00:21:32,960
Speaker 2: the big energy crisis that they're talking about in government

456
00:21:33,040 --> 00:21:35,520
Speaker 2: right now. Where do we how do we make more cities?

457
00:21:36,600 --> 00:21:41,480
Speaker 2: It's actually cheaper to upgrade existing areas with infrastructure than

458
00:21:41,520 --> 00:21:42,960
Speaker 2: it is to go and build a new city in

459
00:21:43,000 --> 00:21:44,200
Speaker 2: this country. And that's our future.

460
00:21:45,880 --> 00:21:48,240
Speaker 1: I mean, do it the government come and talk to

461
00:21:48,280 --> 00:21:48,760
Speaker 1: people like you.

462
00:21:49,920 --> 00:21:52,680
Speaker 2: We do talk to them. It's not it's always a

463
00:21:52,720 --> 00:21:56,000
Speaker 2: bit harder to you know, and wet. You know, they

464
00:21:56,119 --> 00:21:57,840
Speaker 2: talk to us, but I don't think they really can

465
00:21:57,920 --> 00:22:02,800
Speaker 2: go and do and like do it is probably the

466
00:22:02,840 --> 00:22:03,440
Speaker 2: hardest thing.

467
00:22:03,359 --> 00:22:07,360
Speaker 1: For like local governments, state governments and local and state

468
00:22:07,400 --> 00:22:09,120
Speaker 1: governments talk to you. There's no point in the federal government.

469
00:22:09,119 --> 00:22:12,080
Speaker 1: Federal gunman can't do anything because it's a local level.

470
00:22:12,400 --> 00:22:14,679
Speaker 1: And by the way, Queensland is a lot better than

471
00:22:14,840 --> 00:22:18,920
Speaker 1: every other state. I mean, Brisbane Council and one of

472
00:22:18,960 --> 00:22:22,160
Speaker 1: the equivalent down is the Gold Coast relatively speaking, I'm

473
00:22:22,160 --> 00:22:25,600
Speaker 1: talking about because you're you're a huge council and it's

474
00:22:25,640 --> 00:22:26,600
Speaker 1: a lot more pro.

475
00:22:28,040 --> 00:22:29,920
Speaker 2: It's a lot more in favor of, a lot easier

476
00:22:30,000 --> 00:22:30,359
Speaker 2: to work with.

477
00:22:30,600 --> 00:22:32,800
Speaker 1: And you go to New South Wales, my god.

478
00:22:32,840 --> 00:22:34,560
Speaker 2: Your counsels are the size of our suburbs.

479
00:22:34,640 --> 00:22:39,800
Speaker 1: Yeah, yeah, and they're just like really difficult and or same.

480
00:22:40,000 --> 00:22:42,960
Speaker 1: Victoria's even worse apart from the fact they've got a

481
00:22:43,000 --> 00:22:45,720
Speaker 1: landtas down there road for everything over fifty thousand dollars

482
00:22:45,760 --> 00:22:50,440
Speaker 1: in value. Do you do you get it dragged in?

483
00:22:50,560 --> 00:22:52,480
Speaker 1: And they say, well, okay, John, Like what do you reckon?

484
00:22:52,520 --> 00:22:54,239
Speaker 1: We could do to sort of open up more areas here.

485
00:22:56,000 --> 00:22:58,160
Speaker 2: We've got a really good advocacy which is like the UDI,

486
00:22:58,440 --> 00:23:01,600
Speaker 2: which is the Urban Development Institute of and those guys

487
00:23:01,920 --> 00:23:05,200
Speaker 2: there take the fight, you know, through to state and local.

488
00:23:05,680 --> 00:23:08,160
Speaker 2: I think there's there's look, I think there's two sides

489
00:23:08,200 --> 00:23:10,240
Speaker 2: to that side, you know, to the government and obviously

490
00:23:10,320 --> 00:23:13,280
Speaker 2: the industry. There's people that are really trying to make

491
00:23:13,720 --> 00:23:15,840
Speaker 2: a difference and understand the challenges. And I think there's

492
00:23:15,840 --> 00:23:18,480
Speaker 2: other people that are actually fighting against it. And so

493
00:23:19,119 --> 00:23:20,840
Speaker 2: it's because of the agendas, like we were in a

494
00:23:21,000 --> 00:23:24,440
Speaker 2: very green mentality right now. We don't want to see

495
00:23:26,000 --> 00:23:29,520
Speaker 2: the bad side that comes with population growth, you know,

496
00:23:29,640 --> 00:23:31,480
Speaker 2: the impact on the environment. They don't want to see that.

497
00:23:31,640 --> 00:23:34,760
Speaker 2: But that itself is you know, the challenges in this country.

498
00:23:34,920 --> 00:23:39,159
Speaker 2: We're very centralized. We built our cities very centralized. We

499
00:23:39,240 --> 00:23:41,280
Speaker 2: don't have a three dimension or living like the US.

500
00:23:41,880 --> 00:23:44,320
Speaker 1: Eighty percent of as population lives on the coast and

501
00:23:44,400 --> 00:23:45,960
Speaker 1: we're the only country in the world does that. And

502
00:23:46,200 --> 00:23:47,959
Speaker 1: we're the only country in the world that has more

503
00:23:48,000 --> 00:23:50,359
Speaker 1: than fifty five percent of population live in three capital cities.

504
00:23:50,640 --> 00:23:52,159
Speaker 2: Well, you know that four hundred and thirty thousand we

505
00:23:52,200 --> 00:23:54,159
Speaker 2: spoke of eighty three percent of that went in the

506
00:23:54,160 --> 00:23:57,000
Speaker 2: South eat Queensland. Wow, that's the average. So you think

507
00:23:57,080 --> 00:23:59,200
Speaker 2: all those people into an area that's what twelve thousand

508
00:23:59,200 --> 00:24:02,399
Speaker 2: square kilometers like that, and that has no supply and

509
00:24:02,480 --> 00:24:04,479
Speaker 2: it's lost, it's lost an element of its solf.

510
00:24:04,480 --> 00:24:05,240
Speaker 1: It's going to burst.

511
00:24:05,640 --> 00:24:08,240
Speaker 2: It's burst. Yeah, it's already happened, because.

512
00:24:08,080 --> 00:24:09,480
Speaker 1: I mean, the reason why people went there in the

513
00:24:09,520 --> 00:24:10,760
Speaker 1: first place, they're going to still go there.

514
00:24:10,800 --> 00:24:14,399
Speaker 2: Yeah, yep. Because they're very different in Melbourne. Melbourne probably

515
00:24:14,440 --> 00:24:17,840
Speaker 2: i'd say the opposite of Melbourne, Melo Sydney and Brisbane. Yeah,

516
00:24:17,880 --> 00:24:19,399
Speaker 2: Melbourn's gone a little bit backwards, but it's not a

517
00:24:19,440 --> 00:24:22,000
Speaker 2: bad market. It's just very good at supplying itself. It's

518
00:24:22,119 --> 00:24:25,639
Speaker 2: very planned out. Sydney and Sydney and Brisbane very similar.

519
00:24:25,960 --> 00:24:27,199
Speaker 2: And this is where I look at if you ask

520
00:24:27,280 --> 00:24:28,920
Speaker 2: the future of me and you go, okay, John, what's

521
00:24:28,920 --> 00:24:30,399
Speaker 2: the market look like in a couple of years, and

522
00:24:30,440 --> 00:24:34,359
Speaker 2: I go, exactly like Sydney. Brisbane is going to be

523
00:24:34,560 --> 00:24:37,119
Speaker 2: like Sydney. It is going to be just as expensive.

524
00:24:37,640 --> 00:24:40,480
Speaker 2: And it's because we share very similar things. We've caught

525
00:24:40,560 --> 00:24:42,399
Speaker 2: up a lot in the last five years to Sydney.

526
00:24:43,760 --> 00:24:46,280
Speaker 2: You know, we predicted that Melbourne would be the third

527
00:24:46,359 --> 00:24:48,800
Speaker 2: most affordable city, and it did. It started to happen

528
00:24:48,840 --> 00:24:52,000
Speaker 2: like Brisbane's now more expensive than Melbourne. Melbourne very good.

529
00:24:52,160 --> 00:24:55,080
Speaker 2: So I've always called it the leaky bucket because it's

530
00:24:55,160 --> 00:24:58,240
Speaker 2: so good at supplying itself. We're almost over supplying itself.

531
00:24:58,280 --> 00:24:59,479
Speaker 2: And that's what it's done. And then as soon as

532
00:24:59,480 --> 00:25:02,160
Speaker 2: it gets a bit of a downturn, those fundamentals change,

533
00:25:02,560 --> 00:25:04,440
Speaker 2: whereas in Brisbane and Sydney, as we've seen it, like

534
00:25:04,480 --> 00:25:07,400
Speaker 2: Sydney's not pretty flat right now, it's not. It's not bad,

535
00:25:07,480 --> 00:25:09,200
Speaker 2: but it's growing a bit. It's growing a bit, but

536
00:25:09,359 --> 00:25:13,760
Speaker 2: it fundamentally it's always going to grow a bit because

537
00:25:14,040 --> 00:25:16,159
Speaker 2: it's got the same challenges. It's got a lot of

538
00:25:16,200 --> 00:25:19,679
Speaker 2: overseas migration. So where the jobs are, where the jobs are,

539
00:25:20,240 --> 00:25:25,120
Speaker 2: and supply is tight, and that's the challenge and that's

540
00:25:25,160 --> 00:25:25,600
Speaker 2: the secret.

541
00:25:25,920 --> 00:25:28,879
Speaker 1: So bottom line is real estate is going to continue

542
00:25:28,880 --> 00:25:29,879
Speaker 1: to be a great asset.

543
00:25:29,640 --> 00:25:33,400
Speaker 2: Class, absolutely a long term asset class, long term, long

544
00:25:33,520 --> 00:25:35,600
Speaker 2: term asset class. And that's where you know, we've got

545
00:25:35,640 --> 00:25:38,000
Speaker 2: to stop looking at it like a share market. That's

546
00:25:38,040 --> 00:25:38,720
Speaker 2: probably the one thing.

547
00:25:38,800 --> 00:25:41,120
Speaker 1: Yeah, yeah, you're right, we're not bowser in and out

548
00:25:41,160 --> 00:25:44,760
Speaker 1: every month it's a long term asset class exactly. But

549
00:25:44,880 --> 00:25:46,600
Speaker 1: I still still mean someone asked the other day, I

550
00:25:46,640 --> 00:25:47,920
Speaker 1: still think it's the best asset class.

551
00:25:48,080 --> 00:25:50,360
Speaker 2: Is well, look from a mum and dad point of view,

552
00:25:50,480 --> 00:25:51,720
Speaker 2: yes it is in.

553
00:25:51,880 --> 00:25:54,679
Speaker 1: Terms of knowledge and understanding and you know, like how

554
00:25:54,720 --> 00:25:56,800
Speaker 1: you manage it. I'm sure it's not as liquid as

555
00:25:56,800 --> 00:25:58,080
Speaker 1: a share marker, but it's still.

556
00:25:57,880 --> 00:26:00,600
Speaker 2: The best, easier to understand for you know, the average job, the.

557
00:26:00,600 --> 00:26:03,400
Speaker 1: Average person, because they can listen to this podcast where

558
00:26:03,400 --> 00:26:04,919
Speaker 1: they can read stuff, they can find out it all.

559
00:26:04,960 --> 00:26:07,680
Speaker 1: There's no supply. It's pretty obvious as supply. And we

560
00:26:07,800 --> 00:26:11,480
Speaker 1: keep talking about the housing market crisis. Well, if you've

561
00:26:11,480 --> 00:26:13,159
Speaker 1: got a house or a bit of real estate, you

562
00:26:13,240 --> 00:26:15,920
Speaker 1: know you're on the other side of that transaction. You're

563
00:26:16,200 --> 00:26:16,840
Speaker 1: you're going up.

564
00:26:17,119 --> 00:26:17,320
Speaker 2: Yep.

565
00:26:18,040 --> 00:26:22,480
Speaker 1: Well, and Australia's love affair, we're probably just going to continue.

566
00:26:22,320 --> 00:26:24,159
Speaker 2: I think so and the worlds and this is and

567
00:26:24,320 --> 00:26:25,560
Speaker 2: you know, this is where I keep coming back to,

568
00:26:25,720 --> 00:26:27,879
Speaker 2: is that people want to live in Australia like we have.

569
00:26:28,400 --> 00:26:30,760
Speaker 2: We have a great lifestyle. If you travel, you know,

570
00:26:30,840 --> 00:26:32,840
Speaker 2: you know exactly what we have here, and we've got

571
00:26:32,960 --> 00:26:35,840
Speaker 2: resources to back it. And that's where I look at

572
00:26:35,880 --> 00:26:38,480
Speaker 2: this and we go, well, you know, the future of

573
00:26:38,880 --> 00:26:42,200
Speaker 2: residential property in Australia I think is still got growth

574
00:26:42,240 --> 00:26:45,280
Speaker 2: in it, mega growth. It's got some challenges, definitely, but

575
00:26:45,440 --> 00:26:48,440
Speaker 2: it's this is actually the most exciting market I've ever

576
00:26:48,520 --> 00:26:50,879
Speaker 2: been in in the over twenty years i've been doing this.

577
00:26:51,320 --> 00:26:53,960
Speaker 2: What I'm seeing right now, I've never seen this before.

578
00:26:54,359 --> 00:26:55,400
Speaker 2: It is the most exciting.

579
00:26:55,920 --> 00:27:00,200
Speaker 1: That'll do me. John Rivera, Director of Projects Sales of

580
00:27:00,240 --> 00:27:03,280
Speaker 1: Project Marketing at Colliers Thanks very much, mate, Thanks Mark,

581
00:27:03,359 --> 00:27:03,840
Speaker 1: appreciate it.

582
00:27:04,000 --> 00:27:04,240
Speaker 2: Cheers