1 00:00:00,280 --> 00:00:04,440 Speaker 1: Welcome to Shared Lunch. I'm Jackie Newman. Today we're pulling 2 00:00:04,480 --> 00:00:08,200 Speaker 1: back the curtain on Centuria Capital Group. I'm joined by 3 00:00:08,360 --> 00:00:12,280 Speaker 1: co CEO Jason Julich to talk about how they've built 4 00:00:12,400 --> 00:00:16,400 Speaker 1: a twenty two billion dollar property empire. The types of 5 00:00:16,480 --> 00:00:21,200 Speaker 1: assets Centuria managers touch almost every part of our lives, 6 00:00:21,440 --> 00:00:26,040 Speaker 1: from high tech data centers and private credit, to hospitals 7 00:00:26,079 --> 00:00:30,240 Speaker 1: and agriculture. We'll explore what it takes to scale such 8 00:00:30,240 --> 00:00:33,599 Speaker 1: a vast property platform. Before we get started, I want 9 00:00:33,640 --> 00:00:37,600 Speaker 1: to acknowledge the Gadigel people of the Eura Nation, the 10 00:00:37,680 --> 00:00:42,519 Speaker 1: traditional custodians of the land, water and sky from where 11 00:00:42,600 --> 00:00:47,360 Speaker 1: we're filming today, and pay respect to elders past and present. 12 00:00:48,159 --> 00:00:50,800 Speaker 2: Investing involves the risk you might lose the money you 13 00:00:50,840 --> 00:00:54,120 Speaker 2: start with. We recommend talking to a licensed financial advisor. 14 00:00:54,840 --> 00:00:58,680 Speaker 2: We also recommend reading product disclosure documents before deciding to invest. 15 00:00:58,920 --> 00:01:01,320 Speaker 2: Everything you're about to see and here is current at 16 00:01:01,320 --> 00:01:02,160 Speaker 2: the time of recording. 17 00:01:02,320 --> 00:01:04,920 Speaker 1: Jason, Welcome to Shared Lunch. It's great to have you on. 18 00:01:05,040 --> 00:01:05,800 Speaker 3: Thanks for having me. 19 00:01:06,000 --> 00:01:08,600 Speaker 1: I want to step back in time to where it 20 00:01:08,640 --> 00:01:12,720 Speaker 1: all began. You arrived in Sydney from New Zealand at 21 00:01:12,760 --> 00:01:16,360 Speaker 1: twenty one for what intended I understand to only be 22 00:01:16,400 --> 00:01:20,520 Speaker 1: a short stay. However, you quickly found yourself immersed in 23 00:01:20,600 --> 00:01:24,880 Speaker 1: property consultancy with your now co CEO, John McBain. Could 24 00:01:24,920 --> 00:01:27,600 Speaker 1: you take us back to the late nineteen nineties and 25 00:01:27,680 --> 00:01:30,640 Speaker 1: tell us about the origins of Centuria. 26 00:01:30,680 --> 00:01:31,319 Speaker 3: Sure? Yeah. 27 00:01:32,640 --> 00:01:35,000 Speaker 4: I just finished union in Auckland and my father had 28 00:01:35,000 --> 00:01:37,760 Speaker 4: a small investment and a very small developer in Sydney, 29 00:01:37,800 --> 00:01:40,240 Speaker 4: and he offered me to go across for a year, 30 00:01:40,319 --> 00:01:42,400 Speaker 4: learn the business and come back. And so I was 31 00:01:42,440 --> 00:01:44,119 Speaker 4: going to come over here for twelve months. I knew 32 00:01:44,120 --> 00:01:46,200 Speaker 4: no one and Sydney, so it was quite a big 33 00:01:46,240 --> 00:01:47,800 Speaker 4: move and there was a lot for me to do. 34 00:01:47,880 --> 00:01:48,920 Speaker 4: So in the end I just said I'm going to 35 00:01:48,920 --> 00:01:50,320 Speaker 4: go get a job somewhere else, and I went for 36 00:01:50,360 --> 00:01:53,800 Speaker 4: a job with John and his business partent at the time, Andrew, 37 00:01:53,840 --> 00:01:56,280 Speaker 4: and they had a property consulting business, sorting out problem 38 00:01:56,800 --> 00:01:59,320 Speaker 4: assets after the nineties crash. It was a big crash 39 00:01:59,360 --> 00:02:01,720 Speaker 4: in the nineties, a lot of empty office buildings and 40 00:02:01,800 --> 00:02:05,160 Speaker 4: half built developments and so forth. One of our jobs 41 00:02:05,280 --> 00:02:09,560 Speaker 4: first jobs was to lease up and sell a small 42 00:02:09,600 --> 00:02:13,640 Speaker 4: shopping center in western Sydney, and we leased it up. 43 00:02:13,639 --> 00:02:14,639 Speaker 3: We took it to the market. 44 00:02:15,280 --> 00:02:17,280 Speaker 4: There's only one buyer, and he was an accountant that 45 00:02:17,320 --> 00:02:20,840 Speaker 4: wanted to wanted to syndicate it for high networth investors, 46 00:02:20,960 --> 00:02:22,240 Speaker 4: and we helped. 47 00:02:22,080 --> 00:02:23,320 Speaker 3: Him do it. We helped and write as I am. 48 00:02:23,360 --> 00:02:25,360 Speaker 4: We introduced them to investors because we're going to get 49 00:02:25,400 --> 00:02:27,040 Speaker 4: a good fee out of it. And he kept falling 50 00:02:27,080 --> 00:02:29,080 Speaker 4: over and you couldn't raise the money. And after the 51 00:02:29,080 --> 00:02:32,079 Speaker 4: second or third time of trying to extend it, Duncan 52 00:02:32,120 --> 00:02:34,960 Speaker 4: and Greg said, why don't you go syndicate it? And 53 00:02:35,000 --> 00:02:37,040 Speaker 4: they gave us three months and we went to raise 54 00:02:37,200 --> 00:02:39,840 Speaker 4: three million dollars for a nine million dollar purchase and 55 00:02:40,120 --> 00:02:41,600 Speaker 4: it was really hard, and we got there and we 56 00:02:41,639 --> 00:02:43,120 Speaker 4: got it. We got it done, and that was our 57 00:02:43,120 --> 00:02:43,600 Speaker 4: first fun. 58 00:02:43,880 --> 00:02:47,880 Speaker 1: Taking a step back. For an investor new to Centuria, 59 00:02:48,240 --> 00:02:51,720 Speaker 1: the Centuria ecosystem can feel a little bit like a 60 00:02:51,760 --> 00:02:55,320 Speaker 1: nesting doll, right. So you've got Centuria Capital C and I, 61 00:02:55,560 --> 00:02:58,600 Speaker 1: which manages the funds, and then you've got the specific 62 00:02:58,680 --> 00:03:04,680 Speaker 1: reates Centuria off cough or COF and Centuria Industrial CIP. 63 00:03:05,919 --> 00:03:09,560 Speaker 1: For an investor looking at these entities for the first 64 00:03:09,560 --> 00:03:12,840 Speaker 1: time at a very high level, if they invest, what 65 00:03:12,880 --> 00:03:14,960 Speaker 1: do they get exposure to across these three. 66 00:03:15,200 --> 00:03:15,359 Speaker 3: Yeah. 67 00:03:15,400 --> 00:03:17,440 Speaker 4: Look it's come a long way from the one little 68 00:03:17,480 --> 00:03:19,760 Speaker 4: building out in western Sydney. So yeah, if you look 69 00:03:19,800 --> 00:03:22,160 Speaker 4: at it today, it's twenty two billion dollars of assets. 70 00:03:22,160 --> 00:03:25,200 Speaker 4: Centuria Capital CNI, which in the ASEX two hundred is 71 00:03:25,240 --> 00:03:29,840 Speaker 4: the fund manager and we manage all the different funds, 72 00:03:29,840 --> 00:03:31,720 Speaker 4: so we've got close to one hundred and fifty funds. So 73 00:03:31,760 --> 00:03:35,200 Speaker 4: we've got three other listed entity. So we've got COUGH 74 00:03:35,200 --> 00:03:37,760 Speaker 4: which is our office three set which are industrial e 75 00:03:37,920 --> 00:03:39,760 Speaker 4: and the small Asset plus over in New Zealand which 76 00:03:39,760 --> 00:03:43,000 Speaker 4: is a small diversifyed rate. So if people want to 77 00:03:43,000 --> 00:03:47,160 Speaker 4: get into listed investments, they can invest into those and 78 00:03:47,160 --> 00:03:50,520 Speaker 4: they're like a share exactly the same they listed on 79 00:03:50,840 --> 00:03:52,360 Speaker 4: either the ASSEX or xi X. 80 00:03:53,720 --> 00:03:55,480 Speaker 3: You know, we pay out our dividend. 81 00:03:56,080 --> 00:04:00,200 Speaker 4: So for example, CIP is ninety five office asset, it's 82 00:04:00,240 --> 00:04:00,960 Speaker 4: just over four. 83 00:04:00,760 --> 00:04:03,800 Speaker 3: Billion dollars worth of real estate. 84 00:04:05,240 --> 00:04:09,640 Speaker 4: And they'll get access to a diversified portfolio of industrial assets. 85 00:04:10,640 --> 00:04:13,400 Speaker 4: Obviously you got T plus two two or three liquidity 86 00:04:14,240 --> 00:04:16,080 Speaker 4: which suits a lot of people, but you've got the 87 00:04:16,120 --> 00:04:19,719 Speaker 4: volatility of the shar market as well the office vehicle, 88 00:04:19,880 --> 00:04:23,760 Speaker 4: so there's twenty office assets spread around Australia, very high 89 00:04:23,800 --> 00:04:27,440 Speaker 4: A grade assets, really strong tenant based like seventy five 90 00:04:27,440 --> 00:04:32,400 Speaker 4: percent of the tenant bass governmental multinational listed tenants. And 91 00:04:32,480 --> 00:04:35,880 Speaker 4: again they'll get right now, office centiments quite low, so 92 00:04:37,040 --> 00:04:41,039 Speaker 4: investments to that it's very cheap share place around a dollar. 93 00:04:41,080 --> 00:04:45,240 Speaker 4: You're getting a ten percent distribution return. It's training about 94 00:04:45,279 --> 00:04:49,040 Speaker 4: forty percent under the INTA, which is your valuations, which 95 00:04:49,480 --> 00:04:51,520 Speaker 4: bore the assets are valued every six or twelve months. 96 00:04:52,839 --> 00:04:55,560 Speaker 3: So it's a different investment to the say. 97 00:04:55,480 --> 00:04:57,880 Speaker 4: One hundred and fifty unlisted funds, where they might be 98 00:04:57,920 --> 00:05:01,679 Speaker 4: a single asset. So for particular investor wants some invest 99 00:05:01,720 --> 00:05:03,640 Speaker 4: in to office or industrial or retail, they can go 100 00:05:03,720 --> 00:05:07,080 Speaker 4: into one asset and again they get paid a monthly 101 00:05:07,760 --> 00:05:10,120 Speaker 4: distribution which just comes from the rent paid by the 102 00:05:10,160 --> 00:05:14,520 Speaker 4: particular tenets and that property. Now, some people like unlisted 103 00:05:14,680 --> 00:05:17,120 Speaker 4: because you know, you don't see ships getting up and 104 00:05:17,160 --> 00:05:21,120 Speaker 4: down every day due to outside factors like world events. 105 00:05:22,200 --> 00:05:24,440 Speaker 4: So they know that though there'll be a valuation every year, 106 00:05:25,080 --> 00:05:27,599 Speaker 4: the term of that fund might be five years. The 107 00:05:27,640 --> 00:05:29,560 Speaker 4: assets sold in five years, they know exactly what they've 108 00:05:29,600 --> 00:05:31,440 Speaker 4: invested in too, and a lot of them might get 109 00:05:31,480 --> 00:05:33,840 Speaker 4: diversification by going into a number of those hints with 110 00:05:33,880 --> 00:05:37,240 Speaker 4: a lot of businesses, as I said, with multiple assets across. 111 00:05:37,000 --> 00:05:38,320 Speaker 3: Those unlisted funds. 112 00:05:38,640 --> 00:05:41,120 Speaker 4: So there's pros and cons of each sort of vehicle 113 00:05:41,360 --> 00:05:45,039 Speaker 4: beats single asset, bit multi asset, unlisted versus the rates 114 00:05:45,040 --> 00:05:46,800 Speaker 4: that give you the liquidity and other bonuses. 115 00:05:46,880 --> 00:05:52,320 Speaker 1: Is it like that Centurias foundations are in the traditional 116 00:05:52,400 --> 00:05:55,680 Speaker 1: bricks and mortar assets that we're aware of, so office 117 00:05:56,520 --> 00:05:59,800 Speaker 1: and warehouses, But in more recent years there's been a 118 00:06:00,279 --> 00:06:04,359 Speaker 1: focus on what we'd call alternative assets. What would you 119 00:06:04,440 --> 00:06:09,040 Speaker 1: say are the benefits of investing across these asset classes 120 00:06:09,160 --> 00:06:14,240 Speaker 1: as it relates to the impact on earning's quality, earnings, resilience. 121 00:06:15,279 --> 00:06:16,679 Speaker 1: Why invest in these assets? 122 00:06:16,800 --> 00:06:19,560 Speaker 4: If you go back to the beginning of twenty seventeen, 123 00:06:19,600 --> 00:06:20,760 Speaker 4: we just ambissed an office. 124 00:06:20,760 --> 00:06:22,360 Speaker 3: A whole portfolio was office. 125 00:06:22,080 --> 00:06:26,120 Speaker 4: And at that stage we sort of decided at a 126 00:06:26,360 --> 00:06:28,680 Speaker 4: board level that we need some diversification. So the first 127 00:06:28,720 --> 00:06:30,560 Speaker 4: one we did was a group called three sixty Capital 128 00:06:30,600 --> 00:06:32,880 Speaker 4: at the beginning of twenty seventeen, and that really got 129 00:06:32,960 --> 00:06:35,920 Speaker 4: us into industrial. Next one was healthcare, So we're having 130 00:06:35,920 --> 00:06:38,920 Speaker 4: a good look at healthcare, real estate, so private hospitals, 131 00:06:38,960 --> 00:06:42,040 Speaker 4: medical facilities and so forth, and we like that because 132 00:06:43,200 --> 00:06:46,480 Speaker 4: there's a very good story around Tarwin's around aging, demographic 133 00:06:46,760 --> 00:06:50,480 Speaker 4: and healthcare and so forth. So we bought a small 134 00:06:50,480 --> 00:06:52,800 Speaker 4: fund manager there called Heathiley and again we grew that 135 00:06:52,839 --> 00:06:56,080 Speaker 4: one out. We went to New Zealand and bought Augusta 136 00:06:56,400 --> 00:06:59,960 Speaker 4: which was which is the last largest analysted real estes 137 00:07:00,080 --> 00:07:03,960 Speaker 4: state manager and they were a cross office industrial retail 138 00:07:04,800 --> 00:07:06,840 Speaker 4: so that sort of got us into the retail side 139 00:07:06,839 --> 00:07:09,000 Speaker 4: a bit. We then bought Prime West, which was the 140 00:07:09,080 --> 00:07:11,680 Speaker 4: largest fundamental manager out of Western Australia. They had about 141 00:07:11,720 --> 00:07:14,280 Speaker 4: five billion dollars of assets. They had a lot of 142 00:07:14,280 --> 00:07:17,720 Speaker 4: retail so large format and enabled shopping centers. They had 143 00:07:17,720 --> 00:07:21,080 Speaker 4: a lot of office in Western Australia. They also had agriculture, 144 00:07:21,200 --> 00:07:23,080 Speaker 4: so it was a new sector for us to get 145 00:07:23,080 --> 00:07:25,360 Speaker 4: into at the time, which was ag and that's probably 146 00:07:25,360 --> 00:07:27,440 Speaker 4: had that's one of the sectors of the highest growth 147 00:07:27,440 --> 00:07:29,280 Speaker 4: over the last two or three years for us. We 148 00:07:29,360 --> 00:07:32,320 Speaker 4: got into real estate credit so leanding out to developers 149 00:07:32,360 --> 00:07:34,680 Speaker 4: and we bought a small manager called Bass had about 150 00:07:34,680 --> 00:07:37,680 Speaker 4: two hundred million dollars of loans out again help them scale. 151 00:07:38,920 --> 00:07:40,560 Speaker 4: That's now two and a half billion, so it's grown 152 00:07:40,640 --> 00:07:43,240 Speaker 4: in four and a half years ten times of size. 153 00:07:44,080 --> 00:07:47,160 Speaker 4: Great business and a really good diversifyer. So when real 154 00:07:47,240 --> 00:07:49,960 Speaker 4: estate equity is a bit harder, real estate credits usually 155 00:07:50,040 --> 00:07:52,640 Speaker 4: going the other way. So it's sort of really DIVERSEID 156 00:07:52,720 --> 00:07:54,320 Speaker 4: the platform in the last sect that we've gone into 157 00:07:54,320 --> 00:07:57,440 Speaker 4: more recently as data centers, so we own a number 158 00:07:57,440 --> 00:08:01,080 Speaker 4: of data centers and we've also invested in AIREE, so 159 00:08:01,080 --> 00:08:04,880 Speaker 4: we're a very well diversified platform now. It's also helped 160 00:08:04,920 --> 00:08:08,240 Speaker 4: where some markets like offices office have been quite tough 161 00:08:08,280 --> 00:08:11,360 Speaker 4: since COVID, whereas industrial has been very strong and data 162 00:08:11,360 --> 00:08:12,840 Speaker 4: centers has grown very quickly. 163 00:08:13,240 --> 00:08:15,240 Speaker 3: So as a platform, it allows us. 164 00:08:15,120 --> 00:08:19,240 Speaker 4: To give investors access to a wide range of investments 165 00:08:19,280 --> 00:08:21,720 Speaker 4: in different structures but also different sectors as well. 166 00:08:21,760 --> 00:08:25,520 Speaker 1: I read this morning that in the US, construction spend 167 00:08:25,760 --> 00:08:30,040 Speaker 1: on data centers are exceeded office spend for the first 168 00:08:30,040 --> 00:08:30,600 Speaker 1: time ever. 169 00:08:30,760 --> 00:08:33,040 Speaker 4: The rough numbers where if you go back ten years ago, 170 00:08:33,640 --> 00:08:35,840 Speaker 4: there was about three billion dollars worth of data centers 171 00:08:36,160 --> 00:08:37,960 Speaker 4: being built in the US year and there was about 172 00:08:38,080 --> 00:08:41,560 Speaker 4: forty five billion of office office kicking up to sixty 173 00:08:42,000 --> 00:08:44,600 Speaker 4: it's come back down to about forty and data center 174 00:08:44,640 --> 00:08:47,199 Speaker 4: has gone from three and now gone through through office. 175 00:08:47,200 --> 00:08:50,959 Speaker 4: It's amazing. So our first data center investment was about 176 00:08:51,000 --> 00:08:54,200 Speaker 4: five or six years ago and we bought Telstra's main 177 00:08:54,280 --> 00:08:56,679 Speaker 4: data center in Victoria. Then we bought a small one 178 00:08:56,679 --> 00:08:59,720 Speaker 4: in perse More recently we've bought in Queensland. 179 00:09:01,160 --> 00:09:03,319 Speaker 3: So we've owned. 180 00:09:03,000 --> 00:09:06,240 Speaker 4: The real estate piece for five or six years right 181 00:09:07,600 --> 00:09:09,640 Speaker 4: in that particulars it was one of the biggest data 182 00:09:09,679 --> 00:09:11,360 Speaker 4: centers at the time was about you know, we bought 183 00:09:11,360 --> 00:09:13,200 Speaker 4: it for so a four hundred million, which back then 184 00:09:13,280 --> 00:09:16,000 Speaker 4: was a big facility. Now it's tiny compared to some 185 00:09:16,040 --> 00:09:18,880 Speaker 4: of the big ones that are being built. And then 186 00:09:18,920 --> 00:09:22,320 Speaker 4: eighteen months ago we invested in a business called Reset Data, 187 00:09:22,400 --> 00:09:27,160 Speaker 4: and Reset Data started off bringing technology down into Australasia 188 00:09:27,240 --> 00:09:30,480 Speaker 4: for liquid immersion. So with the chips, as they've got 189 00:09:30,520 --> 00:09:35,000 Speaker 4: more and more powerful, they get hotter. The traditional air 190 00:09:35,080 --> 00:09:38,800 Speaker 4: callings air conditioning of these chips was getting to a 191 00:09:38,840 --> 00:09:40,600 Speaker 4: point where they couldn't call the chips because they were 192 00:09:40,600 --> 00:09:44,960 Speaker 4: getting so much more powerful and the heat load. So 193 00:09:45,240 --> 00:09:49,040 Speaker 4: the original founder had found this technology in Europe and 194 00:09:49,200 --> 00:09:52,000 Speaker 4: was looking to come down and sell it into the 195 00:09:52,040 --> 00:09:55,199 Speaker 4: Australian market. It was probably before it's time, so they 196 00:09:55,240 --> 00:09:57,079 Speaker 4: worked out what they needed to do from there and 197 00:09:57,120 --> 00:10:01,480 Speaker 4: when we got involved pretty shortly thereafter, Navidia they came 198 00:10:01,559 --> 00:10:03,079 Speaker 4: to us and they said, look, you know we've got 199 00:10:03,080 --> 00:10:04,719 Speaker 4: two cloud partners in Australia. 200 00:10:05,240 --> 00:10:07,319 Speaker 3: We like one more and. 201 00:10:07,320 --> 00:10:09,400 Speaker 4: If you build a certain facility, you know, for us, 202 00:10:09,400 --> 00:10:11,920 Speaker 4: you can become a cloud partner, which meant you worked 203 00:10:11,920 --> 00:10:15,360 Speaker 4: with Navidia to build out these facilities for AI. And 204 00:10:15,400 --> 00:10:17,720 Speaker 4: so the first facility we built was down in Docklands 205 00:10:18,200 --> 00:10:21,240 Speaker 4: in Melbourne and we worked out pretty quickly that we 206 00:10:21,240 --> 00:10:23,920 Speaker 4: had a lot of power capacity and with data centers 207 00:10:24,120 --> 00:10:27,319 Speaker 4: it all come down comes down to power. So we're 208 00:10:27,320 --> 00:10:30,600 Speaker 4: able to build this AI factor, which was still the 209 00:10:30,600 --> 00:10:33,679 Speaker 4: most powerful supercomputer in Australia in six hundred meters, was 210 00:10:33,800 --> 00:10:38,119 Speaker 4: built on Nvidia architecture and it's there just to basically 211 00:10:38,679 --> 00:10:41,720 Speaker 4: for AI infrincing. You know, we first built that facility 212 00:10:42,440 --> 00:10:45,040 Speaker 4: so or twelve months ago, again ahead of its time. 213 00:10:45,080 --> 00:10:46,120 Speaker 3: There's nothing like it here. 214 00:10:46,559 --> 00:10:48,520 Speaker 4: What we've seen in the last six months, the demand 215 00:10:48,640 --> 00:10:50,880 Speaker 4: from a lot of the US and Asian groups wanting 216 00:10:50,920 --> 00:10:52,679 Speaker 4: capacity down in Australia has just. 217 00:10:52,720 --> 00:10:54,280 Speaker 3: Multiplied by the factor of one hundred. 218 00:10:54,480 --> 00:10:56,520 Speaker 4: We were really closely with Navidio and we all know 219 00:10:56,559 --> 00:10:58,640 Speaker 4: as the biggest company in the world now it's come 220 00:10:58,640 --> 00:11:01,959 Speaker 4: from nowhere to being absolutely huge. We were really closely 221 00:11:02,000 --> 00:11:04,160 Speaker 4: with them, which means we see what's coming down the pipe, 222 00:11:04,160 --> 00:11:07,040 Speaker 4: the new tech, the density. It's the newest part of 223 00:11:07,080 --> 00:11:08,959 Speaker 4: our business. But it's a really exciting part of the 224 00:11:08,960 --> 00:11:09,680 Speaker 4: business as well. 225 00:11:10,720 --> 00:11:15,000 Speaker 1: Changing tach different asset class agriculture. So you've got a 226 00:11:15,160 --> 00:11:20,640 Speaker 1: portfolio over around one point three billion dollars in agricultural assets. 227 00:11:20,360 --> 00:11:23,520 Speaker 1: What's your edge there, what is the experience that you 228 00:11:23,600 --> 00:11:25,520 Speaker 1: bring to this particular asset class. 229 00:11:25,720 --> 00:11:28,040 Speaker 4: Yeah, look, when we bought the manager out of West 230 00:11:28,080 --> 00:11:30,560 Speaker 4: Australia Prime, we set a small AG team and they 231 00:11:30,600 --> 00:11:32,880 Speaker 4: only had aboute hundred fifty min dollars of assets. And 232 00:11:33,000 --> 00:11:34,680 Speaker 4: if we're in a particular seat there, we want it 233 00:11:34,679 --> 00:11:36,880 Speaker 4: to be one two three billion. We sort of said 234 00:11:36,880 --> 00:11:39,120 Speaker 4: to the head of AG, you know, what's the top 235 00:11:39,160 --> 00:11:41,560 Speaker 4: of the pyramid an AG in terms of tech size 236 00:11:41,640 --> 00:11:44,760 Speaker 4: all those sorts of things, And you said, it's large 237 00:11:44,760 --> 00:11:47,160 Speaker 4: scale glasshouses. And so we went out to see some 238 00:11:47,200 --> 00:11:50,440 Speaker 4: of these things and they're huge. You know, we just 239 00:11:50,480 --> 00:11:53,600 Speaker 4: bought the biggest one actually last month, which is in 240 00:11:53,640 --> 00:11:56,480 Speaker 4: South Australia, it's forty five I think there is underglass, 241 00:11:56,720 --> 00:11:59,960 Speaker 4: so it's absolutely huge. Then what it's called protected cropping, 242 00:12:00,120 --> 00:12:02,080 Speaker 4: so you're still growing stuff, but it's in the glasshouse. 243 00:12:02,160 --> 00:12:05,640 Speaker 4: It's protected from all the elements basically, and you get 244 00:12:05,720 --> 00:12:07,680 Speaker 4: much higher yields because you can. 245 00:12:07,600 --> 00:12:09,600 Speaker 3: Go all year round, you got heating, cooling. 246 00:12:09,880 --> 00:12:13,040 Speaker 4: So what we're doing differently, so if investors are looking 247 00:12:13,080 --> 00:12:15,240 Speaker 4: to get into AG into a particular fund at the moment, 248 00:12:15,480 --> 00:12:18,880 Speaker 4: most managers will take the operating risk and they'll have 249 00:12:18,960 --> 00:12:21,120 Speaker 4: the real estate, so you're taking the business risk and 250 00:12:21,160 --> 00:12:24,320 Speaker 4: so forth. We didn't want to expose avestas to that, 251 00:12:24,440 --> 00:12:26,240 Speaker 4: so we just wanted to take the real estate and 252 00:12:26,280 --> 00:12:28,600 Speaker 4: get long term leases over it. So it was getting 253 00:12:28,679 --> 00:12:31,560 Speaker 4: exposure to AGG but not probably taking the risk that 254 00:12:31,920 --> 00:12:34,320 Speaker 4: a lot of these AG funds have in them, and 255 00:12:34,360 --> 00:12:37,600 Speaker 4: we wanted to give our individual investors access to this 256 00:12:38,120 --> 00:12:40,520 Speaker 4: sort of product. So now we control about sixty five 257 00:12:40,520 --> 00:12:44,440 Speaker 4: percent of the large scar glasshouse market in Australia. We've 258 00:12:44,480 --> 00:12:48,199 Speaker 4: got all the big five operators within our portfolio, so 259 00:12:48,240 --> 00:12:52,920 Speaker 4: you're continuity of income because it's very expensive to build 260 00:12:52,920 --> 00:12:56,319 Speaker 4: these glasshouses or the tech and glass comes out of Europe. 261 00:12:57,160 --> 00:12:59,800 Speaker 4: There's not many being built and if something happen to 262 00:12:59,840 --> 00:13:01,960 Speaker 4: one of our tenants, one of the other operators would 263 00:13:01,960 --> 00:13:04,319 Speaker 4: take it the next day. For ag You know, it's 264 00:13:04,360 --> 00:13:07,680 Speaker 4: quite a conservative investment into the egg space and it's. 265 00:13:07,600 --> 00:13:08,280 Speaker 3: Gone really well. 266 00:13:08,320 --> 00:13:10,240 Speaker 4: So we set today about one point four billion in 267 00:13:10,280 --> 00:13:11,000 Speaker 4: that egg space. 268 00:13:11,200 --> 00:13:15,160 Speaker 1: You mentioned Centuria bas So with that business, you are 269 00:13:15,200 --> 00:13:19,400 Speaker 1: now a major player in Australia's massive private credit sector. 270 00:13:20,679 --> 00:13:23,440 Speaker 1: Where do you see the opportunities there? 271 00:13:24,000 --> 00:13:27,120 Speaker 4: It's all about mitigating rest that's the base case. So 272 00:13:27,160 --> 00:13:29,240 Speaker 4: when we bought fifty percent of this business, it was 273 00:13:29,280 --> 00:13:35,800 Speaker 4: started by Xubs I think head of credit over structured 274 00:13:35,840 --> 00:13:38,640 Speaker 4: credit over in Europe and another Australian guy, and they 275 00:13:38,720 --> 00:13:40,520 Speaker 4: built this little business and they came to see us, 276 00:13:40,559 --> 00:13:43,280 Speaker 4: and before we invest in it, we actually tested it out. 277 00:13:43,280 --> 00:13:44,720 Speaker 3: We invested in a few of the funds. 278 00:13:45,240 --> 00:13:48,520 Speaker 4: What they liked about joining with us obviously we're bigger 279 00:13:48,520 --> 00:13:50,760 Speaker 4: and we had more distribution, but also, you know, we've 280 00:13:50,760 --> 00:13:52,800 Speaker 4: got five hundred property people in here. 281 00:13:52,720 --> 00:13:55,360 Speaker 3: So it mitigated a lot of the rests. 282 00:13:55,360 --> 00:13:57,400 Speaker 4: So every time they looked at a deal, they could 283 00:13:57,480 --> 00:14:01,480 Speaker 4: use our development teams, or our leasing team or heover 284 00:14:01,920 --> 00:14:05,480 Speaker 4: to help do due diligence. Our development teams know every 285 00:14:05,559 --> 00:14:09,280 Speaker 4: builder in Australia. They know we could finish any project 286 00:14:09,320 --> 00:14:11,760 Speaker 4: off if something went wrong with it. So just having 287 00:14:11,800 --> 00:14:14,920 Speaker 4: that sort of backup on that property team behind them 288 00:14:15,320 --> 00:14:16,760 Speaker 4: is definitely a big point of difference to some of 289 00:14:16,760 --> 00:14:19,880 Speaker 4: the other groups. So we've seen that grow, as I said, 290 00:14:19,880 --> 00:14:22,320 Speaker 4: from two hundred to enough billion in that time. Two 291 00:14:22,360 --> 00:14:25,760 Speaker 4: doss is super important. How we look at it as 292 00:14:25,800 --> 00:14:28,680 Speaker 4: an asset land. So if you value whatever the asset 293 00:14:28,800 --> 00:14:31,840 Speaker 4: is but a block of land residual stock, so it 294 00:14:31,920 --> 00:14:34,920 Speaker 4: might be a completed department building or townhouse project. If 295 00:14:34,960 --> 00:14:39,120 Speaker 4: you value that correctly and you get to a conservative level, 296 00:14:39,600 --> 00:14:41,960 Speaker 4: there should be no risk in it. Now, when you're 297 00:14:41,960 --> 00:14:44,080 Speaker 4: do in construction, that's always the riskier part. So we 298 00:14:44,120 --> 00:14:46,480 Speaker 4: talk to the builders obviously, talk at the subcontractors under 299 00:14:46,520 --> 00:14:49,040 Speaker 4: the builders, see if they cant paid, how the projects 300 00:14:49,040 --> 00:14:52,240 Speaker 4: are going. Our development teams will go through every building 301 00:14:52,280 --> 00:14:55,320 Speaker 4: contract to make sure it's up to our level. So 302 00:14:55,360 --> 00:14:57,720 Speaker 4: it comes down to a lot of due diligence. But 303 00:14:57,920 --> 00:15:00,200 Speaker 4: having that sort of team behind us to meet get 304 00:15:00,240 --> 00:15:00,840 Speaker 4: a lot of the risk. 305 00:15:01,720 --> 00:15:06,280 Speaker 1: I understand the majority of that lending book is against 306 00:15:06,440 --> 00:15:10,080 Speaker 1: residential projects. We're all reading about and many of us 307 00:15:10,120 --> 00:15:14,080 Speaker 1: are feeling this housing crisis across Australia and New Zealand. 308 00:15:14,840 --> 00:15:17,800 Speaker 1: Do you think that our Centurion bus is playing a 309 00:15:17,880 --> 00:15:20,880 Speaker 1: role here in helping to address this crisis? 310 00:15:20,920 --> 00:15:21,600 Speaker 3: Look, it is. 311 00:15:21,640 --> 00:15:25,520 Speaker 4: You know, ninety percent of our books residential, about ninety 312 00:15:25,560 --> 00:15:28,920 Speaker 4: two percents first mortgage, so we're lending first mortgage and 313 00:15:28,960 --> 00:15:34,120 Speaker 4: only about eight percent is missoning finance about seventy percent 314 00:15:34,480 --> 00:15:39,080 Speaker 4: New South Wales. But basically, yeah, we're financing developers either 315 00:15:39,120 --> 00:15:44,200 Speaker 4: building your apartments or townhouse projects, residential subdivisions, so that's 316 00:15:44,200 --> 00:15:46,240 Speaker 4: on the construction side. It would be land bridges where 317 00:15:46,240 --> 00:15:48,280 Speaker 4: they might have bought a big block of land they 318 00:15:48,360 --> 00:15:50,440 Speaker 4: might need two years to get the planning through to 319 00:15:50,440 --> 00:15:53,520 Speaker 4: be able to build, or it's residual stock so it's 320 00:15:53,560 --> 00:15:55,360 Speaker 4: built and they started selling it down and we just 321 00:15:55,560 --> 00:15:56,440 Speaker 4: were financing it. 322 00:15:56,440 --> 00:15:57,680 Speaker 3: Why they sell it down. 323 00:15:57,760 --> 00:16:00,920 Speaker 4: So everything we do is really how those developers get 324 00:16:00,920 --> 00:16:02,000 Speaker 4: more stock into the market. 325 00:16:02,080 --> 00:16:03,840 Speaker 3: You know, it comes down geographies as well. 326 00:16:03,880 --> 00:16:08,000 Speaker 4: You know, we're very bullish on New South Wales as 327 00:16:08,040 --> 00:16:10,160 Speaker 4: computer to something like Melbourne. Malbom has been pretty tough 328 00:16:10,160 --> 00:16:13,120 Speaker 4: and you've seen it go from probably the second highest 329 00:16:13,160 --> 00:16:15,120 Speaker 4: median house price in the country to probably fifth or 330 00:16:15,160 --> 00:16:16,920 Speaker 4: sixth now, so you. 331 00:16:16,920 --> 00:16:19,080 Speaker 3: Know, we're seeing we invest in areas. 332 00:16:18,880 --> 00:16:20,960 Speaker 4: Where we think the market will continue to grow and 333 00:16:21,000 --> 00:16:22,400 Speaker 4: stronger and demand. 334 00:16:22,880 --> 00:16:24,080 Speaker 3: New Zealand's is really interesting. 335 00:16:24,160 --> 00:16:27,400 Speaker 4: We've we've made our first couple of loans there more recently. 336 00:16:27,600 --> 00:16:29,680 Speaker 4: So we do want to build out of credit business 337 00:16:29,720 --> 00:16:32,120 Speaker 4: in New Zealand, so we're sort of putting a team 338 00:16:32,160 --> 00:16:35,360 Speaker 4: together there now. It's good having you know what, fifty 339 00:16:35,400 --> 00:16:37,440 Speaker 4: five people over here just in the debt business, so 340 00:16:37,440 --> 00:16:40,280 Speaker 4: we've got a really good base to build from. But 341 00:16:40,360 --> 00:16:42,360 Speaker 4: being you know, one of the largest of the largest 342 00:16:42,400 --> 00:16:44,160 Speaker 4: unlisted manager over there, I think we've got a really 343 00:16:44,200 --> 00:16:47,880 Speaker 4: good opportunity to build out that dept business in New Zealand. 344 00:16:48,360 --> 00:16:53,400 Speaker 4: In Australia, there's probably two main things. Regulatory side, we 345 00:16:53,640 --> 00:16:57,840 Speaker 4: like leaning to developers are doing first home buyer stock right, 346 00:16:57,840 --> 00:17:00,080 Speaker 4: so a lot of Western Sydney. The reason for that 347 00:17:00,240 --> 00:17:02,600 Speaker 4: is the government's always supporting that. You know, we've got 348 00:17:02,800 --> 00:17:05,840 Speaker 4: the five percent deposit here, which is a new scheme 349 00:17:05,840 --> 00:17:10,520 Speaker 4: they brought in last year. But there's always new government 350 00:17:10,560 --> 00:17:12,880 Speaker 4: projects to help promote first time bias. So if you're 351 00:17:12,920 --> 00:17:14,840 Speaker 4: at that end of the market. I think that's a 352 00:17:14,880 --> 00:17:17,800 Speaker 4: market that's going to be held up by the government. 353 00:17:17,920 --> 00:17:19,480 Speaker 4: So we relate that. 354 00:17:19,560 --> 00:17:23,000 Speaker 1: We can't talk about Centuria without talking about the massive 355 00:17:23,080 --> 00:17:28,359 Speaker 1: growth engines, so Centuria Office and Centuria Industrial. Firstly, with 356 00:17:28,600 --> 00:17:33,200 Speaker 1: Centuria Industrial, it feels like they're sort of pivoting from 357 00:17:33,680 --> 00:17:38,879 Speaker 1: you know, traditional industrial warehouses to be more of a 358 00:17:38,960 --> 00:17:41,600 Speaker 1: digital infrastructure. Yeah. 359 00:17:41,640 --> 00:17:43,680 Speaker 3: Look, it's probably not a full pivot. 360 00:17:44,119 --> 00:17:46,400 Speaker 4: So you know, we've gone through our portfolio of ninety 361 00:17:46,400 --> 00:17:49,320 Speaker 4: odd buildings and we said, okay, which site would suit 362 00:17:49,920 --> 00:17:52,640 Speaker 4: data centers and data center it needs a lot of things, 363 00:17:52,640 --> 00:17:55,840 Speaker 4: you know, that can't flood. Some operators are looking when 364 00:17:55,840 --> 00:18:01,560 Speaker 4: near fly zones, certain shape sights don't work, and so forth. 365 00:18:01,640 --> 00:18:03,880 Speaker 4: So next step is you're to secure the power, which 366 00:18:03,960 --> 00:18:06,480 Speaker 4: is quite a process in Australia. Every state's different, so 367 00:18:06,520 --> 00:18:09,639 Speaker 4: it gives us optionality. So we could add power and 368 00:18:09,720 --> 00:18:13,000 Speaker 4: then sell it add value. That way, we could get 369 00:18:13,040 --> 00:18:15,159 Speaker 4: the power and then lease the land out as powered 370 00:18:15,240 --> 00:18:17,800 Speaker 4: land and someone will come along and build their data 371 00:18:17,840 --> 00:18:21,760 Speaker 4: center on that land and we'd just be the freeholder. 372 00:18:22,680 --> 00:18:25,080 Speaker 4: Or we do the full reset data neocloud route where 373 00:18:25,080 --> 00:18:27,560 Speaker 4: you build it with the chips in it then and 374 00:18:27,600 --> 00:18:30,800 Speaker 4: do that. So I don't think it's a full pivot. 375 00:18:30,840 --> 00:18:33,359 Speaker 4: It's more just adding value. We think we've got stuff 376 00:18:33,400 --> 00:18:35,320 Speaker 4: in our portfolio we can add value. We're still buying 377 00:18:35,320 --> 00:18:39,879 Speaker 4: traditional info industrial as well, but the data center stuff's 378 00:18:39,920 --> 00:18:42,800 Speaker 4: a really interesting play. I think the vast majority will 379 00:18:42,800 --> 00:18:47,400 Speaker 4: always be infull industrial, but where we can add value we. 380 00:18:47,320 --> 00:18:51,760 Speaker 1: Will touching on a centurion office. So the focus there 381 00:18:51,960 --> 00:18:56,439 Speaker 1: is on metropolitan office. Can you tell us what we 382 00:18:56,560 --> 00:18:59,479 Speaker 1: mean by metropolitan office and then what is the appeal 383 00:18:59,520 --> 00:19:01,240 Speaker 1: of metro office businesses? 384 00:19:01,440 --> 00:19:04,240 Speaker 4: So a big change for the portfolio and Kough so 385 00:19:04,320 --> 00:19:07,560 Speaker 4: the twenty odd office buildings as metropolitan. So that's outside 386 00:19:07,640 --> 00:19:10,640 Speaker 4: the CBD. People go outside the CBD for a number 387 00:19:10,640 --> 00:19:12,680 Speaker 4: of reasons. One is obviously cost. So if you're in 388 00:19:12,680 --> 00:19:15,440 Speaker 4: a building at chiff Lee, you know, let's say you're 389 00:19:15,480 --> 00:19:19,560 Speaker 4: in two thousand plus a meter, you could be up 390 00:19:19,560 --> 00:19:21,520 Speaker 4: the road on the north shoor five hundreds a meter. 391 00:19:21,600 --> 00:19:24,080 Speaker 3: So there's a massive cost cost difference. And if you 392 00:19:24,080 --> 00:19:24,640 Speaker 3: don't have to. 393 00:19:24,560 --> 00:19:27,440 Speaker 4: Be in the CBD, then a lot of even large 394 00:19:27,480 --> 00:19:29,040 Speaker 4: groups choose not to be. 395 00:19:29,400 --> 00:19:31,119 Speaker 3: It's interesting going through COVID. 396 00:19:31,119 --> 00:19:34,359 Speaker 4: It's been obviously an interesting time for office, and we 397 00:19:34,440 --> 00:19:36,439 Speaker 4: survey all our tenants twice a year to see we're 398 00:19:36,480 --> 00:19:39,560 Speaker 4: they going to take more space less space, and it's 399 00:19:39,600 --> 00:19:42,840 Speaker 4: been pretty interesting and the last couple of surveys more 400 00:19:43,160 --> 00:19:46,200 Speaker 4: tenants that want to actually increase space and decrease space. 401 00:19:46,240 --> 00:19:48,360 Speaker 4: So I think the whole work from home COVID thing 402 00:19:48,480 --> 00:19:52,280 Speaker 4: is definitely stabilized. If you were a big tenant that 403 00:19:52,359 --> 00:19:55,640 Speaker 4: wanted to take some more space because you've got people 404 00:19:55,640 --> 00:19:57,920 Speaker 4: coming in two or three days a week, that's all 405 00:19:57,960 --> 00:20:02,879 Speaker 4: really happened, so it's now stabilizing going the other way. 406 00:20:03,119 --> 00:20:06,240 Speaker 4: The other good thing, particular Metro and what we're seeing 407 00:20:06,800 --> 00:20:11,320 Speaker 4: is construction costs since COVID out of control, they've gone 408 00:20:11,359 --> 00:20:14,000 Speaker 4: up so much and in most developments are just not 409 00:20:14,040 --> 00:20:14,879 Speaker 4: getting off the ground. 410 00:20:15,440 --> 00:20:16,200 Speaker 3: They just don't stack. 411 00:20:16,359 --> 00:20:20,320 Speaker 4: So there's very little office being built around Australia right 412 00:20:20,320 --> 00:20:22,399 Speaker 4: now other than things that are getting finished off that 413 00:20:22,480 --> 00:20:25,879 Speaker 4: started some time ago. So what we're seeing, and this 414 00:20:25,920 --> 00:20:29,480 Speaker 4: is Metro and CBD getting a real lack of supply 415 00:20:29,560 --> 00:20:31,879 Speaker 4: coming to the market, but you've still got demand. So 416 00:20:31,960 --> 00:20:35,639 Speaker 4: when you've got you got one highest immigration rates in 417 00:20:35,640 --> 00:20:39,520 Speaker 4: the world for developed country, that obviously means a lot 418 00:20:39,520 --> 00:20:41,560 Speaker 4: of demand for apartments and houses, but also means a 419 00:20:41,600 --> 00:20:44,280 Speaker 4: lot of demand for the other sectors. So I think 420 00:20:44,320 --> 00:20:47,520 Speaker 4: what we're seeing and even though Australia is a bit 421 00:20:47,560 --> 00:20:49,480 Speaker 4: of out of whack, the rest of our rates have 422 00:20:49,520 --> 00:20:52,399 Speaker 4: started to go up again. And I was just up 423 00:20:52,440 --> 00:20:55,679 Speaker 4: in Asia last week in Singapore, Hong Kong and Tokyo 424 00:20:55,840 --> 00:20:58,719 Speaker 4: talking to investors. They're still very bullish on coming down 425 00:20:58,760 --> 00:21:01,800 Speaker 4: to Australia and as they just see that supply demand 426 00:21:01,840 --> 00:21:05,399 Speaker 4: dynamic and they think because of the lack of supply 427 00:21:05,560 --> 00:21:08,800 Speaker 4: and the ongoing demand with our immigration, you're going to 428 00:21:08,840 --> 00:21:10,640 Speaker 4: see rental growth across most sectors. 429 00:21:10,840 --> 00:21:13,320 Speaker 1: I want to talk about the outlook. So you mentioned 430 00:21:13,400 --> 00:21:17,520 Speaker 1: rates briefly. It feels like we're in a higher for 431 00:21:17,600 --> 00:21:22,120 Speaker 1: longer rate environment at the moment. That can often be 432 00:21:22,240 --> 00:21:26,200 Speaker 1: a headwind for property as an asset class generally speaking, 433 00:21:26,760 --> 00:21:31,080 Speaker 1: How would you say Centuria is positioned against this backdrop. 434 00:21:31,680 --> 00:21:34,680 Speaker 4: Yeah, Look, there's a few things your rates always do 435 00:21:34,800 --> 00:21:37,240 Speaker 4: make it harder in real estate. You know, most real 436 00:21:37,359 --> 00:21:41,040 Speaker 4: estate investments are geared, so higher interest costs means lower returns, 437 00:21:41,080 --> 00:21:43,000 Speaker 4: and getting the best cost of debt is a really 438 00:21:43,040 --> 00:21:45,960 Speaker 4: important thing for us. We probably went in the GFC 439 00:21:46,040 --> 00:21:49,920 Speaker 4: with three banks across our portfolio. We now have twenty 440 00:21:49,960 --> 00:21:53,040 Speaker 4: six banks lending to us, so we have obviously Australian banks, 441 00:21:53,080 --> 00:21:56,399 Speaker 4: New Zealand banks that we have European, Asian, American banks 442 00:21:56,400 --> 00:21:59,520 Speaker 4: as well. And what that means is when we go 443 00:21:59,560 --> 00:22:02,320 Speaker 4: out for on a particular project, rates might have gone 444 00:22:02,400 --> 00:22:05,480 Speaker 4: up twenty five points, but we can get really competitive 445 00:22:05,520 --> 00:22:08,119 Speaker 4: rates on the margins, which means lower margins sort of 446 00:22:08,119 --> 00:22:11,119 Speaker 4: balance out that cost a bit. Look, we expect the 447 00:22:11,200 --> 00:22:14,560 Speaker 4: markets pricing in another couple of rate rises, which is 448 00:22:14,560 --> 00:22:15,520 Speaker 4: probably going to come through. 449 00:22:15,600 --> 00:22:17,560 Speaker 3: We're also with our funds. 450 00:22:18,240 --> 00:22:20,560 Speaker 4: When we buy an asset, we usually swap it out 451 00:22:20,560 --> 00:22:23,199 Speaker 4: for the five year term, so we'll lock in the 452 00:22:23,200 --> 00:22:25,439 Speaker 4: cost of debts, so even if if rates go up, 453 00:22:25,480 --> 00:22:28,480 Speaker 4: it shouldn't affect your returns that were forecasts at the 454 00:22:28,520 --> 00:22:29,400 Speaker 4: start of the investment. 455 00:22:29,440 --> 00:22:33,800 Speaker 1: As well, investors are increasingly focused around the impact of 456 00:22:33,880 --> 00:22:39,600 Speaker 1: their choices from an environmental, social, and governance perspective. How 457 00:22:39,640 --> 00:22:44,520 Speaker 1: important are these considerations in terms of centuries? Investment process 458 00:22:44,560 --> 00:22:45,840 Speaker 1: and decisions. 459 00:22:45,640 --> 00:22:50,280 Speaker 4: Look obviously more and more increasingly important both by a 460 00:22:50,359 --> 00:22:54,879 Speaker 4: tenant and an investor standpoint. I think Australia did a 461 00:22:54,920 --> 00:22:57,479 Speaker 4: really good job with their neighbors system a long time 462 00:22:57,560 --> 00:23:00,760 Speaker 4: ago they brought that in and a few back then, 463 00:23:01,000 --> 00:23:02,959 Speaker 4: if you had a building or a vacancy of more 464 00:23:02,960 --> 00:23:04,600 Speaker 4: than two thousand meters, you had to get a neighbor's 465 00:23:04,680 --> 00:23:08,520 Speaker 4: rating which rated your building in terms of sustainability and 466 00:23:08,560 --> 00:23:09,080 Speaker 4: so forth. 467 00:23:09,960 --> 00:23:10,600 Speaker 3: So that was good. 468 00:23:10,640 --> 00:23:12,120 Speaker 4: So that was a good hit start, and what that 469 00:23:12,200 --> 00:23:14,639 Speaker 4: meant was if you were a landlord, you knew that 470 00:23:14,680 --> 00:23:17,280 Speaker 4: when you sold your asset forgetting tenants for a while, 471 00:23:18,240 --> 00:23:21,560 Speaker 4: the buyers would look at your rating. So it forced 472 00:23:21,560 --> 00:23:23,760 Speaker 4: a lot of building owners to upgrade their buildings and 473 00:23:23,800 --> 00:23:26,080 Speaker 4: their neighbors ratings, you know, from two to three to 474 00:23:26,119 --> 00:23:29,639 Speaker 4: four to five five stars on the tenant side. Tenants 475 00:23:29,680 --> 00:23:31,960 Speaker 4: like the government, they won't go into a building on 476 00:23:32,040 --> 00:23:36,679 Speaker 4: six five star neighbors. Now that's gone up progressively. A 477 00:23:36,720 --> 00:23:42,240 Speaker 4: lot of your large multinational tenants, particularly European, they need 478 00:23:42,240 --> 00:23:44,560 Speaker 4: a very high rating to come into a new asset 479 00:23:44,600 --> 00:23:49,639 Speaker 4: as well. So as a landlord, it benefits you to 480 00:23:49,680 --> 00:23:51,560 Speaker 4: make sure that your buildings are on the cutting edge 481 00:23:51,560 --> 00:23:54,360 Speaker 4: of this. Probably the big thing at the moment's electrification. 482 00:23:54,760 --> 00:23:56,960 Speaker 4: So we're going through our folio and put a timeline 483 00:23:56,960 --> 00:24:02,040 Speaker 4: together for particularly the cough listed portfolio to electrify it, 484 00:24:02,280 --> 00:24:05,600 Speaker 4: so it means, you know, no fossil fuels and it's 485 00:24:05,640 --> 00:24:07,200 Speaker 4: all of electrified by a certain. 486 00:24:06,960 --> 00:24:07,480 Speaker 3: Point in time. 487 00:24:07,520 --> 00:24:11,239 Speaker 4: So that's a lot of capex to get there. But 488 00:24:11,480 --> 00:24:13,520 Speaker 4: we know one the building will be worth more when 489 00:24:13,520 --> 00:24:14,960 Speaker 4: you go to the market. There will be a deeper 490 00:24:15,040 --> 00:24:17,879 Speaker 4: pool of potential buyers when we do sell that asset, 491 00:24:17,920 --> 00:24:20,480 Speaker 4: and there will again deeper poor tenants to come into it. 492 00:24:20,520 --> 00:24:23,560 Speaker 4: So it's definitely a focus for a lot of investors 493 00:24:23,600 --> 00:24:24,240 Speaker 4: and tenants. 494 00:24:24,480 --> 00:24:26,960 Speaker 1: I want to take a moment to get a better 495 00:24:27,040 --> 00:24:30,680 Speaker 1: understanding of the man behind the strategy. So a few 496 00:24:30,760 --> 00:24:33,679 Speaker 1: rapid fire questions just to get your take on a 497 00:24:33,680 --> 00:24:38,199 Speaker 1: few big picture issues. You have one thousand dollars to 498 00:24:38,400 --> 00:24:46,880 Speaker 1: invest in just one property class industrial, data center's, office, agriculture. 499 00:24:47,359 --> 00:24:48,000 Speaker 1: Where does it go? 500 00:24:48,359 --> 00:24:49,000 Speaker 3: It's hard one. 501 00:24:49,000 --> 00:24:52,640 Speaker 4: We've got seven different asset classes. I give a case 502 00:24:52,640 --> 00:24:56,760 Speaker 4: for nearly every single one at the moment. Look if 503 00:24:56,800 --> 00:24:59,760 Speaker 4: it wasn't your last last dollar and you really want 504 00:24:59,760 --> 00:25:02,120 Speaker 4: to have a you know, obviously data centers is where 505 00:25:02,119 --> 00:25:06,399 Speaker 4: you can make a lot of money. It's growing so quickly. 506 00:25:07,400 --> 00:25:09,760 Speaker 4: Technology is changing a lot. But the one thing they'll 507 00:25:09,800 --> 00:25:13,000 Speaker 4: need is power and capacity. So if you're investing in 508 00:25:13,000 --> 00:25:15,560 Speaker 4: to write asset there, it should be a very good 509 00:25:15,600 --> 00:25:18,560 Speaker 4: long term investment office perks. 510 00:25:19,040 --> 00:25:22,760 Speaker 1: What is one office perk that every office needs to 511 00:25:22,800 --> 00:25:26,080 Speaker 1: have to get people back into the office in twenty 512 00:25:26,119 --> 00:25:26,680 Speaker 1: twenty six. 513 00:25:26,960 --> 00:25:27,600 Speaker 3: Okay, it's amazing. 514 00:25:27,640 --> 00:25:30,800 Speaker 4: Since COVID everruns and all sorts of things, wowness is 515 00:25:30,800 --> 00:25:34,040 Speaker 4: obviously the big one. We're putting saunas. I hate them, 516 00:25:34,040 --> 00:25:35,960 Speaker 4: but a lot of people seem to them cold plunges. 517 00:25:36,520 --> 00:25:39,040 Speaker 4: So we're putting all of these sorts of things into 518 00:25:39,119 --> 00:25:41,600 Speaker 4: our buildings, free gyms for tenants. 519 00:25:42,080 --> 00:25:43,640 Speaker 3: Wowness has been the big one. Definitely. 520 00:25:44,000 --> 00:25:47,359 Speaker 1: Looking back at the late nineties when you met John, 521 00:25:47,960 --> 00:25:50,920 Speaker 1: what is the one trait that you saw in him 522 00:25:51,240 --> 00:25:54,760 Speaker 1: which made you think, right, I can hitch my wagonto 523 00:25:54,800 --> 00:25:56,360 Speaker 1: this guy. 524 00:25:56,640 --> 00:25:58,840 Speaker 4: Look, I think had a really good vision. But the 525 00:25:58,920 --> 00:26:01,400 Speaker 4: thing that I like the best was his ethics. Now, 526 00:26:01,440 --> 00:26:03,960 Speaker 4: if you're in funds management and you're managing other people's money, 527 00:26:04,160 --> 00:26:05,240 Speaker 4: it's the most important thing. 528 00:26:05,600 --> 00:26:06,639 Speaker 3: And I remember. 529 00:26:07,920 --> 00:26:09,760 Speaker 4: Just a few things came up and how we handled them. 530 00:26:09,800 --> 00:26:12,520 Speaker 4: We was just straight down the line. I remember back then, 531 00:26:13,080 --> 00:26:15,600 Speaker 4: you know, the agencies would sell some building for you 532 00:26:15,720 --> 00:26:18,639 Speaker 4: and most developers of investors would just chip them at 533 00:26:18,640 --> 00:26:21,200 Speaker 4: the end and whatever their fee was, I take thirty 534 00:26:21,200 --> 00:26:24,160 Speaker 4: percent off the fee. And John, I remember, right from 535 00:26:24,200 --> 00:26:26,240 Speaker 4: the start of our smallest thing, he just said, the 536 00:26:26,280 --> 00:26:28,000 Speaker 4: agent does a deal at least deal or a sale, 537 00:26:28,200 --> 00:26:30,199 Speaker 4: you pay him as full commission on the day and 538 00:26:30,200 --> 00:26:33,520 Speaker 4: that's it. And we've got amazing relationships for all the agencies 539 00:26:33,520 --> 00:26:36,160 Speaker 4: around Australia and New Zealand now because. 540 00:26:35,760 --> 00:26:37,399 Speaker 3: We treat them a bit differently than some of the 541 00:26:37,440 --> 00:26:37,960 Speaker 3: other groups. 542 00:26:38,520 --> 00:26:41,040 Speaker 1: The flip side. So if we were to ask John 543 00:26:41,280 --> 00:26:44,440 Speaker 1: the same question what quality in you would he say? 544 00:26:44,480 --> 00:26:48,359 Speaker 1: Has kept the partnership together for twenty five years. 545 00:26:48,600 --> 00:26:50,760 Speaker 3: I think I side. 546 00:26:50,760 --> 00:26:54,760 Speaker 4: I think I'm quite organized and quite process driven and 547 00:26:54,840 --> 00:26:57,000 Speaker 4: John's a bit more the vision in that side. 548 00:26:57,000 --> 00:26:58,159 Speaker 3: So it's a really good balance. 549 00:26:58,160 --> 00:27:02,359 Speaker 4: So I think as it's companies grind to five hundred 550 00:27:02,400 --> 00:27:05,840 Speaker 4: people and four hundred assets, you know, the process side 551 00:27:05,880 --> 00:27:10,120 Speaker 4: and that side has been I've really enjoyed. So yeah, 552 00:27:10,119 --> 00:27:11,040 Speaker 4: it's a bit. 553 00:27:10,840 --> 00:27:16,960 Speaker 1: Of I like that. So this is a really difficult question. 554 00:27:17,040 --> 00:27:20,560 Speaker 1: Now the final question. You've been in Australia since you 555 00:27:20,600 --> 00:27:24,879 Speaker 1: were twenty one, when the All Blacks are playing the Wallabies, 556 00:27:25,600 --> 00:27:26,720 Speaker 1: what jersey are you wearing. 557 00:27:26,840 --> 00:27:29,800 Speaker 3: That's not a difficult question. I like backing winners. I 558 00:27:29,920 --> 00:27:30,480 Speaker 3: leave it at that. 559 00:27:32,680 --> 00:27:35,800 Speaker 1: For those of you following along in the app, there's 560 00:27:35,840 --> 00:27:38,840 Speaker 1: a few ways you can follow this story. You've got 561 00:27:39,000 --> 00:27:43,920 Speaker 1: the broader Centuria Capital Group ticker CNI or the more 562 00:27:43,920 --> 00:27:51,600 Speaker 1: specific reads Centuria Industrial ticker CIP or Centuria Office ticker COF.