Issue 29 | The Property Development Review

Market Overview - NSW

Daniel O'Brien Xcommercial

Q. Who have been key investors over the last 18 months and have you seen a shift from previous years? A. Not really. It’s still the private clients, high net worth clients, AREITS and the syndicators. Everyone is chasing yields and add value and it’s the same old story. Due to the lack of stock in the middlemarkets of $20M - $50Mwe have seenmore andmore syndicators over the last 18months, so they are always an active buyer group. Q. What is your secret to achieving the exceptional results that you have? A. You will go in circles and never progress without amap. Goal setting regularly, and routinely is vital. Executing the plan is also critical. Agency is not rocket science. It’s getting through your weekly goals and activities and if you do this each week the results are inevitable. Themost difficult part is consistently doing it. Like anything and everything in life, consistency is the key. I struggle with it – but nothing in life is easy. Youmust do the work. I believe we have the best job in the world, andwe need to remind ourselves of this, be grateful that we have the earning capacity we all do, and just have a crack. Q. What are some of the most significant or rewarding projects that you’ve been involved in and why? A. Themost rewarding has been launching X Commercial successfully over the last 9months. Being able to design our own destiny, our newbrand and executing ideas that we have come upwith has been very enjoyable. We have some exciting things happeningmid-year which we are working on now, and it is great when others business owners, and agents can see the benefits of what themodel is, andwhat we are offering. B. Seeing your work mates hit their goals and enhancing their lives by succeeding giveme a real kick also. If you work hard, you really can achieve anything. Q. What advice would you give property developers today? I would give them the same advice I give everyone looking to acquire property in Australia’s hottest real estatemarket. The only time it is ever a bad time to buy property in Sydney is “later”.

Q. How does the property market in (NSW) compare to other states at the moment and what are some key trends that are occurring? A. It’s hard to comment as I don’t have offices in other states, but I can say that in NSWoffice staff are now starting to return to offices, which is great. Most businesses have used the last 18-24months of Covid lockdowns sensibly to assess the number of staff who are preferring to work fromhome, whether that be full time or part time, andmy view is that leasing activity should pick up this year and surpass levels during the last 2 years. Companies are certain of their space requirements now, andwhile incentives aremuch higher than they have been “pre covid” I expect savvy tenants to really take advantage now and start committing to new spaces. Fitted out spaces are still #1 on the list for most tenants. Q. What sectors are most in demand? A. Industrial. By far this is the strongest asset class, both for leasing activity and tenant enquiry. I can’t see this changing in the near future. The infill areas we work in around the Sydney CBD have never been tighter for sales and leasing stock and the drift to other areas a little down the highways from the CBD and ports are now also seeing very low vacancy rates. I expect this will continue well into the future. Q. What do you see as the biggest challenges that face buyers and sellers in todays’ market? A. For buyers it is competition. There is a weight of money ready to buy Sydney property, buyers need to continue to be bullish with their assumptions and take that leap, that themarket will not dip. In blue chip or even B &C locations in Sydney, you rarely see values drop. They might stop increasing in value for a time, however buy- ers must take the view that bricks andmortar are a very safe hedge in an uncertain world and Sydney property will always perform well. All that being said, I feel that as soon as themarket starts to feel the pinch of the pending increase in interest rates, we will likely see an increase of investment stock hit themarket. Investors that purchased investments during COVIDwhen the rates where at an all-time low, will most likely see a squeeze on their cash flow and this could result in a few forced sellers to hit themarket. We have an election inMay whichmay slow it down for a few weeks, but investors are starved of opportunities and bricks and mortar inmy view that high quality properties with strong tenancies will always be seen as a safe bet as far as investors are concerned.


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