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Ready Talk is your go-to podcast for insights into property development, investment, and commercial real estate in Australia. Hosted by industry experts, we cover trends, strategies, and tips to help you navigate the Australian property market.
Welcome to ReadyTalk, proudly sponsored by Development Ready, Australia's home for property development.
Speaker 2:My next guest has over thirty years in the banking and finance industry, specializing in securing and managing debt and equity and development transactions. He's definitely the smartest man in this room, at least for sure. Having an abundance of degrees, including an NBA, we welcome Mark Greenberg from Lambert Capital, the director and founder of the business. Welcome.
Speaker 3:Thanks, Jake. Thank you very much. Good introduction.
Speaker 2:Love it, mate. I always try and pump people up. At least I I wrote this one. Some people try and write their own ones.
Speaker 3:But Not sure if you said NBA or NBA.
Speaker 2:I said NBA.
Speaker 3:Definitely an MBA,
Speaker 2:man. I definitely wrote it.
Speaker 3:Definitely an MBA. No. All good, man.
Speaker 2:I love it. Mark, development finance is something that obviously is is intrinsic into our business. But can you just tell me a bit about your background, how you got into that, and what you did before it?
Speaker 3:So, yeah, background was more chartered accounting when I when I first started. I always had a bit of passion for property and development, my family being in property and and development itself.
Speaker 2:They were developer? Like, yeah.
Speaker 3:Yeah. My grandfather my grandfather was a, you know, builder developer back when he when he first sort of started in probably, I don't know, back in the fifties and sixties and seventies. Okay. Sort of in the blood. After chartered accounting, I I ran my own accounting practice.
Speaker 3:I sold that at at 26, Went into general management. Finally ended up in in ANZ in corporate property. So that's where I learned all the property side of things. And then worked for a company, Ash Morgan, pre GFC, probably one of the biggest non bank lenders at the time, so that taught me a lot of of how to structure deals. ANZ probably taught me the the the credit side of things.
Speaker 3:And then ended up after the GFC, then then setting up Lambert Capital, and then that's how we got to today, which is running a non bank fund, which lends to property development finance.
Speaker 2:Just to go back on that a little bit. So where did you where did your grandfather develop? Like, was it in Melbourne? Or
Speaker 3:In Melbourne. Mainly, you know, blocks of units and
Speaker 2:Yeah.
Speaker 3:Cool. That sort of stuff. Nothing nothing too high rise.
Speaker 2:Any particular area?
Speaker 3:Jesus. Stretch my memory back.
Speaker 2:I was kidding. Taking you to fifties
Speaker 3:and sixties. Oh, no. Back back I'm talking about, you know, from myself probably in the seventies. Yeah. So seventies and it's probably, you know, going out to seeing units maybe out in like a suburb like Clayton back in those days or yeah.
Speaker 3:So not not high rise, but, yeah, small projects, but, you know, getting in the car and going out and seeing it and Yeah. Then watching him, you know, successfully buy property, sell property. Yeah. Pretty inspirational.
Speaker 2:So you've always had it in the in the in the blood by the sound of it. You you mentioned pre GFC, you're with Ash
Speaker 3:Ash Morgan. Ash Morgan.
Speaker 2:Yeah. So did you were you with them during the GFC, or had you left
Speaker 3:Yeah. So ANZ was probably 2002 to 02/2007, and Ash Morgan probably 2007 or 02/2009, I guess.
Speaker 2:Okay. Yeah. So I just
Speaker 3:But, yeah, just just right when it was all, you know, flying and then when it sort of crashed.
Speaker 2:Well, you would have learned a few tricks of the trade, I'd imagine, then or at least how to minimize risk because you would have that would have been a majority of your job, I'm imagining. Run us through your day to day. So we know you secure your fund. What's something unusual that you've seen previously? Like, what kind of deals are Lambert Capital looking to do?
Speaker 3:Well, I mean, the business today is probably pretty pretty boring in terms of the type of lending we do. It's townhouses. It's land subdivisions, low rise apartments, probably that 5 to $20,000,000 loan size. We focus on experienced developers, mainly in Melbourne, Victoria, but, you know, throughout Australia. We've done deals in in Queensland, South East Queensland, New South Wales, Sydney, bit in Tassie.
Speaker 3:But, yeah, that's that's that's the type of size.
Speaker 2:So you say you're pretty boring townhouses, apartments. Is there anything any kind of pitch that you got that was a little bit different, something a little bit out there?
Speaker 3:I mean, yeah. Look. I mean, people try to bring any deals where, you know, it could be a you know, I'm making this up now, but, yeah, maybe a pig farm in Darwin or something ridiculous that we're going to be able to say no to pretty quickly. Yeah. We're pretty standard sort of lenders, pretty much similar to an ANZ or one of the major banks sort of checklist, but just outside of that sort of profile.
Speaker 2:A majority of your cohort that are using you, are they kind of repeat customers? You said you deal with obviously pretty, you know, developers that have proven themselves before.
Speaker 3:Yeah, I one of our major focuses is actually trying to do, you know, repeat business. We've probably done you know, some of our clients have done, you know, five, six, eight deals together. You know, one of my x a and z clients from twenty odd years ago, we've probably done 20 plus deals together over that time.
Speaker 2:Is the non compete over? Can we say that on air
Speaker 3:I hope so.
Speaker 2:That's good. That's good. So you're pretty in in ingrained in the development finance space. Is there anything that's kind of interest you? Because it sounds like your whole working career, you've pretty much, you you know, even in the account accountancy side, you've been involved in the money aspect of it.
Speaker 2:Is is there anything else that interests you, you know, outside of that?
Speaker 3:In in business or
Speaker 2:In business? Like, what else would you be doing? Like, if I you know, I said if I wasn't selling real estate, I'd be doing podcasts. And after thirteen years of selling real estate, now I'm doing podcasts.
Speaker 3:Probably probably a bit of passion is probably share trading or, you know, maybe foreign exchange trading, that sort of thing. Yeah. I always like to do that. Yeah. Whenever I've tried to dabble in it, it probably takes me away from the core business.
Speaker 3:So I probably prefer to, you know, stick to what we're doing at the moment. But if I wasn't, you know, running a successful non bank, you know, fund at the moment, that would that would be something of interest. Yeah.
Speaker 2:Was it scary when you started it up? Was it like, I mean, I I'd imagine, obviously, there's two parts to it. You've gotta find who's gonna give you the money, and then you've gotta find the deals that make sense for the business. Yep. Did you did you always have that belief from someone backing you, or did you just go, I'm gonna do this better than what other people are?
Speaker 3:I mean, I think yeah. Mean, I've always run my own business. I, you know, I ran my own chartered accounting practice as a 23 year old. So, my father ran a chartered accounting practice for forty odd years, so that probably gave me the confidence to go into that. Yeah, in terms of starting the fund itself, that probably came out of necessity coming out of the GFC, and jobs in finance weren't really out there, so I was ready to start my own business again.
Speaker 3:Lambert Capital itself, that second iteration of it started probably around 02/2009, it was direct private lending, had a lot of networks in the high net worth family office space, putting together deals. So it came pretty naturally, and then the progression from that sort of contributory deal by deal basis, and then setting up syndicates, putting together four or five different investors into a deal. And then it sort of just the natural progression was to then migrate into setting up a fund. Probably took us a bit longer than we thought in terms of the compliance and getting it set up, but had the confidence and the backing of a couple of core investors, one being Thorny Investment Group backed by Alex Wiselys, who was in their offices from 02/2009, and then also my family, the Rosen Group. Finally, my uncle, my mom probably stopped treating me as the little nephew and son and gave me a chance.
Speaker 2:Oh, that's good.
Speaker 3:And my father probably backed me rough from the start. He's always been there to to back me in deals. So so that probably, yeah, also gave me the confidence to to set it up.
Speaker 2:Yeah. Love it. So how how many I I noticed from a brief look at your website, and I try not to do too much research because I want to know about it, asking you, but you've got two main kind of backers now, two main family groups involved in it. Are they funding a majority of the projects, are you still trying to get other people in?
Speaker 3:Yes. At the start, had a core sort of group of investors that had done deals with us over probably the five, ten years prior to that. The fund itself got set up in 2021, so it's been going for, you know, four or five years now. But yeah, today that's a different sort of beast to what it was when it first started. There's probably 170 plus investors, so a good spread of investors from 100,000 up to probably 10,000,000 is probably the biggest single investor.
Speaker 3:It's a good mature business now, but yeah, starting up, had to encourage people to it was more a chase to get the funds in, and now as a mature business, it's more about the right deals. Yeah. So it sort of swung around a bit.
Speaker 2:Yeah. So so run us through that. You you started it out of necessity from from the GFC, but in a current economic climate, which is, you know, for I'm being 35, not really knowing the GFC because I was very young then. Now it seems as volatile as it's ever been in my kind of adult career. What's the biggest shift you're seeing in an appetite for development financing?
Speaker 2:Are people a bit more weary of financing, or are they looking for more money now because it's harder to access?
Speaker 3:Probably a bit of both. In terms of our client base, I think the more experienced developers are sort of sitting back a bit, probably taking a bit longer to go through their feasibilities, perhaps delaying some starts on their future stages of a resi subdivision or starting the next townhouse project, so they're more cost conscious. So I think probably the biggest change we're seeing is just the slowing down in terms of the starts. Hence why I think a lot of the non banks and a lot of our peers in the industry will probably be sitting on a lot of cash at the moment because there's there's been successful clients of ours who have repaid their loans, which is good. But in terms of starting new projects and just the sheer weight of cash that's probably sitting on the sidelines, There's probably probably an oversupply of cash at the moment.
Speaker 2:Yeah. So excuse my ignorance in this, but are you then seeing more people come to you and you're approving the deals quicker because the ones they're presenting make more sense because, obviously, it's harder at the moment, so they're only really looking for good deals? Or are you finding you're rejecting more because it's not making fiscal sense?
Speaker 3:Probably rejecting as many as we've ever rejected because of the fact that not because the deals aren't good, but probably the loan to valuation ratios are probably pretty high. A lot of people have bought sites, project related site values aren't stacking up, costs have blown out, harder to get pre sales. So holding costs are chewing into it, whether it's land tax or interest, obviously. So, yeah, so I think some the projects are taking a bit longer to get funded.
Speaker 2:So in proposing to Lambert Capital, I'm assuming, you know, being kind of you're a big business, but you're a small business in terms of, you you know, your versatility and are able to adapt. What's like a red flag that you see in a proposal? What's something that you just go, no, whether it's a pig farm, for example, or is there anything other than the numbers? I get the numbers have to stack up. I I totally get that.
Speaker 2:Will you invest in anything or are you like, oh, I'm not investing in retail right now because you know?
Speaker 3:Probably oh, yeah. I mean, the numbers dictate, you know, how we can actually get something through our investment committee. But from a probably from an experience point of view, so if you're not an experienced developer, if you don't have the right civil works contractor or the right builder, if you can't actually deliver the project on time and on budget, so a lot of our developer clients that have been successful in recent years have actually either acquired or set up their own building entity, which has allowed them to control costs, to control time, and actually then deliver a profit. So that's probably been a shift we've seen as well.
Speaker 2:And is that what advice would you give to someone, say, that he's starting up, that the numbers probably do make sense, but you're not going to take it on because they're not experienced and you need to see kind of proof of product? Where are they going to get financed? Is everyone the same as you, or are they better going to a major bank or the complete opposite of
Speaker 3:I would say that every deal will get financed somewhere. So it's not a if the deal stacks up, as you said from the numbers, they're to get funded somewhere. Most of the deals that we see aren't getting rejected because of lack of experience because you then go and hire the right people to help you, whether it's the right project management team, whether it's getting a more experienced builder. There are deals that will get done. Probably the ones that aren't getting done are the ones that the LVRs are too high.
Speaker 3:So if you bought a site and you paid I'll make it up let's say you paid $2,000,000 for the site and you borrowed 80%, that's 1,600,000.0. But then when you go to start construction, if you're sitting at 80% LVR and you don't have the the additional equity to put into a deal, you're gonna struggle to get finance anywhere. Yep. The other thing also, you talked about red flags earlier. If they don't have a strong balance sheet behind them or the capacity to cover cost overruns or if there's been delays in construction, then they're going to get stuck during construction.
Speaker 3:So they're the sort of developers that we're probably going to reject.
Speaker 2:Yeah, And I guess that goes back into having proof of product. Yeah. They've done it before and they probably have those things ticked off.
Speaker 3:And you'd hope if they've been a successful developer, they've got a pretty good balance sheet behind them. That's that's also a leading indicator if they've got, you know, some net assets and cash behind
Speaker 2:them. Is there anything else other than just, say, the LVR or overpaying? Because we all know sometimes you can't help overpaying if the market does what it does and you even if you've got the twelve month settlement or whatnot. Is there anything for a developer seeking finance that they're making mistakes in where you're saying that, no. You're not doing this correctly, or it's is it just overpaying, or is there something else in there that, you know, that they're making mistakes in obtaining finance?
Speaker 3:Yeah. Definitely, we've seen, you know, over the last five, ten years where perhaps inexperienced guys have come in and put down deposits expecting the property market to always go up or they've bought a site. They're waiting for the, you know, a PSP. They're waiting for a permit to come through. They're even done their costings, and when they finally get ready to start the feasibility, they realise they have paid too much for the site as to what they can develop or what the permit allows them to do.
Speaker 3:Construction costs have run away, so therefore that project related site value is probably even less than what they originally paid for the site. So that has been an issue we've seen definitely in the resi subdivision sort of space. But yeah, in terms of things going forward, I think we're probably going to be focused more on our existing clients that have, you know, got an existing site. They've done stage one. They're coming back to us for stage two funding or stage three funding.
Speaker 3:Plenty of term sheets out there at the moment just waiting from to start construction so we can get the cash back out, I guess, is our challenge.
Speaker 2:In terms of yourself, you know, I was in a car with a developer the other day, and we were driving through Melbourne, and he was giving me the you know, I developed this. We did this one around the corner. We've got this one coming up, you know, as you're kind of driving through. And I imagine he'd be the same with his children. What's the most rewarding thing for you?
Speaker 2:Is it just seeing projects that you've funded? Is it helping developers that probably become friends achieve their goals? Is it just providing for you and your family so you get to go and watch Collingwood Pies, which I've tried to resist saying that you're a mad Collingwood supporter most of the time. But what's the most rewarding thing for Mark?
Speaker 3:Definitely watching the pies. But in terms of business, yeah, I mean, they will probably all the above. Yeah. A lot of lot of our good clients are friends now. Repeat business is very important to us, same as looking after our investors.
Speaker 3:Grateful that our investors have stuck with us for, you know, some of them for ten, fifteen, twenty years now. But, yeah, I mean, for for us, it it it's probably the whole cycle. So it's it's seeing some of the younger developers come through that, you know, started with nothing and have gone on to do, you know, 10 developments and what they're giving back to their communities themselves. Definitely some of our Chinese clients, Indian clients that have come out, started with basically nothing and now successful developers. But, yeah, some of the long term clients and seeing, you know, maybe their sons or the future generations coming into the business as well.
Speaker 2:You're a big family, man. Guess you started with the parents and the uncles, and there you get to see all of that. What's an emerging trend coming out that's probably gonna impact your space and the development lending space? Like, I know and I'm just gonna preface it because I hope you're not gonna say this, but, like, we know cost of construction was kind of out of everyone's control with everything that happened during COVID and, you know, all of a sudden, prices went up. And then, like you said, housing prices were coming down while cost construction was going up, which was a recipe for disaster.
Speaker 2:Do Do you see any other emerging trend coming out in the lending space that's
Speaker 3:I think something that we've always focused on, and it's probably it's been, you know, through the election cycle, you've seen affordable housing is is a big issue. We've always, as a lender, always focused on the exit. So for us, it's it's backing developers that are supplying product into that affordable space. So whether it's cheaper land, whether it's house and land packages, whether it's townhouses in that sort of 500 to maybe seven fifty, 800 space. So we've always focused on that because we think that's where most of the demand is going to come from.
Speaker 3:So I think the challenges are for developers to be able to get that price point as construction costs have gone up quite a bit. Hopefully, values aren't sort of flying up at the moment. That might help out a bit. But I think perhaps in terms of if you think about challenges in that affordable space, it's more the government regulation, the authorities, how do we get approvals through quicker, when construction's finished, how do you get that occupancy certificate issued quicker, there's issues with getting fire approvals or getting your power connected. And if it takes two months once you've finished construction and you've these holding costs then, it does impact on developers' ability to sell that product at that affordable price because their costs have gone up dramatically.
Speaker 3:So the government or the authorities adding to complexity and delays, I think, is one area that needs to be addressed as well.
Speaker 2:As we record this, we had the election on the weekend. Obviously, Labor retained. Do you see that affecting much, or do you think it's just much of a muchness for what's happened in the last three years?
Speaker 3:I mean, if we talk about, as we just touching on that affordable space, I think both Labor and and Liberal Party's policies were gonna be positive for that space. We probably tried to talk about it internally. We thought it probably doesn't make a big difference as to who wins. I think Labour obviously are trying to promote affordable housing, so I think that's going to be good for the industry. But I still think there's a lack of supply in terms of maybe there's plenty of land out there, but maybe releasing more land and also trying to reduce construction costs is a big challenge, think.
Speaker 3:So capacity for the industry, if they're going to deliver 1,200,000 homes over the next, I don't know how many years, and when they've delivered probably not that many. That is a big challenge.
Speaker 2:What do you think that looks like? And obviously, this is just pie in the sky or just theoretical stuff. Is it releasing more land that's not as far out of the city as what they've done? Like, you know, or rezoning it so that construction can happen there? Or is it just going wider and, you know, bigger city centers like Geelong Esque kind of maybe a bit more north or a bit more, you know, Southeast or whatever it may be?
Speaker 3:Yeah. I mean, I think there's that balance, that infrastructure challenge. I mean, you you see yeah. You want more high rise in the inner city versus, you know, going out to the Western Suburbs and then having issues with roads or infrastructure. So yeah, I think there's got to be a bit of a balance.
Speaker 3:Everyone, you know, no one wants to have high rise next door to them, but eventually I think that's what's going to happen. But yeah, I think and I think also the expectation of the first time buyer that they're going to have a, you know, five bedroom house in the middle of the city is is not realistic. So people need to if they want that five bedroom house, they're going to have to go out to regional locations or further out. But, yeah, I think that that is a big challenge as to how we're going to be able to create all these homes, and there's a balance between immigration and looking after the existing population that needs to needs to have their first homes.
Speaker 2:I like that. It is correct, isn't it? It's kind of that do you want space versus location? Like, you know, it's gotta be affordable in both. If you want the location, it just has to be a higher density.
Speaker 2:And if you want the space, then it's just gotta be further further out. Like, that's all it is.
Speaker 3:I think in Australia, we've we've been we've been pretty lucky and and probably a bit spoilt in the fact that, you know, we did have a lot of land and there wasn't a big population. If you go overseas now, the expectation is you're gonna live in a high rise in the middle of the city, and they they get used to that sort of lifestyle. Yeah. I think maybe that's gonna be a challenge is to is to change the mindset of people. They're going to have to live in apartments or townhouses, maybe some of those bigger houses some of the inner suburbs are going to have to be rezoned to allow for, you know, instead of a single covenant, sort of, you know, they can put on, you know, three or four townhouses on some of those bigger sites.
Speaker 2:Where would you suggest if you're looking if you're thinking, alright. I wanna do house and land package, but maybe, you know, abundance of townhouses or whatever it may be. Are there any suburbs in in Victoria that you're like, when they come across your desk, you're like, let's really look at this one, try and make it stack up?
Speaker 3:I think I think we go back to, you know, probably myself or even at Lambda Capital, we look at, you know, what's what's the standard sort of supply demand equation. If the demand is going to be closer to, you know, transport and schools and community facilities, etcetera, we've seen in recent years, probably the Western Suburbs of Melbourne have been very popular, and they've all done very well. We've funded numerous residential land subdivisions and townhouse projects that have all sold through. So I think as long as the demand is there, I think that that's probably a growth area. But yeah, I mean, we're funded all, you know, whether it's downsizes relocating to Queensland, or there's different sort of themes that we're sort of followed.
Speaker 3:We've done a few deals up in Bundaberg, for example, which we never would have thought would be an area we'd fund in, but they've all done very well and sold through. So, I guess it just comes down to the the standard sort of demand and supply equation.
Speaker 2:I love it. Yeah. And we did touch on the election and much of a muchness, I guess, between the two parties. But is there anything that you'd change in the finance the development finance industry if you could? Like, if, you know, if you just had free rein to change a a policy or something that's gonna be the betterment of the industry and and the users of the industry, is is there something that you change?
Speaker 3:In in terms of finance, you're saying? Or
Speaker 2:Development finance probably or the money industry.
Speaker 3:Maybe what we touched on earlier in terms of just making it a bit easier for developers to actually deliver the product that people want at that right price point, I think is probably a big challenge from the construction side or the development side. From a finance point of view, yeah, I think the market pretty well serves. I mean, you got the the banks, non banks like like ourselves. There's there's plenty of options for finance. As I said, there's lot of cash out there at the moment sitting there waiting to lend.
Speaker 3:So I don't think there's a challenge in getting the money out. It's probably maybe maybe the affordability, I guess, that question again, in terms of being able to service debt. I'm not sure how that policy is gonna work from a, you know, 5% deposit, and can people actually service the debt on 95 loans? Probably they need to temper their expectations as to how much they can borrow as well. So I think there's a there's a challenge there as to that that affordability again.
Speaker 2:Mark, we finish with the quick five questions. One of them is not gonna be relevant to you, and I kind of asked you in a roundabout way, I'll think of something. First one is if you had a million dollars in cash, it doesn't change your life. So I say that you can have a high risk kind of thing. Where whereabouts are you investing it?
Speaker 3:Probably, yeah, probably in that sort of share market space.
Speaker 2:Is there a particular, like, you know, business model, or is there a particular company that you'd be looking at?
Speaker 3:If it's I mean, if you've got a million dollars, that's probably not a huge portfolio, so you probably want to diversify it and maybe even just put it into an index fund, so maybe like an ASX 200 type fund, I don't know, without picking something, like, I don't know, there's a, say, STW is a code, you know, that just follows the ASX 200 or something like that And then in terms of maybe get some overseas exposure, I'd say probably The US, maybe some NASDAQ sort of index fund again, whether you leverage it up and get rid of exposure, I think that's obviously the future is in that space. Maybe what's the one that comes to mind? Is it QQQ or something? Know. Of those ones, but yeah, something like that that sort of has a bit of leverage as well, perhaps.
Speaker 2:It's very different speaking to someone that deals in finance and lending compared to speaking into real estate agents who are all saying, just chuck it in crypto or something or buy buy property. No.
Speaker 3:I'm fine.
Speaker 2:But your regular reasoning sounds a lot more structured.
Speaker 3:My chartered accounting background tells me, you know, not to doubt. I look. I've got mates that are into it, know, they they make 50,000 one day and lose 50 the next, but I'm probably a bit more conservative.
Speaker 2:Yeah. Hey. What's a favorite deal of your career? What's something you've funded that whether you always wanted to or just gave you the biggest pleasure?
Speaker 3:I mean, there's there's been heaps of deals I can remember even yeah. Whether it's my first deal or, you know, the first deal in the fund that
Speaker 2:What was what was your first deal in the fund? Like, as Lambert Capital, what was your first deal? I think
Speaker 3:the first deal in the fund was actually a pretty it was about an $18,500,000 deal, so it was quite big for the fund. We threw that in at the start as our first deal. It was a subdivision out in the Western Suburbs here in Melbourne. So yeah, mean, was a good deal for our developer client. It was good for our fund to get it started good fees for the shareholders of Lambert Capital as well.
Speaker 3:But yeah, I mean, can remember, if I think about the yields that have sort of inspired me over the years, I mean, we touched on family before, you know, maybe going to an auction of a site that my grandfather sold, which was the George Hotel down there in St. Kilda. I remember going to the auction.
Speaker 2:On the corner of is it Gray Street or
Speaker 3:Yeah. And Fitzroy Street.
Speaker 2:Yeah. And Fitzroy Street.
Speaker 3:Yeah. So it's an iconic building, but I remember going to that auction and after the auction, I'm sitting next to my grandfather and he gave me the check and said, here, hold on to this or whatever, the 10% deposit. You know, just things are sticking to your memory that inspire you.
Speaker 2:When did he sell that?
Speaker 3:It would be the eighties? Yeah. Okay. Maybe early eighties.
Speaker 2:Yeah. Amazing. I'd have to check.
Speaker 3:Yeah. Love it. Yeah.
Speaker 2:I've spent many a night there in my in my late teens, early twenties. So is there anywhere that you haven't lived it sounds like you've been Melbourne pretty much born, bred, and, you know, in and around, but is there anywhere you haven't lived that you'd like to? Is there anywhere that appeals to you?
Speaker 3:Well, I think as as my girlfriend once joked with me that I've I've moved around a lot. So I bought first seven years in East Bentley, and then I've moved from Caulfield to North Caulfield to South Caulfield back to Caulfield, North Caulfield, and back to Caulfield. So I've moved around quite a bit. But
Speaker 2:For those listening in different states, that's about I I reckon that's a five kilometer radius.
Speaker 3:That's a four and half
Speaker 2:kilometers. Yeah. Maybe.
Speaker 3:And, yeah, probably if I was gonna, well, live live anywhere else in the world, you're saying? I'll probably Oh, anyway, I'm gonna say. Yeah. New York. It'd probably be a you know?
Speaker 3:I've always loved going to New York as tourist, but I'd love to just, know, go there and live there even if it was for six months of the year or something. Yeah. Yeah. Just exploring all the different sort of, you know, neighbourhoods and, you know, it's a cool city.
Speaker 2:And That's my answer. I just like the pace that everyone seem seemingly is at.
Speaker 3:Yeah. It's a fun city and cool people and, yeah, just the vibe and all the different parts of New York is yeah. Even Brooklyn. So yeah.
Speaker 2:Now I'm gonna change this one because it's usually if you if you didn't sell real estate or whatnot, what what would you do? But I I wanna know if you were mentoring someone and it's not finance, what industry would you be telling them to look to get into? Like, where do you see the future kind of going towards?
Speaker 3:Jeez. That's a big question for me.
Speaker 2:That's why I threw it in there. You know? You can't
Speaker 3:read up for it for this As in as in for as in for, like, graduates coming out of uni? Sure. What are you saying?
Speaker 2:Yeah. For sure. Like, say say you're just mentoring someone who's starting their career and has the world at their feet and they're and smart enough to kind of go down any path. Yeah. Don't say surgery.
Speaker 2:But, like, where would you be pushing them? Do you just see that the world will continue on as it has for the last thirty or forty years in the same kind of professions will do well, or is there emerging trends?
Speaker 3:Yeah. I mean, I'm not really one of those futuristic sort of guys, but I think, I mean, obviously, to start with the basics, you've to follow your passion. But would think something, I mean, what we're seeing a lot now is probably AI and how that's sort of taking away a lot of jobs. I'm not sure if that's the right answer that you're looking for, but in terms of embracing sort of technology that's coming up and working out where the industries are heading and how maybe using AI to have a profitable business that would get rid of a lot of staff and all the costs and lot of overheads, and we're seeing that a lot coming in into day to day discussions in Lambda Capital and how we can embrace some of that to help us to be more efficient. Maybe if you can actually harness that technology and where that's heading, think.
Speaker 2:Where do you see it in the financial industry? Where do you see AI being implemented? Like, is it on feasos? Probably the most nothing I think of as the most
Speaker 3:Yeah. Mean, we sort of consciously said we're going to use AI, but it's just coming up in conversation now. When we say, okay, well, how would we analyse that deal? You can ask one of the AI, know, whether it's ChatGPT or whatever the latest one is today, but you can ask the question, and it will give you pretty much 90% of the maybe not give you all the answers, but it will give you all the questions and issues you need to address. And the more you ask and the more you train it, it actually is pretty smart.
Speaker 3:Maybe that's something, yeah, we should be using more ourselves.
Speaker 2:I love it. And last but not least, what's one thing you're doing in 2025 that you haven't done previously? Guess we just spoke about it.
Speaker 3:You mean mean in business or
Speaker 2:In business or personal? Whatever you're doing.
Speaker 3:I think I mean, for us for us as a mature fund, I think the focus has has moved more from raising funds to actually sourcing the right sort of deals as a mature fund. Yep. So that's probably one of the challenges, maybe putting more efforts into the marketing and the BDM sort of side of the business to actually now go ahead and chase those deals.
Speaker 2:Yeah. At what what stage at what stage you call it mature fund, but at what stage do you flip over from, alright, I'm trying to find money to because I'll be able to find a deal. There'll be someone out there that wants a deal Yep. To now I've got people that just trust me. Like, how long did that take you?
Speaker 2:I know there's not an exact answer to that, but what did you feel it took you?
Speaker 3:Yeah. Mean, it's probably a bit of both. It's sort of you've always got people that want to give you money, but as a construction lending business, as loans start to mature and as the money starts coming back, if you lend out $15,000,000 for a deal, and it's a construction deal that starts at 5 and gets up to $15,000,000 after twelve months, and then all of a sudden you get the $15,000,000 back, that changes the sort of dynamic of the business and you've got a bit of cash drag that you need to then sort of manage. Whereas when you're growing the business, if you're starting with zero and going up to 150,000,000 or $200,000,000 worth of deals, As you're growing, you're taking money in constantly, but then as the money starts to come back, you've got to be planning that next deal. As we said earlier, when the industry starts to slow down a bit or there's people taking a bit more time to start their next stage, you've gotta you gotta focus on where you can balance that money.
Speaker 3:So
Speaker 2:yeah. Perfect. Yeah. Mark, thank you so much. Thanks for all your insights, and thanks for coming in and having a chat before you jump on a plane to head over and watch watch the Mighty Pies.
Speaker 3:A business trip, mate.
Speaker 2:Yeah. A business trip. Thanks, Mark.
Speaker 3:Cheers, mate. Thanks.