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π§ Real deals, real strategies, real results. Learn how to find, fund, and operate profitable property plays from someone whoβs actually done it.
Hosted by Andrew Wright, principal of Professionals Southport and a commercial investor who rebuilt after losing a ~$15M portfolio during the GFC, this podcast gives you a straight-talking look at what it really takes to build wealth through property.
Each episode delivers practical frameworks, real deal breakdowns, and honest conversations with high-performing investors and operators across residential and commercial.
But itβs bigger than the episodes. The goal is to build a community of like-minded investors who share stories, swap insights, help each other grow and maybe even do deals together.
π Join the community & learn more - leave your email at: www.andrewwrightproperty.com.au
π Connect with Andrew: hello@andrewwrightproperty.com.au
βI've been thinking too small with my portfolio. When I talk to you, I think, wow, stop coming up with excuses as to why you can't grow I purchased my portion of the main buyer as an option contract and said, look, I'll de-risk it for you. Don't just say, oh yeah, I know how an option works. Have you actually done one?
Almost all good lawyers and barristers will tell you not to ever allow a drawdown on the deposit. Would you say it's a lot more painful, the actual project management of that compared to the industrial sheds? We have got some technology that we've taken from University of Bristol and the Netherlands and we've applied it here in Australia as a first where we essentially are detaining water but rather a lake but a lake underground that slowly percolates back into the groundwater.
Hi, I'm Andrew Wright, principal of Professional Southport, and this is the Andrew Wright Property Podcast. I've built a multi-million dollar property portfolio, delivering a seven-figure annual rental income, and led my real estate team through thousands of sale and lease transactions. In each episode, I share real deals and strategies that will help you find, fund, and operate profitable property deals.
The aim of this show is to provide education and build a community of like-minded investors who can collaborate, share insights, and help each other in each other's journeys. You can make excuses or you can make money, but you can't do both. So come and join us
Hello there, and welcome back to the Andrew Wright Property Podcast, episode two in how to scale your property portfolio using property options. Paul Vam- Vacaris is back in the studio after a five-minute break on the phone. He was settling deals and, uh, probably just made a heap of money during our little five-minute break.
How you going, Paul? Ah. Yeah, good, good. Thanks very much. You got a bit on your plate today. Oh, look, yeah, like I said, I've got, uh, big settlements today, and then we've got a, uh, a couple of, um ... Well, like any of these development deals, there's a million moving parts, so it's, it's, you know, being able to hold the hand of the, of the seller and being able to provide the buyer some comfort that, uh, he's making the right decision.
So it's, it's, it's just a normal day. I love it. I think I do 105 calls a day as a blended average, um, which is, uh, which is good, and, uh, it lets you go home, get a good night's sleep, and start again. And you work till late at night most nights, don't you? Last email last night was 11:52- Yeah, there we go ... uh, PM, and then I'll crawl into bed, and then my poor wife, she has to
Has got four kids under eight, so she, uh, she's definitely carrying, carrying the torch for that stuff, so. You got four kids at school now? No, four under eight years old. Oh my God. So, so yeah, it's, it- it's wonderful. It's wonderful. It's like being part of the greatest show in the world. You know, it's, uh, you got front seats, front row seats.
It's, uh, it's, it's the best. Hey, I didn't get a chance to ask you, but did you see that bus driver absolutely sledge me when I w- got out of your, uh, property in Brisbane? 'Cause I parked somewhere close to a bus stop. He was, he wanted to kill me, didn't he? Look, yeah. Look, look, uh, yep- ... yeah, they certainly ... I think it, uh, it comes part and parcel sometimes of- I wasn't in the bus zone.
I was just before it. I- You, you were, you were, you were. They, uh, obviously, uh, he's might've been having a bad day. He might've been having a bad day, yeah. So, so you get people with a bad day. Paul, let's go through five real deals that, uh, you've done recently using the call option strategy or put and call options.
Mm-hmm. So deal number one, Corridor Industrial Park in Beenleigh. Let's talk the viewers through the deal. All right. Wonderful deal. Uh, essentially the buyer was relocating to Perth. The seller, sorry, was relocating to Perth. Mm. Um, he had leased a ... He'd built a big shed on about 1.7 hectares of land on three titles.
Um, he decided that he wanted to, um, get out for the most amount of money. He'd bought it two years ago for around 7 million. He was looking to get around that 10 mark And, uh, great uplift for him in light that he hadn't done anything but a slight refurbishment of the shed. I looked at the land, it being on three titles, being already zoned industrial, um, and the road had just been, uh, uh, upgraded, uh, in the area or, uh, uh, you know, leading up to the property.
Uh, I decided to go through with him and give him a slightly better offer, um, and then give him the ability to lease back and stay in the shed so he could transition his business. Um, and essentially what we call that is latent acquisition. So we, we say to a person, "We'll pay you all the money. You can stay where you are for a period of time to allow you to use that liquidity or that, that cash to go in and buy something else at a stronger position, you know, have a, have a stronger, uh, purchasing power."
So I then did a built form or a massing study on the land to show how much mass I could put on it, at what height, what distance from the road, how many breezeways or how much breezeway area, in other words, area for trucks to turn around and so forth. So generally, most land is around 50%. Yeah, not all, but most land- Site coverage, you mean?
Site coverage, yeah. Yeah. So, um, with this one, we had to leave a little bit more 'cause of the shape of the blocks, um, and to allow trucks to get a loading dock area as well as having, um, the sheds to go forward. So then I thought, well, righto, I did the numbers on the sheds, how much to build them, whether it be in tilt slab or, or steel or Meccano style.
Um, and then I went to the owner and I offered him $10.7 million and, uh, said, "Look, I can't settle for six months, so can we do an option contract, um, where I'll give you a deposit at 10% and I will then, uh, allow you to draw down on that deposit at three months and, um, I will have a personal guarantee on the drawdown in case he tries to not settle?"
And then I went through the process of, um, very quickly getting a draft in, a designer to draft up some, some sheds or some, some industrial sheds, and then I sold them off, the first two blocks of them cheap. I went to some syndicates that, uh, you know, put, put it into their super essentially for a return.
And, uh, they're very easy to transact on if they're a good price 'cause around that 30 to 35% mark of everything we buy in a, in a metropolitan area that's not perishable We buy a lot. We buy our couches, we buy our fridges, we buy our ... I think I get four Amazon packages a day- Mm ... um, uh, the, the, the family orders.
So those distribution and industrial sheds have become really hot property. Um, and their typical yield is around that six to seven mark- Mm ... with the client paying all the, or the tenant paying all the, um, the outgoings. So I sold those off cheap. I sold those off, off at about $5,000 a square meter. These, these are concrete tilt panel sheds?
These are ... No, I did steel, steel with a sandwich panel- Okay ... uh, external. How many? Um, uh, all up we did around 63,000 meters under roof. So it worked out to be about 115 sheds. Okay. And you got- Yeah, of different sizes ... you gave the seller 700,000 more than what he wanted for the land- I did, but- ... in return for some time for you to get a DA up
I tried to get 12 months. He didn't wanna do 12 months. Mm. So we came to a deal at six months, um, with owner's consent. So, you know, you need the owner's consent to go and put an application into the council for, for development approval. Yep. Um, uh, and, uh, yeah, we essentially we did that. We lodged a BA on one of the blocks, a DA on the other block to split it, and, um, there was three of them.
So one of them had a shed. The other two were vacant and being used as hardstand. So from there I really had to hustle quickly to get the, uh, you know, buyers to come in on contracts to purchase so then I could take those contracts to the bank and say to the bank, "Hey, I've got these unconditional contracts- Mm
REIQ contracts, you know, standard, standard form contracts to purchase." And then they, bank looks at those, validates the, the buyers, the entities that are purchasing it, and then loans me the money to settle on it. Because it's de-risked. It's, for them, they need the, they need to cover their costs always.
And you mentioned that the seller did a lease back on one of the existing sheds. He did. He leased back at a great number. But you don't get that great number until after settlement, obviously. Correct. Correct. But that was comfort for the bank as well, that you had cash flow. Absolutely. So he ga- I gave him, uh, a number that w- essentially would've covered my land tax on the property, take away- Mm
a, a risk, but also incentivize him to be able to transition, and then I gave him an option as well. So I said, "Look, we'll do a 12-month lease back with a plus one option." So it was a 24-month lease back. He's gotta be there for a minimum 12 months, which suited him perfectly, transition his business. And if he'd wanted to stay, if he landed a big job, let's say, in Queensland- Mm
um, he was able to then stay at that l- location. And that shed was not something you intended to knock down. You were building on the other parcel of land. On the other, yeah, the three titles across that- Yeah, right ... 1.7 hectares. Okay. So, uh, essentially, um... And then he, he'd originally looked at developing it himself, um, but there was some restrictive overlays in relation to some trees, um, and e- some acoustic stuff that I didn't think council would've, would've held him to, um, should he have tested the mettle of council.
You know, gone to council and said, "Hey, look, how about we put a building on this site, has no penetrations in the, uh, or no windows to allow that, that acoustic, uh, provisions to be satisfied." Mm. And then typically, trees, large trees don't go well with industrial, you know, whether it be from, you know, the pollutants, whether it be from the traffic overground.
Mm. They don't typically go well, but then I made a deal with council to then repopulate all the facade or the front of the property All the, uh, all the swathe, as we call it, with a plant out, quite a significant plant out that, that would, was wasn't cheap, um, to allow them to say, "Right, well now we've got some- There's more trees than before
we've got some visual amenity- Yeah ... and there's more trees than before. Yeah. And these got a higher likelihood of long-term survival, and they're native species. They're already dedicated on a list by council, and we obviously had a arborist come out and put in a report that said, "Hey, these other trees, they're unlikely to, to, to survive."
And there were other trees in the area that had been in industrial areas that had slowly started to wither and die because of the impacts of that industrial land. Mm-hmm. Typically, industrial and trees don't go together. I like having the trees there 'cause it provides a visual amenity to, to a block. So I, I kind of, I think it's actually important.
And Paul, this project, number one here in Beenleigh, uh, successful? The, the numbers? Yes. Numbers, yeah. Yeah, the numbers are great. So essentially, uh, it's about, would've cost, cost us about 70 mil, 65 mil, um, and then we probably got about 105 in sales. So y- yeah, th- that, that's- This is a joint venture? This was a, this is a syndicated purchase where myself and a number of other parties that I, that I act for and with, uh, came in and they said, "Right, let's all take a, a stake, a capital stake in it, and let's all put some money in."
And, um, yeah, it was, uh, it was a great one. It's a big project. It's a big- It's a big project, but it's a- Yeah ... it's a really hot market as well. Industrial, uh- Ind- industrial ... has, has been massive. Yeah. It's been massive. Just l- look at, look at offices. Offices are- Dead ... dead. Dead. Yeah. Yeah, everyone's used to working from home.
Obviously, that was the trigger, but also it was tying up that builder- Mm ... that was able to do it on scale, that we had comfort in his ability to c- complete. Complete, yeah. Yeah, 'cause we always worry about the, the builder falling over. Yeah. Um, and, uh, and then the product was fit for purpose or, you know, f- fit for the area.
So we've done a mixture of, of strata, uh, industrial sheds, and then strata warehouses. So typically, the industrial sheds will have a little, you know, boardroom and reception area and, you know, little bit of glass frontage at, uh, uh, on the facade at the front. And then beside those they'll have generally a, you know, very high roller door where people can store their machinery or their equipment or their trucks or carry on the business that they require.
Um, so we've had a, we've got a mix there that complements each other, rather than have just one big sole purpose industrial park- Mm ... um, which often can be, can be, uh, you know, not as, not as, uh, not as profitable or not as, uh, wanted. Okay. So I really wanna focus, uh, I want the viewers to remember win-win at the end of this podcast.
Mm-hmm. So that guy who sold you the site has walked away potentially with 700 grand more than he thought the site was worth, and you- A r- a, a reduced lease with flexibility. Yeah. And then, and, uh... Yeah, he... I, I think he would've struggled to get 10 million, to be honest. Um, I think, uh, it required a number of steps to be able to see that.
Mm. But I think, uh... I certainly tried to buy it for 10 million, um, but then eventually they gave me a number they wanted. They had another asset that they wanted to purchase into. Mm. So that's what worked. He was looking for a 45-day settlement, and I think if I went on a 30- or 45-day settlement, I would've got it for 10 million.
Mm-hmm. But given that six months gave me that time to get the capital together or get the contracts for purchase together. Yeah. Now, there's still, it's still, like- Under, in a commercial contract, you've got 18 months to deliver a product or the buyer can tear the contract up Mm. The bank knows this.
Generally a buyer will know this, yeah? So it's not an overly complex build being- Sheds ... being sheds, so I'm confident we can deliver it in that 18-month period. Mm. But you run that risk. Yeah. Yeah, if you have a, a major storm event or if you have some major issue on site or- Mm ... you know, uh, they can essentially tear the contracts up and then leave you in a world of hurt.
Paul, episode one, I forgot to ask you a question about risk management with options. Mm. Now, the question is, when you sign a call option agreement, but not, not a put call but just a call, eh, presumably do you get your lawyer to go in and register some sort of caveat on the title so that seller can't go and just sell it to someone else when you have a call option over it?
No, no, no. So, uh, yeah, you can't, you can't do that. So a caveat's a- How do you protect yourself? How do you stop a seller going to sell it if you have a call option? What legally protects you on that site? Well- Just the, just the call option agreement itself ... just, just the contract, yeah. You'll- Yeah ... you'll, you'll normally monitor it and keep it.
You, you, you can't register an interest in the land. Normally they'll have a mortgage, so your interest will, even if you tried to, to be second. Mm. Um, what's interesting about, about options contracts is that a, a, uh- Generally, generally you won't get a, a registrable interest in the land. You'll, you'll be at a contract position where that person will be bound to it.
So you're able to, you're able to, you know, review the position, make sure they don't do a deal with someone else. If they go- Mm-hmm ... and sell it to someone else, then the, all their money's gonna be generally- They'd have to reverse it or- Yeah ... pa- massive damages for- And, yeah, exactly ... yeah. And then often that's the risk of allowing a draw down on the deposit as well.
It, that's, that's a very big risk I take. Um, and I certainly, m- almost all good lawyers and barristers will tell you not to ever allow a draw down on the deposit in case the person goes and, you know, gets a loan on the land, and then it can't settle 'cause it, the debt can't be cleared. Mm. Um, there's a high risk.
So, so I'm, I'm off- I'm offering a 10% non-refundable deposit on this other deal. Yeah, but it's not- Might I have a risk? ... it's not draw down. So it's non-refundable, but should they not settle, you got the, uh, the rights to get your deposit back. Yeah, yeah. Yep. Yeah? Yep. So essentially they don't have a war chest to fight you on.
If you allow- Yeah ... a deposit to be drawn down- Mm ... essentially the other party who's drawn the deposit down- Yeah ... they have a little war chest there where- Mm ... you've now got to fight them to get it back. Gotcha. Yeah. And they've got to take you to court, and they've got to get a summary judgment, uh, which is reasonably quick, where the courts will then say, "Right, you have to pay this guy back."
Gotcha. Which when it's in a, in a trust account, they can't access it, neither to you, until both parties agree to release. Gotcha. Deal number two, Cairns Gateway Estate Look, that's, uh, that's one of my favorites. Um, essentially, uh, the gentleman who owned the land, um, uh, or the gentleman who had the option contract on the land, he did the uplift.
He bought it for a couple, 2 million bucks. He spent about half a million dollars on soft costs and everything else, and then he sold it off to my syndicate for $10.3 million. Mm. Um, we then purchased it, uh, where I purchased my portion of the main buyer as an option contract and said, "Look, I'll de-risk it for you, and I'll purchase this stuff on a put and call, and then I'll pay you a deposit, and then I'll onsell it."
Yeah, so on one of the blocks, I subdivided into four, and then I sold those off at a really good uplift. Doubled, doubled our, doubled our money on those. And on the other one, I got about 85 on 165, so I got about 50% uplift on, on the other one, selling a very large 1.7 hectare parcel to a, a gentleman who, uh, or a party that wanted to do very large sheds, very large industrial sheds on there.
It was a, it was a cracking site in, in the regions. It was up in, up in Cairns, uh, in Gordonvale. The original landowner, uh, Stateland, had done an amazing job of taking all the prickles off the site, and he left a great amount of margin and then really held our hand through the process with it, and at no reward to him other than the original sale price and him picking up that margin.
It p- He didn't have any... He didn't have to go and help us, you know, with the pump station and negotiating with council and managing civil contractor pricing and engineering and, uh, he didn't have to help us with any of that stuff. Um- No, he didn't ... and he held our hand the whole way along. Mm. And I asked why, and he said, "Look, it's important for me that you be successful.
I don't sell a site to someone and they fall over. I- it's important for me every site I sell or transact on, that the parties are successful." Mm. He said, "Because on the next one, someone looks back at the one I sold last time and says, 'Hey, you sold one where those guys made heaps of money.' You're, in fact, right.
There is lots of profit in this." Mm. Yeah? And, um, look, we are all, the other gentlemen, Peter and Robert and myself are, are all blessed. We all just went, wow, we just, we must have been the luckiest guys on the planet we felt at the time. Um- So this is still in- It settle- ... finalizing now ... it settles at 2:00 today.
2:00 today. Yeah. I'm, uh, my phone is, is ringing its head off in the, my pocket at the moment, and we're, we're delighted that the, the settlements are, are happening today. We're really pleased. And are you happy to talk through the numbers on that one, just in rough- Es- yeah ... terms? Essentially, uh, it's all public, so it's pretty- Mm
it's pretty, uh, you can see it on RP Data, and you can, you can see it online. Mm. Essentially, we, we bought the land for around $70 a meter. We then applied the civils- Did the trunks, did the ICN, and we sold off at around 400 a meter. Yeah, blended average. So we bought it for 70, cost us 150 in the end- Mm
and we sold it off at $400 a meter. Mm. Um, and then we were worried about the usual stuff in, in the, in the region, cyclones and, you know, the quicker, the downturn can be quicker, but there simply wasn't any industrial land. So, in the area, um, it's a very hilly, uh, very green area, so the industrial land is like hen's teeth.
Mm. Um, so that gave us that uplift, and we ended up getting Hungry Jack's, Banjo's, Pearl, which is a service station powered by Mobil, Grace, um, and a couple of other really big box players, um, that I can't mention till they, they do their press release- Yeah ... to purchase. Paul, developers talk about 20% margins.
$150 a square meter to 400 is, like, 130% margin. Yeah, it, it would be less than that because I haven't taken into account agent fees. I haven't taken into account, um, some of the holding costs. So probably closer to 200 dollars a meter would be probably the- The cost. So 200 to 400 ... would be the co- would be, would, would be cost, 200 to 400, yeah.
So 100% margin there. Yeah, and that's not uncommon. No, like, on, some developers are way, way in excess of that. Yeah. Yeah, but it c- it comes down to, uh, typical, a typical Mercato, like the project I'm doing on the river at the moment in, in Bulimba. We're doing a, a, uh, high-rise project there at 67 Byron Street.
Um, we're building 10 luxury, ultra high-end luxury units. Mm. The margins on that are in the single digits. Um, the numbers are much bigger. You know, they're, you know, we're around that sort of 50 mil GRV. Mm. But at the same time, the margins are much more leaner, and there's a lot more moving parts. And to be honest- And that's residential construction, which is, yeah, a lot more...
Would you say it's a lot more painful, the actual project management of that compared to the industrial sheds? Oh, way harder. Yeah. Way harder. Way more, way more moving parts. You've got, we've got a, a- amazing builder, uh, who's been transparent and honest. We've got a very good contract between us. It's a fixed price contract- Mm
AS4000 contract. So we've, we've got those benefits, uh, going forwards, but when you start adding stormwater and revetment walls, we're right on the river, so when you start adding all those mechanisms in play, it becomes, you know, it's very easy to chew up. You know, I think we've- Look, we've been, um, I'll be very transparent.
We've, we've chewed through the majority of our contingency in the first six weeks coming out of the ground, and everyone chews up their contingency- Mm ... coming out of the ground, 'cause you can't see exactly what's under the ground. Mm-hmm. But, um, and w- with a fixed price contract, we expect it to be on, on budget going all the way along or very close to it.
But there are lots more moving parts and then- How many units was that? Only 10. 10, and- But they're all really, really- And they're- ... luxury ... and they're, they're $5 million each. Well, yeah, well, the first few we sold were 5 million, and then they'll only go up from there. Top one will, will, uh... Look, I think reality will see us at about 11 and a half mil for the top, for the penthouse.
Yeah, right. And then the rest of them will go for around that 5.2, 5.1, 5.5.2 mark, I think would be, would be re- It still allows the, the buyer to get a bargain and, um, uh, us to be able to make a margin. But m- lot of moving parts. Um, you know, I take my hat off to guys like Rob and Andrew Gray at Graer. They, they have got so many projects on, they've got so many moving parts.
I think their ability to manage stress and manage, you know, a couple hundred calls a day is remarkable. Mm. They certainly... They're not being... I- uh, the media and the marketing all says, "Oh, they've been, you know, they've been, you know- Lucky ... touched by an angel or something." But they haven't, they haven't.
They've, they've worked for it. They've, they've handpicked their consultants. They've- Mm ... really controlled the design, yeah, and the facade and the finish. Um, and I think that's, after doing it, I think that's really, really challenging. Mm. It's much more challenging than a land sub, you know, a, you know, reconfiguration of parcel, um, a material change of use from one use to the next.
Yeah. Um, uh, yeah, it's certainly, um, I f- I feel it's a lot harder. Next deal here, Northern Palms Industrial. Oh, Northern, Northern Palms is wonderful. Um, so Northern Palms is one we've just started. Where is that? It's up in North Queensland. Yep. Um, look, we haven't, we haven't settled on that yet. We're in option at the moment.
Um, we're... Essentially we've got around 85,000 meters of commercial along the highway, and then we've got about another 90,000, 9 hectares of, of residential that has some problems with it. Mm. Uh, problems in relation to overland flow. Essentially, we've had Australia's largest- Uh, house and land developer, uh, behind us who has developed and been approved by council, uh, all these blocks, and it's raised the height of the land.
So essentially now we're getting what's called upstream impact from water. So we've had to come up with a, uh, detention ponds. In other words, we have got a, some technology that we've taken from, uh, University of Bristol and the Netherlands, and we've applied it here in Australia as a first, where we essentially are detaining water, like large, a lake, but a lake underground that slowly percolates back into the groundwater.
Yep. So essentially we're able to remove the flooding on that site. And on that one there, there's-- We wouldn't have done it if it didn't have already a DA for the commercial and industrial and a pub site. So if we wouldn't have had that, we would have never entered into the contract. But we've got a two-year option contract, uh, with a great vendor, um, who understands, look, there are some challenges to overcome.
Um, and, uh, we've got essentially, let's say Let's say we've bought it for 27 million, and we will cost us around seven million to do the first stage. Um, we'll essentially own the second stage in its entirety from the profits or the, the g- gross realization value in the first stage. So the first stage is gonna go for around 375 to $400 a square meter on 84,000 meters, 84,700 meters.
So essentially we got about the same in costs as in sales on the first stage. Mm. And in the second stage it'll take us a good year to be able to have Sara and TMR and council all accept this underground detention system. And we're working with a, with a, with a company called Permcon, uh, Australian Permeable Concrete, and Boral to apply all the roads to be, to be a permeable surface to allow that water to run through the road rather than run down it, and then run into underground detention ponds, which essentially are big geotextile and geo-fabric ponds underground.
And then from there the water slowly percolates- Yeah, wow ... back into the groundwater, which is good for the environment, makes the yard greener, but allows us to not lose that usable land. 'Cause the original concept was a big lake. We thought, "Right, we've got this, you know, nine hectare, nine hectare residential lot."
Yeah. "Let's put a two hectare lake in the middle." Mm. "We'll get better values for all the, for all the properties or the la- land blocks around that lake." Mm. Yep. Um, and then, uh, we'll lose two hectares of land. But we'll get some success out of it. And then upon research and meeting a couple of really, really smart, uh, hydraulic engineers like Shane Barnes, um, they said, "Look, there's this system that they're doing in, in the UK, and they're doing it in Netherlands, which is essentially a big swamp.
Um, it's been very effective." So they started that in 2006, so they've got a huge amount of tech on it. So we're now going through what's called our music to get our squid approval, stormwater quality improvement device. Wow. So- I wonder whether in m- the majority of councils that will actually reduce your infrastructure charges on what they call the permeable hardstand?
Oh, absolutely. Yeah. Well, we're doing- So you're saving all those charges as well? Oh, absolutely. Right now we're actually, we're actually trying our hardest. We're actually doing it as a, with our margin for Redlands Council. We're, we're really trying hard. We haven't been approved, we haven't been accepted.
Redlands Council haven't said yes to it yet. Um, but along Beveridge Road and along Ricketts Road, um, they've asked us to present our technology and a solution set to them, um, because the flooding there with development going on over time- Mm ... it's caught more water, it's concentrated it more. It's now got terrible flooding The residents there are getting impacted.
Instead of being at a one in 100 year event, they're getting impacted on a yearly basis. Yep. Um, so Redlands Council said, "We need to do the right thing. We wanna get this solved." So now we're actually applying detention ponds into the road reserves- Yep ... and into a development there at 41 Beveridge Road, where we'll make the entire road platform a permeable surface that's been...
It's, you know, Boral are using it now. We've, they just did a pour out at Graceville. Um, it's, it's, it's rolled out around the country, this permeable concrete. Mm. But essentially we've taken the next step by then putting it into a system where it goes into an underground detention pond or a poly tank.
Mm-hmm. Large poly tanks- Yeah ... with geotextile liners. You know, liners that are like a fabric. Yeah, a long, 100-year lifespan fabric, and then from there the water slowly goes back into the ground table. Mm. Um, doesn't work for everywhere because you don't have sometimes the distance between the surface and where the groundwater table is.
So there is a thing called the, the Ground Atlas in Australia, and that Ground Atlas gives us a very, very concise map of what's called ground truthing, how much distance you've got there to understand what volume of water you can store under the ground. Mm. Look, I'm fascinated by all of this engineering talk, and I need to learn more.
Yeah, I, I'm not an engineer, so I, I'm probably not explaining it the best. Well, I'll tell you why I wanna learn more about it. It's because I'm out there, my favorite asset class is truck parking depots, and I'm out there buying these sites and I start off with this big. And when the engineers come and do their storm water reports, sometimes the buildable hardstand for truck parking becomes like this.
Yeah. But if this permeable- Concrete ... concrete is a solution. It could massively increase the amount of usable area on the site that I can use for truck parking. Well, the company we've set up is called HydraX or HydraX Infrastructure, HydraX Infrastructure. So essentially we'll be the first ones in Australia to actually apply it in a solution that works.
Other guys have gone and done it where they've had a permeable gutter. Mm. But essentially the gutter doesn't have enough area. By the time you have leaves and plastic bags and- Mm ... you know, debris loading up that area that typically drains water through, then effec- all of a sudden now you, you don't have a, a drain hole.
The drain hole gets, you know, like at home, gets filled full of junk. Yeah. So we've made it into the whole road surface. And if you look at Greenbank Road, if I knew about this technology at Greenbank Road, I would've saved my client a couple million dollars on building that huge detention pond or lake that the water can drain into, where we turned a two hectare developable area into an, into essentially 11 hectares in the end.
It being was nine and then we got 11 in the end. So we picked up essentially nine hectares for them, but it cost us $2 million extra- Mm ... 'cause we had to build a big lake where we had to, you know, build a berm on one side and we had to channel that lake all the way out to a discharge point on the road.
Mm. If I would've had this technology two years ago- Mm ... uh, I would've put underground detention ponds there. Mm. And this is right next to the Charter Hall site- Yeah ... uh, Flagstone Logistics Park. I mean, how do we go with the town planning process? If, if I, like I'm working on a site now, I'm about to- I- I'm responding to an information request, and it's about the stormwater and a detention basin.
Can I go, like, is it too difficult to amend a DA later once it's approved and say, "Oh, we're not gonna do hard stand here, we're gonna use this permeable concrete?" Oh, no, they love it. They love it. It, it's c- like, an ASCON or a, a... Generally an engineer for the council, he's a, he's a solutions-based guy. Mm.
Yeah. And then the council looks at it from a cost base and says, "Right, if you've got a better mousetrap, let's go for it." Yeah? Mm. It's, uh... And then look, you have a DA. DA is one thing. Yeah? The parameters of how a site needs to work. Yeah? Where the access and egress is, where the stormwater's discharging, where your power's coming in, how your sewer line's working.
And then you get your operational works. Mm. Yeah. And when you're doing up works, often there can be a lot more provisions the council bring forward to say, "Hey, what you're doing o- o- on, on there doesn't quite work. We want you to do it this way." Yeah. From there, there's always a negotiation point. Good. And you'll go to council, and you'll never go to council without being a relevant expert.
Yeah. So I certainly won't go to council without a RPEQ stormwater, you know, hydraulic engineer. Yep. Because I'm just not as smart as them and I, I can't do the math- In that area ... or ACAM. In that area. You're not as smart as- Yeah ... yeah. So and it's the same with structural, and it's the same with civils.
Yeah. You'll always have that relative expert, um, that's there and that's on board. And often, look, the best developers have taught me they will see who council uses. Mm. Because council have vetted them essentially. Mm. They've said, "Right, we use, you know, John Peters, who's an engineer. He is brilliant. We use him as a consultant when we have problems."
Mm. So then you'll go to him and you'll say, "Am I able to retain your, your services?" If he says yes, I think you're miles ahead because y- he already has an understanding of the, what council accept- Yeah ... and the parameters of, of, uh, of what'll be s- what'll get up, so to speak. Mm. Yeah. That site we went through there, um, Northern Palms, it seems to me like- The best.
W- we're talking about win-win. Like, your skill set there has really helped that seller, because he wouldn't have been able to do it by himself. Well, look, I fell in love with my own stock, so I had that on the market. Mm. I had that on the market for- As a real estate agent, you were trying to sell it ... at 30-plus million dollars.
And I went to everyone, and everyone said, "Look, there's some prickles on this thing." Yeah. Mm. It's not, it's not, it's not great. Um, the owner is, uh, not a developer, so to speak. Mm. He's, uh... They've, they've acquired land along highways all up and down the East Coast over a couple of generations. Um, and this was in a pre-'86 trust, so it didn't have any CGT, uh- Pre-'85, yeah
pre-'85, sorry. Yeah. Didn't have any CGT, uh, implications or- Mm ... or penalties. So he was saying, "All right. Well, we, we'll get out of this, and we'll get this money for it." So he got the DA. He'd, he'd spent a lot of money on the consultants. Um, and then there was always this block that when he owned the land, his parents owned the land or, you know, they'd purchased it in the early '80s, it didn't have any flooding on it.
I know it well. I used to actually rent a hardstand off Dyke Road across the road- Yeah, right ... uh, on McGregor Road. So it didn't have any flooding on it at all. It was actually a place we all went to 'cause it had no flooding. And then with that subdivision, and I don't wanna say who the, the p- the biggest developer in house and land packages beside us, 'cause it's really not their fault, and they're really honorable people.
It really is council allowed them to get- Mm ... that extra half a meter with the pads and the built form- Yeah ... going forwards. Now all of a sudden, the water, instead of just having a very light overland flow impact, all of a sudden now has backed up. Yeah, and some stockpiles of fill on their land have contributed as well, and we've shown through LIDAR that now that, that la- that block is inundated with water.
So essentially I would've got me 32 million for it all day, uh, as a, as a, as a selling agent, but unfortunately that block was what was bound, we were held back with. And so then a team of us came together and said, "Right, let's apply this solution." Mm. And then that solution eventually went from a pond or a dam or a lake into underground detention.
Yeah, right. Woodlands Rise. Oh, Woodlands Rise. I get excited about every one of, every time you mention them. So Woodlands Rise was a wonderful vendor who had enough of every developer turning up, you know, in their expensive car with no socks and a suit and said, "I don't wanna know about any, you know, fire sale."
Mm. Um, so I asked what they wanted. They said, "We want X amount of dollars." You know, "We want, you know, 20 million bucks." And, uh, I went away and thought about it. I said, "Look, if you can give me three years- I'll do a deal. I'll do a, I'll do a call option with you. Um, and, uh, I'll give you $75,000 a year. Um, you can do whatever you want with it.
I'll pay your land tax. I'll pay your rates. Um, one of the family members came back and said, "Look, you're signing a deal today," you know, 2025 You're paying for it potentially in 2028. So property's gone up in that time, milk's gone up Can you pay us a bit more year on year? So I went back to, uh, essentially Peter Mack from State Land and said, "What do I do?"
He said, "Look, they make a fair point." He said, "Why don't you give them CPI plus 2%?" So I gave him the CPI, whatever it is per year, plus 2% on the end value. So essentially I'll end up at about 100, if I sell it in three years, probably about 112 or 114, depending on what... 'Cause inflation's pretty high at the moment.
A square meter. $114 a square meter as opposed to 100, and then I lose the 225, the 75 per year- Yep ... over the three years, and then I lose the land tax, which is, you know, about 100 grand. But pales in, in, in significance when you've already been offered $140 a square meter already. Correct. Yeah, and, and considering with the claw back, so the, the, it's in a, it's in a PDA area- Mm
a product development area. Mm. So they've now disclosed there'll be a road going through there, uh, a major trafficable road- Mm ... going through that land, as it is on many people's land. Yeah. So I'll turn, you know, 200 and something thousand meters, uh, just over 200,000 meters, I'll turn that into about 165,000 meters- Yeah
with the road resumption. The, the state will pay me for that, taking that land off me. Yep. Yeah, at, at, at a less than fair price, but that's how it is. Yeah. I get the benefit of a road. Um, and then, um, and then I will sell that off. It retails for about 1,000 a meter, um, once it's developed. I don't think I'll have the money to do a development.
The civil costs are very, very, uh, are quite high. Mm. There isn't many trees. It's flood free. There's very little, very little cut, no fill. Um, so it has a huge amount of benefits to it. But at the same time, I think if I... I'll get the DA. The DA will go through very quickly 'cause it's with Economic Development Queensland, EDQ.
Yep. So it, they have a special, um, uh, that just deals with developments and approvals, so they're much more efficient than council, without any disrespect to council. So it'll go through that. I'll generally like PDAs 'cause you have an offset for infrastructure costs. In other words, every block that you apply, you'll pay 31 or 34,000, depending on where, where it is.
Yep. Per block, plus your power, sewer, water, everything else. So council will often give a, an incentive in a PDA, whether it's a 50% offset, a reduction in those contributions. Now, when you're doing 120 blocks- Adds up ... or 140 blocks- Yeah ... it's a $3.5 million bill, $4 million bill, down to a $2 million bill.
Yeah. So that $2 million is just, hits the bottom line. Um, it, it... Essentially for me, well, I'll get the DA. I'll s- I'll get 225 to 250 a meter. Um, and, um, it'll be a, it'll be a great one. Um, yeah. Okay. It'll be a, it'll be a really, really good one. There's, there's no- Yeah, it's, it's, it's really, really high growth area in that- Mm
in that Thornlands PDA. Paul, I'm not gonna make the mistake of asking you to start talking about the health industry, 'cause you have a passion and a lot of- I don't, yeah ... uh, a lot of, uh, expertise in that area. But we do have one project here, Worri Medical and Allied Health. So Worri Medical is a wonderful one where they've just done Australia's largest, uh, um, dis- disability aged care social housing project.
Um, essentially there's, uh, 1,500 people going in that are reasonably moderate to high care, uh, needs. So there isn't a medical center anywhere near them. Mm. There isn't an allied health center anywhere near them. Essentially, they've all got to be transported, and that transport comes at a cost to the state essentially, yeah.
So, uh, my client came to me and said, "Look, the 7-Eleven's going in next door, you know, a service station's going in on, on one side, on the southern side. I've got 4,000 meters there. I want you to give me a fair price for it." Um, and I purchased it, uh, and then with that purchase, uh, I'll apply a medical center where I'll have, you know, radiology, pathology, chemist, a GP.
Yeah? And, uh, and then I'll have allied health on the top floor, NDIS, and, you know, physio and OT and that kind of stuff. And then, um, it's a captive audience, so it's a nice easy one. Um, it's, uh, it- that one there is not a option contract or a put and call contract. That one there is a simple, uh- I know it's gonna work 'cause it's captive audience.
Mm. Essentially you got 438 townhouses going in next door. Mm. And you have 1,500 people who are in some level of disability support that have a need to use the services within that, within, within what I'm applying there. Um, so it was a no-brainer. Paul, one of the other things that's so impressive about these deals we're talking about is we've talked about, uh, luxury resident- waterfront development, we've talked about industrial sheds, and now you're talking retail.
You're, you're going over all these asset classes, and it's just so fascinating. Look, look, I, I don't know, I don't know retail very well. Um, I have been selling a shopping center in Adelaide for, for, for a while, for a, uh, for a... Which is a great one in Sea Cliff. But, um, but the... It's one of those things you say, well, if you've got 1,500 people there that all have higher needs than, than your general, you know, general public, um, and there is no medical center within a couple of kilometers.
Mm. There is no GP. The community needs it. Everything is separated as well. It's all, it's all sparse. So essentially, Bunnings was successful for a number of reasons. One is that you can get everything in o- under one roof. Mm. So it's the same, it's the same with, uh, with this one. Mm. You know, we're doing a, the world's first capital HQ in Cairns.
We're doing a building where, and it's just been released into the, into the news, so I'm not telling any, anything new here. But we're doing, you know, planner, engineer, surveyor, traffic economist, real estate accountant, all in one building, all under one roof. Mm. And we've got a golf driving range, and we've got a gymnasium that comes with it, and we've got a restaurant on the top floor.
So essentially a person can walk in, like they do into my office, and say, "I need a solution. I don't wanna drive here, there, and everywhere and make 400 calls. I want everyone on the same page, and I want everyone to come up with a solution for me, and I need it validated with evidence. And I don't wanna be talking about this in six months.
Let's go now." Awesome. So yeah. That's, that's essentially, uh, and that's essentially my business model. Everyone I try and interact with, I say, "Look, I'd love the opportunity to earn your business." And I know you're the same. You say, "Look, come to me- Tell me what your needs are. Ask me the question. It won't always be good news.
It, I, I, I think everyone can handle bad news. They just can't handle garbage and lies. 100%. So for me, I actually love that. I say to every single customer, "Look, if you've got anything, if you're doing an extension, if you're going up a, lifting the house up, if you're, uh, doing a subdivision, look, please, love the opportunity to, to, to provide some benefit to you and earn your business in the future."
Um, and then I find that the lifetime customer- Mm ... the one that you work with, that you hold hands with- Mm ... that you walk down the road with together, you not only retain that customer and have an income from them, but you also develop a relationship. Yep. Uh, and I think that relationship is something that makes you feel part of the community.
I, I just, I live in Bulimba in, in, um, in Brisbane, and the community, everyone sorta knows each other. "Hey, look, go see this guy," or, "Go do that." Mm. "He'll help you out with that. He did one. He might be able to give you a guide." That's been... It's like with me with Stately and Peter McDougall. Uh, the poor guy, I, I probably ring him twice a day-
to say, "Hey, what do I do here?" And he'll say, "Look, you've gone mad. There's no, there's no merit in that." Mm. "You're shooting, you're shooting into the wind." Other ones he'll go, "That's brilliant." And then we tried to gather to buy a site next to, um, Flagstone Industrial Park there at, uh, the highway corner of Greenbank, sort of where the corner of Greenbank Road and the Warrego Highway is.
I think it's, I think it's the greatest thing I've ever seen in my life. Is this Charter Hall? Charter Hall, one. Yeah. And Charter Hall are dialed in. They are- Mm ... absolutely... For me, I, I, I look to them as a model. Um, and then you see that industrial park they've done there. The landowners had acquired the land for pennies on the dollar.
Um, they took a huge risk. They turned it into a priority development area to have a 24-hour precinct. So essentially, if you're going to eBay or Amazon or, or any of the big corporations and you say, "I can pick up your efficiencies by 20 or 30%," they're gonna pay more for the land, they're gonna pay more for the lease.
Mm. So when it's a 24-hour industrial park or that one they did at Western Sydney, they say, "All right, well now we can run, we can traffic in and out and we can run, uh, our logistics, uh, to service all of our, our outlets- Mm ... 24 hours a day." So Charter Hall took it. I think they had Shadforth do the, do the civil works.
I think they bought it for about 110 million, and in five years ago you could have bought it all of North Maclean for, for 50 million. They bought one block of land for 110 million, and then exercised the civils, which I don't know the number of, but they would've been massive. Um, would've been huge, and now they're effecting a, you know, more than a half a billion dollar build where they've got industrial and distribution center.
Yeah. Uh, and it's all over Google, and you can see the videos and the pictures, and you can actually do a 360 view of it now. You can actually look around. Um, remarkable how they've turned nothing into something. Wow. Paul, I think, um, w- we could talk forever on some- We could ... of these other deals, but we better, uh, finish the podcast 'cause we just don't have time to go through all these deals that you're doing.
But it has really made me think that I've been thinking too small with my portfolio. When I talk to you, I think, "Wow, stop Coming up with excuses as to why you can't grow, and this is the number one thing I want the viewers to listen to here, is that if you can understand, don't just say, "Oh, yeah, I know how an option works."
Have you actually done one? Like, you actually have to make a decision, right? It's time to scale. S- start with speaking to the planner. Start with speaking to the developer. Mm. Start with speaking to an agent that is exercising these or working on these. Yeah. And then always ask them to back it up with facts.
Mm. Yeah? You don't wanna hear, "You might be able to do that." You wanna hear, "Here's what the code is- Mm ... here's what they say you can do, and here's where someone else did it, but they were successful in getting the council to allow them to exceed the limitations." Those conversations are the starting point.
They were for me. Mm-hmm. Um, you know, if you look at 5 Dudley Street in West End, they managed to get in an LMR2 five stories. How do they did it? Well, that's another podcast. But at the same time, I think that it's those conversations that you have, and that's why I urge everyone, no matter what you ring for or what you call for, I will always say, "Hey, look, let me have a look at that."
Mm. And then that's why I built that tech to be able to me to deliver those planning reports, non-speculative assessments on land- Mm ... to give you the, you know, the limitations under a, under a code assess application, or under what's allowed now, and then what's been allowed in other places that have exceeded the limitations.
So you can say, "Hey, does that match in? Does that fit?" Mm. Um, and then as well, we've now got a new, a new, some new tech around social amenity. You know, if you buy in somewhere and they're putting a new school in or they're putting a new shopping center in, well, look, the land value's gonna go up. Your property values are gonna go up.
Mm. Yeah. If they build a jail next door, they're gonna go down. So- Or a sewage treatment plant. Yeah. That's why I say any one of your viewers, any one of, uh, anyone I interact with- Mm ... uh, it'd be a, it'd be a absolute honor to take their call and, and be able to go through them on just a question and answers.
There's the call, call to action, folks. Once again, if you have a large development site or someone you know does, get in touch and, uh, we'll, we'll talk to Paul here because his town planning knowledge and experience, and his network of- expert consultants that he has will be able to quickly- Mm-hmm
determine, you know, how we can maximise the value of your site. Please press the s- subscribe button. Thank, thank you, Paul, so much for your knowledge. Like, even r- I feel a little bit intimidated talking town planning jargon with you because, uh- Oh ... it's just at another level- Oh ... that you're experienced. No, I, I think, I think it just comes to, you know, you start, you, as you start thinking about it, you realise, oh, gee, there's so many more opportunities out there.
Yeah. So I, I really appreciate the time to be able to even discuss it and- Mm ... talk about it and, um, yeah, it's, it's, for me, it's, uh, I say to everyone, "Get a job in planning." Yeah. Get a job in, uh, development. It's, it's, it's a real adventure. So- I look forward to doing some deals together, Paul. Yeah, yeah. You too.
Thank you for your time. No worries. Thanks. Bye. Thanks, viewers. Thanks, everyone. Thanks for listening to the Andrew Right Property Podcast. This is all about building a community of like-minded investors who can share real-life stories, experiences, and collaborate with a view to helping each other. Join us.
Get in touch through the link in the show notes. I look forward to you joining me on the next episode.