Home Property Australia Why Cbus Property s chief is burning the midnight oil

Why Cbus Property s chief is burning the midnight oil

  • March 21, 2018

Why Cbus Property’s chief is burning the midnight oil

Taxes on foreign investment, a new generation of renters and the evolving workplace are three issues keeping Adrian Pozzo, Cbus Property’s chief executive officer, awake at night.

Pozzo, who will be speaking at The Property Congress in September, has led Cbus Property since 2007.

Over this time, the property development and investment arm of the Construction and Building Industry Superannuation Fund, has become one of Australia’s largest integrated developers.  Today, Cbus Property has $3.8 billion-plus in funds under management and another $5 billion in the pipeline.

Pozzo says state government taxes on foreign investment in the residential space “certainly make us think twice about the sectors we chase,” and will have long-term implications not only for the property industry, but most likely for government revenue bases.

“We see a lot of cranes in the sky at the moment, but I worry about the future cranes we might not see in the sky in three to five years’ time,” he says.

Presales from the foreign investor market has propped up “significant” amounts of residential development over the last five years, Pozzo adds.

“Cutting foreign investment won’t alleviate the problem of affordability. I believe that in three to five years there will also be a problem with pricing because there won’t be enough stock being built. And furthermore, less development will also affect government revenue bases because they are reliant on property revenue, notably stamp duty.”

The Property Council’s 10-point plan to fix housing affordability, released last year, identified a suite of measures to boost supply, including incentives for planning reform and inducements to tempt institutional investment in new rental stock.

Pozzo says the build to rent model is one to watch, as it could meet the needs of ‘Generation Rent’.

“The old concept that was drilled into us by our parents was that the first thing you do is buy your own home. But that doesn’t necessarily resonate with the next generation,” he says, adding that Cbus Property is “looking at build to rent in detail, as everyone is at the moment”.

Pozzo is currently overseeing some of Sydney and Melbourne’s most dynamic new building projects. In Melbourne, 447 Collins Street, a mixed-use building dubbed the ‘pantscraper’ is taking shape, and will deliver 49,000 square metres of premium-grade office space, a five-star W Hotel and 202 luxury apartments. 

Last week, a landmark $1 billion-plus deal in Melbourne’s CBD gives the developer nearly 3,000 sqm on the corner of Queen and Bourke streets, while the $1 billion Newmarket residential development at Sydney’s historic horse stables in Randwick is also underway.

The accelerating pace of technological innovation is a “huge challenge” for those in the city-shaping business, he explains, and building design is evolving at a cracking pace.

“We are really grappling with technology, because a building that is designed today might not be finished for five years. With technology moving so quickly, building design and building requirements need to be continually reviewed.”

He points to the push towards open plan and coworking spaces, and the eventual obsolescence of car parking in the age of autonomous vehicles as examples.

“By 2030, the whole of the Melbourne CBD could be just like London, and only those people prepared to pay fees and charges will have the ability to drive in the city,” he predicts.

“When this happens, will we need five or six basement levels of car parking in an office building?” he asks.

Adrian Pozzo will be speaking at The Property Congress in the Chief’s Wrap session on 13 September in Darwin. The Early Bird discount rate is now available. Book online today.