Developing to make a difference
Developing to make a difference
As director of a major developer with its roots in western Sydney and its tentacles reaching across the Harbour City, Eastern Pacific's Chris Abouhamad shares a nuanced and insightful look into the property development landscape in New South Wales.
Whether offering a withering critique of the planning system, conditional praise on the Federal Government response to COVID-19, or a warm-hearted view of regional charity, his near-on four decades in the industry position him as one of the foremost voices in the property development sector.
Eastern Pacific has a significant portfolio of residential, commercial and industrial projects under its belt. Tell us a little bit about how the company has evolved over nearly four decades.
The key to successful growth is consistent growth; understanding the markets, your financial capabilities and choosing projects and partners that align with the company’s
vision (Go vs. No-Go). The leadership culture instilled in Eastern Pacific has not and will not change.
However, the adoption of fringe technology and software has made data a key part of our continual improvement. This technology, which for a long time was not as accessible, is now something that sets us above and beyond the market average.
At Eastern Pacific, we support data analytics and reporting by building our own custom software and business intelligence reporting, obviously not a luxury afforded back in the 1980s and 1990s.
With the industry becoming larger both in terms of project sizes and demographic opportunities, we’ve evolved in size and scale in order to target broader market sectors
and expand our service offering in both construction and development.
Presumably none of those 35-plus years have been anything quite like 2020. Has any good come from this year from Eastern Pacific’s viewpoint and a wider industry perspective?
Every year offers its opportunities and challenges; if we take a macroeconomic approach, 2020 will be, at least for most Australians, a lesson learnt scenario, where some fundamentals will change. We’ve coined the term internally to our team to ensure we “Don’t forget to remember the year to forget.”
At times, the day-to-day turbulence of an evolving situation created unhealthy amounts of panic in every Australian. As a business owner, we must rely on our beliefs and optimism that there must be a silver lining in every situation, and there truly was.
Besides our Federal Government’s initiatives, a stabilised property market with healthy signs of growth and not a single day’s loss of work – we all got to re-evaluate, at the hardest of times, what is most important to us.
I particularly enjoyed seeing the human side of business, which at times is a rarity, and just how caring we can be to one another when it matters most.
How has the construction landscape changed in Sydney over the decades you’ve been in the industry, in terms of opportunity, administrative requirements, and design and technology?
The opportunities have never been better. World markets have realised Australia is a great place to live and invest. Between Asia and the US, international financial, investment, education, political stability and everything else that makes Australia, well, Australia.
The opportunities to develop greatness are extremely exciting. The downside to rapid and unsustainable growth was demonstrated in the recent property boom between defects, mal-practice and lack of accountability.
This then prompted greater administrative requirements and the strategy of greater investment in better design and reportable technology – and the industry failed the integrity test, being unable to prove its stability under crushing demand.
At present, there is too much disparity between the level and expertise of service offerings of developers, design practitioners and builders. It not only needs to be
improved, but consistent.
We’ve seen the Federal and State governments introduce stimulus into affordable housing, infrastructure, stamp duty reform and Job Keeper in response to the pandemic. How effective do you think these branches of government have been in regards to the construction and housing sectors?
As great as these mechanisms are, unfortunately, they will come at a generational price we will all pay. We have not felt the full ramifications of COVID-19 on our economy – but I can definitely commend our Government’s approach, which has eased the financial blow by drawing repayments for these debts out over a medium-long term, as opposed to heavy taxing in the short term.
The stamp duty reform is a questionable mechanism, albeit a step in the right direction. Its alternative provides a cash flow concession rather than abolition, and my fear is this may cause property prices to increase – although this will not be a smart move on behalf of property developers.
With regards to the investment into sectors such as infrastructure and affordable housing, it is proven these sectors bolster our long-term economic performance. Where
Doomsday analytics forecasted a 10-30 per cent downturn in real estate, the real numbers were less than two per cent – how’s that for performance?
On the local government level, have there been, or do you recommend, any improvements in processes often described as complex, slow and unwieldy?
The biggest deterrent from international and local investors, developers and migrants in Australia is the planning system, which is nothing short of broken, inefficient and costly. There is no accountability for delays, poor advice, inefficient outcomes, or internal political motives that affect everyone from developers to buyers.
The planning system is a key contributor for increasing house prices due to choking supply, bottlenecking community development and the inability to meet the market for dwelling demand. There may be many areas that need fixing, but the general disrespect to timing, in applications, assessment and outcomes, is a good place to start.
Eastern Pacific develops homes, residential towers, commercial precincts, offices and retail outlets. Where do you see the greatest growth potential and challenges in 2021?
The residential market has its cycles like any other market, but housing is a human right and necessity. That is how we see it.
Residential development will always have a healthy share in our pipeline in any market, and it looks to be a promising few years ahead.
Challenges will lie in local and international recovery; our growth is hinged on immigration, students, stable trade relationships and a universal vaccine.
Do you have any operations outside NSW or plans to expand or venture into other states?
In the long term there may be, but we are not actively looking. NSW is by far the strongest state in terms of economic performance and opportunity, and we’re glad to be
domiciled in this great state.
Your company has been involved in providing rural aid in recent years. How did that come about and what is it that you do for these communities?
The Rural Aid program comes from a personal relationship between our love for charity and our country. I’ve always wanted to use my skills, and our company’s, to affect real and positive change in people’s lives, and this was the perfect opportunity.
We commit our time, resources, materials and financial assistance to repair, rebuild and assist disaster stricken farms and families in rural Australia. We understand we cannot solve all their problems, but everyone needs assistance, support and friendship – that is what being Australian means.
It’s perhaps not charity, but Eastern Pacific also gave a complimentary $15,000 luxury upgrade to early purchasers in a new apartment complex in Sydney’s west. Is this part of the way in which you try to differentiate your business in a competitive market?
This was a great opportunity for us to say thanks to our purchasers who had believed in our product and purchased from us. This came from a place of genuine gratitude and the drive to be better wherever we can. The finishes are by far the best in that demographic and have far exceeded the standard of like products. To differentiate is a key focus for us, to build the Eastern Pacific brand into one that cares and is creative.