Join us as we discuss his professional highs and lows including how he was virtually unemployable prior to starting his own business, his foray into the property market as a 23 year old, and how he embraced the entrepreneurial outlook.

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[00:14:47] If someone was the only person prepared to put their hand up it's very hard to criticise the way someone does a role. So at times I wasn't happy with how people were doing things and I, with that mindset, put my hand up and said, 'Okay, well, I'm gonna run for that position as well’, and probably had very little experience in that world. 

 

This is Property Investory where we talk to successful property investors to find out more about their stories, mindset and strategies.

 

I’m Tyrone Shum and in this episode we’re speaking with Jim Valery, who grew up in country towns across New South Wales and Queensland. After working in the mines, he is now the founder and director of New Style Developments, where he has undertaken over $30 million worth of property deals.

 

 

 

Valery may have been born in Sydney, but he’s a country boy at heart. He took the skills and lessons he learned from working in coal mines and trade unions, and applied them to the property development business he runs.

 

Jim Valery: 

[00:00:28] I'm the sole director of New Style Developments. And I guess my role is more about the oversight into working with our team both internally and externally. In development space, it's important that you have the right consultants, but it's also important that you do have the relationship with them to be able to drive them and give them the right input. So it's all about making sure that I guess the buck stops with me to make sure that internally and externally, we're doing the thing that's delivering the right result for our investors, making sure everyone is adequately safeguarded predominantly in Brisbane City Council and more aligned to infill developments, rather than the Greenfield ones. I just feel that it's probably a lot better infill where I believe that there are better productive growth is more stabilised because the market's already established, rather than the fluctuation that you might get in the Greenfield areas.

 

Tyrone Shum: 

Valery expands on what infill versus Greenfield is...

 

Jim Valery: 

[00:01:43] An infill development is generally referred to as a development that is being done within an area that has got significant infrastructure around it. So it's already got roads, shops, schools, etc, that all the infrastructure is there, it's surrounded by houses that have been there for quite a while. A Greenfield development is more going into the outer suburbs of an area, a lot of times you're creating your own roads, at times, they will often do master planned estates in those areas where they're creating their own schools and shopping precincts as well. So they're planning quite a large area. Greenfield you'll generally see 1000 lot subdivisions in a number of stages where infield could be anything from one to two up to sometimes 30, 40 lots of divisions. But generally, you won't find much bigger than about 30 to 50 lots of divisions or a billion fuel development.

 

 

Jim Valery: 

[00:02:57] Very much. I guess it's something—the volume's here for them, they've generally been holding a property for a number of years, and there's obviously a lot more competition, I guess, when you're going against some of the really major players here that have held the property for a long time and bought at the right price. So for me, it's about not wanting to go and do that direct competition and keeping the infill areas where we can be, making sure that our competition is a general Mum and Dad sale. So we keep our new builds at the right price of the suburb, and it becomes an attractive option for buyers.

 

Tyrone Shum: 

He shares what a typical day looks like for him at the moment.

 

Jim Valery: 

[00:03:51] Any given day at the moment, I guess I do have a team. So we've got Ben, who does a lot of our operation on field work, and he provides our in sales and development management in acquisition areas. So there'd be a lot of interaction with them overseeing where developments are in all areas, a lot of networking and touching base, whether it be through consultants and upskilling, or whether it be just interacting with people and assisting people out in the small areas. But generally, it's a lot more oversight in looking at the bigger picture rather than as much hands on with the nuts and bolts—that's generally done by the consultants or our external or internal people. And it's more of the oversight and making sure that the total picture is moving the right way.

 

[00:05:03] The strength is from the team and it's where everything is. As soon as you're relied upon by other people to be doing certain areas, that's got a big impact on how you can deliver yourself.

 

 

Tyrone Shum: 

Valery steps back in time to explore the places where he grew up.

 

Jim Valery:    

[00:05:26] I was actually born in Sydney, in Ashfield. Moved through to Mudgee, which at the time it was a farming and a sawmilling. It's quite big with wines and coal mining, Mudgee in New South Wales country. But moved to Gladstone, started all my schooling in Gladstone. And so I probably have the ability to be calling a number of spots home.

 

[00:06:03] So, I was probably four or five years old when I was in Mudgee. And then probably up to about six or seven by the time I got to Gladstone . So not a great deal of time to plant your feet in those other areas. But yeah, grew up and obviously, they were good areas to grow up in.

 

[00:06:36] Obviously, at that age you're with your parents and my father was quite into carpentry, dovetail finishing, and some of the higher end cabinet making areas of carpentry. So it was probably an opportunity where he acquired a sawmill out in the Mudgee areas. So it was in relation in there. It was the moving of the family out there to Mudgee to utilise and to be living there, well, he had the sawmill going and it was great to be able to run through in a rural area running through the fields with my brother and it was certainly a much more relaxed environment, I suppose, that you grew up in, rather than city living.

 

 

Jim Valery:    

[00:08:08] So I grew up in Gladstone and started to work there the first time. I probably had a significant accident when I was a young fellow there too. And that put me in grade one or two. Boys being boys and playing in the backyard with fire and incinerators and aerosol cans and petrol, they sort of don't mix. So I grew up there, did all my education and schooling there. Started doing some work there, played a lot of rugby league growing up as well. So rugby league was a big part of my sports and my social circles whilst growing up. And that also led me to be looking at moving out into the coalfields in Moranbah, inland from Mackay, and to be working in the coal mining industry. It was certainly an assistance in playing a builder I believe in being able to play it at a level which was attractive to some other teams in regional areas to be going out there and playing football, giving me a start into the coal mining industry.

 

Tyrone Shum: 

Valery explains the locations of the different places he has lived and worked in Queensland. He shares how rural areas differ from the cities, and why this was a great fit for him.

 

Jim Valery:    

[00:09:26] It's northern Queensland, Gladstone's in Queensland as well. It's a bit Central Queensland and then Mackay's up towards the north Queensland areas. It's about four hours away from Townsville. So it's not right up at the peak, but it's certainly up in the northern part of Queensland. And Moranbah is a little place about 200 kilometres inland from the coast, so it was out in very much the regional areas again. Where at the age that we were there, there was TV and other things, but a lot of the rural towns don't have the added entertainment districts or precincts or things like that. It's about interacting with people. And I think for a lot of reasons that's a great way to get up and walk because it allows you to connect with people skills, and being able to interact with people and talk to people. And that's a big part of life. If you can be talking to people it's certainly a major head start.

 

[00:10:44] I was 21 years old when I went up to Mackay. So they've got a little bit of work. Actually worked at Armaguard, being a bigger guy, as young guys will, worked in Armaguard for a while and got some construction orientated work in Gladstone. But when I was 21, I was moving up to Moranbah and stayed there for about 15 years. And had a great time in Moranbah.

 

 

Jim Valery:    

[00:11:16] I started off with, of all things, explosives, obviously having had the incident when I was a young fella, and then being moved into the explosive field, so I got to play with more dangerous toys. But then it was moving into the jungle of machinery operations, and driving the big trucks or the big loaders. And I guess that was good, because it gave me a real first exposure into property investing. And obviously, you're on a reasonable wage when you're in a coal mine. So that was the introduction to property investing. And probably the downside, or the bad side, of property investing where you do have a lot of spruikers, who will come and talk to high income areas and high income people. So it's probably fair to say that my first couple of purchases were the greatest choice.

 

Valery shares about his move from Moranbah to Brisbane, and at what stage in his career he decided to make a change and start investing in property.

 

Jim Valery:   

[00:12:34] It was quite early, probably... if I moved up there when I was 23, I think we were looking at our first house from about 23. So there's obviously, the realisation and I guess as everyone does, the initial plan was to be working up there for a few years, and then set yourself up and go back to the place you knew, being Gladstone. But it was living there and enjoying the lifestyle, enjoying the direction of the community and making... I guess actually, when you do move, you make new connections and new networks and it becomes something that living in Moranbah there, which was only a town of about 8,000 people at the time. It was great.

 

[00:13:16] It was certainly what I enjoyed and certainly what I probably still would have done other than progressing and moving into a full-time role with the trade union, which when we moved down to Brisbane, coming from Moranbah, a town of about 10,000 people down to Brisbane. It was certainly a major change or difference. But it was obviously the right move at the right time. And it allowed me to continue to move to where I am now.

 

[00:14:07] I guess it was more along the lines of the coal mining industry is called a heavily trade union industry, it's quite militant in that area. And it's from, I guess, the belief that you can't be criticising someone to do something you're not prepared to do yourself, or, if someone was elected unopposed to do something. So it's very easy for people to be criticising and complaining about the way someone does something, but unless you're prepared to do it, or unless that person has actually had a competitor.

 

[00:14:47] If someone was the only person prepared to put their hand up it's very hard to criticise the way someone does a role. So at times I wasn't happy with how people were doing things and I, with that mindset, put my hand up and said, 'Okay, well, I'm gonna run for that position as well’, and probably had very little experience in that world. And for whatever reasons I became shift delegate, made my way through to become one of the executives, you know, responsible for leading the 500 or so workforce. And then, for that same reason, moved down to Brisbane and took on the full-time union role. It was the fact that the only person who nominated was someone that I didn't believe I'd be comfortable with doing the job. So I either had to put my hand up or accept the way they did the job.

 

 

Coming up after the break we will delve further into Valery’s time working in the trade union.

 

[00:18:02] And when you're looking after a workforce or membership of only 10,000 people, and seeing how many people had also been affected by investing in property in the wrong way, then probably a realisation that when you're in regional areas it is very hard.

 

Then his career prospects post-trade union.

 

[00:21:59] I became pretty unemployable. Where, for working as a blue collar worker, I would have been a union troublemaker. So they would have been people who wouldn't have liked the idea that I had played an advocacy role looking after workers previously so they probably didn't want me in the workplace.

 

Valery expands on the first property he purchased.

 

[00:23:33] So there was originally me and my partner at the time, we went and saw the local financial planner with a viewpoint of buying something in Brisbane. Bigger market, we thought that that was the right option.

 

And that’s next. I’m Tyrone Shum and you’re listening to Property Investory.

 

 

 

Valery discusses how long the process of moving into full-time trade union work took him.

 

Jim Valery:   

[00:15:48] So that was probably over over a period of time... a couple of years, probably three or four years in working my way up locally, and moving into the full time role in about 2005, which was certainly a significant change. It would be fair to say that at the time I hadn't embraced IT, technology, as well as some other people and younger people had—it was certainly something that I had to really adapt to a new way, or a new life.

 

 

Jim Valery: 

[00:17:02] I guess for the trade union I was in, the principal of the Union, that the mining industry again was that the officials got paid the same as the people they were representing. The wage of the officials was always based off what the coal mining wage was. And you didn't have the ability to run for a position unless you also worked in the industry. So it wasn't a matter of people from outside the industry coming in and doing the role. It was people who have been in the industry and knew the industry, they were the only ones who could run for the position. And to make sure that the right people were able to run and were happy to run. They had to maintain, to make sure, the wage was also the same as what they could be earning whilst working in the mines. So there was no real change from the wage point of view, but there was probably a bigger looking in.

 

[00:18:02] And when you're looking after a workforce or membership of only 10,000 people, and seeing how many people have also been affected by investing in property in the wrong way, then probably a realisation that when you're in regional areas it is very hard. It's very easy for people to be going and making unrealistic offers or comments and that but you don't do the research, I guess you don't do what you need to do. There's not as much availability at your fingertips with that maybe into a different era, I guess, with the podcasts and much more robust and established Internet where everything can be at your fingertips, and to not learn is your own fault. That's certainly changing but I guess when you're not exposed, and you're not surrounded by that, like-minded people.

 

[00:19:05] And as you said earlier, that mindset that you need to be doing those areas, it's very easy to rely upon the views of other people, when you're not exposed to the support systems you can get with Inside Property Groups and properly network. So there's a realisation and seeing that it wasn't isolated to myself. There were a large number of people who had been buying the wrong way. And we're severely impacted and greatly up to get affected, you know, whenever there was a change in their workplace, because they bought the wrong way.

 

He explains what he moved on to next after his time in trade unions. He has always been passionate about helping those in regional areas access the same services as those in the cities and this is what he set out to achieve.

 

Jim Valery: 

[00:19:53] I guess it was seeing a realisation just myself. It'd been to other people. Having immersed myself in Brisbane, I moved into looking at more of an advisory service or a one-stop shop where I could continue helping people on the regions by giving them access to the right consultants, lawyers, accountants, whatnot, based in Brisbane and being able to analyse and look at things in a bit more detail in, in purchases by leveraging to talk to the right agents, rather than just listening to speakers and just provide them a platform of information where they could go as a one-stop shop.

 

[00:20:45] So it wasn't daunting, where they didn't know where they had to look, or they couldn't work out where they should look, it was providing them an opportunity to have a large amount of resources and consultants into one spot to enable him to do some sanity checks on any investments they were wanting to do. And probably was during that time that it was a realisation that people still like property and enjoy property and wanted to be in property but just a generalised buy and hold option, something they were wanting a bit different, looking at something a bit different to that and looking at other ways that they could be involved in property, rather than just buying and holding there's probably a level of impatience, whether it be or, or catching up last time and going okay, well how can we do something that has got a bit more proactive nature to it.

 

 

We discuss when he made the jump to property development.

 

Jim Valery:   

[00:21:49] It was finishing my time at the trade union. I became pretty unemployable. Where, for working as a blue collar worker, I would have been a union troublemaker. So they would have been people who wouldn't have liked the idea that I had played an advocacy role looking after workers previously so they probably didn't want me in the workplace.

 

[00:22:17] And the fact that as a secretary of the Union, I was in charge of the operation. The business world didn't see that to be a business acronym, where that was only a trade union. So there was a realisation of having to create something for myself, and it was moving into the development space. And I've been involved in that since about 2014. A realisation that through the choices that I had made, I wouldn't go back on any of those choices now. But truly the choices that I had made, it led me to the path that I have now where there wasn't the ability to go back to a safety net, and working and getting a wage, it was going okay, well I need to embrace the entrepreneurial outlook and create the way for myself or create the income for myself.

 

 

Jim Valery: 

[00:23:33] So there was originally me and my partner at the time, we went and saw the local financial planner with a viewpoint of buying something in Brisbane. Bigger market, we thought that that was the right option. They talked to us about looking at other options, one of which was a house in the Mackay area, in Decatur Beach.

 

[00:24:03] And the second one was a house and land package on Bribie Island. So they were the first two and it's fair to say that I still owed more on what the properties were paid for some six or seven years after I purchased them I still owed more than the property was worth. So in looking at it now there's a realisation that it was a spreaker there was a lot of incentives being paid to various people to get people to put their name on the line. But as a 23-year-old who was on good money in the mines, it wasn't as much of a... I had other things I was enjoying doing. I wasn't going to be doing all this research. Okay, yeah, cool, I'm going to take the advice of that expert, that's what we'll do. And I can continue to do what I was enjoying doing, being playing football and enjoying life. So there wasn't the research that needed to go into it.

 

[00:25:05] I think at the time, they were talking about Bribie Island, was one of the last states available in Bribie Island, which was over 10 years ago, and I do know, it's still opening up new estates in Bribie Island now. So the belief that it was the last lot of land, house and land available that areas without doing your research was certainly an attractive idea. The fact they're still releasing lots here now, basically realise it. Now, that's something we should have looked at a lot more deeper.

 

 It's a scarcity mindset that they'll try to sell to you. And unfortunately, without the knowledge and due diligence, as you explained, that was probably a challenge that we've discovered. Do you still have those properties? Or did you end up selling those?

 

Jim Valery: 

[00:25:52] No, I'd sold those properties and moved on to look at different things through various things to do with the timeline and your life that aren't in the portfolio now, no.

 

Okay. And those particular properties, were they initially for investment or for you to live in?

 

Jim Valery:   

[00:26:10] No, those were certainly both investment properties, yes.

 

Valery shares how many properties they have purchased for development mainly for clients, and how many properties he has in his property portfolio.

 

Jim Valery:   

[00:27:00] The last six years, we've probably done in excess of 12 or 13 properties, probably in excess of $30 million worth of transactions, either buying or selling property. So a little bit going on. 

 

Then he expanded on the types of developments he has done.

 

Jim Valery:   

[00:27:19] I have done apartment development previously, also townhouses previously. I've done a new build, a hybrid, new build, and land subdivisions. But generally, I guess through the path of realisation land subdivision to the areas that I do want to play in, as you hang your skills further within the development space. That's certainly the area that we are focused on now and that’s our primary. You could never say that you wouldn't explore something else because you don't know what is around the corner. There could be something coming up, it's just too good to refuse but fit certainly on the land and the house and land options. Providing the land that the builders can then package it up and utilise various selling methods to make sure that we can sell out the stock and look after the investors who do come on board.

 

Valery sheds light on his main focus at the moment which is land subdivisions, and expands on if he partners with the builders on his projects.

 

Jim Valery: 

[00:28:30] We'll utilise a number of builders to provide people opportunities. The build is certainly something that should be up to the buyer as to who they want to build through. Sometimes there will be people who will be buying and queuing investment channels and they will already have something packaged up, but it's always in a two-part contract where they settle on the land and then they have a contract with the builder. Number one, that provides them a better stamp duty opportunity because you're paying stamp duty on the land only. But it also provides you the ability to utilise an alternative builder if they wish to or to utilise a builder where there has been a design packaged up as well.

 

For further clarity, he explains if buyers can build through his company as well as purchase the land.

 

Jim Valery: 

[00:29:28] We do work on having relationships to give people choice. And we can generally advocate on behalf of a seller to try and get the right price. But I mean, generally there's packages done up that one block might have five or six different builders who've got a design on there and the buyer might choose which one works best for them, or they might choose to engage the builder themselves. It depends on how much time that person wants to put into it, whether they want to be utilising something that's already been designed or whether they want to design their own place. 

 

 

He takes us back to a moment in time when he had one of his worst investments.

Jim Valery: 

[00:30:32] Looking at one that we did in Stafford, which was a few years ago now. And it was on a busy road. We had done developments on a busy road previously. And the realisation and going 'okay, well, our goal was to have the lowest house and land or land availability in a suburb’, so we knew we were at the bottom of the suburb, and we were going to have the cheapest available land in the suburb which was reasonably close to the city. And the cheapest houses available, I believe that the generalised houses in that area were selling at about $540,000, $550,000. We were working on the idea that there were $520,000. So we were going to meet the bottom of the market.

 

[00:31:24] It was at the time that the Royal Commission into banking happened and just, the availability of credit just dried up remarkably. And there was a significant learning for us that once there is that credit shortage, those people who can still get credit move up, and they are looking for the A class properties or the B class properties, or the C class properties. But there's no one left looking at a D class property. So they became properties that we certainly pushed and marketed considerably. And essentially, they were significantly lower than we had hoped for. And based on what the evidence was, that they would have achieved.

 

[00:32:12] And so as a company we had a learning not to be doing things on busy roads here, regardless of discounting, because in times money is hard. People can push their way up to the best lots rather than just being so reliant upon set price, everyone's pricing has to come down. And there's no one left at the bottom. See, we had a project that didn't perform, and it performed negatively. But that's something that we absorbed as a company to make sure that none of the investors had to have any absorption of that nature. They still had their interest return if they were on an interest return basis. And that's something we have to wear.

 

[00:33:02] So as a business... guess we won't do those areas anymore. And it was certainly a learning for us. And it's one that we paid for. But number one is you got to make sure that the people that you work with, significantly, investors, there's a rule that investment is about the return of capital, and then a return on capital. So we want to make sure that there's always a return of capital. And we hope to make sure that the return on capital is positive.

 

Valery explores why he went down the path of discounting those properties initially, and ponders if he could have done anything more.

 

Jim Valery: 

[00:33:53] This was just a smaller development. So it was only two house renovations that are back lot. So we combined both backyards and created one lot of land. And it was two renovated homes. So there was no real ability to do much more. Yes, there could have been a holding of the stock and we certainly did explore that, but the structure that was set up, and given that there was a few different investors, that isn't what they signed on for.

 

[00:34:24] So it was something that we had to go 'Okay, well, we'll sell them at a loss rather than having someone sign up for something that they didn't want to do originally.’ So there were options that we could have looked at holding, we certainly did look at conversions into multiple boarding houses or key person accommodation. But at the end of the day, there was fatigue from people in saying 'Okay, it's a big game. This is longer than we want.’ So it was a matter of going 'Okay, we have to execute the finalisation of the project for them.’

 

To get us back on a positive track, he shares his ‘aha’ moment.

 

Jim Valery: 

[00:35:18] The 'aha' moment was through doing the education. It's important to continually improve yourself no matter where you are, what you're doing personal development. You know, we are our best

Tyrone Shum:

Valery demonstrates his honourability through not only his work, but also his relationships with his family members. It is a combination of these things that keep him motivated.

Jim Valery:  

[00:00:01] The ‘aha’ moment for me is that I've got a mother who hasn't been well, and she's doing chemotherapy at the moment, she lives in Bundaberg. But I've been able to move her down to Brisbane, and allow her to reside with us, me and my son. And I've got the ability and the time now to be able to provide assistance and care in running her to the hospital and assisting her to be moving through that phase purely because of the team. 

[00:00:42] So I guess the ‘aha’ moment for me is the realisation that we've got the team there now that enables me to have outside areas. If something important comes up, I've got the comfort that we have got the team there to be able to continue what we need to do as a business. But if there's something that comes up in a personal nature, there's also the ability to attend to those matters as well.

[00:01:26] It's having that team, it's having the systems, the right selection process on sites, making sure that we're doing things well to keep moving forward. And having those resources to make sure that we can, because there's always a time where something comes up in our life. And if we've made the right structures around ourselves, we can deal with those things, without losing any motivation or pace or risk to anyone.

Also on another positive track, he shares his other ‘aha’ moment.

 

Jim Valery: 

[00:35:18] The 'aha' moment was through doing the education. It's important to continually improve yourself no matter where you are, what you're doing personal development. You know, we are our best

Tyrone Shum:  

Valery explains how he became interested in units, townhouses and developments, and shares whether he plays a part in any of the interior design.

[00:02:12] Whether it comes from the time that we're given Lego blocks as little kids, and we always seem to like to build something, it seems to be more fun. You can do a land subdivision, and you can look back, and it's not as though you sit there and feel as though you've created anything. It's dirt on the ground and grass on the ground. So that was there before you got there. So all you're doing is shifting the boundaries around it, there's no real 'Look at that'. I can come back in three years' time, 'Look, we constructed that'. 

[00:02:44] So I think inside most people, especially boys and men, there's always that desire to be building something and going, 'Okay, yep, I love the colour I picked there,’ or ‘I loved something I picked there', I don't have those aspects. And I avoid renovation because I've got no ability to look at colours, but I've got the team members to do that. But the realisation in looking back and going that you've built something and you've created something is certainly at some point, it's always of interest to us. I guess it's a realisation for me now that to do those style developments, I am very reliant upon the builder as well. I can do everything right myself, and if the builder doesn't play their role, or if they make mistakes, or they don't build things to the right quality, that has the ability to affect the overall project. And if it's my project it's my name. It's our company name. So I guess it's more that's the viewpoint of me being more into land subdivisions, it's something we can control. It's totally within our control, it's in our skill set. We're not reliant upon others to provide such a significant component of the deal. 

[00:04:06] And I have had builders go into administration and things like that, and it becomes quite hard. So just from our point of view, it's about the realisation that we're comfortable with our skill set and the skills of our team. We don't want to be introducing further risk into a deal, especially a deal where they will be less involved. Yes, we will do some construction elements and they'll generally be along the lines. If we're looking into hold stock, we'll certainly do a build on that stock for us to hold and to create passive income. But we're pretty restrict those areas to ones that we're looking at holding rather than what we're looking at doing with utilising a syndication or investors.

Tyrone Shum:  

New Style Developments has evolved over time, from units to townhouses to subdivisions. We discuss with Valery how subdivisions offer a lot more control and how the marketing process is different than that of units and townhouses, in that with land there isn’t something already physically built. 

[00:05:34] Land's not very sexy, that's why you do something with getting someone with the right design on there, because then you can leverage off the beautiful looking house. And you're selling land, but you're talking more about the house, purely because land, it doesn't excite people. Yes, people want to live in a certain area, they want that access, but to physically put a picture up with a block of grass isn't that exciting. Where if it's a beautifully designed home, it certainly creates more of an emotional attachment. So you're very much right in that. There's a specific way. I think it's important for a lot of people who are trying to sell land, and a house and land, think all they need to do is put it on realestate.com.au and it’ll sell. And that's certainly not the case. It is a specific skill set. And a lot of local agents don't have that skill set. You've got to make sure that you do pick the right people, I believe, and you've got the right back up internally to be driving those people, which is what we have through our team.

He shares whether he prefers any specific type of land subdivision, and elaborates on how he goes about finding them.

[00:07:03] We've certainly moved more away, and everyone starts doing the one to twos and two to three lots of divisions. We've moved away from that now, we're certainly looking for preferably five or six lots, or, up to 30 or 40. We know we have got two seven lot subdivisions, an 11 lot subdivision, and a 33 lot subdivision. So they're certainly the areas you want to play in. 

[00:07:32] And especially in Queensland, if people are doing subdivisions, there is a need to understand that the way that you do five lots or less is different the way that you do seven to 10 lots. And that's different the way that you do 11 to 30 lots. So if you're doing five or less lots, you don't need to disclose your plans, you don't need to have a development approval, you can be selling from the word 'go'. So if the development takes you nine months, that gives you nine months to sell. Let's say it's a four lot subdivision, you've got nine months to sell four blocks of land. Where if you're doing a seven lot subdivision, you've got to get the DA approval first and have the disclosure documents before you can start selling. And that project, whilst it might take you 12 months, you've only got six months to sell them because you've lost that first part during the development approval stage. So you've got more lots to sell in a shorter time frame. So it is important to have those sales systems in place once you're starting to jump into disclosure area.

With his lots ranging in size from as small as three or four to as large as 30, Valery has a lot on his plate. He shares if all of these are located in the Brisbane area.

[00:09:15] We try and focus on Brisbane City Council as a whole. Obviously people will talk about Brisbane being Brisbane, the wider group which might include other councils like Logan or Moreton Bay, but we try and work within Brisbane. We're very lucky in Queensland that Brisbane is such a large council area. So it's got the one set of planning legislation. I'm very comfortable with that planning legislation and I believe that I know it quite well. 

[00:09:47] Other councils... you've got to learn how to drive their online systems. You've got to know the subtleties or differences in their planning legislation. I prefer to focus on Brisbane. It's a very large council, there's plenty of opportunities in Brisbane. So that's certainly the area that we focus on because of that. 

[00:10:08] I feel sorry for people in Melbourne and Sydney, where you've got such small council areas, and you can even walk for a kilometre, and the rules change on what you've got to do in a development. So, it's been a lot harder there, to where we are blessed in having, you know, such a... Brisbane, when it might not be the biggest city, but it's the biggest council in the southern hemisphere, I think, or at least our region. And so, that does give us the ability to learn the legislation, know it well. We've got a luxury to go from, so that that provides a foundation for our prospecting. 

[00:10:57] People forget that property is a people game. So I do my networking and relationship building with agents. So strangely, I don't go and door knock, I don't go and send letters out, like most people or most developers do, but I work very strongly with my relationships. And if you can maintain that, that probably comes from the skill set you learned. And being in the bush, in the regional areas, you've got to learn, and you've got to be comfortable talking with people and interacting with people. So having that comfortability with learning those skills through my previous time makes up my strong point in dealing with people, talking to agents, having those relationships, and doing the right thing by people. And that that leads us—along with the time... again—but it certainly leads us to be lucky, where we get a lot of opportunities. I guess I say lucky, but the more you work, the luckier you get. So it's easy to say it's luck, where really, it's probably an acknowledgment that the team is working very well. But we do get a lot of opportunities presented to us, it certainly keeps us going. 

Valery’s good relationships with real estate agents has been key in finding and purchasing development sites. He delves into how he goes about this process.

[00:12:36] I'll certainly talk to them quite detailed about specifics. And someone's come through with legislation and that, so we'll look at a suburb, we'll download all the right size properties, we'll do an assessment quickly, get rid of runs that haven't got the right financial or they've got flooding, or they've got other restraints, which means they can't do it. A lot of people then will go and door knock themselves, will go and send letters out. So everyone knows regardless of how people do it, once they know how to deal with suburb analysts to shortlist a suburb to work out which ones are the right properties to target. A lot of people will then try and target themselves, we've only got so much time. 

[00:13:32] So my belief is that if I can have strong relationships with agents, I'm happy to give them my lists, and I'm happy to pay them as a buyer's agent. I'm happy for them to be a listing agent, whoever they want to work with. They deal with interaction with homeowners all the time, the homeowners straight away have arguably, a higher level of... a real estate agent is probably slightly higher than a developer in the people's views on ethics. 

[00:14:04] You know, whilst I would say that there are developers and I'd like to think we are one that give strong ethics. But everyone thinks that there's all these greedy developers more this or that. So a homeowner who gets approached by a real estate agent is probably happy to, you know, they're the industry expert, from what people think. So we have that conversation starting with an agent rather than ourselves. Because, yes, we do want them to get brought into the meeting and have the conversation more personalised, but we've only got so much time today. So if I could be working with agents who do that all day, every day, they prospect, I'm happy for them to prospect for me.

Coming up after the break, we hear more about the benefits of good relationships, this time with buyers...

[00:16:45] Once an agent is comfortable that you're treating them as a serious person as well, and you start doing the little things right with them, you do form a bond. People like people. 

Valery’s views on the importance of continuing education...

[00:28:38] We don't know everything, we always can learn and we should always want to learn. And if we have that mindset, where we continually want to learn, we'll always be doing better and improving ourselves rather than resting on our laurels thinking we know everything because the world changes, property market changes, the ways to do things changes.

His struggles with finding employment, and how it led him to where he is now...

[00:33:07] It was a realisation when I put my name down for a job, as a fill-in job at the airport, car parking. I was told that there was a high level of applications and sorry, I didn't make the cut this time. That was a realisation that if I couldn't even get a job parking cars, given what I'd done previously, that it was time that I certainly had to make sure that I created my own path. 

And that’s next. I’m Tyrone Shum and you’re listening to Property Investory.

As I, and I’m sure some of our listeners, have experienced, finding development sites can be a frustrating process. Valery gives insight into how he creates relationships with the real estate agents he works with in order to secure these developments.

[00:15:44] I think it comes down to that that can be a time thing sometimes, I'm sure. There's been people who at some stage may well have had a young lady who caught their eye never do a lot of work before that young lady had any intention of wanting to get to know them. So, again, we're people. You've got to put in the time, you've got to put in the effort. So you've got to show the agent yes, initially, you might spend a lot of time going to have catch-ups with them. If they give me something I'm going to put an offer in regardless, my offer might be way too low. But I want them to know that I'm prepared to pull the trigger. I'm prepared to put an offer in, and I need to give them the respect that they've taken the time to contact me. 

[00:16:32] So I need to take the time to actually review it, and give them an offer or offer feedback back on what we think the price is. A lot of times, my pricing can be vastly different than to where they want, but at least I'm showing them the respect. And once an agent is comfortable that you're treating them as a serious person as well, and you start doing the little things right with them, you do form a bond. People like people. So if someone feels as though you're doing the right thing to them all the time, it forms... I wouldn't call it a friendship, but it forms an ability to interact on a much deeper level or a much more friendly level.

So how does Valery do his due diligence and make commitments to his sites?

[00:17:48] It comes down to the site, obviously. The more constraints the site shows when you're doing your research. We've got some that you'd happily go unconditional on right away. Because you know what the legislation says. You build up your network, I can talk to my town planner straight away, I can talk to my civil engineer straight away. As you get into a bigger site, it could take a little bit more time, and I think people understand on bigger sites, it'll take a little bit more time. But realistically, as a developer, we're going to want to say that this is such a complicated site, we need so much more time because we want things to be in our favour in having the right buyer, but that not needing the buyer, we don't have to buy that we're still under due diligence. So we want to do the safety way. 

[00:18:52] If push comes to shove, there's very few sites that you could be unconditional on within 30 or 60 days. Unless it's a major, massive, big, big site. But if we look at our 32 lot in Taigum, we're probably talking about 60 days due diligence. You know, we have done some due diligence beforehand. But we're also talking to the right consultant in that time to make sure that we're very comfortable.

With large developments differing so greatly to small ones, Valery explains how he purchases these large sites outright.

[00:19:41] Taigum is one that we've done. It's two sites by the same owner. One site we are settling on, a second site that we have an option on for 12 months to allow us to get the DA. So that's a negotiation one that we were able to have. Options can scare a lot of people who aren't well-versed in property. So being able to explain that and then talk them through it... I guess it comes down to how well you could explain it. 

[00:20:13] But there's always some people who want the certainty because they've made a decision they want to sell, they made a decision that they're ready to move on to the next phase of their life. And they want to start picking where they're gonna live. But they can't realise that dream until such time as you're unconditional. So yes, there's times I think options can work and do work and ideally base, you know, that would be something I'd love to do for every deal. But it's not always gonna work. And if we come back to property being a people game, is that we need to actually think about things from the seller's point of view sometimes and not always try and force them to do what we want to do, if we're happy to work with them. And we'll have a better relationship with the seller as well. So ideally, we'd like it, but we can't always get it.

He shares how he gets the funding to approach these types of deals. Perhaps he has a chest of cash lying around?

[00:21:33] We generally utilise, provide opportunities for investors, as well as financiers' money as well as your own money. So it's a combination there, we do have a good list of investors who always like to know what opportunities we have coming up. I see it as an opportunity. A lot of people will sit there and go, 'Okay, I feel bad about going and asking someone to put money into something', but it's an opportunity. 

[00:22:12] So that opportunity, they can take it or not take it. So we do have a list of we've yet to at least, once we have something coming up. You also need to continually expand that list as people change their mindsets and change where they're going, or invest in something else. So someone who is wanting to invest in property isn't just gonna talk to me, because my deal may not suit them. Or my deal may not be ready for them at the right time they're ready. They don't want their money sitting there waiting for me. So if I haven't got an opportunity for them, at that time, they'll be looking at who else has got an opportunity. 

[00:22:54] So we have to work on the idea that we're always going to be continually reviewing, and looking and providing the opportunity for other people. Because whilst we have got some people there, we can never be sure, when we start negotiating, that they're the right people. In saying that, I'm always confident that we're going to be able to settle on a deal. If I'm not confident, I'm not going to print out the contracts. So there are certainly opportunities out there. And we like to think that we're providing a reasonable opportunity, and our general number is around 15% per annum, or we've also introduced a jury cave, and we're forced to rethink and change the way we look at things. And so we've introduced the cash flow option where someone can take their interest paid monthly to compensate them and to increase your own cash flow. 

[00:24:02] So that's generally about 1% per month, and they can continue to get their cash flow increased by the interest payments every month. So it comes down to what suits the investor as well. So it can't always be about what we want, it's about going, 'Okay, how can we work together?'. It's a long term game. And if we can be working together in the long term, we want to make sure that we do consider what their needs are, as well.

Motivations and mindset are key when it comes to business. Valery shares what drives him and keeps him going.

[00:25:04] My 'why' is in it having something set up. It's a generational thing. I've got my son who works with me as well. At some point, I'd love to be sitting there and sipping beers at the pool and watching him do the work. Not really, because I think I'd still be bored, I still want to do things. It's about making sure that you can set things up with the profession that not only your son, but also the future generations can benefit from them. And it's not about getting ahead yet. So, you know, young fella works in there. And he'll get some of the rewards as well. But it's about setting up a foundation. And I'd like to think by the time he's 30, he'll have four or five properties in his name, and a new car, and there'll be very little debt on those properties. So that will be a good foundation for him. And that's the driver for me.

We explore his mentors, and give details on what the key pivotal points have been along his journey.

[00:26:13] I do education, I've been doing education through Nhan Nguyen at Advanced Property Strategies. Which has been great. And there's also like minded being Matt Jones, who runs the Vision Property Networking Group. And also does joint venture boot camps where it's about getting in there and delving into. Jill, who we both know, works with both groups as well. So it's about understanding that mindset as well, but I guess I initially went into doing the course with Nhan. 

[00:26:55] And his comment is always that it's 70% psychological in development, and maybe 20% skill or 10% time or 10% skill, 20% time. But I always had a disbelief, and it might have been my viewpoint of what psychological is, was different to what Nhan is putting out there. I was picturing getting up in the morning and saying 10 times, 'I'm gonna be successful', or doing those things here, which don't really resonate with me at all. So there's certain areas that I probably don't resonate with, I guess, in a realisation of psychology, the study of the Senate it's about being able to push you, it's about being able to have that 'why' reason to keep going, it's being able to take the step. 

[00:27:47] There's a lot of people out there who were highly educated, but don't have the mindset to be able to take that step and expose themselves to something because they won't trust themselves. So it's certainly in that sense psychological, which is really, really coming to me quite a bit now. I probably understand a lot more than I did at the time. But I'd say they would be the primaries from a mentoring or education, and I'm in Young's diamond group, which is the high level group for himself as well. So that's something that I'm continually doing. 

[00:28:25] And whilst I have done a significant depth of projects, it's a time that we think we know everything, that we start going backwards. We don't know everything, we always can learn and we should always want to learn. And if we have that mindset, where we continually want to learn, we'll always be doing better and improving ourselves rather than resting on our laurels thinking we know everything because the world changes, property market changes, the ways to do things changes. So we do need to continue to evolve. So it's about making sure that we can continually, having that personal development.

Valery shares how continuing education is a key point in this industry, as it is in any other, and how he adapts to changing technology.

[00:29:25] We realise that things we learn change and there's a new app, or there's a new way to do things or there's a new legislation that comes in place. So we've got to adapt and change that as well. And we don't have to do things exactly the same as someone else. But, you know, we can embrace that mindset and the idea that you can do it your way. Take the learnings from other people but adapt it to your way because we've all got our own personality traits. Mine being that I prefer interacting with agents. Other people are really successful in doing the letter approach. So, adapt it to your personality.

Valery explains what he would have done differently 10 years ago if he knew then what he knows now.

[00:30:24] 10 years ago would have been the importance of continual education, but also the importance of getting the right advice to allow holding stock at an earlier time frame. So, I would have liked to have been holding stock a while ago as well, and for whatever reasons it was something that I didn't see as an important factor. It's certainly something I would like to have been able to go back and tell myself 10 years ago that there's a need to be holding stock as well. They could've been the two foundations, continuing education and continuing to improve yourself and make sure that the property's worth more than the cash sometimes.

[00:31:31] I'm excited about division market as a whole, I really do believe that we've got a good four years, at least, coming up. There's been significant cash coming in from COVID, we had an underlying demand in the market prior to COVID. There's been changing in the funding bits of legislation, which means that there's about to be an abundance of private money coming in as well. So I think there's a pent up demand there. So for me that’s the market. We've got some great projects on the books, so that's exciting, to be having good projects may begin to what I believe will be a great market, and you continue to move forward that way and actually hold some as well.

[00:32:41] I think the hard work leads into the luck. So a hard worker will find themselves in many lucky positions. So as I said earlier, for me, it was the fact that I didn't have that fallback option. I'd come out of being a Queensland Secretary trade union, which may be pretty much unemployable from the eyes of the generalised public. It was a realisation when I put my name down for a job as a fill-in job at the airport, car parking. I was told that there was a high level of applications and sorry, I didn't make the cut this time. That was a realisation that if I couldn't even get a job parking cars, given what I'd done previously, that it was time that I certainly had to make sure that I created my own path. 

[00:33:33] So, there was an enormous amount of hard work in there, which certainly made an ability to get luckier now, but that luck is coming from three years of hard work. The skill set wasn't there, no one's born knowing how to do what we're doing now. It's not something that we learned, subdivision, or we learn these skills in school, we don't learn these skills from our parents. The financial wisdom doesn't come from growing up. There's probably some household that does, I mean, there's certainly some if I look at stereotypical... I guess it's certainly Chinese households are far better at providing that financial blueprint into their children more so than a lot of Europeans. It's not so much sought after. And it's not purely restricted to stereotypical Chinese. Jewish are renowned for being good at finance as well. 

[00:34:36] So there's certainly some people who do get that blueprint but generally speaking, most people don't. So we don't have those skills. Those learnings, that knowledge. They're things that we have to acquire not only are too hard working, yes, there are times that we do acquire those skills and we benefit from them. I certainly think that we're benefiting now from hard work and the skills that we've been able to acquire. 

[00:35:06] And yes, you can sit there and say, I was talking to a few consultants before a property meetup and they were saying that we seem to have a lot of projects on the books where there's a lot of people struggling. So there'll be some people who sit there and go, 'That's probably down to luck'. But again, I'd like to think that luck's come from hard work in establishing the right network. So it's not lucky that a certain person will tell me about a site because I've done the time to build up the relationship. So you know, I think luck is very, very, very unlikely to have an impact into things that we do if we do them well.

Thank you to Jim Valery, our guest on this episode of Property Investory.