In this episode, this property developer and buyer's agent extraordinaire takes us on an edge-of-your-seat trip from his explosive days—literally!—in the Air Force to the story of how he was hit with a gut-wrenching $60,000 cost in one of his property projects. Plus, he reveals exactly why he isn't easily fazed by disheartening and even nail-biting, budget-blowing situations in the property game!

Timestamps:
00:01:04 | A Man With Multiple Hats
00:07:14 | The Lad from Tasmania
00:11:03 | From Chemical Engineering to the Air Force
00:15:32 | From Explosives to Property Projects
00:18:22 | Analytic Skills Abound
00:21:54 | Never Forget the First One
00:26:27 | The One That Stood Out
00:31:49 | In the Eye of the Storm

Resources and Links:

[00:20:00] We sold that and we took a bit of a loss. I think I lost about $10,000 or so on that one. But it wasn't long before I jumped into another duplex project with some friends. Again, it was down in Adelaide; we bought a deceased estate. And we just kept it nice and simple. 

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 Brickport Founder Richard Williams. This property developer and buyer's agent extraordinaire takes us on an edge-of-your-seat trip from his explosive days—literally—in the Air Force to the story of how he was hit with a gut-wrenching $60,000 cost in one of his property projects.

Tyrone Shum:   

With a commendable background in property development and being a dedicated buyer's agent himself in Australia's property space, Williams spills the details of what he does and why he's passionate about it.

[00:00:29] I'm a small property developer. That's property developments always been my passion. I was never particularly taken by other strategies or otherwise, though I have used and do use some of them incorporated into my small developments. 

[00:00:45] But just as a quick background, you know, I'm just your, your average kind of guy that grew up and went to school, went to university studied engineering, got a job, you know, the 38-40 hours-a-week-type [of] role, and bought their first property and then enjoy this property stuff and really enjoyed it. 

[00:01:03] So I continued on as I went, and I've got myself to the stage now where I'm working as a buyer's agent or project manager, still doing my own projects, which is fantastic. I'm incorporating specialist disability accommodation into my own personal projects, which has a fantastic yield opportunity. And I'm holding all those; my focus is on Newcastle and surrounds. 

[00:01:25] And I'm helping other investors with my services as a buyer's agent and project manager. Just doing small developments. It might be their first development where you know, they just want to spend their weekends watching the kids play soccer and watching a bit of Netflix; have a nighttime. 

[00:01:41] So you know, I'm helping those mums and dads out, or you know, those people that just don't know how to do things, and they just need someone to hold their hand on the first or second small property purchase and projects. And I really am enjoying that space as well, Tyrone. It's great helping others get into small property projects and property developments where they can add value and equity right up front.

Tyrone Shum:   

Switching between wearing his small property developer hat and his buyer's agent hat, Williams definitely takes the bull by the horns with his day-to-day tasks, no matter how challenging they may be.

[00:02:15] For on the buyer's agent front, it's checking what's out, checking out what's listed at the moment, talking to real estate agents, [and] getting an idea for the properties that are out there. 

[00:02:30] And, you know, they say you look at 100 properties for every one that you like, or put an offer in on. And it's probably true, but at times, it's really hard to forget where I've come from and how much I've learned. Because, you know, a lot of those 100 properties, you know, I'm skimming through the portals and real estate.com, and a lot of them you don't even bother looking at. 

[00:02:51] It's like, I've got the criteria. I know what I'm looking at. I'm looking for stuff where I can add value, typically in that small development space. So you know, I'm looking for big backyards, nice access ways down the side of the house, the house is kind of the front of the block a little bit to the side. 

[00:03:09] And I'm getting out there looking at those properties, predominantly around Newcastle, and surrounds. And I'm talking to the agents of those properties. I'm talking to other small developers, other people into property, getting out in networking, having a chat with some mortgage brokers, financial planners, and other people that are in the industry and sort of business owners. 

[00:03:36] Yeah, and then I've been really loving putting together little short clips on LinkedIn and Facebook lately about when I am at a property, you know, what do I like about it? Where do I see the opportunities with those types of properties?, and putting them up on social media so that people are able to see the types of properties I'm looking at, you know. If they want to learn a few things, fantastic, have a little watch of those. 

[00:03:59] If they're like, 'Hey, I like what you're doing, but I'm not quite sure how you're doing it. Can you help me with something?' That's fantastic. I'm happy to have a chat and maybe work with people like that. So I guess that's the buyer's agent side of things. 

[00:04:12] And then from the small developer-property developer hat, those days change depending on what I need at the time. 

[00:04:23] Like, if I'm getting a DA really large, you know, I'm talking to the consultants, I'm giving them briefs. You know, talking to the designer, the engineer, the town planner, making sure everyone knows knows what our plan is, you know, chatting with a builder to see what they think the cost would be to build that at the moment chatting with the the real estate agents to check what our sale prices are likely to be. So doing that sort of due diligence and working through that progress. 

[00:04:53] And then you know, once we've launched with council on a particular project, you know, that project goes quiet for a few months. Council sort of has to get into their inbox. And then once it's in their inbox, you know, they've got to send it out and let the neighbours know for two or three weeks, so nothing's happening in that time. 

[00:05:10] At the moment, though, you know, I've got three villas, they're all specialist disability accommodation up here in Newcastle. It's a fantastic little project; the gross yield on completion of that one will be over $200,000 a year just on three villas. Hence, why I'm liking the the specialist disability accommodation projects busy with finance at the moment. 

[00:05:35] So you know, it's putting together finance documents; it's looking for other properties in my portfolio that may need to restructure and a refinance at the time. It's really working through requests for information from the lender, you know, that includes the lender doing due diligence on the builder. So they're asking me all sorts of questions about the builder, and I forward them on to the builder, and we have three-way conversations with the lender, the builder, [and] myself. 

[00:06:05] It's a process, Tyrone, and you'd think it'd be nice and simple. And in a way, it is simple, but it's not easy. There's always something else that needs doing. 

[00:06:14] And I guess that's one of the benefits of property and property development. It's kind of like, if at times, if you knew how hard it was going to be at times, and how things may not go your way. Maybe you wouldn't do it. But there's great opportunity out there.

Tyrone Shum:   

Of course, before Williams became the successful property developer and investor he is today, he was once a young lad who enthusiastically walked the streets of Tasmania, spending as much time as he could outdoors.

[00:06:51] I grew up in Tasmania, Tyrone. So I spent my first 18 years down on the Apple Isle. 

[00:06:57] Yes. It's a nice area. 

[00:07:00] I love going back there for holidays. I don't know that I'd ever go back there to live— though, never say never. 

[00:07:08] But I certainly love going back. It's a beautiful part of the world, beautiful countryside, and I really like it. I've still got family there who I enjoy going back to catch up with.

[00:07:37] Yeah, I grew up pretty middle class, Tyrone, so you know, there wasn't much extra money to go around. There was certainly no overseas holidays. But we were very lucky we had a caravan. So for, you know, at least three weeks every summer, we'd take the caravan and we'd go down to a beautiful spot in the world that's now world famous—Freycinet National Park [in] Coles Bay and just near Wineglass Bay. 

[00:08:01] And you know, we spend the summer down at Freycinet in the caravan and we had some beautiful family holidays down there. We spent a lot of time with family growing up. [On] weekends, we'd be visiting either my dad's family or my mom's family. We had a lot of outdoor time, whenever it snowed. 

[00:08:22] Snow was never around for a great deal of time in Tasmania, because you know, it was snowing one day, and the next day it was windy and raining and the rain had come and washed the snow away. But if it rained, and it was a weekend, we'd jump in the car and we go up and throw some snowballs and have some snow fights, get wet and cold and then jump in the car and turn the heater on and drive back home. 

[00:08:42] So I was very lucky and blessed to have lots of outdoor time growing up. And it was a great spot to grow up. You know, it was fairly quiet in a way like you know, the biggest, biggest place I went to, you know, for a lot of the time was Launceston, which was maybe 100,000 people, and where I grew up was 20,000 people. So it [is a] totally different vibe to sort of Sydney. 

Tyrone Shum:   

Williams never thought of growing up middle class as a hindrance to his success. Frankly acknowledging the facts of his childhood, he still happily looks back to his past with fondness.

[00:09:07] I certainly didn't grow up around that many people that were hugely successful business owners or many that even had their own businesses. 

[00:09:17] You know, most of our family friends were were employees middle class, and I did get some exposure to property though, in that my dad was a plumber. And he built his first house at the age of 16 —it was called a 'spec house,' a bit of a 'specie' a 'speculative house'. And he built it at 16 as a plumber; his dad was a brickie. And he built that, and then he sold it. He did a few others along the way. 

[00:09:43] But probably one of his best projects was a light industrial warehouse, which he still owns about 40 [or] 50 years after building it in the '80s. He has stories of paying that off when the interest rates were 17% or 18%. But he also had a few bad experiences along the way, things that sort of a bit jaded. 

[00:10:03] So, you know, he never really grew the portfolio and sort of took advantage of at the time. He got kind of fed up and sick of it was, you know, [in] the early 2000s, when people from the mainland were going across to Tasmania and buying up cheap properties. And you know, the market boomed. Probably, unfortunately, a couple of those cheap properties were ones that my dad sold. 

[00:10:25] But it was great to get that exposure to property. And you know, Dad's helped me along the way with a couple of renovations. He's absolutely fantastic on the tools. So that was great. 

Tyrone Shum:   

Although his father and grandfather were mainly active in the property space as he was growing up, Williams curiously ventured into the offbeat path of chemical engineering in university—a step that soon led to his stint in the Air Force.

[00:10:37] I lived in Tassie till 18 when I finished Year 12, and then after then, it was was off to university. So I wanted to study chemical engineering. And being a smaller place, Chemical Engineering wasn't available in Tasmania. So off I went to Melbourne with my bags packed. And I studied chemical engineering.

[00:11:20] I guess it was just a quirk of what I liked and what I was good at school, Tyrone, you know. I really, really enjoyed the maths and the chemistry side of things. And I knew a couple of civil engineers and structural engineers, but I just didn't see that as being quite right for me. So I fly to study Chemical Engineering in Melbourne and I lived there for five [to] five and a half years.

[00:11:45] I loved my time in Melbourne; it's a beautiful city. And whilst I was there, I happen to take on a scholarship and join the Air Force. So you know, not quite where my parents saw me ending up necessarily. But the appeal of joining the Air Force at the time was that they were going to pay for all my, the rest of my studies. 

[00:12:10] So three years of of university studies; they were going to pay my hex debt; they were going to give me a salary to finish going to university. And they were going to give me a job for the next four years or so after I graduated. And I wasn't quite sure where I was going to go in life and where I was going to end up. 

[00:12:27] There were certainly some of the chemical industries that I didn't want to work in after graduating as a chemical engineer. I wasn't particularly attracted to the plastics and polymer industries. But I did quite like the appeal of the food and pharmaceutical industries. 

[00:12:46] But instead, yeah, I joined the Air Force and ended up with 20+ years of Air Force time. I deployed with the Air Force. I went across to the U.K. I studied a Masters of Engineering, a Masters of Science in Explosive Ordnance Engineering. So I guess you could say I'm a an 'Explosives Engineer'. 

[00:13:12] Oh, that sounds fun.

[00:13:14] I got to see things blow up. I got to go to [indiscernible], to the Outback. And I'd see bombs get dropped from planes and see explosions happen. And I even missed a flight or two due to testing positive along the way to explosives on my clothing. So that was one of the interesting but less fun parts of the job. 

[00:13:39] So I really enjoyed the Air Force, and it gave me the opportunity to meet some great people who, you know, had income similar to myself. And it gave me the opportunity to also buy my first place over in Adelaide, which was great. So I bought that. I gave it a bit of a renovation and lived in it for 10 or so years. 

[00:14:04] One of the guys from work had done a duplex project with a mate of his, and he's like, 'Hey, this went really well. You know, we bought a block a land, we knock the house down, we built two houses, and we sold them and we made some money'.  

[00:14:17] Nice. 

[00:14:19] And myself and some others thought that sounded great. We'd love to do the same thing. So having a property, it's like 'Alright, well, I can borrow a bit of money, but I probably can't borrow enough to do a project like that'.  So half a dozen of us teamed up together. And we found an old property to buy, which was deserving of being knocked down. 

[00:14:42] And we got the plans to do two duplex or two properties—a duplex. We did that through a project home builder, so that the builder owns the plans. And then this thing came along called the Global Financial Crisis. And we weren't quite sure what to do. Because borrowing the money to do the build got tricky. The banks wanted to look at it as a commercial loan for us. 

[00:15:07] And we didn't really know our stuff well enough to go, you know, if we build it, how much money are we going to make? Are we going to make money? Or are we going to spend more money than we actually get back out of it?

Tyrone Shum:   

Being an explosive expert in the Air Force didn't mean Williams failed to enjoy life and have fun along the way. In fact, it opened doors for him.

[00:16:05] I had a few holidays along the way, Tyrone, but they were, you know, annual leave type holidays. I went to Vietnam for four weeks with a mate of mine. I did a few other trips. I was certainly super lucky to have studied over in the U.K. for 12 months. 

[00:16:23] Whilst I was there, you know, I had a few weekends in Europe. A week here, a week there. I went snowboarding in Bulgaria for a week, I spent Christmas in Switzerland, and then New Year's in France and a few other places. So I had some great opportunities there. But you know, for most of that time, it was 20+ years of working with Air Force and sticking with them. So as far as the property went, it was project on the side.

[00:16:50] Yeah, that's great. 

[00:16:53] When you said you're with Air Force, did you actually hop onto the plane and fly with them on the plane? Or was it actually basically, you know, on the ground most of the time because [of you] being an explosive expert?

[00:17:03] No, as far as the job with the Air Force went, I was it was a desk-based position, Tyrone. So mostly, a safety engineer, assessing the safety of explosives and the risks of using them, the risks of keeping them, the risks of storage—very similar, you know, to what we do with property development and the sort of stuff I do now when I'm analysing deals. 

[00:17:24] It's like, you know, what's the risk of something not happening the way we expect it to? It's like, if it goes different, is that okay? Is that still all right? You know, are we going to lose our pants? Are we're going to be able to stay in this deal? So it's that same sort of risk assessment methodology that I use now when I'm looking at property.

Coming up after the break, we'll learn more about his undeniably unique venture in the AirForce and how it impacted his life in the property space…

[00:19:01] The military is good like that. They give you a broad range of experiences; they keep moving you into new jobs, and helping you build your skills.

How he overcame a harrowing blow in his finances…

[00:20:02] I think I lost about $10,000 or so on that one. But it wasn't long before I jumped into another duplex project with some friends. 

How he found himself in a comedy of errors that yielded a lesson he would never forget.

[00:33:38] There was a whole heap of things that didn't go according to plan, Tyrone, and my head just got filled up. And I'm kind of like: I'm stuck in this project; I can't get on the next one. What to do? 

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

Tyrone Shum:   

Williams surely used the analytic skills he honed in the Air Force in his own property development journey. In talking about his work in the military, Williams gives us a glimpse into how he exactly sharpened those skills.

[00:18:12] Workwise, it was all Air Force time, Tyrone, though, having said that, like the Air Force moved me to new positions and new jobs every two to three years. So whilst I did over 20 years with the Air Force, you know, there was seven [or] eight jobs, maybe more along the way. You know, I had times where I was looking after life-support equipments; working in the maintenance squadron. I had another job where we were looking at targeting and how we would employ the weapons we used, 

[00:18:42] I had other positions where I was buying those weapons. I had times when I was looking at the safety and suitability of those weapons and how long it was safe to keep them for. So there was a real breadth of positions. And I generally moved to a new job about every three years. 

[00:19:01] So the military is good like that. They give you a broad range of experiences; they keep moving you into new jobs, and helping you build your skills. They put you on courses and professional development opportunities. So it's great in that in that sort of regard. 

[00:19:18] However, for me, property was always a passion and something that I was always keen to do. And since, you know, that first project with those sort of work colleagues, I've continued to do projects, either with other people or on my own ever since.

[00:19:33] Excellent. So how long were you with the Air Force, by the way?

[00:19:37] 20 [or maybe] a bit over 25 years.

Tyrone Shum:   

After delving into his first property project with his colleagues, Williams admits it was absolutely nowhere near 'all roses and rainbows'. But, he also reveals that nothing would stop him from his passion.

[00:19:56] I kept doing projects. Like, after that little one with my work colleagues… 

[00:20:00] Look, we sold that and we took a bit of a loss. 

[00:20:02] I think I lost about $10,000 or so on that one. 

[00:20:05] But it wasn't long before I jumped into another duplex project with some friends. Again, it was down in Adelaide; we bought a deceased estate. And we just kept it nice and simple. That was just myself and the couple. And we did a 50-50 joint venture where we bought the property. We got a project home builder to build two new houses. We got the loan for a house each. We built those houses. We subdivided them. We kept the house each. Fantastic. 

[00:20:33] That was nice and simple. And it's like, right, 'Okay, this this stuff works. I can do it on my own'. And then from there, you know, I went on and did another little project where it's I bought a house over in Perth that I never saw; I bought it through a buyer's agents. And I built two in the backyard. And I've retained those properties. They've done all right for me. 

[00:20:56] The last couple of years has been fantastic for the capital and rental growth on those properties. They've just recently come off fixed rates. And the rates as for everyone have jumped fairly significantly. 

[00:21:11] But you know, the Perth rental market over the last two years has been really strong and had strong growth. So I'm not as concerned about the jumping interest repayments on those properties due to the strong rental growth and there continues to be strong rental growth on those properties. And in Perth in general that vacancies are so low. I'm not particularly fast about that debt in particular.

Tyrone Shum:   

Interestingly, before stepping into that joint venture with his colleagues, Williams acquired his first property in Adelaide.

[00:21:50] I purchased a primary place of residence—so a house that I was living in. You know, I bought a little character, two-bedroom SA Housing Trust place in Adelaide. I just need a couple of kilometres from the city. So that was my first purchase. And I purchased that for about $174,500 at the time. And I lived there for about about 10 years, kept it for 15 or 16 years, and then sold that and put the money towards my property developments.

[00:22:20] Oh, excellent. So that first property was it mainly just obviously for you to live in. But did you have any intention to do anything with it like renovate it? Or was it just, you know, basically a principal place of residence just to start off with?

[00:22:34] It was my principal place of residence. However, it always needed a slight renovation; the kitchen that was in there, when I bought it was pretty average. But having said that, that was one of the reasons why the price point was within my budget, you know, had it been fully renovated, the purchase price would have been significantly higher, and maybe I wouldn't have been able to afford to purchase that property. 

[00:22:58] So the intention was always to give it a renovation. But I didn't really understand anything about zoning, about minimum lot sizes, or anything when I purchased that first property. So the intention on that one was not to develop it.

Tyrone Shum:   

Being a humble man who recognised the impact of his father and grandfather's legacy of hard work in the property industry, Williams confesses that no one else influenced him in venturing further into property. But of course, that didn't stop him.

[00:23:44] Interestingly, I don't recall anyone that was particularly influential in pushing me towards property or even mentors at the time. Like, it was, you know, it was the time of newspapers; it was the time of sitting down Saturday mornings, reading Saturday morning's paper and going, 'You know, what are the open homes for this weekend? What's available? What can I look at?'

[00:24:08] Education on property, and what's good about property, and how to do things was kind of non-existent or I wasn't aware of it at the time. After I bought that property, you know, I started to become aware of Steve McKnight and a couple of other people in the space. 

[00:24:26] But you know, I was living in Adelaide; it wasn't exactly [the] No. 1 tour destination for property educators or anything like that. So, you know, I got along to a few sort of evening seminars and kind of learnt what I could. But it wasn't until about 2013 or so that I sort of really got into property education and found some mentors in property and other people that were doing similar things. 

[00:24:51] Like, you know, I moved to Sydney and I started going along to property education events, as well as some that you you could probably describe as, you know, 'property sales evenings' where people had a product to sell. And you know, I started finding people and, you know, I just start chatting to people and I'd grabbed their phone numbers and stuff. 

[00:25:12] I started to put together my own little book of people I wanted to hang out with—people that seem like they were doing property things as well. And you know, I suppose from there, I progressed to actually organising property meetups in Sydney. You know, I'd go along to other people's meetups and hear the presenters that they organised. 

[00:25:32] And I thought, you know, there's people I want to learn from myself. So you know, let me put together a crowd and an audience that they would want to speak to. So I started organising my own events. But you know, that wasn't really until 2014 [or] 2015. So, you know, I was already 13 or so years into property by then. 

[00:25:52] So the first 10 years or so, it was really just kind of bumbling along, learning what I could as I could, from people that I could ask questions [from]. But I didn't know the questions to ask everyone. I didn't know how to do things. 

[00:26:08] Those first couple of developments we learnt as we went; we didn't know how to do things. I didn't know any builders to ask at the time. 

[00:26:17] It was an interesting journey. I certainly could have done a lot better. But I didn't do bad either. I lost a little bit of money in a couple of those. And I always felt that things have been slower than I wanted them to. But I did get to the end of the projects, and they worked out well.

Tyrone Shum:   

Williams may have stumbled through the first 10 years of his property development journey—but he learnt as he went through all the ups and downs. And one particular challenging experience during that time stands out for him.

[00:27:02] After I've done those projects, I tackled a project that was a little bigger, Tyrone. It was at 10-townhouse project; it was the amalgamation of three properties. It was two properties plus the backyard of a third, creating a fourth block, which was a battleaxe property behind the three front-street frontage houses. It was in Newcastle; it was about [in] 2014 that I acquired or so. 

[00:27:34] And I was looking for someone to work with—someone that knew stuff and could help me and help me move forwards quicker. And unfortunately, I picked the wrong person as a project manager to work with. The deal was kind of set up as a joint venture, as a profit share. When it went really well as it was course it was going to, you know, they stood to make a percentage of the profit at the end of the project—which they were happy with. And you know, that worked for me. 

[00:28:04] And then we were going to do a bit more of the management work—although I was going to do some as well at what was quite a challenging site and a challenging time.  And I say the word 'time', you know, the biggest lesson from that project is the value of time. 

[00:28:21] I think I was wrapped up in that project for four to five years. Because the subdivision works took me, you know, three to four years, it took me almost a year to get through Council. 

[00:28:34] And then there was... once we were on site so that the subdivision works had or the works had to be done before Council will allow the property to be subdivided. So the property had quite a bit of slope on it. It was in a suburb near the university in Newcastle. 

[00:28:54] And we started to go through a bit of a property boom around, you know, [in] 2013 [or] 2014. 

[00:29:01] But at the same time,—and this is what I missed—one of the things I missed on the due diligence, was that the local university, it just wasn't far off bringing hundreds of rooms online for students. 

[00:29:14] When those rooms did come online, lots of the university students that were living in, you know, their share houses and, you know, potentially a lot illegal boarding houses nearby, decided to go and live on campus. 

[00:29:29] So lots of the homeowners or the investors that had properties in the area that had had, you know, full occupancy for quite a while all of a sudden had a couple of spare [or] couple of empty rooms. So some of those property investors thought, 'You know, we've had some really good times; let's just pop our properties on the market and we'll go and do something else. We'll go and buy another property somewhere different'. 

[00:29:52] So those property investors put their properties on the market and the suburb price stayed fairly flat. And it stayed like that in a year or two, whilst the rest of Newcastle and other areas were booming. So when you're sitting on a development project, and your sales prices are staying flat, it's like, 'Hmm, well, my site's not going up in value; that's a bit of a problem'. 

[00:30:18] But because we were in a booming market, the cost of building was also going up. You know, traders were in demand; builders had plenty of work on. They could pick and choose the jobs they wanted to do. They looked at my property, and they're like, 'Wow, there's a bit a slope on this one'. So they're like, 'Well, we'll just put a bit of a premium on the job. And if you choose to do it with us, fantastic. And if you don't, have a great day'. 

[00:30:44] So the cost of building the development was going up; the sales value of the development was staying flat. You know, for the margin to stay in there, that meant the land value was going down. So that wasn't a great position to be in. 

[00:31:03] There was some further complexities in that I had to do what's called underwater major works. So I had to go in and dig up the old concrete sewer pipes and replace them with new PVC pipes. And I knew we needed to do it; it wasn't unexpected. It cost a little bit more than we had budgeted. I think it ended up costing about $50,000. We budgeted about $35,000 [or] $40,000. 

[00:31:30] But there was a stormwater pipe belonging to council that was closer to the surface than anticipated. And that pipe needed to be replaced in its entirety. So that was about $20,000. But before we can work out which path we were going to take with that, we needed to go to the engineers and go, 'Well, can you do a design to put the pipe in a different location? Or, you know, should we leave it there and case it with concrete?'

[00:32:00] So you've got to get a couple of proposals from the engineer. Then you take those proposals to the builder, and the builder costs them up, and then gives you an answer. And then you pick one of the answers and proceed from there. So each of these little things slow the project down. 

[00:32:14] In addition to that, there was this beautiful four-car garage behind one of the properties [that] had to go, because that's where three of the townhouses were going to sit. The lovely couple that own that property, he'd worked for the council in the '80s as a tip truck driver, and he'd got some field from somewhere. And he popped it under his shed because the property is sloped to the back. So he'd built his garage up. So he came down his drive, and then went into his shed. 

[00:32:41] That had asbestos contamination in it, and then it cost me about $60,000 to clean up that asbestos contamination. 

[00:32:49] Wow. 

[00:32:50] So it was a bit of a comedy of errors. And then the project managers started to get a bit of a sniff that, 'Hey, this isn't quite going according to plan; maybe we're not going to make a massive profit here, and maybe, if we don't make a profit, we're not going to get paid anything'. 

[00:33:09] So they started to lose interest and the relationships between the existing landowners [and] the people were going to purchase their properties, because they'd been purchased under option—those sort of relationships between the project managers and the property owners deteriorated. 

[00:33:27] Because the property owners are like, 'Hey, when are you going to exercise the options? You know, property prices are going up, and we're a little concerned we're going to get priced out of the market out of spots we'd like to move to'. 

[00:33:38] So there was a whole heap of things that didn't go according to plan, Tyrone, and my head just got filled up. And I'm kind of like: I'm stuck in this project; I can't get on the next one. What to do? 

[00:33:55] The project managers put a caveat on the property. And I'm kind of like, 'Well, you know, I just need to clear my head. I'd like to actually sell the property'. I knew that in selling it, I was going to take a significant loss, multiple six-figure loss. 

[00:34:12] It really slowed me down by a number of years. Like, the the money I'd made from buying my principal place of residence, you know, 15 years earlier—all that money and more was, unfortunately, lost on that one project. But I bought myself a whole heap of lessons. Quite a bit of stress at the time. 

[00:34:32] But as I was explaining to a friend of mine, I'm like, 'You know, I probably don't get stressed about little things these days. Because, you know, once you've lost half a million dollars and you wake up the next morning, it's like, the fact that something's small is not going quite according to plan, it's like: Yeah, whatever. We'll fix that. That's okay'.

Richard Williams’ story continues in the next episode of Property Investory. He divulges how he finally got out of this stressful joint venture project after almost five years.

 

[00:01:20] Whilst I took a loss, it cleared my head; it moved me away from that project, and put me in a good space.

 

What his bold perspective is on property development…

 

[00:11:42] Some people look at development, they say, 'Oh, isn't that risky?' I'm like, 'Isn't it more risky to buy an apartment and just wait for the market to go up?'

He opens up about the mindset shift that took him from thinking like an employee to viewing things through the lens of a successful property developer.

[00:15:06] For me, it's been quite a journey from engineer and employee to, you know, business owner, self-employed, and then you know, building a brand and a business and doing my own projects as well. 

 

And that’s next time on Property Investory.