Property Investory
Developing Discernment with Danny Ciarma
November 27, 2017
On this episode of Property Investory we hear from Danny Ciarma: Director of award-winning Australian development company Urban DC. We join him on his journey from the farm in country Victoria, to the draft table in Melbourne. Tune in to learn how he built his thriving property business from the ground up…literally, starting it all with a $5000 loan. Plus, the biggest trap for new property investors and those starting their development journey.
1.08 | A Diverse Resume
4.16 | Trading Rodeos For Rulers
6.36 | Lessons You Can’t Teach
12.06 | Know Your Strengths and Acknowledge Your Weaknesses
13.45 | Romantic Dates She’ll Never Forget…
18.36 | Testing the Theory
24.26 | Keep Moving Forward  
27.30 | Playing the Long Game
31.55 | Use Every Resource Available  
35.15 | Take Notes: We’ll Be Living Differently  
38.47 | ‘I’m Relentless’  
41.48 | Building A Mental Library  
46.49 | A Future Filled With More than Money  

Resources and Links:

Danny Ciarma 
[7:14] Discovering the game monopoly. I was absolutely mesmerised by that game and I didn't understand anything about reinvestment or didn't understand, you know, the whole concept of a property portfolio. [7:36] That's sort of what I'm doing in real life now. 


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

Tyrone Shum 
I’m Tyrone Shum and in this episode we’re speaking with property developer Danny Ciarma, founder of award-winning company Urban DC and 20-year veteran of the property industry. Follow his journey from the family farm to city of Melbourne, from architect to developer, all the way to becoming one of Australia’s most innovative developers from just a $2000 loan.


A Diverse Resume 

Tyrone Shum 

If you were to meet Ciarma today, based on his accomplishments, you might think he has always been a successful property entrepreneur. Someone who started at the top and kept going, but in reality it’s his experience of various roles within the property world that give him an edge. 

Danny Ciarma 

[0:20] I've been developing some medium to high density residential buildings for around 20 years now. I started out as a registered architect, but pretty quickly moved into project management and development management and then became a developer very early in my career. 

[0:55] In the last 15 years I've completed over, we'll say 20 development projects. And currently with Urban DC I've got two two projects under construction - one in 308 Carlisle street Balaclava, which is 38 apartments, over retail. I've got one under construction in Roselle in Sydney, which is 22 high end apartments. And I'm about to market a project I've got in Caulfield, which consists of 18 large owner occupied apartments. 

And I've got another further two projects in planning at the moment in Sydney. One's in Rose Bay, and the others in Bondi Junction. Yeah, and just completed a building in Brighton, which has 26 high-end owner occupier apartments called Oscar Brighton, and only a couple of weeks ago that building won the Bayside council Design Excellence Awards for medium density housing. So that's a nice accolade to have. 

Tyrone Shum
The development industry never stays still and neither does Ciarma. No two days are ever the same…  

Danny Ciarma 
[3:10] I've got several projects on the go. So I'm constantly rotating from one project to the other. And depending on the phase, a particular project is in, that will determine how much I spend on one project, you know, I might spend three quarters of a day focusing on one element of a project, and then 10 minutes on another one, and so forth. So, it's just whatever is required. 

So, it might be going to a planning meeting, talking about all the issues surrounding that, for our submission. And then I might move on to a marketing meeting to talk about the brand, the brand mark for the project and marketing material. I might go to a site meeting and talk to the builder about how the progress is going on site. Visit sites, while I'm doing my due diligence. 

And there's a lot of deskwork too you know, undertaking feasibility studies, talking to valuers, talking to bankers, and right through to marking up plans with a red pen, which I often do, send it back to the architect, and the list goes on. So yeah, it's just rotating through all those elements that's required in order to get the projects going.

Trading Rodeos For Rulers

Tyrone Shum 
Growing up, Ciarma’s career dreams didn’t seem to fit his country surroundings. 

Danny Ciarma 
[5:20] So I grew up in Kilmore, Country Victoria. My dad trained horses, and harness racing. So I grew up on the farm with lots of animals and horses. I've spent most of my childhood either sitting on a socket beyond a horse or at the races. 

Tyrone Shum 
But family experiences can be the most powerful of influences. 

Danny Ciarma
[5:58] I went to school in the country. But from an early age, I always wanted to be an architect. So you know, I, from as early as I can remember, I loved drawing and sort of loved property. My Dad, prior to training horses, was a builder developer. So he built spec homes and apartment buildings. And, from an early age, I was always on building sites, and I can still remember the smell of sawn timber, when the framing material was going out. 

And I remember playing around in the garage, and at the age of eight, looking at all the architectural plans, or the documentation that dad had for all these building projects, and I was just mesmerised by it,  and that was back in the days when it was all hand drawn.  

Tyrone Shum
Ciarma’s beginnings in the property world prove that inspiration can come from the simplest of places.

Danny Ciarma 
[6:53] I just knew then that I want to do this, I want to be an architect. So, I always had a flair for it, I always knew what I wanted to do, which was good for me, because it gave me a lot of focus whilst I was at school, I had something to work towards. In terms of property itself, I even remember at that stage discovering the game monopoly. 

I was absolutely mesmerised by that game and didn't understand anything about reinvestment or didn't understand, you know, the whole concept of a property portfolio. I just loved that game and the idea of buying multiple properties and working your way up to building hotels on your sites, that was just amazing. That's sort of what I'm doing in real life now.  

Lessons You Can’t Teach

Tyrone Shum 
Like many students, Ciarma learnt more about hard work outside university than in it. 

Danny Ciarma 
[8:10] I went straight to uni. It was a five year course. So it's a long course. And I did the last year over two years because I wanted to work. I just couldn't wait to get out there. So I worked in an architectural practice, while studying part time for the last two years. So not straight into it. 

I did the odd job, whilst I was going through uni, to help put myself through everything from kitchen hand chef, cook at KFC, a waiter, a barman, I steam clean cups. I did all of that. But you know, professionally I went straight into architecture.

Tyrone Shum 
Ciarma’s path from entry-level architect to powerhouse property developer certainly wasn’t straightforward. However, he says every challenging experience was really preparation in disguise.  

Danny Ciarma 
[8:51] I was in it for about two to three years. You have to do a two year period to fill out a logbook and become registered, I wanted to become registered. I'd come so far I wanted to be able to, so I could call myself an architect. So I did that. And probably after about three years I got into project management at Village Roadshow. And that was a great experience because you got to see so many different facets of the building process—not only did we manage the fit out contractor, we also managed the relationship with the landlord, because it was always in like shopping centres. 

So there were a lot of lease or leasee type relationships that had to be managed and then over and above that we had our own contractors. Now, if FEMA or fit out contractors, you know, the carpet, the curtains, the seating projections. There was a whole heap of things that had to be managed. So you really, really, it was a great training ground to sharpen your skills in project management. 

[10:01]  I'm testing my memory now. But probably five or six years, I got sent over to Geneva to develop the first multiplex in Switzerland for Village Roadshow. So I did that. And then when I got back, I knew I wanted to move into development. And that's when I got a job for the Docklands authority as development director, which was a really good springboard into the development industry.

Tyrone Shum 
In fact, without all his lived experience and his training opportunities, Ciarma knows he wouldn't be the developer he is today. 

Danny Ciarma 
[10:45] It's a funny thing, a lot of people jump into property development, would you jump into a surgery? And operate on someone?  If you didn't train as a doctor? You know what I mean? So people seem to think that anyone can do it, but it takes a lot of time and user experience to get it right. 

Tyrone Shum 
Reflecting on his own journey, Ciarma realises there isn’t one path to property development. If there is one essential quality or requirement, it might be the opportunity to just practice your skills. 

Danny Ciarma 
[11:30] I think now back in back in my day, there was never really a property development course, at uni. I think now there may be, there were always project management courses, and they were even sort of quite new, even back then. I'm talking about 20, 25 years ago. People come into the industry from many different avenues. 

There's architects that become developers, there's quantity surveyors, there's builders. There's all types of people that enter the field, and everyone has their own journey and experience. I mean, probably the easiest thing to do is get a job with a developer, and learn project management skills. Start off as a junior, sort of assistant project manager and work your way up to development manager. That's what I would recommend. 

Even when I was doing architecture, or working as a young project manager at Village Roadshow I was always buying apartments and houses and renovating them. I always did that on the side. So you sharpen your skills, bit by bit, sort of outside of the workforce as well.

Tyrone Shum
Ciarma knows that the best kind of learning is hands-on, and he’s reaped the rewards of collaboration in his own professional life. 

Danny Ciarma 
[13:10] Prior to Urban DC—we just started about five years ago—I was in partnership in a company called Urban Inc. So we had that for about seven or eight years. That was in my own right with another partner. We did lots of projects there as well.  Prior to that, what really gave me sort of the head start was I entered into a partnership with a well known developer at the time called Maurice Schwartz, who invited me in as a partner in a company called Pan Urban. That was probably around about 20 years ago. 

I was managing director of Pan Urban and took a partner there. And that was, you know, a really good entree into property development. So I had an older mentor that sort of taught me the ropes and helped me sharpen my skills. Then I moved on from there. So, I have been doing it for about 20 years, but in different phases with partnerships with people.

Know Your Strengths and Acknowledge Your Weaknesses

Tyrone Shum 
Building upon years of experience as a developer, Ciarma now feels confident to manage his projects alone, giving him the freedom to be flexible. However, he knows going solo is a unique skill. 

Danny Ciarma 
[14:22] You don't have to check with your partners about decisions you're making. Are you happy with that? Yeah, you know, and each partner is equal—you're always checking with each other and you're always on pretty much on the same page. You run your own race, you run your own race. So sometimes you need partners, because sometimes if you may not have the overall rounded experience—you might be stronger in one aspect of development and your partner might be better in another. 

There's lots of people that come together where someone might have great financing skills—knows how to arrange capital or raise capital—they might get into partnership with someone that understands construction and has a building background. Those two sort of complement each other. 

[15:10] So it just depends on you. I tend to have a well rounded balance of experience amongst all facets of the industry. So, I'm okay to go it alone—one minute you've got your design hat on marking up plans, the next minute, you're looking at a feasibility trying to work out a cash flow and internal rate of return. 

Then the next minute, you're talking to the lawyer about an agreement, next minute you're talking to a builder about construction techniques and types of materials. So you need to know a little bit about everything.

Romantic Dates She’ll Never Forget…

Tyrone Shum 
Ciarma’s first property purchase was anything but conventional and hilariously much more than money was at stake. 

Danny Ciarma 
[22:08] Funny story, my wife likes hearing this story, and she reminds me about it a lot. So when I was about 26 in 1998, I always wanted to buy property. I just started working and never really had much money. I read a book called Building Wealth Through Investment Property by Jan Somers. That was a life changing book for me, I loved that book, and I still have it in my bookcase and always refer to it. 

Some of the things in that book were about buying multiple properties and sitting on them and watching them go up in value and then drawing against them and all of that. I wanted to do that but I just didn't have the money. I was only sort of a couple of years into a lowly paid sort of graduate architect's job, barely had money to sort of pay for the car and the rent every week. 

So, I started going out with my now wife Michelle and I recall taking her out to auctions and open for inspections on weekends.

[23:20] I just can't believe she put up with it.  I eventually found a great little one bedroom apartment in South Yarra - brown brick building, punt road, noisy street. It was probably at the cheaper range of what I could afford and I purchased it. Back then any number of one bedroom apartments around South Yarra ran between $90,000 and $100,000. That was at the time when Rams and Ozzie home loans were lending 95% LVR on new mortgages. 

So, I bought one, I found one and it was $95,000 and I needed nine and a half thousand dollars to complete the transaction. Problem was that I only had $4,000 in the bank. So I sheepishly asked Michelle, my girlfriend at the time, for a loan and without question, she lent me $2,000. Then I drew out cash from my credit card for the balance and scraped it all together and got the nine and a half grand and settled the property. Problem I had was I was getting paid on a monthly basis and I had three weeks to go before my next paycheck. So, I had to go and get a personal loan for $5,000. I don't know if they can do it now, but back then they processed those lines pretty quickly. Got a $5,000 loan, paid back Michelle within two to three weeks and lived off the rest until you know, from paycheck to paycheck and slowly paid off my loan and the credit card. So that's how I got into property. 

Tyrone Shum 
Thankfully, his relationship was built on strong foundations and as it turns out so was that very first investment, even if it was hard going along the way. 

Danny Ciarma 
[25:03] The good thing back then was those apartments were returning 7% yield and interest rates were 7%. So you know, it was cash flow neutral. I rented it out for a year. Then I got on top of things a bit more financially and was able to move in. I spent about five thousand dollars—I laid floorboards myself and Michelle and I painted the walls. 

In a couple of years after that we needed to sell, as I mentioned before, we moved on to bigger apartments and bought a little house and needed to sell and probably two to three years later, I sold for $178,000. So, I made $70,000 clear and that was an amazing feeling to sort of turn over a property and end up with $70,000 in the bank. So that sort of left a big impact on me, and I thought ‘I want more of this, I want to keep doing this',  so it's been stepping stones along the way. So I did that. 

Not long after I bought my property, Michelle bought a two bedroom apartment in Morang, which we lived in when we got married—she paid $150 for that. When we sold it, we sold it about four years later for $350. So, we sold as we went in order to cash up to buy our modest first home. It was stepping stones along the way. I look back now and go ‘oh geez if I had held those properties, that'd be worth a lot more’. But, at the time, you don't feel as if you don't want to take on too much debt. You feel like you need to free it up and sort of convert it into different properties as you go. 

Testing the Theory

Tyrone Shum 
Like any effective strategy, the rewards from Ciarma’s first purchase were a sign of future possibilities in the world of property investment. The confidence in his long-term strategy was validated. 

Danny Ciarma 
[27:52] I think that was a nice validation moment that ‘ah this works’. In that respect, yes. Those aha moments sort of built up over time, across many different experiences I think. There was one moment which I can recall which is more about property development. 

When I was at uni, in my architecture course we did, we were in a class called feasibility studies. It was at the time when I really just sort of loved design, the built form, architecture. I didn't really sort of know at that point in time that I wanted to be a developer as such, it was more about being an architect. The lecturer put on the board a feasibility where he explained to us how you can calculate the gross floor area of a building and apply a building rate against that. You work out an efficiency and then you apply a sales rate against the sales and it's sellable area. Then you build up a feasibility and you work out a profit. 

[29:06] That was an aha moment for me, because what that taught me was how to monetize my love for the built form. So, it was the economics behind property. So, that moment I think was the crossroads where I knew ‘oh, this is how you make money out of property’. Prior to that, it was all about ‘how do you create a beautiful building? What do human beings want? What amenities do they need?’ The built environment, the built form, all about that. Then, all of a sudden was like, ‘This is the economics behind it’. That was probably the aha moment for me.

Tyrone Shum 
From his earliest development roles he has been focusing on a niche that he is passionate about… and that sells! 

Danny Ciarma 
[16:04] At Urban Inc. we targeted the investment market. It was probably a function of the timing of that market, the investment market was very strong. The Urban Inc. model was to develop smaller, sort of investment-driven apartments that were delivered to the market at an affordable price point—but, you know, dressed up to look really good; design was always important to us. 

So our buildings always look spectacular and are always built well, and that was our market.  We used to sell through investment groups. Some were offshore sales as well. When I started Urban Inc, I really focused on doing smaller boutique buildings that were targeted towards the owner occupiers, and more higher-end buildings. Every building that I've done so far within urban DCs is within those parameters. 

So, you know, I just get more pleasure out of designing a large three bedroom or a large two bedroom apartment that has really nice spacious rooms, better finishers, just better environments for people to live in, rather than targeting the smaller apartments for the young students, you know? So that's the Urban DC model—owner occupier product on infill sites in established suburbs.

Tyrone Shum 
While it might seem like the rise of owner-occupiers is a recent trend, Ciarma says it’s actually not as new as we think. In fact, it makes sense according to market conditions. 

Danny Ciarma 
[17:54] There's no doubt that the market segment is stronger. There's no doubt that the investment market has become, you know, weaker, and it's not as strong as it used to be. Yeah, so that's one driver. But look, I think that the market’s always been there. I think when I was with Pan Urban we developed for a 1 St. Kilda Road, which was very, very high end. It was one of the first wave of owner occupier buildings. 

And at the time, there were several being built around about 2007. That was the first wave. The very first was The Melburnian, which was a cycle, a property cycle before that. But in 2007, there was Lucient, 1 Clarendon Street, four on 1 St Kilda Rd.  There were a few projects that were targeting those owner occupiers. I think that was probably the first time the baby boomers really started that journey of downsizing. 

[18:55] Since then, I think it's always been there. I just think what's happened is the population growth and immigrants coming in and Asian students and, just population growth in general has created a demand for investment driven stock. So a lot of the developers focused on that. But even during that period of time, I still think there was  a demand for unoccupied stock and I think that's going to continue. I think that's an upward trend, particularly as the younger generations come through. 

I think the baby boomers are the first cab off the rank that sort of experienced this apartment living. I think the likes of you and me and generations even before us, it just becomes more commonplace. It has just become a common thing, that I sell my house and I'll move into an apartment. So, I think that markets are going to get stronger.

Keep Moving Forward 

Tyrone Shum 
Even 20-year players like Ciarma don’t always get it right, especially when the very real pressures of life wreak havoc on our long-term mindset. According to him, the best thing we can do is just move on and keep going. 

Danny Ciarma 
[20:50] I've had projects that have been good projects, I've had projects that have been great projects. They've all been good on a level. I've always sort of tended to make money at a property and never lost it. 

The only way I could really answer that question is to say that my biggest regret is selling some of the properties that I have. I've sold properties along the way and I look back now and I know they've tripled in value.  I know at the time, I probably could have held onto them, but I just thought it's run its course and I'll sell it and move on. So my regret is actually selling and not holding. 

I guess as time goes on you sort of realise sometimes you need to retire some debt, free up some capital in order to move into something else, which was what I did, but I regret it.

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Tyrone Shum 
Coming up after the break, we’ll talk about Ciarma’s tips for new investors…

Danny Ciarma 
[1:48 pt2] I think the way to overcome it is to not strive to have the luxury home in Rosebay for your first house, or Toorak or whatever it is. You need to start small and build it up.

Tyrone Shum 
As well as some important development discernment…

Danny Ciarma 
[6:02 pt2] So first and foremost you need to find the right suburbs in the right locations that have a catchment of downsizes that have the ability to sell the home, and move into that location or move within that location.

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


Playing the Long Game

Tyrone Shum
With the benefit of hindsight, Ciarma now understands there’s no better strategy than hard work. 

Danny Ciarma 
[1:40] I do think that people have high expectations today. I think the way to overcome it is to not strive to have the luxury home in Rosebay for your first house, or Toorak or whatever it is. You need to start small and build it up. There's no get rich quick schemes. There's no magic bullet, so to speak. It's hard work. And it's time, right? 

People say, ‘we need to time the market’, it's not timing the market, it's time in the market. So, sometimes you have to sacrifice where you would like to live and the type of house you'd like to live in. You might have to move out of town, out of the city, to a cheaper location and buy a cheaper property that may need some work. I was always lucky because I was always able to turn my hand to renovating. Not everyone is like that. I always found the unpolished diamond or the ugly duckling in the street that was cheaper than all the other buildings and was able to sort of add value to it. 

[2:55] So, the only way I can suggest is that you just have to start within your domain and build it up. What people need to understand is that you buy one little house or a little apartment and as time goes on the values keep rising, which, over time I believe they do. You end up with free equity in there, you know, and that allows you to free that up and buy something bigger. Then as time goes on, you end up with more free equity and then you just move on. And that's how you do it. You know?

Tyrone Shum 
In terms of the property development, location, location, location still rings true—if you’re developing a single set of units or entire apartment complexes.  

Danny Ciarma 
[4:09] It's really just understanding the right locations. What happens is—and that's slowly changing as this type of owner-occupier product becomes more and more prevalent—think if you develop a three bedroom apartment, let's say it's 140 square metres, right? And I'm talking [in] sort of Melbourne terms. 

Now, Sydney—it's different again. There could be anywhere between 10,000 square metres to 15,000 square metres, right in Sydney. It could be 15 to 30 [square metres], depending on where you are. So, that's quite a big price point. If you're talking Melbourne, for instance you can't expect to go to a suburb where the median house price is $700,000 or $800,000 and build a three bedroom apartment where you have to get at least $10,000 or $9000 a metre to make it stack back up. Therefore, you're selling it for $1.4 million or $1.3 million. It's just not going to work. It's all about price parity. 

[5:18] That's why you find occupied apartments tend to spring up in the more affluent blue-chip type suburbs, where the price parity is such that the downsizes might have a house worth $3 million. They can sell that and afford an apartment for $1.5 million or $1.6 million, or $2 million. That changes, depending on the suburb. If the suburb has a median price—if you're in Point Piper and the median is... I don't know what it is—$5 million or $10 million? Or whatever the median is, you can afford a more expensive apartment. That all distils down to the land price and that's the economics of it. 

[6:02] So first and foremost you need to find the right suburbs in the right locations that have a catchment of downsizes that have the ability to sell the home, and move into that location or move within that location. Most people want to be close by. They don't want to move too far from where they've lived, you know, raised their children. So that's number one. 

Then obviously it's  all the other things that go with it: It's choosing the right apartment, designing the right floor plan, the right look of the building, the amenity within the apartment, the appliances, the finishes, all of that.

Use Every Resource Available

Tyrone Shum 
When it all comes down to the final sale, Ciarma says it’s crucial to know how the market is performing. You don’t have to do it yourself, agent’s can sometimes be a developer’s best friend. 

Danny Ciarma 
[7:00] The apartments are market driven. So, you talk to several agents, or one or two trusted agents and you get a feel for what that market is.  When you're in the groove, you sort of know that. When the markets are rising, it's always inching up. You say, ‘I choose that project, down the road by that developer, it breached $12,000 a metre in Melbourne’, ‘Really? That's amazing?’ Then two months go by, and guess what? Around the corner, they're getting $13,000, and you sort of get a feel for the market. You know sometimes when it's been pushed too much and so you always talk to agents. You get an average of what they're saying, you put it into your feaso, then hopefully you get more by the time you're ready to sell because you've specced it up and the product is a nice product, and you've done a beautiful design and the locations good. Hopefully, the market accepts that and sees what you see, and what you saw in it, then you get the top dollar. 

It's not a function of ‘This is my cost so then I've got to add, you know, 20% margin on it and this is what I need to get’. That's what happens, sometimes some developers do that. I think that's a bit fake. You've got to start from the values and know what the market is, and then work backwards and work it in such a way where you hope to get a margin.

Tyrone Shum 
Ciarma feels lucky he hasn’t experienced a situation where the market has turned mid-development, but it’s not just luck. He says learning from the mistakes of others can help safeguard your future returns. 

Danny Ciarma 
[9:01] There's been many, many instances that I know of where sites have come back onto the market—they've stalled, developers have made assessments more often than not and it's not the market that's turned, they've made the wrong assumptions. 

They've bought a site where—$10,000 per square metre every day of the week and they've probably thought that they can get $12,000. Then they've gone through the whole planning permit, they've spent a heap of money on it, on the marketing, the whole thing. Then all the agents say, ‘No, we can't get your $12,000; it's $10,000’, or ‘We might push to $11,000, but that's as far as we can go’. The project doesn't stack up.  

[9:40] A lot of those instances, you see those sites hit the market again. You know, they're sold with a permit now. Sometimes, it's because the markets have risen a lot and the developers are trying to cash in until ‘Why should I go through all the pain and risk of developing when I can make a nice little profit by just selling the land?’ That happens but that's not always the case. Sometimes, they're selling it because they can't make it work and the agents are throwing ridiculous prices on the land because they're trying to recoup all they got: what they paid, plus the stamp duty, plus interest, plus the planning costs, the marketing costs and trying to recoup all that back and load it onto the land price. 

It doesn't stack up. You just get this ridiculous price. It's not gonna work. 

Take Notes: We’ll Be Living Differently

Tyrone Shum 
We all know the way the world treats home, work and leisure is changing. By his own assessment Ciarma thinks our capital cities will be leading the way, and investors should act accordingly.  

Danny Ciarma 
[22:45] I do think that we will become more and more like New York. I develop in both Melbourne and Sydney and I feel Melbourne seems to be more ahead of the curve than Sydney in terms of creating product and design. It's not an argument who's better, I just feel Melbourne is a tougher market and just feels like it's ahead of the curve. I feel within Australia, the eastern seaboard will become more and more like New York, in terms of service-related type buildings, mixture of hotel rooms within apartment buildings, concierge —small service-related I think. 

As time goes on I think that's where people are going generally. People want more time to spend either working to make the money to pay for the services, or relaxing and having their ironing done for them, having the cleaner, having someone who opens the front door when they walk in, having someone who washes their car. I just think there's going to be more of that more overlaid, not just an apartment building with the front door, it's going to be there's going to be services added into it I feel. That's what I see happening as the market becomes more mature and sophisticated. I see that happening. 

Tyrone Shum
When thinking about the rise of city living, Ciarma says look no further than Melbourne’s very own recent transformation. 

Danny Ciarma 
[24:41] Everything goes through cycles. The cities are getting more and more populated. Ever since say Melbourne for instance postcode 3,000 came about—I can't remember when that was, maybe the early 90s where back then it was just office buildings and retail. The city was dead at night. Come six o'clock, seven o'clock it was like a ghost town. 

The council turned that around and induced more development in the city and have a look at it—it's booming. So, that now becomes a 24/7 city. The workers go away during the day, but people come home into their apartments at night, so it's 24/7. That helps the retail and it makes it more safer and lively, and I just think that will continue to happen.

[25:55] Suburbs are always pegged to distance to the CBD, aren't they? The good ones are always sort of closer and accessible. Generally, the people who have money to buy those apartments—generally work in the city or close to, generally have the high paying jobs to be able to support that purchase, or are semi-retired anyway, or fully retired but still want to be close by. There's no coincidence to that. 

All the nice suburbs, in all the cities, are close to the city. You get the odd ones that are further out, you get those pockets, but generally speaking, it's like a shockwave effect - the closer in, the more valuable your suburb is and as it goes out. So, I think it's just a function of that. It's not about me wanting to be in the CBD or developing close to the CBD, it's just choosing those suburbs that are sought-after, that have the demographic, they just tend to be near the CBD.

‘I’m Relentless’

Tyrone Shum 
In terms of personal habits that have aided him in attaining success - both in life and in property - Ciarma’s work ethic stands out. 

Danny Ciarma 
[18:23] Apart from sort of training myself to have to know every element of the process, so that nothing comes undone, I would sort of say my biggest trait is that I'm relentless. It sounds a bit OCD, but I make sure that by the end of every day there's not one email that's coming into my inbox that I haven't either actioned or read and understood. I can't sleep at night knowing that I get bombarded by all these emails. And I can't sleep at night knowing that I haven't read them, or there's something urgent that needed actioning and I haven't done it. 

So, I always clean up my inbox.  I was like that in the early days when we didn't have email. I used to always make sure my tray was empty before I left the office and I used to see other project managers around me—my peers—they would just be floundering. You'd see their inbox just overflowing and they weren't performing and they were just getting bogged down. 

So, what I do is I clear the day—sure, there's always a little bit of unfinished business—but I cleared the day. What that allows me to do is jump on the front foot the next day and start chasing people up on emails I'd sent the day before or actually new items. So, it allows you to move forward.  If you don't do that, you just get clogged up and you won't get results. You start spinning around and doing donuts and that's probably my trait. 

Tyrone Shum 
Despite the personal qualities that have contributed to his own success, Ciarma feels as if drawing on the special skills of others—even just through osmosis—is just as important.

Danny Ciarma 
[16:46] What happens is you tend to hang around like-minded people. So, my mentors are my peers. Some are older, more experienced, and some are younger, more energetic. It's like anything—if you're interested in classic cars, you hang around people who have classic cars, or you're interested in being healthy and sporty, you sort of hang around gymnasiums and talk to people about fitness. 

So, throughout my career all my friends are in the same industry. I've got friends outside of the industry. But my colleagues and close friends that I deal with every day are in the industry. You're always swapping notes, you're always bouncing off each other. Some of them are older, and they've  walked the walk long before you did and share their experiences. 

It's not like one sort of old hand that I call for on a daily basis—‘How do I do this?’ It's not like that. It's a group of different people that you talk to on a daily, weekly basis.

Building A Mental Library

Tyrone Shum 
Ciarma is constantly working on himself, filling his mind with knowledge to draw from when it really counts. 

Danny Ciarma 
[11:00] It really is about mindset. I'm very proud of my library. I've got just about every book that's been written out there about wealth and strategies and mindsets and thinking grow rich, all those types of books. I've read them and you need to. I don't believe that every strategy in every book is right and that you should just follow every strategy, but it's just building up a consortium in your mind and building up that mindset. 

It's just constantly thinking about it and just getting confident in knowing by reading so many books. If you're well read, you're generally good at something. So, by reading so many of those books, you start to think like that and that's very important.

Tyrone Shum 
Depending on your stage of life and your investing experience, Ciarma believes that the same material might even provide different lessons. 

Danny Ciarma 
[12:03] I don't read those books now. But I did in the early days, and I've never thrown them away. When you're young, when you're starting out, you do need to sort of read those books because you pick up little ideas here and there, throughout multiple books. It's not only about the ideas. 

I mentioned Jane Somers' book because that was about strategy and ideas, but the other thing about that book was it sets the scene on society where you sit today and what's in store for you—if you're working a nine-to-five job, what are you going to have when you retire? Well, you're not really going to have much except the pension to look forward to right? 

That really set the scene and that was really profound for me, because it sort of explains really well the reasons why you need to build wealth and how property investment is one vehicle to achieve that. All the other books about just how to think and what the millionaires think like, and what are their traits? It's important.

Tyrone Shum 
Ciarma has kindly shared with us some of the books he has found most inspiring.

Danny Ciarma 
 [13:16] There's one book that I like and what I did was, I started reading books about how to build capital and how to create capital. Then, I started reading books about capital itself, money and just the mindsets of people. You sort of start to morph into different books. 

There's one which I loved called 'The Mystery of Capital' by Hernando DeSoto. That was a great book, because what it talks about was the mysterious capital - why are some countries wealthy and others not? Why do countries like Africa that have so much wealth under the ground within the land? Why are they poor whereas other countries are wealthy? There's a lot of things spoken about in this book but one of the overriding things that I took away from it was the legal system—the British Western world legal system that allows people to unlock the value of the land, by way of the titling system. When you think about it, that's very true.

[14:35] Where you've got countries that have a legal system that allows you to own freehold title, what you're really doing is unlocking the wealth in the land that sits below you. I'm not talking about mineral wealth, and coal and gas. I'm talking about owning your own property. Whereas in countries like Africa and other countries where they don't really have a strong land rights system, it's all about land that's been brought down from generation to generation.

 Some generations lose it and it's all leasehold, and you don't have that sort of rights to it, and that's important. So, that was an interesting book. So I just read lots of books that sort of have different angles on capital and property and thinking rich. There's another one called Your money or Your life—Transforming your Relationship with Money and Achieving Financial Independence. So, there's a whole range of books like that, that just sort of kicks you into the mindset. Another one— How to Think Like a Millionaire. I've read them all.

[15:48] So there's another one —The Richest Man in Babylon. I love that book. I just remembered that one. That's another good book. It's all about just putting aside your savings and building it up.

A Future Filled With More than Money 

Tyrone Shum 
So what’s next for Danny Ciarma? Even having already achieved so much and with many accolades to his name…

Danny Ciarma
[20:59] I'm excited about just keep doing what I'm doing. I love the process. I love seeing the finished product. I'm always excited about that next site—what's that next site going to do? What's that next building going to look like? What I really love doing is identifying a site and working out ‘What's the right product to put on it?’ —coming up with an apartment plan, a spec, a colour scheme, you know, working together with the architect and then being satisfied with it. 

What I really love seeing is that purchasers come to the display suite at the sales stage and fall in love with that vision.  That's priceless. When you create something from your mind and you put it all on paper and purchasers come along and absolutely fall in love with that vision. That's what I enjoy.


Tyrone Shum
Thank you to Danny Ciarma, our guest on this episode of Property Investory.