And by November, shares in the group had soared above their February pre-pandemic heights.
For the well-respected Harrison – who has helped build the funds management giant from a nine-person operation to the largest commercial real estate owner in the country with 600 staff and $45 billion funds under management – standing still is not an option.
“We are one of the few companies that are in a better shape than pre-COVID and the reason is because we have focused geographically on Australia, but at the same time diversified across multiple sectors,” he says.
“I’m just a great believer that you need to be an expert in what you do.”
Even as the year comes to a close, the pace isn’t letting up. In the dying days of 2020, Charter Hall and its management have completed a whirlwind of deals including buying a Telstra building in Pitt Street, Sydney and a 100 per cent interest in a new Bunnings at Caboolture, Queensland for $28.1 million.
Harrison says the $6.8 billion ASX-listed company’s focus on properties with long leases to good tenants in a range of industries is proving bullet-proof in the face any COVID-19 recession.
“The 2020 financial year is Charter Hall’s 15th year as a listed company and while we have not been immune to the effects of COVID-19, the impacts have been limited through this focus on assets with long leases to high-quality tenants in predominantly defensive industries,” he says.
“More broadly, COVID-19 has seen accelerating demand for access to industrial and logistics assets, something we have actively pivoted towards.”
Identifying assets and managing them to add value has been one of the group’s key to success. “In the last five years, the dispersion between the top-performing REITs and the race to the bottom is wider than it’s ever been in my history,” he says.
And he’s not shy at pointing the finger at poor-performing peers. “You’ve got shockers like shopping centre giant Scentre and Vicinity because they own regional shopping malls. Even diversified entities, like GPT, particularly, has performed very poorly and the REIT index itself has not performed well,” Harrison says.
By contrast, Charter Hall’s returns have averaged 20 per cent per annum over the last 15 years versus the A-REIT index’s 3.7 per cent per annum.
With 30-plus years in real estate and 15 years at the helm of the property fund manager, Harrison has steered Charter Hall through some choppy real estate waters, identifying growth opportunities and deals.
We are one of the few companies that are in a better shape than pre-COVID and the reason is because we have focused geographically on Australia, but at the same time diversified across multiple sectors.
David Harrison, Charter Hall chief executive
That insight has led the group to play in the traditional office, retail and industrial sectors, but also to aggressively branch out into alternative property assets such as service stations, data centres, pubs, healthcare, childcare and education.
Following his real estate agent parents’ lead, Harrison studied Land Economics at the former Hawkesbury University, now part of University of Western Sydney, before winning a scholarship at Raine and Horne Commercial. It was here that he started his career as a commercial real estate valuer. Before joining Charter Hall, Harrison honed his skills at the small estate agency First Pacific Davies, which has since morphed into global player Savills.
While COVID1-19 has been tough, Harrison maintains it is not a patch on the 1991 recession. “The toughest period I’ve seen in my career is the 1991 recession,” he says. “And in property, it was really the last time we had a dramatic reduction in values because there was oversupply, there was way too much speculative office and industrial development that occurred prior to that recession. And a lot of that was driven by the stock market correction in 1987.”
Once Australia gets a COVID vaccine, the world will return to normal, he says. “I think the quicker we can get a vaccine and all the health issues, social distancing, public transport, all those concerns of the coronavirus will dissipate and we will get back to a world where we will have a more permanent arrangement of working back in the office.”
That will be a welcome boost for Charter Hall and other office tower landlords who, for months now, have been urging a return of city-based workers.
Harrison himself spent the months of enforced lockdown at his Palm Beach house in Sydney’s northern beaches with his wife, three boys and daughter. They were all there “until my wife and daughter got fed up with us boys and came back to Sydney,” he says. Nevertheless, he still worked 13-hour days.
Another initiative Harrison is willing to push is the property sector’s gender imbalance. He is a supporter of the Male Champions of Change movement’s drive to increase equality.
To that end, he is adamant he will not go on all-men panels for property conferences, pushing organisers to increase female representation, saying otherwise he will be a “no-show.”
“I think the industry is done a bloody good job with a whole range of issues. But even in the last four or five weeks, I’ve had to decline invitations to go on panels where they don’t have a female.”
Start the day with major stories, exclusive coverage and expert opinion from our leading business journalists delivered to your inbox. Sign up here.
Carolyn Cummins is Commercial Property Editor for The Sydney Morning Herald.
What this means is that hospitality and cleaning staff, historically lowly paid, have nowhere to live. Businesses find it hard to find good, trained staff; service suffers and people are overworked. The newly arrived metropolitan residents start to wonder why they don’t get served as quickly or efficiently as in the city and grumble about it (sometimes out loud. I’ve seen it.) but, of course, don’t offer to work in these positions themselves as they are lucky enough not to need to. The town loses its appeal and reputation, its tourism shrinks and jobs are lost in those very areas that we are struggling to fill. There are only so many spots that our high school students can fill between actually going to classes or not turning up to day one of a new school year exhausted after working three jobs over summer.
We already have families having to move to Colac and commute over the Otways simply because they can’t find accommodation in town. The Andrews government is having a spending blitz on social housing in the city and large regional towns, but it needs to expand into smaller areas that are the biggest attracters of tree or sea changers. It also needs to offer some kind of tax break to property owners who rent their houses long term in such areas and we need more people to actually buy into this as a type of community service.
It may also be time to consider, as other communities in Britain and the US have, a version of a community land trust, whose raison d’etre is to provide perpetually affordable housing. This can be achieved through a grass-roots movement from concerned residents or through local council, providing they have enough foresight and leadership with regards to long-term vision and planning (not often seen in local government, sadly). It may take the form of some properties only being sold to those with permanent employment in town, at reduced prices through the help of shared equity or perhaps a version of co-op housing to help those who would be unable to secure a mortgage. We need to go back to seeing secure housing foremost as a human right, not a right to huge profit, or we will lose the very fabric of the places that we live and love.
And finally, to those people who have the means to buy houses at such high prices, we are a welcoming place to those who like to get involved and who are able to adjust to a different, slower way of living. But maybe you also need to consider that moving down here will require a change in pace and perhaps a change in career – such as the alliteratively satisfying barrister to barista … if you want a coffee it may actually be the only solution.
No one in the federal government has ever spoken about taking away superannuation from people to pay for COVID-19 support or anything else.
Ms Grubisa’s Master Wealth product costs about $5000 and she promises it provides a lifetime “force field” around assets. “You’ll become bulletproof. You become that man of straw. You can never ever go backwards … like Rockefeller, you’ll own nothing but control everything,” she said.
Other claims made by Ms Grubisa during online events this year include her ability to give clients an inside legal run because she knows “the judiciary” and “the lawmakers”. She even claimed to have out-performed Cate Blanchett when they were both auditioning before the National Institute of Dramatic Art.
“Hello. I was better than her. She forgot her lines and yet she’s out there living my life. I did everything right but the system let me down,” she said.
Purchasers of Ms Grubisa’s Master Wealth product have told The Sunday Age and Sun-Herald that their assets had not been protected as Ms Grubisa suggested they would be.
In one case, a woman struggling with her business affairs said she was instructed to have her university student daughter place a caveat on her house even though the daughter had no financial ties to the property. The manoeuvre was an attempt to stop anyone repossessing the house to repay the woman’s debts. Lawyers for the woman’s creditors quickly identified that the daughter had no genuine basis for a caveat and had it removed.
Ms Grubisa and her DG Institute are being investigated by federal police over the alleged use of the Family Court list to identify couples going through divorce or others in financial stress to allow her clients to target them with offers for their properties.
In addition to asset protection, a major part of Ms Grubisa’s business is educating fee-paying clients on how to acquire distressed properties at discount prices through her Real Estate Rescue package.
Ms Grubisa has had more than 10,000 clients pass through her DG Institute courses since 2010, turning over millions of dollars.
Despite operating out of Sydney, Ms Grubisa does not have a legal practising certificate in NSW. Rather, she operates under a certificate granted by Victorian authorities. Documents seen by The Sunday Age and Sun-Herald show complaints about Ms Grubisa’s conduct and potentially misleading promotional material have been lodged with the Victorian Legal Services Board.
A spokesman for the board said while he could not comment on any specific investigations, the public needed to know it was unable to prosecute a non-resident of Victoria at the Victorian Civil and Administrative Tribunal but could “vary, suspend or cancel a practising certificate under certain circumstances”.
“We can also immediately vary or suspend a certificate if we consider it necessary in the public interest. Where a matter is raised with us, including via the media, it is within our powers to consider the issues and take action.”
The New South Wales Law Society is also investigating complaints about Ms Grubisa’s conduct, including the use of her parents in her client’s legal affairs even though both were struck off the solicitors’ roll in 2012 and 2013 in relation to the misappropriation of $600,000 in trust account funds.
Ms Grubisa said in a statement that her parents did not provide legal services and had been hired to help with administrative work.
That statement also addressed criticisms of the DG Institute’s products, including claims they sometimes preyed upon the financially vulnerable. Ms Grubisa said in the statement that deals for distressed assets often turned out to be win-win situations for buyer and seller. She also encouraged her students to carefully study the individual characteristics of any prospective deal.
In response to a question about how her Master Wealth Control product provides “lifetime protection” for assets, Ms Grubisa responded: “This question misquotes what is said by Master Wealth Control to be offered. What is offered is an unlimited lifetime professional service whereby clients, for a flat fee, can seek assistance and advice from Master Wealth Control in respect of a range of matters, including but not limited to contract reviews, contractual negotiations as well as upon changes to their asset positions from time to time.”
Fresh documents obtained by the Sunday Age and Sun-Herald show Ms Grubisa’s mother, Maria Fitzsimons, wrote to the registrar of land titles in Queensland in 2016 and described herself as being from “the solicitors acting on behalf of the transferee”. Ms Fitzsimons signed the letter and included the letters “LLB” to signify her law degree.
Know more? Email firstname.lastname@example.org
Start your day informed
Our Morning Edition newsletter is a curated guide to the most important and interesting stories, analysis and insights. Sign up to The Sydney Morning Herald’s newsletter here, The Age’s here, Brisbane Times’ here, and WAtoday’s here.
Richard Baker is a multi-award winning investigative reporter for The Age.
A Bunnings Warehouse has stood on the site for 20 years. Charter Hall has negotiated a surrender package with the retailer which no longer needs the facility.
The attraction for the fund was the area’s gentrification where large parcels of land are being rezoned from industrial to high density residential and mixed use, which is creating a shortage of well-located industrial/commercial land.
Charter Hall fund manager Simon Greig said the property provides redevelopment options including the ability to develop a high-profile logistics or last mile facility under the current zoning.
He said South Sydney has emerged one of the most sought-after industrial precincts in Australia given its access to major transport hubs, the Sydney CBD, port, airport and surrounding residential precincts.
“This acquisition is aligned with Charter Hall ’s strategy to replenish its development land bank and grow its Sydney portfolio. It will capitalise on strong demand for industrial and logistics facilities in the South Sydney area,” Mr Greig said.
The deal comes as the industrial property sector has been highly active with pent demand up for storage as people shop online during the lockdown.
Charter Hall chief executive David Harrison said the off-market acquisition and the relationship with Bunnings have allowed the group to access the high profile corner site with multiple development options.
“We now own an industrial and logistics portfolio exceeding $11 billion leased to more than 140 tenant customers,” Mr Harrison said.
“Charter Hall will continue this 13-year strategy to expand our market share of the prime logistics sector for the benefit of our investors.”
Protective surf culture, or ‘localism’, on the west coast of South Australia is back in the spotlight after a new tourism sign promoting the Cummings Monument was damaged with an angle grinder 24 hours after it was installed.
A sign directing visitors to a popular surf break and lookout was damaged 24 hours after it was installed
Surf localism is common on South Australia’s west coast
The photographer whose work is on the sign has received online threats
The sign depicts a surfer above the waves with dramatic steep cliffs in the background, and directions to the popular break.
But surfers are seemingly so protective of the location that even the photographer whose image inspired the sign has received death threats.
Sondra Stewart, tourism development manager for Regional Development Australia Eyre Peninsula and Whyalla, said the vandalism of the sign was disappointing.
“The sign was an investment by the South Australian Tourism Commission (SATC) to give people the opportunity to stop, get out of the car, take a bit of a breather, and have a look at our amazing coastline,” Ms Stewart said.
Ms Stewart has asked the District Council of Lower Eyre Peninsula to take down the sign due to safety concerns.
“I was really concerned that it would blow down and hit a car,” she said.
Streaky Bay surfer Jeff Schmucker said locals can be protective of west coast surf spots.
“It’s disappointing the sign got taken down by obviously someone who’s disgruntled about it, but I do understand why surfers are concerned about crowds coming,” Mr Schmucker said.
“There’s been a bit of an issue [here] about surf localism and protecting the surf.
“The proponents against this have Instagram accounts that have photos of the waves on the west coast, and those photos are available online to old mate in a bar in San Francisco within seconds.
“I think that has more damage than a sign.”
An Elliston surfer who did not wish to be named said there was prevalent surf politics on the west coast.
He was also surprised the region was showcased.
“Getting down there’s hard. Experienced surfers themselves get hurt out there,” the surfer said.
“Someone like a backpacker coming over, seeing the sign, going out there — they could easily drown.
“There’s dry reef to get out, a real small keyhole, the waves are real heavy waves.”
The surfer was also concerned about the stability of the clifftop.
“It’s all undercut. You could easily be standing on something that’s only a couple of foot thick and then you drop to your death.”
Death threats and high tensions
Photographer Kane Overall took the image used on the SATC sign and said he he had since received death threats over social media.
“I didn’t know [the image] was going to be used on the sign, and then I just started getting hit up on Instagram and tagged in lots of negative comments,” he said.
“I actually sold that image to SATC about two years ago when I shot it to use in their media gallery.
“It kind of sucks that I didn’t actually know the image was going to be used.”
“Impact Investment Group always acts with integrity and honesty, but that doesn’t mean we can be pushed around,” chief executive Daniel Madhavan told The Age and The Sydney Morning Herald.
Ms Liberman, the daughter of billionaire Melbourne businessman Boris Liberman, is part of a family regarded as one of Australia’s richest clans. Impact, which invests in range of sectors including green buildings, social housing, renewable energy, is currently seeking backing for a new $70 million impact investment fund.
Despite its admirable ideals Impact has sometimes run into criticism. Roy Morgan Research owner Gary Morgan accused the group of acting unethically in 2015, when it evicted the pollster from its Collins Street office in the week before Christmas over unpaid rents. The dispute was later resolved between the parties.
In the Central Park office tower case, the investors put in millions to fund the development of the green office tower and allege the agreement included a future ownership stake through an equity raising. However, the building was sold ahead of schedule after it secured a top tier tenant, the University of Technology Sydney. Superannuation fund MTAA purchased the building for $70 million in 2018.
“Impact Investment Group on its own behalf and on behalf of IFM dishonestly stated that the reason for the decision to not proceed with the transactions contemplated by the funding agreements was “due to receiving, over the past months, a number of compelling unsolicited offers from third parties to purchase the property” when, in fact, IIG and IFM had solicited offers from third parties through Capital Transactions Australia and Colliers, alternatively CBRE,” court documents allege.
Impact said in its defence that the contract between the investors made it clear it was a loan arrangement that gave it the choice of returning the deposit or granting the investors equity in the project, through an equity raising.
“This is a contractual dispute about a guaranteed loan that paid back the lenders in full, with a 23 per cent return on top. That’s a great return but they want more than that. They want more than was in the contract they signed,” Mr Madhavan explained.
“We have maintained the same position throughout, and that won’t change whether these lenders settle, or proceed to court.”
A Queensland farmer, who has three public service signs erected on part of his property, has been told by his local council to pull them down or face hefty fine to the tune of $600,000.
Peter Wise, who told his story on Channel 9’s A Current Affair, has had the signs on his property for over a decade as a public service for his community.
The three signs, one for Guide Dogs Australia, one for a local church and the other for Crimestoppers, are on display on his side of the fence near a busy Queensland motorway.
Mr Wise, who has lived in the region his whole life, said the signs had been on show for 15 years and the council had known about them the whole time.
As the signs represent community causes, Mr Wise doesn’t charge an advertising fee for their display.
“Been here all my life, I’m with this community, and I’ll support it as best I can, whenever I can,” he said.
“I thought the council works for the community; it doesn’t seem to be the case in this instant.
“I don’t see removing these signs will benefit anybody. It certainly won’t benefit the community.”
According to the Sunshine Coast City Council, Mr Wise is allegedly in breach of the Planning Act which states you can’t have third party ads – paid for or not – without a permit.
In a statement by the Sunshine Coast Council, a spokesperson said they are working with Mr Wise to come to a reasonable conclusion about the display on his property.
“Council has been working with the Wises Road property owner since April 2019 to resolve the signage on the property that does not comply,” the statement read.
“It’s important to note that council does not regulate content of signage, the concerns are in relation to the amenity and landscape impacts associated with the unlawful structures.
“Council officers will continue to work with the Wises Road property owner to achieve compliance and in the event an application is lodged, the specific fees for such an application will be waived given the community and Non-For-Profit nature of the signs.”
Another of Mr Wise’s signs is under the microscope, but this time from the local community.
In addition to the three non-for-profit signs, Mr Wise also has a sign that reads ‘No Sharia here’, in reference to Sharia law which governs behaviour under Islam. The word ‘Sharia’, however, has been replaced with the word ‘racism’ in spray paint.
It is reported that this sign has received multiple complaints – including Ali Kadri from the Islamic Council of Queensland.
“As a Muslim and as an Australian it makes me feel in my own country that I don’t belong,” he told A Current Affair.