Latest / The Follio Property Podcast / How to Master the Perth Property Market (With Zero Knowledge) | Trent Fleskens

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How to Master the Perth Property Market (With Zero Knowledge) | Trent Fleskens · The Follio Property Podcast

• 0:00
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• 0:56
  Real estate expert Trent Fleskins. Trent Fleskins, Trent Fleskins. Trent, you know, many people are struggling, so how are they supposed to catch?
• 1:02
  The amount of data available in Perth is scary from a privacy perspective, but it helps a developer like me to understanding what it is and buying and what I can do with it. I was 18 and invested in a couple of stocks. The thing that really scared me at the time about that, watching it go up and down, and my anxiety was insane. And if you aren't having an intimate understanding of the thing you're investing in, then you're a punter. Trent Fleskins, a veteran developer and managing director of Strategic Property Group, who transitioned from corporate strategy to managing over 100 successful projects. He's back.
• 1:31
  to share his personal journey from a 19-year-old investor to a data-driven expert. When did you know it was on? Middle of last year, 3,500 properties thinking it'll get back to 5,000 by Christmas. And then you see this Christmas, 1,800 properties on the market. Imagine an unemployment rate of 2%. That's where we're at right now in property. Scary thought.
• 1:52
  You're listening to the Folio Property Podcast. I'm Rhys Biddle and I'm here each week with my co-host, Lachlan De La Hunty. Lachlan, if anyone's joined the podcast, what do we need? Newsletter. You want to talk about the newsletter? No, we'll talk about that as well. We'll do some reviews first too. Five-star review on Spotify. Like, subscribe, join the community. All right.
• 2:12
  For those listening, Rhys is really upset because he got his first non-five-star review, so it's down to 4.9. He's taking a bit of an ego hit, so please support him in this course to get more five stars. Yes, Lachlan. And he was too quick for me, but we also want you to join the community. So we've created some exclusive Investar Lens content from our Chief Economist, which will be launching at the start of Feb. There'll be a link in the show notes to register for that report moving forward. We've got a special guest today, the voice of the Perth property market, Trent Fleskins. Hello, mate. Yeah.
• 2:41
  roles reversed it's good you're on our podcast i was on yours recently it's it's been fun it's the second time i'm on now and uh i would have to first off say congratulations you're doing some really good work i really enjoyed listening to or watching a couple of the last podcasts clearly you you're data driven and you're spending a lot of time thinking about the why and then backing it up there's so many podcasts out these days they're just giving opinions
• 3:05
  and trying to sell stuff. And it's often stuff that you can tell that they really haven't had a good think about the why. And I'm really impressed with what you're doing, putting up a lot of the data stacks with the prop stack program that you've got going on. So keep it up. And I've got plenty of ideas for you on your indexes. I know you like your indexes. We do like an index. I'd love a couple more.
• 3:29
  I'll have to get you guys to do some work for me. Your shadow index. Yeah, let's send it. We've got a team. Let's do it. There's a good idea there. No, I appreciate the feedback, Trent. That means a lot coming from yourself. Mate, you were the most requested guest. That's why we had you on. The most viewed guest. Was I? The most listened to guest. So what I was keen to get you on, we've heard your voice for the last eight years. Lachlan's gone on your podcast numerous times a year. No one's really heard the Trent Fleskin story. I'm very uncomfortable about this, Trent.
• 3:57
  convinced me to do this, but I'm comfortable with how we're going to do it. Of course. Of course. So I think the angle I really want to go in today is Trent Fleskin's story, Perth property market, what he's seen, what changes, where is his opportunities. So I thought I'd just kick off Trent. Why property?
• 4:16
  I love that question. I think there are two types of people in the world. There are people who have a fear of missing out and there are people who have a fear of failure. And those who have a fear of failure are people who are probably not investing anything. They're the guys who listen to their parents who said, pay off your mortgage and then save and you'll be all right. And to be frank, most of those people are all right. They end up being fine because they're pretty prudent and they don't take many risks. And we don't take many risks. Yeah.
• 4:41
  You're right. But for those people who dream of something else that maybe they didn't grow up with and want to challenge themselves, you probably therefore have to, when it comes to money, invest in something, right? You see a lot of people go into, what are your options? Crypto?
• 4:58
  Art, stock market, property. They're probably the four things that I know of friends who invest in things. So like most young people having a crack with no money, I was 18 and invested in a couple of stocks, like $1,000. Maybe I made $200 or something. And the thing that really scared me at the time about that, what probably just concerned me was when you're on ComSec,
• 5:25
  you have the ability to just press refresh, refresh, refresh, and watching it go up and down. And my anxiety was insane. And that concerned me because it meant that it was becoming all-consuming, that live nature of my risk. So I had to learn how to deal with that or find a way to avoid it. And the other one was I've always been a big believer that if you aren't having an intimate understanding of the thing you're investing in, then you're a punter.
• 5:50
  There's really only one way to ameliorate that, and that's to trust experts. And when you're 18, 19, you don't have any network. You don't know who the experts are, and so you're punting on that as well. So what that did was lead me away from shares as a default because I was just continually concerned that I didn't understand what this mining company did. I didn't know what three ounces of gold out of a tonne
• 6:20
  met or whether that was good or bad. You can't really control the outcome either, right? You don't know if they're going to get an environmental approval or they're not. And if they did, there were people who were in the know before you who bit you to the punch anyway. You're trying to invest in a bank or some speculative share that went up 40% yesterday. You have no idea why and how. Let's really just be honest about that.
• 6:42
  And it's very hard even for myself now with just general investment and economic now to still be confident about if I was to go and invest in this stock on the market, even if I understood their business model,
• 6:59
  I don't know who the directors are or I don't know them personally. I can't decide for them what their decisions are going to be in the future about how that company is going on. So I still feel like I'm punting. And so property really just became the default after that. And the reason I like property and I've always liked it is because I feel like it's a lot more accessible to become an expert, to have an intimate understanding of that asset so that I'm not feeling like I'm punting.
• 7:24
  It moves slower. It's like a train. If it's going in one direction, it's very unlikely that you can press refresh and it's gonna change in value in 10 minutes. So it takes that risk away. And it gives you time therefore to think long and hard. And what I know about myself and my brain is I'm the least witty person, the least funny person you'll know, but I can get really deep into understanding concepts. And as long as I'm given enough time, I can therefore then try and make really rational decisions about these long-term investment choices.
• 7:53
  And so property, you can feel it, you can touch it, you can look next door and see who the neighbors are and how that affects value. You can use mapping programs to understand what makes this asset valuable. You can understand where the sewer and the water is, who owns the property next door. You can see what the last guy paid for it. You can't really understand how all that information comes together with a company.
• 8:18
  You can understand at another level how you can buy that asset and then split it up into three or four and do a Richard Gere from Pretty Woman and turn it into something more valuable. You said Jimmy Witty. That was quite funny. Thank you. That's all you're going to get from me.
• 8:34
  So you see people who buy companies, for example, and split companies up and make them worth more money. You can't do that when you're 19, 20 and don't have the money to buy companies and you certainly don't know how to understand them at that age. So that's what led me into property and I've stayed there ever since. And unlike a lot of people who diversify that risk by location in property, I've gone through
• 8:58
  of doing that through typology as well. And I might have been jumping the gun on that with a question maybe, but that's how my journey started. For those who don't know what typology is, do you want to explain? Oh, for example. Asset types. Yeah, asset types. It generally always starts with a house and it might then go to small-scale development. That might be a land subdivision. That might include a built form. And then you start to get into commercial. You start to get into industrial. You start to do just larger construction.
• 9:26
  arbitrarily more risky things. And my job is- As your expertise increases, right? Yeah, you start to then identify and mitigate that risk. Yep. Perth property, particularly, you're super passionate. You know, we hear that through the PR that you do on multiple radio, news stations, and the podcasts.
• 9:44
  Did you ever feel like, you know, did you have a bit of a chip on your shoulder with the East Coast when you first got into podcasting or really starting to push the Perth message? A hundred percent. I think about the podcast that I have and that started seven and a bit years ago. And the only reason I did it was I was fed up.
• 10:05
  with as a younger person going to these free events, the Novotel, the Hilton, the Langley that were run by mainly East Coast investment companies, education companies, Spruikers, and a couple of Perth ones that I'd love to mention but don't want to get into legal issues with. That have essentially copycatted those East Coast companies.
• 10:30
  where they targeted young people, first-time buyers, and first-generation Australians who don't have any connections or context either and would give them a really thinly-veiled, easy-to-research-yourself level of information at these free events and then straight-line Jordan Belfort you into a $30,000 education program, into buy this program,
• 10:55
  house and land package in a suburb that you've never been to in a state you probably haven't been to either. Trust us. And it affected people in my family as well. And so, yeah, I had a real chip on my shoulder as to why I wanted to help in that space. And I guess it was the start of that journey in my own education as well, to make sure that, you
• 11:23
  Certainly, the more educated I can get about property, the more I can help other people stay away from those sharks.
• 11:30
  I think we're all the same age and obviously Lachlan didn't grow up in Perth like you and myself, but there's definitely a message that Perth was boring. Everyone wanted to get out. You could look at the migration data of everyone leaving WA, but I think yourself and then publications like Perth's OK was a big thing when that came out was really to kind of put the emphasis on Perth as a city. And then post-COVID, it seems like that lifestyle choice has really driven everyone to... Well, COVID put us on the map, right?
• 11:58
  I think everyone realised during that period, everyone who was in Perth realised actually how lucky we are in the world of social media we live in. You can share it instantly. And I think everyone around the world goes, who are these guys? It's sunny every day. Lifestyles are made. They just look so happy. I think it really put us on the map.
• 12:13
  That is a thing about Perth is that I reckon it to be, you know, that boring uncle sort of space where, you know, it's just a safe fellow to have a chat with, not the most exciting guy when it comes to looking at it from a postcard. And so in times –
• 12:32
  that are a little bit precarious, like COVID, it's the first place you come back to, that safe place. And in times where the world doesn't feel so risky and scary, you have a lot of those people coming out of high school going, I'm going to live in Melbourne. And that sort of was the way things were from really my generation growing up is that it was
• 12:58
  How quickly can you get out of the person? Yeah, and you leave the nest and you go to more exciting, Hong Kong, London, Singapore, New York, this is where you'd want to work. But I think it certainly is maturing as a place to live. It's certainly maturing as a place to work. And as more and more of the capital cities around the world become...
• 13:19
  crowded. Perth stands out as a much more balanced lifestyle and one with far more opportunity. I count myself so lucky to be having grown up as a white male educated in Western Australia, graduating in...
• 13:37
  2007 with a runway over the last 18 years that has educated me on cycles, but for the most part, being a very safe place to get a job, an accessible place to buy a house and a really easy to understand place when it comes to
• 13:54
  moving through the property industry and understanding all the data. I mean, you think about places like Sydney and Melbourne, you have a fraction of the data on property side of things to be able to develop property and mitigate your downside risk. The amount of data available in Perth on property is scary from a privacy perspective, but it helps a developer like me in terms of understanding what it is and buying and what I can do with it.
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• 15:17
  Talk me through early days of you in the property industry. What was the market like and what were some of the fundamentals holding Perth back from growth?
• 15:28
  Yeah, so my first investment into property was buying a piece of land in Dutch and building on it in 2009. I was 19. I had a job. Banking laws were more relaxed then that allowed me to get myself a loan. I had Kevin Rudd's $21,000 first home buyers grant that paid for landscaping and an air conditioner.
• 15:51
  And we did all of our own landscaping. And that land was $250,000 for 480 squares. And the house, this is where it really kicks up. The house was a four-by-two with a theatre, turnkey $150,000. Wow. Right? Don't tell people building now those prices. That would be half a mil, at least now. Oh, yeah, and then some. And so at the time, what I recognised is I could –
• 16:15
  look on the newspaper. I was reading the newspaper and it was a classifieds ad that was maybe three lines long from a private owner who was selling up because they were, I think, too highly indebted at that point in time, 2009, coming out of the GFC.
• 16:31
  I went and bought that piece of land with my dad next to me off this private couple with no real estate agent involved at all. I went to a friend because, you know, as I said, I had minimal contacts at the time. A friend who was a sales consultant for Home Buyers Center. And what I recognized is the house next door was worth about 500 grand. I could buy this land for 250, build the house for 150, and I'm going to make 100 grand.
• 16:55
  I couldn't make that after tax in years at the time. So I thought this sounds like a lot easier to understand for me than the risky share market thing I've been trying to do for the last year or so. And so I just did it. And 90% of success is action, as they say. That's it. You just did it. I just did it. It was just a case of- Most people wouldn't. They're looking at it. That's too good to be true. It can't be right. And a lot of people would have been at that age dissuaded from doing that. And I'm really lucky that I guess I've always had the support
• 17:24
  in the money space, especially of taking a punt on things, at that age you are punting at 19, right? There's no other way about it. I was saying, mate, have a crack, you know? And so I did. And I was lucky in that way that whilst I didn't really understand the market, I couldn't have told you what the stock market was or how many people were immigrating into the state at the time.
• 17:44
  Pretty simple maths. I was lucky that Perth was still going through a growth phase for the next seven years, that I was able to make 100 grand on the first property, swing that cash into then going and doing some research on the old Australian Property Investor magazine and buying a place in Balgar and doing a house behind a house, and then using that money to then move into a triple X in Thornley, all within the space of, I think, three or four years, because I was just addicted to the game.
• 18:12
  And people that know me now will know that I don't spend any of the money that I make really. I still drive a shitty car that no one would want to buy off me. I saw you drive past. Yeah. Because for me, it's just a game that I'm addicted to. And when it all comes together, that deal at the end of the day is something that's really quite satisfying to be able to be a part of.
• 18:36
  Because I don't think I've met anyone so humble when you said it so well. I wouldn't be caught in the car that you're driving. That's coming from a bloke who doesn't own a car, right? So that's where we're very much aligned. I'm probably similar, both. Depreciable assets, boys. Why buy them? And then you're building your family home, which probably gives you some satisfaction all the years of work you put in and you've taken that project on yourself. But it is. It's just for you, is it purely the game? It's obviously financially driven to some degree, but is it just the passion for property or is it?
• 19:05
  I think it's, I'm of, I guess, that personality type where I don't do well with a boss. I don't like getting told what to do. And I think property has given me that freedom to be able to build something where I can have a family of people at work that I get to curate, who I hang out with every day, that we get to be really good at these things and there's pride in being really good at things and being able to help people with those skills.
• 19:32
  in a topic that I can understand, that I can help other people understand, and that I can win with. And that's as plain and simple as it is. If it was somehow that art was the thing that I came across at the time and I was somehow creative, which I'm clearly not, then maybe it would have been a business...
• 19:55
  buying and selling art, but property was the thing that I understood that I was good at naturally and that I can help other people with. And I think when you can combine those things, that's quite a fulfilling thing to do on a daily basis.
• 20:09
  Going through your first initial acquisitions there, it sounds like you were leveling up and taking it to that next level each time the more you probably educated yourself in the market. This is early on in your career. What about you've got the experience under your belt, COVID happens. Even before that, Reece, I'm going to jump in. What did you do from 2014 to 2020 when the market did nothing? So that's what I was like most people didn't make money in the birth property market between. I know very few. 2014, 2020.
• 20:38
  Yeah. Tell me how you navigated that. Yeah. So first thing I did in 2015 is I left my career in strategy and consulting and I got to the age of 25, had a bit of a quarter life crisis, realized that whilst I'm making good money, I wasn't necessarily very fulfilled and therefore very happy. Same mates, same gym, same way to work every day.
• 21:01
  same office that I just didn't enjoy hanging out with any of them, all because it was a job that I thought I should be doing and that I should be satisfied with. It looks good on LinkedIn. Yeah, essentially, if I'm really honest about it. And I was honest with myself about it at 25, had that quarter-life crisis, which sounds ridiculous to some people, and at the time recognized that it wasn't about money. Money is not what makes me happy.
• 21:23
  And so I had to find other things, go on a bit of a self-exploration journey. And so I went traveling for a year and a half, cut the cord financially, did a couple of house-behind-the-house developments, to be frank, whilst I was away to keep the projects going. It turned out to be literally two houses on two streets that backed onto each other.
• 21:45
  Just coincidentally, and just did two house behind a house, so it was quite convenient from a location perspective. That kept my brain going. I feel like I was achieving something. You couldn't make money at that time? The market's going backwards. Yeah, well, it was interesting that on the fees, though, at 2016 it would have been, the projects would have made me about $100,000. Yeah.
• 22:05
  That was book money. You don't make money into yourself. We know that. And there would have been a time between 2016 and 20 where that profit would have been eroded. And now obviously- So you hung on to those assets. 10 years later, there's a few hundred thousand dollars each in those things. I'm a big believer if you don't sell unless you need to, or if you've got something better to do with that money. It's an opportunity cost. And there hasn't been a point where I've needed to. There may have been a point where I've had something better to do with that money.
• 22:28
  But you could hang on. Yeah. And you only realize the loss when you sell, right? Exactly right. And so the same thing happened. I finished a triplex development just before I went traveling. That would have made $200,000 on paper in 2016. The market then went backwards for a couple of years. And there would have been a time where that development was break even or even at a loss, holding those three assets. But what I knew was that the rent was covering the mortgage.
• 22:53
  I had no need to sell and now you look at that book value again, I haven't sold any of those, there'd be over a million dollars worth of equity in those properties. And so again, unless I have something better to do with that money right now or I need it, there's no need for me to sell that. But to answer what was happening between 2016 and 20, I came back after a year and a half, big self-development space.
• 23:17
  Got honest with myself after meeting people along the way who sort of gave me some clarity about what I enjoy in my life. And I was shown a TED Talk that I normally wouldn't watch. You know, TED Talks is things you really have to be passionate about. And it was like five ways to know your path in life.
• 23:34
  which is pretty wanky, right? But when you're on holidays, you watch them all. Absolutely. And I don't remember the other four things, but the third thing was, what's the one thing you're good at that people know you for, like your mates and your family, friends? And that was researching property and developing property. That was what I've been doing since I was 19 as a side hobby with my full-time job when I should have been asleep, right?
• 23:56
  And so I was like, stuff it up. Literally, I've cut the cord. I've got nothing I need to go back to. I'm gonna go home, get all my diplomas and my licenses and things like that and help people doing what I've been doing. And that's where Strategic started. It was a business helping other people buy property and develop property to the extent that they can afford it.
• 24:18
  And so from 2016 to 20, we started off with me and then it was another person, another person in the team. And it grew to us helping 105 clients do 105 duplexes, triplexes and quads. And that was my gig. And obviously it's just graduated. I've sort of promoted myself over time.
• 24:40
  as I was ready with my risk profile and my education to learn more and therefore take on, as you said, incrementally another risk at a time, maybe one risk per project at a time to do bigger projects and different projects with different segments in the market. Post-2020 COVID, the start of, I guess, the Perth upswing that we're on now, when did you know it was on?
• 25:07
  To be frank, I think we knew it was on before COVID and COVID was a speed bump. The first podcast episode I did, number one, with Brendan Ptolemy, who I think has been on this podcast, you guys, he was my first guest, December 2nd, 2018. And the episode essentially was called Green Shoots, question mark, which is ironic given the conversation that you guys are having about Melbourne right now. And you don't know what the future holds.
• 25:34
  for Melbourne and we didn't know what the future held for Perth. There wasn't like an AUKUS happening. We were still in the doldrums, 30 weeks of stock on the market. We hadn't even gotten to the worst stock on market yet, which was five months after that podcast started, which was 17,200 properties on the market in March 2019 when Bill Shorten lost the unlosable election at the time to Scott Morrison.
• 25:56
  threatening our property tax incentives. Never touch negative gearing. Yeah. But then, so that was, I think, the impetus really of having a conversation about where we think this is going. And then I guess it's data driven. It's always been data driven for me. There's no point feeling it out.
• 26:15
  What we started to notice was stock on market from March 2019 was dropping materially before COVID. And then COVID was a scary time for everyone for six weeks in Perth. But I was very confident, especially that, and the data shows like one-to-one nearly, every transaction we didn't get in that six weeks,
• 26:37
  was made up for with massive like 1,400 transactions a week over the next couple of months in Perth. So you came back to that mean of transaction growth. And then you really knew it was on, I think, when we started to drop below 13,000 and started to drop below 10,000 properties on the market. And then it's just been a conversation every year since then of surely it can't get to 8,000.
• 27:01
  5,000 properties on the market and then obviously be in a situation where just middle of last year we're at 3,500 properties thinking it'll get back to 5,000 by Christmas. There's got to be some mean reversion going on here at least. And then you see this Christmas of 1,800 properties on the market. Scary thought. I mean that's below – that's like imagine like an unemployment rate of 2% or something. That's where we're at right now in property.
• 27:29
  What about from a East Coasters dominated the market early on, I guess, from that investment standpoint? What opportunities did Perth people miss at the start of that cycle? So just to give you a bit of an example, I know when we were buying in Rockingham, majority of those investors were East Coast because there's a bit of a bias on Perth.
• 27:45
  Well, you couldn't tell a Perth client to invest in Rockingham at that stage. I'll just take a little flashback, Reece. I used to do, and you did them as well, you do the seminars, you might go talk to BOQ, I'll do a presentation to them, or go to brokers, go and present to them, or you present it to Rewa, whoever it is. I'd go around and talk about Perth being a really good opportunity to invest in 2018, 19, and you get laughed out of the room. I remember this accounting firm up north, and there would have been 50 people a desk.
• 28:10
  50 people attended. And they just critiqued it. Two comments were, you can't make money in property, because the last decade no one made money in property, no one besides Trent made money in property, and you certainly can't do it in Perth. And those conversations are like, the East Coast is a completely different market, you know, Melbourne's booming, Sydney's booming. And it's funny, now we're here today and it's like, you can't lose money in Perth. Everyone's like, everyone, it's a bias, it's that recency bias that's a...
• 28:37
  Yeah, exactly right. And that was the experience as well. I remember talking to banks, private bankers in the late teens, and they had zero interest in Perth. They were so busy putting all their money into projects, apartment projects in Sydney and Melbourne. We had risk profile. It was actually hard to get debt because they give our suburbs ratings. Yeah, we had risk ratings that were hard from the big banks. From the valuations. Valuations, yeah. So you try to buy something. You can't make a risk rating because of market conditions. That's right. Everything's against you, right?
• 29:06
  That's right. So yeah, the whole system was set up against us because we were sort of the fodder. When markets are going well in Sydney and Melbourne, they don't have a need to look towards us. And therefore, we don't get any of that impact, right, of money coming our way, no pressure that way. And so it was a double whammy coming in back in 2000.
• 29:27
  2021, I reckon, was really when you started to see East Coast investment hitting suburbs that I wouldn't invest in, to be honest, even today. They're just places that I have such a bias on with regards to socioeconomics that I wouldn't be putting my long-term money in. And it was a two-pronged approach. And despite-
• 29:47
  like massive growth in these suburbs. You've got to be honest about these suburbs, the ones we're talking about are ones that are top 10 growth over the last five years. But a big reason for it has been this huge injection of capital from East Coast equity into suburbs that they had no bias on. They didn't understand or relate to some of the negative bias about the places in the city of Gosnell, the city of Amidal, the city of Kwinana, the city of Mandurah, that if we had the equity...
• 30:15
  we'd be going to the city of Canning or the city of Coburn or the city of Belmont if we could afford it. And if we couldn't, we may not even have invested in there. And we had therefore missed out on a lot of growth. Now, the first couple of years of growth was simply just self-fulfilling growth. It was the locust swarm penting up prices against each other and people sitting back and going-
• 30:36
  What's going on? This isn't us. You know, one, we don't have any equity to invest anyway. And two, we wouldn't be buying this stuff. And so that has really structurally shifted the price points. It has then been reinforced by, regardless of East Coast money or not, replacement value issues of, you look at Armidale, it was $265,000 a million house prices. Now, close to 600. You couldn't build the house on that, that you'd be buying for 265. You couldn't build it for 400. Yeah.
• 31:06
  So there's some real structural changes now that have – that the East Coast guys has kicked into gear. And now you've got Western Australians who have equity, who want to place it somewhere, who don't want to go to the East Coast because they don't understand it, who can't afford – let's just use an example, Canningvale – and who go, well, if I'm going to be in the market and I'm going to at least get on the surfboard and ride the wave with everyone else –
• 31:30
  but I can't afford a surfboard, I'm at least going to buy a boogie board. And so they're getting in Armidale or they're getting into places that historically, let's be honest, we just wouldn't have bought in. I think you've openly said you wouldn't send your clients to, you know, as well. And then, yeah, apartments is a great example. You look at Sydney. Sydney's market has matured so much that apartments are just as viable in investment option as houses. Very accessible. Very much like the New York market where it becomes the norm. Exactly right. Now, Perth, for...
• 32:00
  up until now really you go, nah, why would you? You don't need to and the market hasn't accepted it. So that's starting to change as well because people have to accept it because it's all they can afford. They become- For the location they want to be. For the location, if they don't want to compromise on location, they become-
• 32:17
  normalized to it. Their friends and their family become normalized to it when they're coming over for a barbecue. And then suddenly it becomes an asset class that is norm. Not by preference, but by compromise. Tomorrow morning is knocking. Stock your fridge now. How about a creamy mocha frappuccino drink? Or a sweet vanilla? Smooth caramel maybe? Or a white chocolate mocha? Whichever you choose, delicious coffee awaits. Find Starbucks frappuccino drinks wherever you buy your groceries.
• 32:46
  I'm reading between the lines there. Through that period, part of your acquisition strategy is probably more blue chip assets and you're standing clear from some of these speculative assets that we speak about quite often. Looking into 2026 and beyond, from an investment standpoint, has your strategy changed over the last couple of years from an asset type and a location? And do you or would you invest outside Western Australia?
• 33:13
  Um, there's some great questions. Yes. So my investment strategy has just changed with my risk profile, with my education and with my capacity. So I'm probably not one these days who's investing in passive on, to be frank, I never really have been someone who's invested in passive investments other than the first house that I built when I was 19. Everything's had a strategy. I've always had to have some way that I can add value. And for me, 99% of the time that is through development.
• 33:41
  So now it's just larger developments. So now I'll be doing commercial developments. It might be, you know, the smallest developments might be childcare centres now. And the larger ones would be commercial resi developments that are some, an old lady never sold in an infilled suburb in Perth. There's a couple of hectares left over there.
• 34:01
  Everywhere around them has been developed into the suburb and she never sold and she just passed away and it's up for sale and I can go in there and instead of doing a triple X, I'll develop 40 houses at a time. Or it might be industrial. Industrial is a market that has clearly got a lot of downside protection these days with online shopping and the decentralization of products.
• 34:25
  transport since COVID. And so that's, that's somewhere I'm at as well. But really, it comes down to a philosophy of in the market that I'm in, which is property.
• 34:37
  How can I solve society's problems? The biggest one being housing. That's the one I can solve. I can't solve crime. I can't solve hospitals. So I'm going to solve housing. And how can I do it in the way that I see most risk averse, given that property development inherently is a profitable thing to do, as long as you can identify, quantify, and then mitigate the risks along the way.
• 34:58
  And so that's my strategy is wherever I'm going with my money, it's trying to continually solve the housing crisis, which is currently a supply issue. It's not a quality issue or an infill issue right now. It's a supply, broad-based supply issue and do it in the least risky ways. And then would I invest outside of Perth?
• 35:18
  The only reason I would do so, given my strategy, has been to diversify on sectors of the market in Perth rather than location is if I got to a point where I believed, not that I was oversaturated in the market, but that Perth didn't have legs and that I wanted to allocate my money to a market and then I would probably have to give my money to Lachlan and say, Lachlan, go and put it in Melbourne because- She should ride me hard as a client too. Because I would ride you so hard as a client too.
• 35:47
  because I agree with you that the fundamentals are now stronger in Melbourne for my money to do what would probably be a development strategy, which is what I do. Trent Fleskins, thanks so much for joining us today. We could go another 30 minutes, but we'll save it for the audience for part two. Sure. Cheers, mate. You've been listening to Folio Property Podcast.