Perth-based home builder ABN Group is planning to expand its operations in Victoria as it adjusts to the slowdown in its home state.
Perth-based home builder ABN Group is planning to expand its operations in Victoria as it adjusts to the slowdown in its home state.
Managing director Dale Alcock said the solid performance of its Victorian operation was in marked contrast to the WA market.
“I’m glad we expanded to Victoria in 2009,” he told a recent lunch hosted by EY, as part of its Entrepreneur of the Year program.
“Forty-five per cent of our volume is out of Melbourne.
“We’re still writing reasonable contract housing volumes for our two brands in Melbourne.
“We’re looking to expand to regional cities within Victoria, as our next growth area, as well as medium density and dual occupancy in Melbourne.”
Mr Alcock said all parts of the business in WA were soft.
Commercial construction was very competitive, with builders bidding low just to win work.
The residential rental vacancy rate in Perth has fallen below 3 per cent yet, in contrast to previous cycles, building has not picked up.
“Our home improvement business usually picks up when new building activity drops off, but that hasn’t shifted either,” he said.
“So every area, from a WA perspective, has been really flat.”
Mr Alcock welcomed government initiatives to boost the sector, including an expansion of the KeyStart scheme in WA and the announcement by Scott Morrison (matched by Bill Shorten) of a 5 per cent deposit scheme for home buyers.
“That is a great initiative and irrespective of who wins the federal election, it will be great for Australians buying their first home.”
Mr Alcock said skilled labour was being lured away from the industry.
“We need to bring forward activity just to sustain trades and apprentices,” he said.
“In our businesses, we’re already seeing people attracted back into resources jobs.”
He called for skilled migration to be eased.
“That needs to be freed up, so bricklayers, tilers, painters go back on.
“We really need to be on our game and act ahead of the need. That needs to be addressed quickly.”
Austal chairman John Rothwell had similar concerns.
“Most definitely there is a shortage of trades and that is becoming more obvious,” he said.
“Applications for young male apprentices has dropped. Now we’re trying to get girls in. That’s toe in the water stuff.”
Prendiville Group chairman Peter Prendiville said skilled labour shortages was a pressing issue.
“It is a critical issue for tourism and hospitality, and its critical right now,” Mr Prendiville said.
“We do not have the available staffing, and the quality staffing, to man all these new operations, let alone the ones that are yet to come.
“Working holidaymakers and student visas would really help, but that doesn’t help with skilled jobs like chefs.”
