National valuations firms target WA

A SPATE of mergers in the property valuations sector could be a sign of things to come, as the downturn in the property market forces greater consolidation within the sector.

National property valuer Herron Todd White announced this week it had merged with Southern Independent Property Valuers, which has offices in Bunbury and Busselton.

The two offices, which employ a total of 11 staff, have been rebadged Herron Todd White (South West).

That merger follows another in July this year, when Herron Todd White merged with Subiaco-based Sullivan Valuation Services.

The mergers are part of Herron Todd White's national expansion strategy, enabling the group to capture a larger price of the shrinking pie in terms of market share.

Herron Todd White chief executive Brendon Hulcombe expects even more merger and acquisition activity in 2009.

Mr Hulcombe said a number of the smaller firms were struggling with the increasing cost of business and were seeking to merge with larger firms that had a national presence.

"A lot of our bigger clients are cutting down on the number of suppliers they want to deal with," he told WA Business News.

"It's going to get very tough for some of the smaller independent valuations firms."

Mr Hulcombe said Western Australia was unique in that it had a number of strong independent valuation firms that were locally owned and operated.

"WA has some big valuation firms that have done well and have done so as independents," he said.

The past six months has been an active period for mergers in the valuation sector.

Last month, Christie Whyte Moore Valuations and smaller rival Valuation Partners merged to form a new company, Quantia Valuation Consultants.

The merger created one of WA's largest valuation firms, with a total of around 40 valuers across its four offices in Perth, Dunsborough, Bunbury and Mandurah.

In addition to the national firms that have increased their presence in the WA market in recent times, WA-based independent valuations firms Hegney Property Valuations and Glendinning & Associates are also ranked as some of the state's largest.

But national firms looking for Australia-wide coverage, either through mergers and acquisitions or establishing new offices, are targeting WA.

Propell National Valuers entered the WA market in July 2007 with the acquisition of Ray White Valuers, which has offices in Perth, Mandurah and Dunsborough.

The firm is now one of the state's top five valuers.

Chief executive Bart Mead said expansion was in response to the changing marketplace.

"Clients are looking for an easier solution and higher quality and more consistency in service...you need to be on a national basis and have that national structure," he said.

"Before Herron Todd White and before we went in [to WA] it was all pretty much stand-alone companies with no association with anyone else in Australia. Now the new names that are appearing in Perth are national.

"To be in a position to get a seat at the table at tendering you need to be a national company."