SINCE first establishing their joint venture partnership five years ago, Home Building Society and Satterley Property Group have been developing some of the largest and most successful residential estates in Australia.
The combination of this successful partnership and current market conditions has enabled Home Building Society to produce profits 30 per cent higher than the previous financial year’s results.
The higher returns are the result of both buoyant land sales and sustained high levels of housing finance.
Home and Satterley, and numerous other interest groups, have been developing land together since 1998. The lending institution purchases and holds the tracts of land and Satterley acts as both project manager and sales agent of the estate developments.
Joint ventures include Brighton Estate, Grove at Ashby, Kennedy Springs, Dalyellup Beach and a new estate in Busselton – altogether the estates contain 12,600 lots.
Brighton is the largest selling estate in Australia and is also the biggest non-mining construction site in the nation. With 800 employees working on-site, about 50 lots are being released on the estate a month.
Home Building Society chief executive Jim Freemantle said most of the major banks saw banking as their core business, whereas Home specialised in home loans and it was a natural progression of the business to go into land development.
Mr Freemantle said the large increase in land sales this year, plus the high level of home loans were a significant factor in increasing profits.
He said the bank had learned that quality always sold and it would continue to look for opportunities in the southern and northern corridor coastal regions.
“We expect the next six months to be very solid; there is nothing on the horizon to see that points to any downturn,” Mr Freemantle said.
The financial planning arm of the bank was expected to expand over the next two to three years, he said, which would help counteract any downturn in the property market.
“We will continue to ride the property cycle hard and build our financial planning business up,” Mr Freemantle said.
Home Building Society first took the opportunity to link its core business of home loans to land development when Nigel Satterley approached the bank in 1998.
Mr Satterley had assisted Sir James McCusker in establishing WA’s first land bank with Town and Country, which was later sold to ANZ in 1984. When ANZ sold out of the land bank component, Mr Satterley said he took the land bank template down the road to the Home Building Society.
Mr Satterley, who recently received the Real Estate Institute of WA’s Kevin Sullivan Memorial Award for his excellence and achievement in real estate, said the success of the joint venture estates arose from the high quality of the land development and landscaping in the estates.
He said the company was also one of the first to pick up early on the market demand for coastal land.
Whereas most land developers turn over around 800 blocks a year, the Satterley Property Group does 4,000.
Mr Satterley said consumers were far more discerning when looking for a quality product, and were looking for lifestyle, flat level blocks and safer communities.
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