Well, here we go again!
If you have been living under a rock or just back from sailing in the middle of the southern ocean, here’s a news flash! We have a new PM. Another PM.
It's time to say goodbye to Tony’s slogans, ‘Jobs and Growth’ , ‘Debt and Deficits’, ‘Lifters not Leaners’ . Change is a coming.
Roll out the red carpet (a very expensive one hopefully) for Malcolm ‘Top end of Town’ Turnbull.
It shouldn’t come as a surprise that the reason Big Mal is now in office is the economy.
Turnbull is one of Canberra wealthiest members of parliament behind that Dinosaur or Cliveosauraur, Mining Magnate Clive Palmer. His wealth has been estimated at a touch over $185 Mill.
As the world around us is slowing, China down, Europe pulling itself apart, trouble in the Middle East, we as Australians are now more focused about maintaining the good times post-mining boom.
So what is Malcolm going to do? Well first he is a businessman. Remember that thing back in the 90’s called OzEmail, yet that’s him. He worked at the world’s largest investment bank, Goldman Sachs. He was also Kerry Packers lawyer. Enough said.
In Malcolm’s first week he has given an insight into how his Prime Ministership will play out. Remember these three words; Innovation, creative, disruption.
“The Australia of the future has to be a nation that is agile, that is innovative, that is creative. We can’t be defensive, we can’t future-proof ourselves”
Amen. I’m feeling patriotic!
The good thing about Turnbull as PM is he gets business. He knows the impact the government CAN play is stimulating activity in our economy.
This is good for everyone!
Turnbull has continually stated that government, the public sector and the Australian business community in general have failed to grasp the scale of change that is currently happening in the world economy, let alone the Australian economy.
Think smartphones, Uber, Airbnb, new business models, delivering phenomenal profits and jobs for minimal investment.
The focus should be to drive growth through creation, which will impact jobs and economic activity.
This is all well and good. But how is this going to help you and me as a property investors?
Economic activity is good for commercial property. Full Stop.
Think about the creation of jobs and new business and how this flows into commercial property?
What types of commercial property will be needed to meet the demands of the new Turnbull economy?
Turnbull has spoken extensively about housing affordability but more interestingly he has spoken about the need to streamline infrastructure across the nation and improve the viability of businesses that require physical distribution and access to road and rail.
Turnbull has also flagged significant investment in public transport, opening up outlying suburbs across the country to businesses currently restricted by no public infrastructure.
This is a green light for investors to begin identifying opportunities.
When you are identifying these opportunities, think about your new PM.
Malcolm is a smooth operator who looks to longevity in his investments. He has a mixed of prestige residential well documented.
What you may not know is he also invests heavily in commercial real estate, both listed stocks and private managed vehicles.
He has money in the market ‘Skin in the Game’ so understands that protecting real estate investments is very important in his economic policy and job as PM.
This cannot be understated.
It was recently disclosed Money Mal is an investor in the Morgan Stanley Real Estate Fund.
Last week they decided to sell a paltry $9 billion of commercial real estate around the country. Great work Money Mal.
The reason for all this discussion about Turnbulls wealth is that he is unlike any other PM in the history of the country.
I hope his economic credentials and economic confidence he have a direct impact on economic activity.
This means money in our pockets and the confidence to invest in commercial real estate.
Australia is only one week into Turnbulls reign. We must temper our excitement but there are positive signs.
Personally here are focus areas I would like to see from Malcolm.
This will provide flow on benefit to commercial real estate.
1. Technology and Entrepreneurship
We need to create incentives for people to start businesses.
Forget tax offsets on income and grants to purchase new coffee machines.
Technology start-ups need cash, cash and more cash.
New businesses need office space, driving both new buildings and competition for existing ones.
2. Public Transport
Public transport networks in most major cities haven’t changed in 20 years.
Invest in better rail infrastructure to keep our cities moving.
Infrastructure creates jobs in the economy and opens up outlying suburbs.
These suburbs are close to residential housing and therefore need new office buildings, retail and industrial real estate hubs.
I will leave it to Malcolm, The Man, The Boss, The Money Maker to get you excited about the future…
“There has never been a more exciting time to be alive than today and there has never been a more exciting time to be an Australian”
We can only hope.