Developer Harry Triguboff says buying land at Sydney prices is unprofitable

Mr Triguboff said he was selling fewer apartments and renting more units even though rents were continually rising.

“I have never seen a market like this … my rents are going up all the time,” he said.

The Meriton founder said he was reluctant to purchase more sites in NSW because of his difficulties getting planning approvals from various councils, particularly Sydney’s Parramatta Council, which he described as “very bad”.

“If I can’t make a profit nobody can,” Mr Triguboff said on Tuesday.

“If I had to buy land today (in NSW) I could not make a profit.

He said the Planning Department in NSW was “hopeless”.

“Our politicians refuse to adjust with the times … in their minds if they do nothing, they will be re-elected. Well the advice they get is wrong,” he said.

“We must move with the times. If people have cars, they must have garages.”

Mr Triguboff said he was arguing with councils over about 1000 units he wanted to develop, and Parramatta Council “looks for rules that are irrelevant and out of date”.

“It’s absolute nonsense. Nobody could make a rule 50 years ago which is good today, and that is what they are trying to do,” he said. “They want to prove all the time that they can force me to do what they want.

“(But) a lot of the problem is there is no profit (from apartment development) today.”

Mr Triguboff said the market had changed. Buyers who would once have opted to buy a house in an outer suburb of Sydney were instead buying three-bedroom apartments closer to the city.

“This has created a new market for us at Meriton,” he said.

“People now require bigger apartments. They don’t want to live in cottages in ‘woop woop’.

“We are catching up with demand, that (three-bedroom apartments) is a new market for us. That is good.”

Mr Triguboff, who employs his own construction workforce, said he had enough land to build for the next two to three years.

“After that we will see what happens,” he said.

Mr Triguboff said that 40 years ago he would sell all the units he developed. Five years ago he would sell two thirds of the apartments he developed. “Now I sell only one third of the apartments I develop,” he said.

The remainder were used as serviced apartments or leased.

“I own 5500 serviced apartments and 5500 residential apartments, and I have 2500 apartments in the (construction) pipeline,” he said.

Mr Triguboff said he liked buying at Queensland’s Surfers Paradise because the land was cheaper, it was waterfront and councils were easier to deal with than in Sydney.

 

*The story by Lisa Allen first appeared on The Australian.