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Introduction

Discussion in 'Introductions' started by David B, 19th Jan, 2008.

  1. David B

    David B New Member

    Joined:
    10th Oct, 2007
    Posts:
    3
    Location:
    Sydney, NSW
    Hello all,

    I was referred to this site by another member and have enjoyed many of the threads on here.

    I work for a property research and investment firm and I look forward to participating in some great topics. There are many great topics here with some very knowledgeable investors.

    Cheers,

    David
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,623
    Location:
    Sydney, Australia
    Hi David, great to have you here!
     
  3. Billv

    Billv Getting there

    Joined:
    15th Jul, 2007
    Posts:
    1,796
    Location:
    Sydney, NSW
    Hi David
    Welcome to the forum.
    Cheers
     
  4. Nigel Ward

    Nigel Ward Team InvestEd

    Joined:
    10th Jun, 2005
    Posts:
    1,172
    Welcome on board Dave!

    If it's not giving away too many of your employer's data and secrets how about sharing some insights for us?

    Perhaps you could talk about the methodology your firm uses to identify property hotspots and forecast growth suburbs or properties?
     
  5. David B

    David B New Member

    Joined:
    10th Oct, 2007
    Posts:
    3
    Location:
    Sydney, NSW
    Hi Nigel,

    You bet.

    First of all we take a top down approach when identifying key growth areas/hot spots. It starts with region identification then suburb identification then development identification, preliminary analysis on performance indicators and market drivers, acquisitions will visit the site and if all looks good at this point we then apply our research methodology.

    Our research methodology is unigue and based on a multitude of investment fundamentals, key market drivers and development specific attributes, our methodology is a weighted multi-component formula allowing us to rate the overall investment merit of a property development in a single measurement.

    The components that are incorporated into our methodology can generally be put into three distinct groups:

    1. Performance indicators - Capital growth (past, present, future), yields, vacancy rates, many many more
    2. Market drivers, indicators and sustainability - population growth, population drivers such as new companies going in to a suburb or leaving, meetings with local councils, infrastructure, proximity to transport, many more
    3. Development specific attributes - comparables, quality of development (we have an ex developer and builder on our team that inspects the quality of the site), developer history, architect, size, views, outlook, etc, etc

    Each component within the three groups above is uniquely weighted and combined to give an aggregate rating out of 100.

    In order for our analysts to deem an investment as superior, the development must score an 85 out of 100. We have put over 300 developments through our methodology and about 10% have passed.

    We are two years old and the properties we have identified as superior have out performed the market by 14%.

    Our methodology is consistent and repeatable. We put together a PRA - Product Research Analysis n each development that is about 40 - 60 pages. It demonstrates the same due diligence you would expect from any other financial product.

    I hope this helps.

    David