MORE THAN doubling one’s volumes – from $119m to $256m – is a startling achievement. Leaving the franchise system and going independent in the same year is an entirely different challenge. Yet that’s what Victoria-based Marshall Condon has achieved, and having gone from sixth to fourth to second in the Top 10, his upward career trajectory is crystal clear.
Condon’s numbers have been years in the making, he explains. “A lot of those transactions are larger transactions that take a while to settle. One of the transactions in there was $160m, a tower we financed, and that’s taken probably three years to do.” The day-to-day brokerage is kept ‘ticking along’ by residential lending; with the commission from the larger deals “we keep [it] in the bank for a rainy day to iron out the ebbs and flows that we get”.
In fact the client behind the tower was Condon’s first deal while at Mortgage Choice. Condon has built relationships with property developers from his time at Bankwest, through his time at Mortgage Choice and then Neue Black. Nevertheless, founding Neue Black was a big change for Condon. The brokerage is a masterclass in branding – slick, corporate and openly targeted at millennial buyers and investors. Yet Condon insists he’s not sidelining commercial. “There’s a long-term strategic direction to line up the residential and commercial side in a more sophisticated way,” he says.
For now, individual reputation rather than brokerage brand matters most in property development, Condon says. “The market we work in is quite a small space, so they know who’s who, and who delivers on what they say they will.” Clients and brokers are faced with the challenge of overconcentration, where banks won’t lend to larger developers who already have multiple deals with them, and Condon prides himself on finding a bank that will, and acting as a ‘translator’ between lender and developer.
If Condon’s success this year has been a delayed effect of the development market’s success over the last few years, then the question arises as to what Condon’s numbers will look like a few years from now. The year 2016 has seen banks pull back from lending to developers in certain areas – many of them in Melbourne – and brokers are looking elsewhere for finance. Condon in particular is thinking ‘out of the box’. “The main lenders are pulling out, but that doesn’t mean that a large hedge fund from America, for example, won’t want to come in and start offering first mortgages.” He knows of two hedge funds currently doing so, in addition to various Chinese lenders.
For Condon, development finance faces a period of transition. “Will it be as cheap? Probably not. Will it be as available? Probably not. So you’ll still need to know the right people. I think there will be a delayed effect, because credit has tightened now and there aren’t many other options yet, so I think in the next two to three years this whole issue of oversupply will fix itself given tightening credit.” Even when the tap does get turned back on, “it’s going to take a good developer to get a good return out of these sites”.