Former Goodman Group Japan managing director Matthew Gibb knows the value of a little Japanese and a lot of patience after spending three years helping establish the company’s Tokyo based business.
“I know enough Japanese to be polite when meeting somebody. Enough to get home in a taxi after Karaoke,” says Gibb, who now heads his own property company, Gibb Group.
“I took lessons for a long time while I was there but there was just so much to do (at work) and I found that was probably enough if you had other things to offer.”
From 2007, Gibb was chief operating officer of Goodman’s Japan business, leading the group through its merger with listed entity JREP Ltd and establishing its first wholesale fund, which held 15 properties valued at $US650 million.
But while getting by in a foreign language was no trouble, Gibb says he found the way in which Japanese companies make decisions by consensus more difficult.
“I thought I was a patient person before I went to Tokyo, but I came back an extremely patient person,” he says.
Gibb returned to Australia in 2009 and shortly afterwards set up Gibb group. The company specialises in industrial property management and development with the two directors of builder Qanstruct, Andrew Percy and Mark Ruff.
He met the pair through his work expanding Goodman’s (then Macquarie Goodman) interests in industrial property in Melbourne in the mid-2000’s and the business relationship was reignited after Gibb left Goodman and moved to Melbourne.
Over the past three years, Gibb Group has quietly built up an industrial property development pipeline valued at more than 4100m. It also manages a portfolio of industrial properties worth around $100m.
The plan is to either sell the properties once they have been developed to a single investor or into syndicate funds that Gibb Group will manage.
The company also hopes to set up its own industrial property fund in the future, but Gibb says the firm would need to find a capital partner before he could execute such a deal.
Recently, the company sold a purpose-built industrial property it developed for Kraft Food Company in Melbourne’s western suburbs for $21.4m just weeks after signing the tenant on for another five years.
“We’ll win the occasional pre-lease and package that up and work with an investment partner on a case-by-case basis.
“But the real opportunity, particularly through the next cycle, is buying well-located buildings – arguably below replacement cost – that can be refurbished or repositioned and then released back on to the market.” he says.
While the group is looking to expand, Gibb says the patience he developed in Japan has come in handy while building a business in Melbourne’s patchy industrial property market.
“It’s about sitting back on things and not necessarily rushing in – being patient and picking the right property that ticks all the fundamentals.
“In the market more broadly you see some transactions – or you see people chasing portfolio transactions – where it might not make sense necessarily to dot hat,” he says.
Often that strategy doesn’t drill down to the quality of each of the properties within the portfolio.
Gibb says it’s important to consider how close the property is to the nearest motorway or freeway junction and whether large trucks such as semitrailers and B-doubles have access to it.
Being located close to a train station or having car parking on site for staff should be key consideration as should the building’s potential for future expansion, Gibb says.
“It comes down to working through a due diligence checklist. And that comes with time and having experience in that, he points out.
“Sometimes people look to grow (their business) for growth’s sake,” he adds.
Gibb says there are good industrial properties with strong future growth prospects, but notes that the market has been going through a slow period over the past 12 months.
“It’s a pretty flat market; it will be for the next couple of years.
“Which kind of suits a business like mine because if we can continue to sign leases and do deals in this climate, then we look forward to things improving,” he says.
13 September 2012 – The Australian