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How does your usual day start?
I like to have a structured morning routine on weekdays; starting the day as soon as the alarm goes off, I immediately have a short cold shower which is effective at quickly waking me up. Then I have a coffee, stretch, followed by reading the Australian Financial Review to stay on top of current trends and then head to the office. The rest of the day I try to follow a structure of calls in the morning and meetings/inspections in the afternoon or night.
How did you start your career in commercial real estate?
When I was 16 I didn't have a clear idea of the career that I wanted but I knew I wanted to work in an industry that included a high degree of interacting with people whilst being both in and out of the office. My parents encouraged me to cold call property valuation companies from the White Pages to try to secure some unpaid work experience. I'm lucky that I did because after a few calls I was fortunate enough to secure one week’s work experience at Herron Todd White. From there I decided that I wanted to work in the property industry and set my sights on completing the Bachelor of Urban Development (Property Economics) at QUT.
While completing my degree I worked at Urbis as a tenant representative for Telstra/Optus/Vodafone to assist them in securing both ground and building leases for telecommunications facilities. In 2014, after a couple of years of working at Urbis I realised that I enjoyed the negotiation process and decided that I wanted to jump into the deep end and try my hand at selling commercial real estate.
I'm glad I made the leap because I enjoy both the technical complexities of selling tenanted commercial property and the high degree of daily social interaction.
What do you enjoy most about working at Ray White Commercial? What makes Ray White Commercial different?
Having worked at both a small commercial agency and one of the biggest in the world I can very happily say that Ray White Commercial is a company that I could see myself working at for a very long time.
The organisation is supportive from the top down, any help or training I have wanted has been provided and I know that I can reach out for assistance from colleagues and directors at any time. The immediate support network of our office manager (Emma Harris) and team administrator (Jessicca Gallow) is instrumental in providing the best possible outcomes and service to my clients.
What are your go-to property marketing methods that you present to your clients?
I specialise in selling commercial investments in South East Queensland including (shopping centres, freestanding/strata retail and offices assets). These asset classes are typically highly desired and lend themselves to being offered for sale through both auction and expressions of interest campaigns. Each commercial property and landlord are unique in their own right. Therefore, the method of sale we recommend to each landlord will vary on a case by case basis.
Tell me about a unique success story?
In December 2018 I sold at auction, 25 Caxton Street, Petrie Terrace which was a character style mixed-used building built in circa 1885. The seller was a relative of Paul White’s son in law, so it certainly felt at times like all eyes were on me to ensure that nothing short of the best possible outcome was achieved.
The property was tenanted by Enzo & Sons, an Italian restaurant run by bar star Jamie Webb, whose nearby businesses were either liquidated or sold during the auction campaign (Lefty’s Old Time Music Hall at 15 Caxton Street and Seymour’s Cocktails and Oysters at 19 Caxton Street). Not only did I have to manage the sale with the large amount of unfavourable press about the tenant’s other businesses, but the actual tenant’s business Enzo & Sons of 25 Caxton Street was put under contract for sale during the auction campaign.
There was significant interest in the property (84 enquiries) however my hands were somewhat tied in my ability to actively engage buyers. To achieve a successful sale of 25 Caxton Street it was instrumental that I was able to demonstrate to buyers who the tenant would be when they settled on the property. However, since the business contract of sale was not unconditional, we were not able to provide buyers with the certainty that they needed to bid at the auction unconditionally.
There were multiple hurdles to overcome throughout the sale process. The sellers and I had many discussions during the campaign including postponing the auction if I didn't get the sellers solicitors approval to tell buyers with sufficient time prior to auction who the new tenant was.
In the end, I was given the green light from the seller’s solicitor to confirm to buyers who the new tenant was 6 days prior to the auction day. On the day, there were six registered bidders who actively fought it out with spirited bidding that resulted in just shy of 50 bids. The asset sold under the hammer for $1,515,000, which was $215,000 above the reserve reflecting a yield of 5.92%.
What is your outlook for the commercial investment market in South East Queensland (SEQ) over the next 12 months?
The outlook for the SEQ commercial investment market over the next 12 months is very positive for sellers. Throughout 2019 we have witnessed both macro and microeconomic factors increase the attraction of commercial investments in SEQ on a risk-adjusted return basis. These include the:
- Recent Federal Election result that provides the economy with continuity of government and political certainty
- Record low cash rate and government easing on lending has resulted in easier access to cheaper debt
- The recent $158 billion income tax cuts package is forecast to further improve both discretionary retail spending and commercial property investment sentiment
- Interstate investors are continuing to assess value at higher levels than local investors and are commenting that there is a limited supply of opportunity in their respective markets, therefore they are increasingly looking North to Queensland for our comparatively higher returns
Michael Feltoe - Ray White Commercial Queensland
Phone: 0447 714 899
Email: michael.feltoe@raywhite.com
