Resort News, October 2021 by Multimedia AU/NZ

Registered by Australia Post Print Post No. 100023799

Issue 302 | October 2021 | $13.75 inc. GST

The Monthly Magazine for Accommodation Industry Professionals

www.accomnews.com.au

Profiles Cascade Gardens Beaches on Wave Person of Interest Brett Thompson management rights • hotels • motels • resorts • holiday parks • time share • hosted SPECIALISTS IN ACCOMMODATION FURNITURE FF&E AND JOINERY Custom made furniture including packages & finance solutions.

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The legal stuff... The views and images expressed in Resort News do not necessarily reflect the views of the publisher. The information contained in Resort News is intended to act as a guide only, the publisher, authors and editors expressly disclaim all liability for the results of action taken or not taken on the basis of information contained herein. We recommend professional advice is sought before making important business decisions.

Advertising Conditions The publisher reserves the right to refuse to publish or to republish without any explanation for such action. The publisher, it’s employees and agents will endeavour to place and reproduce advertisements as requested but takes no responsibility for omission, delay, error in transmission, production deficiency, alteration of misplacement. The advertiser must notify the publisher of any errors as soon as they appear, otherwise the publisher accepts no responsibility for republishing such advertisements. If advertising copy does not arrive by the copy deadline the publisher reserves the right to repeat existing material.

Disclaimer Any mention of a product, service or supplier in editorial is not indicative of any endorsement by the author, editor or publisher. Although the publisher, editor and authors do all they can to ensure accuracy in all editorial content, readers are advised to fact check for themselves, any opinion or statement made by a reporter, editor, columnist, contributor, interviewee, supplier or any other entity involved before making judgements or decisions based on the materials contained herein. Resort News, its publisher, editor and staff, is not responsible for and does not accept liability for any damages, defamation or other consequences (including but not limited to revenue and/or profit loss) claimed to have occurred as the result of anything contained within this publication, to the extent permitted by law. Advertisers and Advertising Agents warrant to the publisher that any advertising material placed is in no way an infringement of any copyright or other right and does not breach confidence, is not defamatory, libellous or unlawful, does not slander title, does not contain anything obscene or indecent and does not infringe the Consumer Guarantees Act or other laws, regulations or statutes. Moreover, advertisers or advertising agents agree to indemnify the publisher and its’ agents against any claims, demands, proceedings, damages, costs including legal costs or other costs or expenses properly incurred, penalties, judgements, occasioned to the publisher in consequence of any breach of the above warranties. © 2021 Multimedia Pty Ltd. It is an infringement of copyright to reproduce in any way all or part of this publication without the written consent of the publisher.

Inside FRONT DESK Editor’s Note: We are resilient, we are tough, we are business owners .........................................................05

INDUSTRY Special Report: Open borders to bolster North Queensland MR ........................................................... 06 ARAMA Report ...........................................................................08 State Report ............................................................................... 09 SCA Report .................................................................................. 10 BCCM Report .............................................................................. 12 Person of Interest: Brett Thompson .................................. 14

MANAGEMENT Legal Ease..................................................................................... 16 By All Accounts .......................................................................... 16 Motel Market ............................................................................... 18 Building Relationships ............................................................ 19 Thinking MR.................................................................................20 Q&A – Michael Philpott: COVID impacts MLR values ..................................................22 Good Governance .....................................................................23 SEO: The solution to longer-term brand awareness ...23

Intonet ...........................................................................................28 What to keep in mind with a new website ......................29

TOURISM PO Box 1080, Noosaville BC, Queensland, Australia 4566 Phone: (07) 5440 5322 mail@accomnews.com.au www.accomnews.com.au EDITOR

Mandy Clarke editor@accomnews.com.au

The Last Resort ..........................................................................32

EVENTS & APPOINTMENTS

INDUSTRY REPORTERS

Grantlee Kieza

Events.............................................................................................34

DESIGN & PRODUCTION

Richard McGill

Appointments .............................................................................34

ADVERTISING SUBSCRIPTIONS

Stewart Shimmin advertising@accomnews.com.au Gavin Bill subscriptions@accomnews.com.au

CONTRIBUTORS Trevor Rawnsley, Col Myers, James Nickless, Michelle Scott, John Punch, Lel Parnis, Andrew Morgan, Kelley Rigby, Mike Phipps, Lynda Kypriadakis, Anne Stubbs, Arvo Elias, Anne Stubbs and Leanne Kalf.

ARAMA Industry Events Calendar .....................................35

PROPERTY New Manager Profiles .............................................................36 AccomProperties Sales Report ...........................................36

PROFILES Cascade Gardens:

KEY Commercially funded supplier profile or supplier case study Supplier information or content Suppliers share their views in one-off, topical pieces General editorial. Case studies and features may cite or quote suppliers, please be aware that we have a strict ‘no commercial content’ guideline for all magazine editorial, so this is not part of any commercially funded advertorial but may be included as relevant opinion. Happy reading!

Tourism Report ...........................................................................30

Operator with tenacity and family history in MR ..........40 Beaches on Wave: Golf pro hits a winner at Beaches on Wave ....................44

PREFERRED SUPPLIERS Preferred Supplied Directory ................................................46 FRONT DESK

44 ResortNews | October 2021

This industry is made up of many small business owners, investors, and entrepreneurs. Most of us arrived here in the middle years of life, we meandered through a multitude of careers, varied walks of life and indeed countries. I’ve had the privilege of meeting many of you, through correspondence or at industry events and I’ve noticed that as much as we differ, we share many common traits and goals. We are all truly invested in this industry, and I don’t just mean financially. We invest time, energy, hope and in some cases even our heart and soul, but most of all we invest in people. Basically, we are all people persons. We work hard in this business not only to benefit our own families’ futures but also for our staff, the

social media? Whatever it is that comes next, you are giving it a go because when it comes to being a small business owner YOU are IT. We bend over backwards to learn new skills and we ride the storms because there are no other options. I get it… All the stress and pressure and I agree wholeheartedly that it sucks. However, I am also confident that good times will follow, something that will make all the hard work worthwhile.

Mandy Clarke, Editor editor@accomnews.com.au guests, renters, investors and let’s not forget those bodies corporate! Often the only person we forget to look after is ourselves. We all wear many hats and juggle many balls. I know that one minute you’re knee deep in shower cleaner scrubbing tile grout and the next you’re primed for a meeting with a potential investor. What comes after that? Maybe even filming a Tic-Toc to market your resort on

I suppose what I am trying to say to you is this, I know COVID has thrown one doozy of a curve ball. And, for many holiday property managers, especially in Tropical Northern Queensland this ‘lukewarm’ school holiday ‘recovery’ feels like the final nail in the coffin, but I hope this is not the case. Experience and most tourism experts tell us it is normal for the industry to move in cycles, and they reassure us that business WILL come back stronger than before. I leave you with hope of open state borders soon and a glimmer

for the return of incoming international visitors. Meantime, just like the managers featuring in our October edition, the tenacious Cairn’s manager Sam McLean and Gold Coast manager David Ekberg, along with our Person of Interest Brett Thompson of Landmark Resort & Spa, keep on wearing those hats and juggling those balls. Be resilient, remain positive and most of all, take care of yourself.

EDITOR'S NOTE

We are resilient, we are tough, we are business owners

In this Resort News, Grantlee’s special report examines COVID’s impact on MLR businesses in TNQ, and our tourism report covers the September school holiday tourism struggles. We have a Q&A from Michael Philpott at MR Sales, all about real estate and MLR sales and the impact of COVID and lockdowns on sales and values. I hope you enjoy this edition of Resort News. Get in touch, I love to get your feedback and remember our team is here to support you. Cheers, Mandy

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FRONT DESK

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SPECIAL REPORT

Sheraton Grand Mirage Resort Port Douglas, images supplied by TTNQ

Open borders to bolster North Queensland MR By Grantlee Kieza, Industry Reporter

tourism demand which starts next March,” Mr Curulli said.

Rays of sunshine are emerging through the dark economic clouds hovering above the management rights sector in North Queensland.

“I think you'll find there will be a lot of pent-up demand for people to holiday in North Queensland once Australia is free to travel again. “We are seeing a lot of inquiries in the holiday market but no one's coming to do inspections because of the border restrictions and therefore no transactions are taking place.

The region has not suffered lockdowns so much as “lock-outs” during the COVID-19 pandemic, but the effect has still been a dramatic slowdown in sales. The downturn comes as industry leaders welcome $40 million in additional support for Queensland tourism and hospitality businesses hardest hit by COVID-19. The businesses may be eligible for grants of up to $50,000 to support jobs under the Palaszczuk Government’s Economic Recovery Plan. Tourism Minister Stirling Hinchliffe said the new $40 million Tourism and Hospitality Sector Hardship Program was part of the $600 million COVID-19

Barron Falls lookout

Business Support package, jointly funded by the Palaszczuk and Australian Governments.

of tourists, have seen the tap turned off on visitor numbers since the beginning of last year.

The management rights field in North Queensland has become a two-speed sector.

Antonio Curulli, from MR Sales, says he has only completed two transactions for Cairn’s holiday properties in the 18 months since COVID arrived in Queensland, but stresses that now is the right time for smart investors to buy.

Permanent properties are still faring well because of a severe shortage of rental accommodation, particularly in Cairns, with some agencies there reporting vacancy rates of less than 1 percent. But holiday apartment complexes, requiring that steady influx

“By the time a property is settled in four to six months COVID restrictions on our borders will likely be over and it will be the time for our peak

INDUSTRY

“Things can only get better. Vendors know this and they are very attuned to what's happening. They are waiting until the market springs back when the country comes out of these lockdowns.” Other industry leaders are confident that the sales of management rights in North Queensland will soon gather pace. Travel restrictions have locked North Queensland out of the international market, a vital piece in its tourism and accommodation business, while border closures involving Victoria and NSW mean that more than 15 million Australians ResortNews | October 2021

Snorkelling in summer

have been stopped from visiting Cairns, the Great Barrier Reef and its neighbours which are all desperate for tourism dollars. However, Cairns local Shane Croghan, from Resort Brokers, predicts that an upswing in vaccination rates will initiate the opening of borders and usher in a regional domestic tourism boom. “I think a lot of people in the southern states are just itching for the time when borders are open and they can say let's get up there to sunny Cairns,” Mr Croghan said, “and I think we will see a really great tourism boom in the north.” Management rights veteran Calvin Bailey said while business was picking up in his industry in South East Queensland, there had been no recent upsurge in the north. “Historically even pre-COVID, we take some time to catch up to any boom in the southern part of the state,” Mr Bailey said. “There's certainly more interest in permanent letting properties in Cairns now because they offer more security and there is a definite shortage of rental accommodation. “Unfortunately, there has been little added to the marketplace in terms of permanent rental

Great Barrier Reef Drive

of rental properties in Cairns was seeing a push to change some holiday apartments into permanent mode, though rights holders were conscious that holiday properties typically produced higher yields.

properties in Cairns since the GFC more than 10 years ago. “The job market is just coming back a little and when the tourism trade comes back there will be even more demand for rental properties.

“Developers have been focusing more on the holiday market to achieve higher returns from management rights even though construction costs are the same,” Mr Curulli said.

“There is still good interest and inquiries for permanent letting properties but with a shortage of properties we just don't have enough on the market to do much about it. “We probably have among the lowest vacancy rates in Australia so that is very good for prospective buyers of management rights at permanent rental properties. The property prices for management rights still haven't picked up to the extent that they have down south so that makes them good buying with excellent opportunities for investors to make really good returns. “There's been little change in multipliers with them, probably going for anything from 3.8 to 4.5. “In terms of short-term rental businesses – the holiday market – though, there has been very little sold in the last 18 months because the tourism industry has suffered.” Antonio Curulli said the shortage

“Because the yields from permanent letting properties are lower there is not enough new stock coming onstream. “It will take two or three years to bring a facility up to market as a permanent letting property. We need more permanent facilities being developed but I don't see that happening until the developers and the banks see eye to eye to create that product.” Tourism Tropical North Queensland Chair Ken Chapman said holiday reservations in his area were so dire that the Far North was facing its worst school holiday bookings since the pandemic began. He said without travellers from New South Wales and Victoria, and with consumer confidence at an all-time low, the $40 million

Tourism and Hospitality Sector Hardship Program would “give employers and employees a much-needed temporary reprieve from a dire financial situation”. Mr Curulli said the “smart money” in North Queensland management rights was on a tourism boom coming in 2022. “Smart investors are looking at holiday properties now,” Mr Curulli said. “They know by the time but they go through with their due diligence and settle they won't actually be coming into the property until March next year “That’s the start of our peak demand period for tourism. “I think you'll find there will be a lot of pent-up demand for travel to North Queensland when the borders are re-opened.” Queensland Tourism Industry Council CEO Daniel Gschwind said tourism and hospitality were critical for the recovery of the Queensland economy. He said the new Tourism and Hospitality Sector Hardship Program was “urgently needed” and would help the tourism industry “keep vital businesses and their staff going through the current uncertainty.”

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INDUSTRY

ARAMA REPORT

Preparing your management rights business for sale A wise person once told me that the time to start thinking about selling your management rights business is the day you buy it. If you are looking to sell your management rights business this year, it is probably important to consider how the impacts of the last 12 months have changed the market, especially as the sales process is presently taking longer than perhaps when you first purchased your business. This year the market has been a stark contrast to the last 12 months and probably one of the hottest the industry has seen in sometime for long-term letting (permanent) management rights. Although we would love to polish up the crystal ball to predict the future, alas we can’t so if you are thinking of selling, now is

If you are looking to sell your management rights business this year, it is probably important to consider how the impacts of the last 12 months have changed the market Trevor Rawnsley, CEO, ARAMA

really the time to be capitalising on the market. Thanks to low interest rates it has also been a pleasure to see smaller businesses take a win with more buyers at the lower end of the market coupled with the banks looking upon them more favourably. Short-term letting buildings have been a little bit of a different story subject to the location of

the building and its net profit. Some of the regional areas have had positive growth with local tourism. The challenge with selling short-term letting buildings in the current climate is ascertaining what the sustainable net profit is after add backs (any expenses in the profit and loss statement that would not apply to an incoming purchaser). For those hit hard by COVID it would be unreasonable to be expected to sell based on low figures because it is not a true reflection of the general performance expected in the future. If you are selling a management rights business for the first time, cast your mind back to when you purchased your business. What were the key things you looked for, and if any, what things went wrong during the buying process? It would be worth noting these down because chances are, your potential buyer is going to be looking for the same things and eliminating contentious matters prior to the contract being signed and this will save you much time and pain in the long run.

Australian Resident Accommodation Managers Association is the peak industry body representing the interests of people who are involved in management rights.

For membership enquiries:

national@arama.com.au | www.arama.com.au 1300 ARAMA Q (1300 27 26 27)

It is of importance to have up to date sales figures and assuming you have been using the expertise of an accountant who specialises in management rights, you should have a sale basis profit and loss statement. The sales figures should be no more than two to three months old because there is little point assessing a deal on figures that are out of date. You also want to ensure that your trust and general accounting records are up to date and accurate, especially your ‘Authority to Act forms’ (In Queensland this is the PO Form 6) and your ARAMA INDUSTRY

Addendum with an accurate set of costs and charges. Equally as important is the trust audit report. Your prospective buyer should be able to easily trace income through your PMS system and also determine the sales figures for your business. Other important information that will be required for the sales process are: what is the status of the terms of your management rights agreement? Are there body corporate issues? Any outstanding due diligence issues from when you purchased? There is a substantial amount of documentation that will be required for the sale of your business, so start collating documentation such as a copy of the caretaking agreement, letting agreement, current valuation among others. Your management rights specialist solicitor will be able to guide you through this process. If you have been considering selling your management rights business, the current market is certainly providing favourable conditions and could be your time to strike while the iron is hot. Whilst there is a lot of preparation and work that is involved in a sale, there are plenty of experts in this field to support you. ARAMA advocate that all members considering selling their MLR business seek professional advice from experts in this industry. Selling management rights can be more complicated than any other business so it’s important to have the necessary support and expert information throughout the sale process. ResortNews | October 2021

New disclosure requirements for NSW sales and what Queensland body corporate records can be accessed. Real Estate agents in NSW should be aware of a recent change to the Property and Stock Agents Regulation 2014 in relation to agents’ material facts disclosure obligations. From September 1, 2021, agents must disclose any order that is in force under the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (the RAB) to prospective purchasers. These orders can include a: Building work rectification order: Requiring the developer or builder to carry out or refrain from carrying out building work to eliminate, minimise or remediate serious defects or potential serious defects, or Prohibition order: Prohibiting the issuing of an occupation certificate for the apartment building, or its registration as a strata plan. The building commissioner may make such an order when: •

•

An expected completion notice was not given or was given less than six months before the application for the occupation certificate was made An expected completion amendment notice was not given or was given less than six months before the application for the occupation certificate was made

•

A serious defect in the building exists

•

Building bond has not been given.

Stop work order: To ensure building work stops due to the likelihood of significant harm or loss to the public or ResortNews | October 2021

Real estate agents in NSW should be aware of a recent change to the Property and Stock Agents Regulation 2014

STATE REPORT

New disclosure requirements for NSW sales

Col Myers, Small Myers Hughes

occupiers, or significant damage to property. Agents who are aware of a material fact set by the regulations, or ought to reasonably know, and fail to inform prospective purchasers (whether intended or not), face a maximum penalty of $22,000. NSW Fair Trading is introducing these changes to restore confidence in the residential construction industry and to make sure that apartments being built are trustworthy. The department will continue its compliance and enforcement role to ensure real estate agents are meeting their disclosure obligations to buyers. This will include targeted audits of agents who are selling properties where RAB orders have been issued.

Queensland body corporate records that may be accessed

‘Records’ are defined to include the rolls, registers and other documents kept by the body corporate under the Body Corporate and Community Management Act (Qld) 1997 and applicable regulation module. They include paper and electronic documents.

body corporate would be required to keep:

What records must be kept? The body corporate regulation modules set out a long list of documents that a body corporate must keep, with varying requirements about the length of time each document must be kept. Examples of these documents are: •

Accounting records for each financial year

•

Insurance policies

•

Orders made against or in relation to the scheme or body corporate

What constitutes a “record of a body corporate” is much broader than the compulsory list of documents set out in the Queensland regulation modules and has ramifications for the duties of a body corporate and the breadth of access allowed to an owner or prospective purchaser.

•

Correspondence received and sent by the body corporate

•

Minutes of committee and general meetings.

The three categories

What records should be kept?

Consistent with the approach of department adjudicators, the Queensland body corporate legislation in effect creates three categories of records:

These are, however, not the only documents that form part of the records of a body corporate.

•

Records that must be kept

•

Records that should be kept

A body corporate has a statutory duty to act reasonably in anything it does in carrying out its function given to it under the body corporate legislation and community management statement.

•

Records that are kept.

Acting reasonably, a INDUSTRY

•

Additional maintenance records

•

Records relating to its obligations under workplace health and safety and fire safety legislation

•

Any other document retained by the body corporate for the purpose of discharging its functions.

If records are not kept that are records that a body corporate, acting reasonably, should have kept, then a department adjudicator may find that the body corporate has not acted reasonably in responding to an owner or prospective purchaser's request to access records.

Records that are kept There are often records that are kept by a body corporate that are beyond the scope of records required to be kept under the body corporate legislation. These records also form part of the records of a body corporate and an owner or prospective purchaser may be allowed to access these records. However, there are ways that a body corporate may withhold access to records under certain circumstances, and if a body corporate is unsure as to what documents constitute body corporate records or how to withhold access to its records, it should seek assistance before or during the seven-day turnaround time for record requests. Disclaimer: This article is provided for information purposes only and should not be regarded as legal advice.

SCA REPORT

A data-driven holistic grasp of strata insurance Strata insurance report shows the value of a strata manager and strata insurance issues that must be fixed. The recent release of the Deakin University report in each aspect of strata insurance was a major landmark report for the strata industry. The first of its kind, it offers a holistic view of strata insurance in Australia and New Zealand. The report highlights the unique nature of the supply chain of strata insurance, the challenges many strata communities face and the important value that strata managers add to the insurance process. The report outlines how for a while now, the role of the strata manager in strata insurance has been undersold and misunderstood. The report revealed strata managers performed a whopping 47 tasks when it came to insurance. Insurance is a core duty of a strata manager and one that they perform exceptionally well. Strata managers fill a knowledge and expertise gap that simply cannot be met by volunteer committees. When things go wrong and disaster strikes, it is strata managers who do the heavy lifting, getting out on the ground, accessing claims, processing and liaising with companies and brokers.

Despite their difficult work, strata managers have been shown to add remarkable value to the supply chain of strata insurance

James Nickless, President, SCA, Qld

Strata managers 47 duties filled into seven broad categories, including quotes, procurement, placement and renewal, evaluation, record keeping, advice and finance. According to the report the value of a strata manager is multifaceted when it comes to insurance. Strata managers are agents of the bodies corporate they are engaged by and thus obliged to act in their best interests. This is a legal duty, managers cannot breach it and it holds them to a higher professional standard, especially those that are members of SCA (Qld) as our code of conduct provides a further program for accreditation and professional standards. Similarly, managers are the keepers of records when it comes to bodies corporate and thus are best equipped to understand maintenance history and any other relevant information when it comes to

QLD - NSW - VIC - WA

insurance. They have quick and easy access in this regard. Finally, as was to be expected, the report clearly showed that strata managers had knowledge and expertise, particularly practical knowledge and expertise about how to navigate the claim process and the supply chain. In this sense, strata managers are like a jack of all trades charged with ensuring that everyone else does their job properly and things run smoothly. Despite their difficult work, strata managers have been shown to add remarkable value to the supply chain of strata insurance. Their work in what is a complex chain is invaluable and irreplaceable. Despite this, much of the data out of the report indicates that the role they play is misunderstood. Much of the feedback from the report centred around the fact that many bodies corporate fundamentally do not understand what kind of value the strata manager adds. It is an ongoing priority for us at SCA (Qld) to ensure our members are transparent and communicate the full details of their multifaceted roles. The report was of course, heavily focused on the ongoing crisis in Northern Australia, particularly North Queensland. The report demonstrated that strata insurance claims in the north outweighed premiums paid. This is despite managers doing their utmost, being unable to find schemes insurance in many cases.

INDUSTRY

With many schemes lacking easy access to insurance, the value of the manager is even more apparent. The Northern Australia Reinsurance Pool will hopefully alleviate many of these problems. But it is worth noting how much strata managers have had to go above and beyond in recent years to help communities in the north. All the duties and responsibilities a strata manager has in schemes which have little difficulty obtaining insurance are magnified in the north. Strata managers in the north have often gone to extraordinary lengths to find insurance or arrange alternative insurance for their schemes. There can be no doubt that schemes in the north see just how hard their managers have worked for them over the past decade or so. The value of strata managers cannot be better demonstrated by the extraordinary lengths many of them have gone to up in the north. Whilst the Deakin Report demonstrated to many for the first time the critical role of the strata manager, lot owners in the north have had the unfortunate opportunity to know how hard managers work for years now. It is our hope that the recently announced reinsurance pool for disasters ensures that a degree of normality returns to the North Queensland strata insurance market. View the whole report on our national website. ResortNews | October 2021

BCCM REPORT

Secret ballots:

Dispelling the mystery The use of secret ballots for electing a body corporate committee can prompt a range of questions, and opinions. Secret ballot processes simply mean that an individual owner’s choices about who should be elected to committee positions are anonymous. By keeping the views of individual voters private, secret ballot processes are commonly considered to assist in hindering attempts to inappropriately influence their decision. This article dispels some of the mystery surrounding secret ballots by explaining when they are required and some of the rules for conducting them.

Let’s start with the basics The most common question we receive about secret ballots is when they are required for elections and when they are not. The answer to this question lies in the body corporate regulation module that applies to the scheme. Under the Body Corporate and Community Management Act

Michelle Scott Commissioner, Body Corporate & Community Management

1997 owners must return their nominations for a position on their body corporate committee to the secretary before the end of the body corporate’s financial year. Owners can nominate for as many positions as they want. After this date has passed, the ballot papers for the committee election are prepared. These must be prepared in accordance with the provisions in the regulation module that applies to the scheme. The first thing you should do is determine which regulation module applies to your scheme. Community titles schemes regulated by the Body Corporate and Community Management (Standard Module) Regulation 2020 (the Standard

Photo by Kristina Flour on Unsplash

Module) must conduct elections by secret ballot unless the body corporate has previously resolved by ordinary resolution to conduct them by open ballot. The Standard Module outlines detailed processes on how the secret ballot or open ballot elections are conducted. It is important to check these specifics of the regulations to ensure that your elections are conducted in a way that is procedurally correct and to avoid disputes about the election process and outcomes. Elections for schemes regulated by the Body Corporate and Community Management

INDUSTRY

(Accommodation Module) Regulation 2020 (the Accommodation Module) are to be conducted in the way set out in the module unless the body corporate decides otherwise by special resolution. Unlike the Standard Module, the Accommodation Module does not outline detailed processes for conducting elections. Other than the limited processes it gives for ballots, it requires the body corporate to pass a motion by ordinary resolution dictating how the ballots for election of the executive and ordinary members are to be conducted.

ResortNews | October 2021

The new regulations applying for standard and accommodation module schemes which commenced on March 1, 2021, both make provision for conducting secret ballot for elections electronically. The body corporate can make the decision to conduct the secret ballot electronically by passing a motion by ordinary resolution at a general meeting. To conduct an electronic vote, the body corporate must operate an electronic voting system that does not disclose the voters identity. While not the most common regulation module, it is relevant to point out, for comparative purposes, that schemes regulated by the Body Corporate and Community Management (Commercial Module) Regulation 2020 (the Commercial Module) choose how to conduct their elections by passing a special resolution outlining the process. The Commercial Module does not dictate whether the process should be by open or secret ballot. Our office has documented

these election processes on our website for each regulation module. These pages can be printed individually to ensure everyone is familiar with the specific processes that apply to their scheme. They are located on www.qld.gov.au/bodycorporate under the heading ‘Forming a body corporate committee’. One crucial element to conducting a secret ballot in all cases is that, except in very limited circumstances, nobody else should submit a ballot paper or voting paper on behalf of an owner. Each owner should follow the processes outlined on the ballot paper and individually return the ballot paper to the named receiver, whether the body corporate secretary or the body corporate manager. Past adjudicators’ decisions have, in most cases, declared votes to be invalid when another person has submitted the paper on behalf of a lot owner without being their representative or other authorised person. A ‘representative or other

Photo by Tiﬀany Tertipes on Unsplash

authorised person’ means, for example, a power of attorney. For further information and for general queries about the body corporate legislation please contact the Information and

Community Education Unit on freecall 1800 060 119, make an online enquiry at www.qld.gov. au/bodycorporatequestion or visit our website at www.qld. gov.au/bodycorporate.

PROGRAMME

This months suppliers to the programme ACCOUNTANTS & AUDITORS AIR CONDITIONING CARPET & FURNITURE CLEANING/PROTECTION GLASS INSTALLATION/REPAIRS MANAGEMENT RIGHTS AGENTS PAINTERS & DECORATORS SOLICITORS

Management Rights Transactions Damian Quinn

• Property Law • Retirement Villages • Body Corporate

SUNSHINE COAST & QUEENSLAND WIDE

To find a Preferred Supplier see the directory in the back of this issue

Damian Quinn (07) 5443 5266 www.simpsonquinn.com.au ResortNews | October 2021

ASAP Glass P/L Management Rights Sales Amalgamated Group Griffiths Parry

All Preferred Suppliers have been recommended by other accommodation properties for their service and have qualified for inclusion in the programme. The next time you need to use a new supplier, why not make life easier and use a Preferred Supplier.

One of the Sunshine Coast’s most experienced firms in on-site management rights transactions. • Commercial & Business Law • Litigation & Dispute Resolution • Wills & Estate Planning

Jonathan Grant Accountants Climate Control First Resort

INDUSTRY

PERSON OF INTEREST

INTERVIEW WITH BRETT THOMPSON:

Hard yards to scoring in management rights By Grantlee Kieza, Industry Reporter

Brett Thompson, the general manager of the Landmark Resort and Spa in Mooloolaba, sat down with Grantlee Kieza to talk about the most important lessons he’s learned after more than 30 years in the accommodation business. Before you tackled the accommodation industry you made the hard yards in sport? Yes, rugby league was my passion growing up. I played Queensland school boys rugby league and I was fortunate enough to get a scholarship to Ipswich Grammar, where I was captain of the First XV rugby union team. I was one of four brothers who all played football and who went to Ipswich Grammar. I then played for the Brisbane club Souths.

That’s a famous club, once the home of Mal Meninga and Wayne Bennett. Yes, I played in the second row for Souths’ reserve grade team that won the Brisbane premiership in 1979. I was the youngest player in the reserve grade side. We had some big-name state players such as John Salter, who played for Queensland and Brad Tessmann, who played for Australia. That year we had all three grades in the grand final, which was great for the club. We won the reserves and third grade but lost the A grade grand final. My brother Gary played in the A grade side on the wing outside Souths’ star centre Mal Meninga.

What happened after the grand final success?

Brett and wife Maree in Townsville trying their luck on the tables

I was doing shift work at the time for Budget Rent a Car, and I couldn’t get the time to play football. I completed a year at teacher’s college in Brisbane before I decided it wasn’t for me and then I did a stint at McPherson’s which was a major building supply company based in Fortitude Valley. Then I went to Budget, and I spent 10 years there when Bob Ansett was running it. Back then Bob couldn’t get his business into airports, so we had to work out of car parks. But

Bob brought some marketing ideas from America where he grew up. He had some great ideas about customer service and that’s where I learned a lot. He was well ahead of his time in making sure the customers were treated like they were number one. It was a great time and I ended up as state operations manager for Queensland. Unfortunately, Bob fell on hard times financially and retired to Noosa.

INDUSTRY

How did you get into the accommodation business? I had a partnership with a car hire business in Rockhampton, but I cut ties with that, and I applied for a position at Club Crocodile, when they were looking for someone to manage their motel on the Bruce Highway in Rockhampton. My wife Maree and I were employed as managers. ResortNews | October 2021

We were then promoted to Cairns and managed two properties, Hides Hotel, which is a famous historic property right in the centre of Cairns, and Club Crocodile in Lake Street.

Coast to promote Mooloolaba.

Does your family help with running Landmark? Maree helps by working on our reception and reservations three days a week. Our eldest daughter Courtney is an accountant in Townsville and our son, Ben, is a carpenter just finishing his four-year apprenticeship. He works in Noosa for a boutique builder. Brittany is now a thirdyear uni student doing education. She’s going to be a performing arts teacher at high school.

You were in North Queensland for many years? I worked for Club Crocodile from 1995 to 2002. I was also the general manager at Club Croc on Long Island where we had 160 rooms and that was great because we had a young family. From there I was manager at the Club Crocodile property on Airlie Beach.

Landmark is a big property?

Then you branched out on your own? I went into partnership with the lease of Motel 98 in Rockhampton with Mick Hart, a commercial tax lawyer out of Brisbane. I was initially the manager there for what was a boutique 26-room motel with an la carte restaurant. Subsequently Maree and I went into partnership with Mick and Trish Hart in Motel 98, and we bought another leasehold with them at the Fitzroy Motor Inn. We were in Rockhampton for five years and we sold the lease on the Fitzroy and then Motel 98 to Grant Cassidy, who has The Empire and The Edge in Rockhampton.

You won the best motel in Queensland at Motel 98 for four years in a row, so you had an excellent reputation. From Rockhampton you bought management rights for Mariners North in Townsville?

We have 132 residential apartments, and we also manage the commercial premises - there are 12 of them. Celebrating Xmas on the Sunny Coast 2020 (Ben, Maree, Brittany, Courtney and Brett)

and ensuring they come back. Repeat business is so important and you learn to treat guests as you’d like to be treated. Maree and I sold our business, but we still maintain our partnership with the Harts as passive investors in Mariners North.

So then on to Mooloolaba? We had six months off when we sold the business and then I took on the role as general manager at the Landmark. That was four years ago. I had spent the last 20odd years in North Queensland so coming south was like coming home since I’d grown up

in Brisbane. But our youngest daughter, Brittany was finishing high school at Townsville Grammar School when I started here. She had another year to go, so Maree stayed in Townsville and for 12 to 14 months I used to go up to Townsville every four or five weeks and Maree would come down until they could both move permanently to the coast. Maree and I bought a house at Twin Waters, and we live off site. I’m on the Chamber of Commerce in Mooloolaba and I chair their accommodation sub-committee. I also sit on the Visit Sunshine Coast subregional panel. I do a lot of marketing with Visit Sunshine

Yes, we bought it in 2007 and were there for 10 years. Mariners North won the best deluxe apartment complex at the North Queensland tourism awards, too. I sat on the committee for the Hotel Motel and Accommodation Association of Australia for a number of years and I was presented with a national award from them. It was called the ACES award – for attitude, commitment, enthusiasm, and service to the accommodation industry.

ResortNews | October 2021

We had 25 staff when it hit and at one stage, we were down to three - the front office manager, the maintenance manager and me. During lockdown we probably lost 80 percent of our business for three or four months. But JobKeeper allowed us to bring our staff back for the rebound. From July last year we had probably one of our best financial years ever.

What do you most love about the accommodation business? Meeting people and the different characters from all walks of life. If you don’t love meeting people, it’s the wrong industry for you. I also love the challenge of converting enquiries to sales.

What advice would you give someone wanting to buy management rights?

What’s the secret to winning those awards? It’s all about customer service; making sure guests are happy

How has COVID treated you?

In Townsville, life after living on site for 20 years (Brittany, Brett, Maree, Courtney, Ben)

INDUSTRY

In management rights you must remember that we are all commission salespeople so it’s all about bums in beds and converting interest and enquiries into sales. You must know the business back to front, too. I still work in reception, and I still make sure the phone is answered within five rings. That was one of the things I remember from my days with Budget. I tell our staff to treat the customer how you want to be treated.

LEGAL EASE

Thank goodness for management rights

What’s that goodness? It is a common phrase used that is then applied to the things in life that we are thankful for. I believe that among those things is management rights, particularly in Queensland where thankfully, we lead the way. And yet, our industry needs to do a lot more to “shine its light” and present that message publicly. Without the legalities allowing for management rights and the beneficial activities coming to all unit owners from those on site who conduct them, there would not be either the accommodation infrastructure that exists for our tourism industry (founded on managed apartments) nor would there be the peace of mind for live-in owners and renters of lots, who depend on a proper functioning building or buildings in a community titles scheme.

That act recognises the necessity to balance the rights and needs of all involved, the unit owners of various types, caretaking and letting managers on site and body corporate managers. It also protected banks as financiers of management rights for their needs to make them viable for secured lending. John Punch Partner, Short Punch & Greatorix Lawyers

So, where does this goodness emanate from? It is really traced back to the laws that were laid down in the 1997 BCCM Act and the letting agency licensing system for commissioned letting agents in buildings. I am pleased to say that I was part of the advisory group listened to by the governments of the day (dating back from the early 1990’s to 1997) it was a long slog and along the way, the first attempt at an act was cancelled in 1994.

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Defined the roles of all the key parties, with limitations applied on rights and obligations – lot owners, committee members, holders of caretaking agreements (service contracts, authorising of letting agents for schemes, letting agent authorisations) and body corporate managers. This produced a workable interwoven fabric, applicable to bodies corporates and schemes, that could be relied on

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Set up a right to have reliable governmental bylaws, binding on all lot owners and occupants, and

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Gave the commissioner of bodies corporate the exclusive jurisdiction to sort out disputes, including as to managers activities, without the need for the parties to get involved on expensive litigation, as had occurred in the past.

Some of those “balancing act” sections of the act, cover: •

The need to limit the term of caretaking and letting agreements (previously there was some that were effectively perpetually renewable) with a restriction on bodies corporate to either conduct such a business itself or impose financial demands on the manager for the renewal of the term, once a manager built up a successful business, and arrangements within the term limitations, for the reasonable extensions were included

BY ALL ACCOUNTS

A change is as good as a holiday Or, for the purposes of my musings, a change may free up some of your valuable time to take a break or just to enjoy efficiencies gained in how you’re running your business. It’s been a hell of time since COVID-19 took hold of the world and despite lockdowns and resulting in quiet periods, many operators have been unable to take much needed time out, nor sit back and review day to day operations. And to my point, it’s important to consider the systems and technology used in your business and whether it may be time for a change for the better. It’s easy, and understandably so, to push such reviews to the future for when you ‘have more time’ but in the meantime it’s

save you time and increase efficiencies in your business.

Lel Parnis Principal, Holmans

quite possible you are spending (potentially considerably) more precious time using outdated systems and processes. If your business IT is still ‘desktopbased’ and you’ve managed to stay away from the ‘cloud’ until now, I strongly recommend you speak to your advisors, do some more research and get online. It absolutely will

Bookkeeping for instance, usually isn’t a favourite task and can be labour intensive or costly if using external bookkeepers for processing everything, if you’re not taking advantage of new technology. It can be a bit of an exercise to convert from your existing system to a new cloudbased solution but the ongoing savings will undoubtedly make you wonder only why you didn’t make the change sooner. Using a cloud-based bookkeeping solution, like Xero, enables all transactions to be automatically fed from your bank accounts for you or your bookkeeper to categorise as you go. The ease of processing online enables business owners to keep their books much more up to date, hopping online to allocate

MANAGEMENT

transactions weekly or even daily, which means up to date ‘Profit & Loss’ reports can be drawn for bank reviews etc. So, no longer is it a mounting task to get your file ready to send to your accountant for tax lodgments or other advice, you’re able to easily keep things up to date. Believe it or not, your bookkeeping can go from being the most painful task to being somewhat cathartic. Booking system solutions are moving to the cloud and it’s certainly worth looking at your current system and all its pros and cons, compared to alternatives in the market. Again, if it may be easier to stick with what you know but ensuring you have the best systems and processes in place can enable you to improve your business in ways you may not have considered. ResortNews | October 2021

It is essential for the industry to maintain an appreciation of these ‘goodnesses’ as an ongoing necessity, for action from all representatives of the industry. Too easily, the blame and avoidance by others of their responsibilities, can lead to a denigration of the onsite manager by dysfunctional committees, dissatisfied owners and also by the actions of the body corporate manager. Hence the absolute need for the industry to be vigilant in protecting against unjust practices (or those which in fact are simply unlawful), whilst ensuring that the managers also live up to their responsibilities in serving the needs of all owners and occupants of apartment units. ©Yingyaipumi - stock.adobe.com

Since then, there has been a lot of fine tuning of some sections of the act, which have been added to over time, including controls on proxy voting, notices of default procedures for caretaking and letting agreements, the need for secret ballots to ensure voting free of coercion and for the forced sale of management rights, when 50 percent or more of lot

owners are dissatisfied with the managers performance. Possibly, the recognition of allowing the inclusion in a strata scheme of an “enterprisebased system” for the conduct of the management rights, is the underlying factor for successful relations with owners. This was a major successful keystone to this system, within the body corporate laws.

I recommend speaking to other operators about their systems, get out to ARAMA functions and have a chat, see what you may be missing out on.

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You can work anywhere; you’re no longer tied to the office computer. Once you are in the cloud you can log on to do your bookkeeping or check/take bookings from anywhere you can get online, which may mean that time away from the complex isn’t such a distant dream. You can invite users off site such as your accountant or auditor to assist with advice without delays in passing backups back and forth and you can see the same data in real time during phone conversations. Online helpdesks within the solutions are generally fast in response and updates are frequently made to improve

ResortNews | October 2021

Of course, the Queensland real estate licensing laws, in a separate act, have regulated the commission agent process for on site management also.

However, it is clear the mosaic of interactions in a scheme and the willingness of everyone to listen and learn, is paramount to a successful management rights story in all buildings.

It’s important to consider the systems and technology used in your business and whether it may be time for a change for the better.

Pros of getting online include: •

Owners of units benefit from having an incentivised manager, to progress the arrangements for the manager to be catering to everyone’s needs on site, under a business model.

In writing this article, I have realised that creating an understanding of what management rights are, among all the parties in a building, and the good features, is difficult to encapsulate briefly.

systems based upon user feedback. Note if you already use cloud-based systems and have bugbears or suggestions for improvement I encourage you to provide feedback via the help function and you may well see your suggestions acted upon as updates are made. •

Costs savings ($ and time) most cloud solutions are paid for by monthly subscriptions and I often hear clients fearful the costs will be higher than their current systems. But once you consider current annual upgrade costs and the additional time and cost of bookkeepers/staff to use less efficient desktop systems,

in my experience the cost of online solutions is no higher than that of their pre-cloud systems and often less. And yes, there are some cons: •

Everything is reliant on internet connectivity. If your internet connection is patchy or fails, then you lose access to all cloud solutions. Which of course is problematic. But there is no longer any avoiding that everything is moving to the cloud. Even government departments, are pushing for all correspondence to be via online portals. If you have troublesome internet connection, it needs to be resolved prior to moving

MANAGEMENT

core systems online. •

Cyber security must be considered and you need to ensure you are appropriately covered in terms of the security provided by the solutions used and potentially additional safeguards and insurances you may need to put in place.

Review and improvement of IT in accommodation businesses isn’t likely at the top of operators ‘to-do lists’ and as such it’s often the side of things that falls behind and costs in ways you can’t see until change is made. Speak to your advisors, industry specialists and fellow operators… if not now, when?

MOTEL MARKET

Get in on the action

Trying to find the elusive passive investment motel that is for sale is no easy feat. So why are motels with a lease in place so popular as passive investments?

Well, over 30 years ago the benefits that a motel under lease offered really started to be identified. Those in the industry could see what a secure and lucrative opportunity was at hand, however they had the inside running. Today we find passive investment motels are rarely available on the market and are a tightly held commodity. More and more investors are buying freehold going concerns to create their own passive investment, by selling a lease themselves. With the high volume of motels that operate under a lease today, it is surprising just how few tenanted investment motels are ever on the open market for sale at any one time. When they do become available, they do not remain that way for long, generally selling quickly. In the early stages of leases being put in place, it was largely only former or existing motel owners/ operators who were interested in investing in motels as passive investments. They knew the industry well, they understood how a motel was operated and they knew travellers always require accommodation, no matter what the reason for their travel, whether business, work, or pleasure. The wider investor market had not considered investing in motels, and not having any history or dealings within the motel industry, were not that interested. Over time as the high return and low risk benefits of motels were more recognised, interest built in the motel industry as a passive investment opportunity from other investor markets. Investors who had previously focused on other property types were now looking at the benefits a motel offered. Corporate investors as opposed to the traditional investor entered the industry. Many of these larger entities own numerous motel properties

saving types of building materials/construction means an adjustment in the maintenance requirement to be budgeted for over time

face downward pressure over the years due to lower supply and higher demand

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Andrew Morgan, Queensland Tourism and Hospitality Brokers

and even the smaller individual investors have continued to add more motels to their investment portfolios. Self-managed superfunds have continued to become a popular investment vehicle for investors to purchase their own motel, with a secure long-term lease in place.

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Bank interest rates over recent years have assisted to increase the demand for passive investment motels where cash in the bank at its current interest rate levels is not an attractive investment option at all. Some of the benefits that have attracted the interest of investors to motels as tenanted investment options are: •

High investment returns: Investors have achieved excellent returns on passive investment motels over the years. Market net returns on passive investment motels are currently at approximately 8 percent or more on capital invested. The return to an investor compared with other investment options such as cash or residential property make them very attractive to a number of investor types. The return levels have continued to

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Low risk: Motels have proven themselves over the years to be very low risk investments. Solid and consistent businesses operating from an investor’s building is what any investor is looking for. Good locations in busy positions often means the investment is underpinned by a strong land value component. Most of the benefit points listed here outline why they are low risk investments Fully tenanted: One way or another, a motel property that is leased almost always has a lessee, as opposed to other investment options. If a lessee/operator was to close the doors of the business the mortgagee would almost always appoint an operator to reopen until the business was on sold. The alternative is that the property owner operates the business themselves or under management until the business is on sold Freehold tenure/increasing land values: Freehold tenure and the ownership of a tangible product, being a commercial property. Motels are generally located on busy main roads or other desirable locations which are larger blocks of freehold land that increase in value over the longer term Solid building structure: Motels are typically of brick/ block construction and this type of structure requires minimal ongoing works. Any move away from this type of structure to more cost

MANAGEMENT

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Outgoings: Generally, within motel leases the lessee pays all outgoings. Outgoings paid by the lessee include, but are not limited to property rates, insurances, repairs and maintenance, and electricity. Leases were originally set up this way so that the lessee had control of his/her own business and did not have to go to the property owner every time a minor matter needed attending to. The lessor may be responsible for a few items such as land tax (unless included as an outgoing) and structural repairs/replacements

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Building allowance/tax benefits: Relatively young buildings or those that have undergone major refurbishments (capital works) will have some level of building depreciation or write off allowable. This will vary for each property however the tax benefits in many cases can provide good taxation relief to the property owner

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High liquidity: Many investment options can be difficult to get out of once you’re in. Continued strong demand over the long term from the buying market means once a motel investment property hits the market, investors are circling. Low supply versus high demand equates to strong sale values.

ResortNews | October 2021

This title might sound like I am about to leap into a therapy lesson for you and your significant other, I can assure you we won’t be going down that road. Although since I did bring it up the advice that I get from couples that have completed a life sentence together is that communicating is what has kept them strong. In my opinion business and client relationships are no different. First, I want to talk to those operators that are starting to sink into their chairs knowing they have not communicated with some owners… ever. I want you to sit back up straight and know that you can start communicating and building relationships at any time. Yes, the first conversation might be a little awkward but in my opinion if you own your shortcomings people respect you so much more. If you were a client of mine, I would be drafting up a letter with you that starts something like this: “Dear Mr & Mrs Smith, it has been four and a half years and I am only getting around to formally introducing myself. I would say I have been busy, but that excuse probably ran out four years ago. I am sorry I have not been in contact; I would love to open the lines of communication

like to know who their managers really are. Add a photo of yourself and your business partner or significate other because humans like to look at faces and pictures and they like to see other people’s lives. Not sure if you have heard of a little App called Instagram, I rest my case.

Kelley Rigby, Managing Director, Letts Rebuild

and tell you a bit about our team and what we have been achieving in our complex…” After sending said email or letter I would follow up with a phone call, and this is a very important step that shouldn’t be missed. Again, I know it might be a bit awkward, but it won’t last forever. That one awkward phone call could be the YES vote that you need or the investor that finally sees your worth, always remember that. A few minutes of an uncomfortable conversation could mean so much to your business.

Newsletters! If I could have this in big bold letters I would. It worries me to hear so many managers do not do this task, it should be in your calendar along with end of month. Yes, it can be a pain, yes it is time consuming but this task, I dare say could be a game changer in your business. Although it might take a few hours to put together this is the easiest and quickest form of monthly communication you can get, and it is something that your competitors don’t do. These newsletters aren’t only for

For those that have only started or are a few months into this industry, now is a great time for you to introduce yourselves and start building relationships and communicating with your owners. Get personal, tell them about you, where you have come from and what you have done in your life. Tell them about your kids, dogs, cats because people

your investors or those investors that you are trying to win back, they are also for the owners to show them all the work you do that they may not see or know about. It is a time for you to shine and show your value. If you aren’t doing this start now, and if you can’t be bothered or don’t have time to do it, hire someone to do it for you. I might know a guy…

BUILDING RELATIONSHIPS

The key to better relationships is communication

Communication is 2021, it is now and it’s something most of us crave. People out there in other states or even this one, are sometimes feeling isolated. Don’t only do this for your business do it for those people that need to feel more human interaction. The two-minute phone call you make to say hello might not seem like much to you but by God, I bet it will mean a lot to many of them.

SPECIALIST EXPERIENCE IN MANAGEMENT RIGHTS

Over 40 years of service to the Management Rights industry, providing assistance in: Buying and Selling Ensuring Agreements Comply with the Law Agreement Negotiation with Bodies Corporate Representation to Licensing Authorities ‘Body Corporate & Community Management Act’ Advice Employee Dispute Resolution

Photo by Brett Jordan on Unsplash

ResortNews | October 2021

For expert advice please contact; Paul Jones John Punch Phone: 5570 9327 Fax: 5539 8745 Phone: 5570 9322 Fax: 5539 8745 paul.jones@spglawyers.com.au john.punch@spglawyers.com.au Cnr Bundall Rd & Crombie Ave Surfers Paradise PO Box 5164 GCMC, Bundall, QLD 9726

MANAGEMENT

THINKING MR

©breakermaximus - stock.adobe.com

The great Australian dream is my worst nightmare “It’s tangible, it’s solid, it’s beautiful. It’s artistic, from my standpoint, and I just love real estate.” - Donald Trump, 45th President of the United States of America Now that I have the attention grabbing headline out of the way a confession. Australia’s obsession with property and home ownership is not my worst nightmare. In fact, my worst nightmare may well be the property developer quoted above, albeit you only have to turn on the TV to witness serious competition from our own so-called leaders. To give The Donald his due he got stuff done and I guess the yanks had to first experience the Joe Biden incompetence benchmark in order to better appreciate his immediate predecessor. But, as usual, I digress. Aspirational land and home ownership has been a core part

Mike Phipps, Director, Mike Phipps Finance

of the Australian psyche pretty much since the white fellas arrived in 1788. Prior to that it seems the Indigenous population managed to exist happily enough without the need for freehold titles, subdivisions and negative gearing. Reckon they might have been onto something, but I guess that horse has bolted. How times have changed. From land grants to keep freed convicts from returning home and to reward officers and soldiers, we are now one of

the most property obsessed countries on earth. In fact, 75 percent of the population list home ownership as a core value or aspiration. Our obsession has only been further fuelled by COVID. Research suggests that looking at real estate has become a national pastime. If we’re not watching someone renovate a bathroom on TV, we’re trawling the real estate sale sites and researching current values. Recent research suggests Australians spend twice as many hours each week looking at real estate as they do going to the gym. Sadly, the research also suggests that both activities exceed the time we spend talking to our parents. The national obsession is manifesting itself in a variety of ways but there’s one that seems to be triggering the afore mentioned nightmares. Yep, it’s the strata scheme owner occupier. Before an owner occupier reads this and takes offence, please know that

MANAGEMENT

you are not the cause of my unpleasant dreams. My concern is the owner occupier trend being played out in my client’s permanent management rights businesses. Given that I’m an investor in some of these businesses I take a particularly keen interest in any trend that diminishes the letting pool. While I suspect that like all property cycles the current COVID spike will eventually swing the other way, the fact is who knows when? In the interim I think the usual strategies designed to maintain the letting pool need to be seen through the prism of the actual bottom-line impact of losing a unit. It’s never good to see the letting pool drop but maybe it’s not as bad as it seems. Rental demand is extremely high and likely to get higher as owner occupiers buy up previous investment stock. Supply and demand is driving up rents and with it letting commissions. ResortNews | October 2021

The management rights model is also underpinned by a caretaking salary which is usually increased annually by CPI or 2.5 percent to 3 percent, whichever is the greater.

Annual Projected Increase in Revenue

So, if you’re doing your caretaking job and managing rent reviews your income should be rising, before any loss of rental stock. The trick is to calculate the net impact of all the dynamics at play. Let’s start by making some assumptions. For the purposes of this exercise, I shall use the dreaded data grid. Makes for riveting reading! Assumptions Units in the complex 60 Units in the 50 letting pool Current annual $75,000 caretaking salary Annual caretaking 3% salary increase Current average $400 weekly rent Assumed rental $30 increases 7.5% Current net profit per $2,500 unit in the letting pool

Think

Caretaking salary increase at 3% Increase in letting commission Increase in letting fees Total Annual Revenue Increase

$2,250 $6,250 $1,500 $10,000

In this scenario the business could "afford" to lose 4 Units (or 8.0 percent) from their letting pool without a decrease in net profit over a 12-month period. It’s important to note that there are numerous other variables at play here and operators should do their own calculations based on the specifics of their business. A good example is the potential loss of additional services provided to tenants, such as lawn mowing of back yards and general R and M. Most lenders have letting pool conditions in their finance documents so it’s critical that if you lose more than the specified percentage of units you tell the bank. When we are assisting a client, we provide the bank with these type of calculations to

©TheVisualsYouNeed - stock.adobe.com

paint the most positive picture we can. We also recommend that if the calculation suggests a revenue drop the borrower should seriously contemplate loan principal reductions to ensure prudent gearing levels are maintained. Better to get on the front foot than wait for the bank to call the shots! As most of our readers know Tony Rossiter (Holmans Accountants) and I assist many syndicates within the management rights industry. I am indebted to Tony for his assistance in better understanding the real revenue impact of unit losses in a rising

Management Rights, Think...

rental demand market. Consider us the perfect team. I can write a lot of funny nonsense and Tony can bring me back to earth! He’s an accountant of course so no surprise there. In closing you may be wondering why I have confined my comments to permanent management rights. Surely holiday properties lose units too? Yes, they do, but the variables around what that means for revenue are significantly more complicated and I’m a simple bloke. I’ve got an accountant looking into it.

PROGRAMME

This months suppliers to the programme Management Rights | Buying (existing businesses & off-the-plan), selling, renewals, new agreements & dispute resolution Property | All aspects of commercial & residential property Hotels & Motels | Franchised, leasehold or freehold Vanessa Sciortino, Special Counsel vas@nicholsons.com.au

ACCOUNTANTS & AUDITORS AIR CONDITIONING CARPET & FURNITURE CLEANING/PROTECTION GLASS INSTALLATION/REPAIRS MANAGEMENT RIGHTS AGENTS PAINTERS & DECORATORS SOLICITORS

Matthew Russell, Partner mjr@nicholsons.com.au

Jonathan Grant Accountants Climate Control First Resort ASAP Glass P/L Management Rights Sales Amalgamated Group Griffiths Parry

To find a Preferred Supplier see the directory in the back of this issue

www.nicholsons.com.au ResortNews | October 2021

(07) 3226 3944 MANAGEMENT

Q&A

Michael Philpott: COVID impacts MLR values By Mandy Clarke, Editor

With over 30 years’ experience in the industry, Michael Philpott has a comprehensive understanding of all aspects of MLR, motels and other property holdings. This issue, he’s primed to answer our burning questions about how COVID impacts management rights business and property sales.

What has been the impact of COVID on the sale of management rights businesses? We have not seen a great change with multipliers; the issue has been the huge decline in maintainable earnings and a lack of financiers. COVID caused earnings to drop (with exceptions in the Sunshine Coast and Port Douglas). At the same time, financiers reduced loans and put new lending on hold.

©Андрей Яланский - stock.adobe.com

stabilised and are beginning to increase. The city went through a significant exodus, and regions are big winners with some locations experiencing growth of 20 percent in property values.

If someone was looking to buy a MLR business in Qld what is the market like?

In several locations, short stay (holiday) management rights businesses are unsaleable unless vendors agree to discount. To sum up, permanent management rights sales: initially, panic set in but some current values have increased due to a shortage of stock. However, in many complexes, there has also been a reduction in the number of units in the letting pool due to a trend of investor owners moving into their units long term. These units have been lost to the letting pool devaluing the MLR business’s value. The question remains will they ever return to the letting pool?

What about unit property values across the Sunshine State? Overall, Queensland has been the winning Australian state for property value. Mainly due to its high net positive population gain and, on top of this, a significant government stimulus hit the market. The Gold Coast has limited stock,

There is limited supply.

Michael Philpott, Director MR Sales

so some unit prices increased. Its rental crisis worsened, with vacancy rates at their lowest level on record and there is limited liveable unit availability alongside reduced rental pools. FNQ has experienced limited unit sales. To sum up: most unit sales happened in Brisbane, followed by the Gold Coast and Sunshine Coast but the tourism sector and student accommodation sector were hit hard.

What about unit sales in NSW? They experienced a significant decline in CBD residential rentals, but they have since

The amount of management rights available for sale dropped considerably. A Finexia Study showed 739 management rights properties on the market in September 2019, but this fell to 436 in September 2021.

What about buying a MLR business in NSW? The NSW market does not have many management rights opportunities, but motels, larger corporate motels and freehold resorts have more stock.

Tell us about holiday MLR business opportunities in Queensland. The state is experiencing a very varied marketplace. The Gold Coast is tourism

MANAGEMENT

dependant and has been hit hard but, in some areas buffered by interstate migration. With the world locked out of the Gold Coast there is a huge oversupply of short stay units and it’s magnified by the loss of the university student market. Cairns’ holiday market has also been devastated due to its heavy reliance on overseas visitors. Meanwhile, Townsville benefited from increased sporting events and related exposure. The Sunshine Coast benefited from an under supply of stock and a high demand from Brisbane and regional visitors which drove healthy occupancy and tariffs. Similar can be said for Port Douglas. It will take a long time and considerable investment to reposition, revitalise and reinstate tourism once borders (both international and domestic) are open.

Where have you seen most MLR sales? Off the plan sales completed that were committed to pre-COVID and Brisbane experienced several permanent MLR sales. Some smaller general management rights complexes with low ResortNews | October 2021

©sommart - stock.adobe.com

letting pools and proportionally higher caretaking components also sold throughout Qld. High growth corporate opportunities are always rare, but we have seen a couple of these come on to the market and sell. These purchasers tend to take a long-term perspective.

What type of buildings are most sought after? Any permanent complexes, nearly all income sizes. Caretaking only roles are also very popular due to living off site. Permanent townhouse and villa complexes with a high salary and low maintenance garden sell well, alongside complexes with a lift, water views and proximity to services.

Have you identified any trends or changes in MLR buyers? We have seen new entrants to the marketplace that have primarily secured a home with income. Generally, the market has been constrained by the inability to borrow and buyers are not entirely confident in what the future will look like. However, if the property is unique, money can still be found as well as potential purchasers.

Did the lending criteria change due to COVID? A lack of finance is a huge barrier to entry and the market continues to be hard. Good businesses and ResortNews | October 2021

low risk operators have always been in demand, but it is difficult for newcomers to secure funding. Throughout most of the pandemic, some funders constrained the market and often external security was needed to secure the funding. Now we are seeing more competition, but it is still very hard compared to pre pandemic levels.

demanding ‘the new norm’.

Are there more deals falling over due to COVID?

Tropical North Queensland has been identified as an area where tourism businesses have suffered the most. Do you have any advice for those MLR operators wanting to buy or sell?

Consumer confidence disappeared but if the maintainable earnings are strong and the growth is strong, the valuers and the banks tend to be supportive. Most deals that have collapsed have been because of financial verification issues.

How would you describe the management rights real estate market right now? It has significantly contracted and is ready to boom! To remove the shackles, we need more consumer confidence and a dramatic increase in available funding to enable people to take more risks.

What are the biggest challenges for buyers and sellers? The lack of stock, alongside providing accurate financials. Most banks are seeking actual financials and valuers are distancing away from COVID adjusted figures,

Are management rights getting the same returns? Not in FNQ, where smaller complexes’ costs are rising, responsibilities are up, and tariffs down. There is also a squeeze from outside agents and owner occupiers draining letting pools.

Banks will lend to good borrowers, at the right price, multiples of 3 to 3.5 in FNQ are bankable.

Where do you think the MLR market is heading? As borders open and tourism is back to normal, we will see a realignment of multiples from around 3 to 4 times to 4 to 5 times for FNQ. There may be some tough times ahead for the industry as we open without the international markets. But everything moves in cycles and holiday sales will kick in and power ahead when the country unites. Permanent MLRs will ease off especially if the rental pool keeps declining and less people live onsite.

MANAGEMENT

What type of property is a good investment right now? Any property is a good investment now, we are at the bottom of the cycle and as we open, we anticipate high growth and considerable upside. Look for high amounts of bricks and mortar ownership, where the assets are working for you are important. Consider motel freehold, as prices per room are 50 percent of replacement values create opportunities. Management rights that do not have systems in place are worth considering because by improving on the simple basics you can add significantly to the bottom-line. The holiday market will bounce back, and buyers should look at buying now if owners provide updated financials.

Any preparing to sell tips? Be well-organised and make sure your agreements are topped up and valid; update and provide training and procedure manuals to add value; get a valuation and don’t be greedy; make sure you shore up your top-ups, review your marketing platforms; and look to expand to a critical mass your properties. Most importantly, supply three years of real figures with no amending periods.

GOOD GOVERNANCE

Changes to building regulation in Queensland How does this impact on the maintenance of residential and mixeduse strata properties? The new Building Regulation 2021 (Queensland) came into effect on September 1, 2021, and largely focusses on standards around new construction work, however, for those that have influence over capital works on the common or private property of strata complexes, important new laws apply.

Capital upgrades in strata schemes From time-to-time the body corporate will need to embark on capital upgrade or replacement projects to keep the common property structurally sound and/ or functioning as intended. Sometimes capital works are required for regulatory compliance, for example the replacement of combustible cladding materials, but most of the time, capital works are required to preserve the structural integrity of the building and ensure the optimal condition of the common property to maximise return on investment for lot owners. The most common capital

to be “assessable building works” and will require private certifier engagement to ensure compliance with building codes and Australian Standards to issue the final sign-off. Without this private certifier engagement, the works may be regarded as unlawful building works and repercussions apply.

Lynda Kypriadakis, Diverse FMX

projects required for residential and mixed-use strata properties are as follows: •

Repainting

•

Roof replacement

•

Waterproof membrane upgrade

•

Combustible cladding replacement

•

Window replacement

•

Lift upgrade

•

Fire hydrant (pump) upgrade.

In mixed-use residential and commercial/retail complexes, the retail tenants are likely to require internal fit-out changes from time-to-time. These internal tenancy fit-outs are more-often-than-not deemed

The body corporate and its building management team will need to ensure any tenancy fit outs have a private certifier involved and are completed in accordance with regulatory compliance standards, even if the works are happening within a private lot.

Building regulation 2021 The construction industry in Australia is largely run under a sub-contractor “selfassessment” model. This means that the sub-contractors that deliver the construction works on site can sign off on their own works and provide certificates to warrant their works. It is not necessary in class 2 to 9 construction (apartment complexes, hotels, or retail shopping centres) for subcontractors to have their works supervised and/or assessed by any independent third party.

As long as the sub-contractor signs the necessary form and provides a declaration to confirm they have completed the works to the correct building code or Australian Standard, that declaration is sufficient for the private certifier and regulatory authority. No further checks are done on the subcontractor’s building work. Sub-contractors that can sign off on their own works include concreters, bricklayers, carpenters, fire services installation contractors, plasterers, water proofers, window/door installers, air conditioning installers, roofers, insulation installers, stair and balustrade installers and pool builders. Electricians and plumbers can also sign off on their own works in certain circumstances. As long as the sub-contractor provides the mandatory selfassessment certificate to the builder upon completion of their works, that is all that is required by the private certifier to confirm construction has been completed to the required standard. Then the private certifier can issue the Occupancy Permit (or Certificate of Classification in Queensland).

SEO: The solution to longer-term brand awareness By Anne Stubbs, HiRUM Software Solutions & Brisbane Small Business Marketing

As an accommodation owner, you’ll be well aware of the vital role your website plays in marketing your business. What you may not realise, however, is that appearing in Google’s organic (unpaid) search results doesn’t just happen the moment your website goes live.

Sure, you can spend money on paid listings like Google Ads but what if you could appear high up in the free search listings without having the ongoing high charges of cost per click advertising? The process that makes this magic happen is called Search Engine Optimisation, abbreviated to SEO. According to SEO software business ahrefs.com, 91 percent of all website pages get no traffic from Google. The reason for this is the sheer volume

of new content that is being created every single day, most of which is not well optimised to be discovered, indexed and ranked by the world’s biggest search engine. So how do you ensure you are among the top 9 percent of websites that do make it into the organic listings?

What is SEO? Search engine optimisation is the process of making changes to your website and content to make it more likely to show

MANAGEMENT

up higher in the search engine results pages (SERP) when someone searches a term or phrase relevant to your business. While many factors play a part in SEO, the key to being successful with your efforts is getting the basics right, being consistent in your approach and applying Google’s best practice guidelines. When we talk about getting the basics right, this includes undertaking detailed keyword research, ensuring the content on your site is developed around ResortNews | October 2021

The new Building Regulation of 2021 introduces some changes to these mandatory self-assessment certificates or forms.

•

Form 43: This is the new sub-contractor’s self-assessment form for confirming they have installed their aspect of works to the correct standard. Subcontractors used to sign the Form 16, but now they sign the Form 43

•

Form 12: This is a new certificate for the designer or engineer to confirm they have completed site inspections throughout the project. Where important structural aspects of works may be concealed at the end of construction (e.g., steel reinforcement placed within a concrete slab, which can’t be seen once the concrete is poured) the engineer or designer will conduct a site inspection prior to the concrete pour to ensure the steel has been placed per the structural steel design. Following this site inspection, the engineer or designer will sign the Form 12 to certify that the inspection occurred, and the concealed aspect of works was completed to the design and code requirements.

The “old” forms included: •

•

Form 15: Design certificate (self-assessment certificate for the engineer or designer of the structural system, e.g., mechanical, lift, fire protection, electrical, hydraulics, structural) Form 16: Construction certificate (self-assessment certificate for the subcontractor that installed or constructed the aspect of works related to the corresponding Form 15).

The Form 15 and Form 16 were a matching set up until August 31, 2021. The private certifier would match the Forms 15 and 16 up at the end of construction to ensure they are all in hand before issuing the Form 11 (Certificate of Classification). Effective September 1, 2021, the “new” forms include: •

Form 15: No change to the pre-existing

•

Form 16: This is no longer the sub-contractor’s selfassessment certificate for their aspect of works. This is now a Stage of Works certificate. This would now normally be signed off by the private certifier or registered building surveyor to confirm a ‘Stage of Works’ has been completed (e.g., frame stage in housing construction)

the keywords that you are targeting and ensuring that your website is easy to navigate and responsive, meaning it can be easily viewed on any device. Without a doubt, your website content is still the single most important factor in positively influencing your search rankings. However, there are technical factors that influence whether Google can easily see and understand your content. These are called ‘on-page’ factors and include elements such as page titles, meta descriptions, heading tags, URL structures and image ‘alt’ text. ResortNews | October 2021

the Body Corporate and Community Management legislation the developer is required to hand-over all the construction contract documentation to the body corporate at the first annual general meeting of the newly registered scheme. This used to include the Form 15 and 16, but after September 1, 2021, the developer’s building contract documents will include Forms 12, 15, 16 and 43. These self-assessment certificates (or subcontractors’ warranties) are very important for the new body corporate to use to make warranty claims for defective building work in the future •

How does this affect bodies corporate in Queensland? The new forms under the revised building regulation impacts bodies corporate in Queensland in three distinct ways: •

•

Brand new buildings: Under

What are the benefits of SEO in the travel industry?

Mature buildings: Any type of structural works undertaken on the common property of the complex must have these important certificates, and sometimes private certification. If your body corporate is contemplating a capital upgrade (waterproof membrane, windows, lift, roof, balustrade, combustible cladding removal) it is important to get a project manager or private certifier to provide advice on assessable building work and what mandatory certification is required for lawfully undertaking the project Private Lots: If a private lot owner wishes to change

arriving on your website with high intent of booking •

More commissionfree direct bookings on your website

•

Reduced overall marketing costs: SEO is less expensive than other marketing methods, including most traditional advertising

Effective SEO delivers:

•

Increased profitability.

•

Free organic traffic to your website

•

Increased brand awareness and visibility in a highly competitive market

•

Qualified leads: people

Smaller business owners can sometimes feel a little intimidated by the jargon and terminology associated with this area of marketing, but it doesn’t have to be this way. Engaging the

If you’re looking for a costeffective method to increase the visibility of your property in search engines and attract more guests to book your accommodation directly, you have to invest in SEO.

MANAGEMENT

a structural element within their lot (move/ install new walls, add air conditioning, enclose a balcony, retail tenancy fit out of any kind) the lot owner must provide these important certificates to the body corporate. Again, it is important to get a project manager or private certifier to provide advice on assessable building work and what mandatory certification is required for lawfully undertaking the project.

Check before starting any capital works on the common property The new building regulation (among other things) mandates new sub-contractor self-assessment warranty certificates and requires changes to some existing forms. For bodies corporate considering embarking on any structural or capital upgrade project it is recommended that you get advice from a private certifier or licensed project manager before starting any design work or tendering to ensure the mandatory certificates are obtained from the outset. Failure to obtain the mandatory certificates is a breach of legislation and result in unlawful building work and/or voided builder’s warranty claims.

support of a good SEO professional can pay dividends in delivering you a longer-term advantage in a highly competitive market at a lower cost. While the benefits of SEO certainly aren’t realised overnight (it can take several months to see significant improvements), the longer-term benefits are very hard to ignore. Reduced ad costs, increased brand visibility and more bookings are usually high up the priority list for most accommodation owners. SEO is the solution to long term improvements in brand awareness and profitability for the savvy property manager.

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Ellipticals N Console

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time 5:00 PM

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Look after your building's exterior

with a Rochele Painting maintenance programme With Rochele’s experience and expertise in providing painting solutions to the strata industry they have tailored their service offering to really help their clients keep their properties well maintained. Painting is only one aspect of what is required when it comes to maintaining a building but can be one of the most essential as it is the first port of call of the defence barrier of the buildings exterior to the harsh elements of the environment, especially in South East Queensland. Rochele knows that sinking funds need to be deep to ensure a property is well kept and looked after when it comes to maintenance and this is why they offer their strata clients maintenance and repayment plans. Servicing not only the strata industry but also resorts and hotels, Rochele provides maintenance plans that ensure after repainting is complete, nominated surfaces retain their clean, fresh appearance through regular washing and the rectification of any paint breakdown. This greatly helps their clients look after the aesthetics of their buildings in a cost-efficient manner. Rochele’s maintenance plans are clear and honest, written in plain English with no fine print. These plans allow a complex to be completely repainted today and paid over several years; additionally the plans: •

Include 2 coats in the first year followed by annual inspection and reporting

•

Provide a maintenance allowance to be used in any capacity

•

Are fully tailored packages with various payment options

•

Allow for cancellation of the contract at any time

•

Allow for a refund maintenance allowance if unused

ResortNews | October 2021

Paramount to Rochele Painting’s maintenance offering, is the minimising of impact to tenancy and business in resorts, hotels and body corporate properties; so out-of-hours maintenance painting is something we offer and specialise in if required. They perfectly match their client’s expectations and budget to be flexible with customisations of hours, products used and time allocated. They discuss with their clients their sinking fund requirements and timeframes. This enables them to customise any repayment and maintenance plan anywhere from 6 months to 10 years depending on the scope of the project. Each of Rochele’s jobs has a dedicated project manager,

so there’s only one point of contact to ensure a trouble free project. Furthermore, we give our customers access to R.O.C.O (Rochele Online Customer Offering), their digital app, which allows them to book inspections and access their project timeline online. They also go one step further and offer a free colour consultation service through their sister company, Rochele Decorating. Sometimes the decision making process can get tricky within strata when there are several people involved. Rochele has found by bringing in a professional colour consultant it greatly assist with one of the biggest arguments that can form over colour. With providing clear and concise

MANAGEMENT

colour schedules as well as the option for colour overlays it makes this process extremely easy when usually it is not. Taking care of all permits and licensing as well as any access equipment that is required, Rochele really are the leaders when it comes to providing a whole package service to the strata industry’s painting requirements. For more information please contact Rochele Painting on 1300 808 164 or visit rochelepainting.com.au

INTONET

Good cop, bad cop? “From little things big things grow” a song written by prominent Australian singersongwriters Paul Kelly and Kev Carmody, where the lyrics chart the Gurindji people's struggle for land rights. Those lyrics are also true of a platform we all use, YouTube! Here too it charts the growth of this platform and its ubiquitous monster, the algorithm. These latter mystery boxes control much of what we do and will usually produce very acceptable results without our awareness. Not so anymore as some have discovered. And in a very questionable and certainly undesirable way! People around the world watch over 1 billion hours of YouTube videos every day; everything from cat videos to videos for cats. The YouTube algorithm is the recommendation system that decides which videos YouTube suggests to those two billion-plus human users and I can only surmise, untold numbers of feline users. This begs an important question for marketers, influencers, and creators alike: how do you get the YouTube algorithm to recommend your videos and help you earn more likes? After all this is how you monetize your channel. But I am getting ahead of myself. According to founder Jawed Karim, the star of Me at the zoo, YouTube was created in 2005 to crowdsource video of Janet Jackson and Justin Timberlake’s notorious Superbowl performance. So, it should come as no surprise that for many years, the YouTube algorithm recommended the videos that attracted the most views or clicks. Unfortunately, this led to a proliferation of misleading titles and thumbnails, in other words, clickbait. User experience plummeted as videos left people

The goal was to find the video each viewer wants to watch, not just the video that lots of other people have perhaps watched in the past.

Arvo Elias, Cybercons

feeling tricked, unsatisfied, or plain old annoyed. In 2012, YouTube adjusted its recommendation system to support time spent watching each video, as well as time spent on the platform overall. According to the theory, when people find videos valuable and interesting, they watch them for longer, perhaps even to the end. This led some creators to try to make their videos shorter to make it more likely viewers would watch to completion, whereas others made their videos longer to increase watch time overall. YouTube didn’t endorse either of these tactics and maintained the party line: make videos your audience wants to watch, and the algorithm will reward you. We can now follow how an algorithm grows but always with the code owners’ interest in focus. In 2015, YouTube began measuring viewer satisfaction directly with user surveys as well as prioritising direct response metrics like shares, likes and dislikes and, of course, the especially brutal “not interested” button. The goal was to find the video each viewer wants to watch, not just the video that lots of other people have perhaps watched in the past. As a result, YouTube declared in 2018 that 70 percent of watch time was spent watching videos the algorithm recommended. Over the years, YouTube’s size

and popularity has resulted in an increasing number of content moderation issues, and what the algorithm recommends has become a serious topic not just for creators and advertisers, but in the news and government. YouTube has said it is serious about its responsibility to support a diverse range of opinions while reducing the spread of harmful misinformation. Algorithm changes enacted in early 2019, for example, have reduced consumption of borderline content by a claimed 70 percent. YouTube defines borderline content as content that doesn’t quite violate community guidelines but is harmful or misleading. Offensive content, on the other hand, is immediately removed. This issue affects creators, who fear accidentally running afoul of ever-changing community guidelines and being punished with strikes, demonetisation, or worse. It also affects brands and advertisers, who don’t want their name and logo running alongside white supremacists. In the meantime, American politicians are increasingly concerned with the societal role of social media algorithms like YouTube’s. YouTube and indeed other platforms have been summoned to account for their algorithms at Senate hearings, and in early 2021 Democrats introduced a” Protecting Americans from Dangerous

MANAGEMENT

Algorithms Act.” As an aside, I wonder if our politicians will succumb to these views?

So, what does the algorithm look like today? The YouTube algorithm selects videos for viewers with two goals in mind: finding the right video for each viewer and enticing them to keep watching. When we talk about “the algorithm,” we’re talking about three related but slightly different selection or discovery systems: one that selects videos for the YouTube homepage; one that ranks results for any given search; and one that selects suggested videos for viewers to watch next. The rules today are as follows for their home page: •

Videos get selected for the homepage based on two types of ranking signal of which performance is the first

•

YouTube measures performance with metrics like click-through rate, average view duration, average percentage viewed, likes, dislikes, and viewer surveys.

Essentially, after you upload a video the algorithm shows it to a few users on the homepage, and if it appeals to, engages, and satisfies those viewers, meaning they click on it, watch it all the way through, like it, share it and so on, then it gets offered to more and more viewers on their homepages. ResortNews | October 2021

©MclittleStock - stock.adobe.com

What to keep in mind with a new website By Leanne Kalf & Anne Stubbs, HiRUM Software Solutions

the ALT attribute to include a few words of descriptive text.

Good website design and effective digital marketing aren’t incompatible. Building an uncluttered, great looking website is just the first step in building your online visibility.

A fundamental principle of good marketing is to understand your target audience. To strike a good balance between website design and content, put yourself in your target customers shoes and ask yourself what you would want to know most when visiting each of your web pages. Then make sure you’ve included that information and it’s easy to find. This includes using language and terms that your potential customers will understand and avoiding "industry jargon".

However, being too sparse with your content can harm how well your website ranks on search engines like Google. What use is a stunning website if no one can actually find it or the user can't instantly find the information they're looking for? The good news is, it is possible to balance elegance with search engine friendly requirements. One key thing to remember is that while a visually appealing and creative website might initially catch a visitor’s eye, people are usually there to find information. When it comes to search engines, the text is still the most easily understood element of a webpage. Anything that is not text or is produced in non-HTML code is ignored by search engines or spiders. So, if your website uses a lot of animation, graphics or JavaScript it is unlikely to rank well in Google's search results. Instead, use text in place of images to display important names, content, or links. The Google crawler can't recognise text contained within an image. If you must use images for textual content, consider using ResortNews | October 2021

Website content includes everything from text, images, animations and graphics. These all play a part in informing and engaging visitors through the customer journey to take action and become a customer. When you’re considering what content needs to be on your website you need to consider each phase of the customer journey. You shouldn’t assume that your website visitors are already familiar with your brand or what you do. It’s worth conducting some keyword research to find out what terms are most related to the content on your web pages.

•

Use a responsive design that's optimised for mobile, as well as desktop and tablets

•

Apply a combination of quality content and amazing visuals

•

Make sure your high-level messaging structure is strong and includes relevant keywords. Use headings, subheadings, anchor text, internal links, and CTAs (calls to action)

•

Implement as many on-page SEO elements as possible. Including, title tags, H1 (Heading 1) tags, meta descriptions, and image alt tags to ensure Google understands as much as possible about your webpage

•

Use links on your web pages with relevant anchor text that take you to another page on your site (maybe a blog page that offers more information on that topic). However, avoid using ‘click here’ as anchor text as it's hard for Google to understand the topic of the content you are linking to

•

It all comes down to user experience and web design needs to work in tandem with SEO techniques to ensure users find what they are looking for. Top tips to help you strike the right balance between great design and search engine friendliness:

•

Use clean, simple navigation structures that make it easy for users to find what they're looking for. If your website is well established with duplicate or old, outdated content, remove it, or redirect it to the most up to date, relevant webpage Use blog pages to create longer-form content that supports your main website pages and add additional

MANAGEMENT

linking between different blogs and main pages •

Keep track of important metrics using free tools like Google Analytics and Google Search Console. As a minimum, you should be monitoring metrics such as your page traffic and bounce rate

•

Ensure your website speed is fast. A slow website kills user engagement and experience and is now a vital metric that Google uses to determine whether your website is worthy of ranking. Websites that use a lot of images and graphics generally tend to be slower. Tools like GTMetrix are great for showing your website speed and what you can do to improve it

•

Avoid intrusive pop-ups on your web pages. Not only are they annoying to most users, who immediately click the ‘close’ button, but Google is now penalising websites that use them excessively. If you must use them, make them unobstructive, relevant and make clear what value they are offering to the user.

To help you achieve the right balance in your website design and content, it is always worth getting the advice of a digital marketing expert. SEO-focused web design is the key to building your online visibility and credibility. Applying these tactics will ensure you have a website that not only looks great but ranks well and builds your bottom line.

TOURISM REPORT

School holiday tourism crisis:

Hopes dashed for many By Mandy Clarke, Editor

When Tourism Tropical North Queensland Chair Ken Chapman predicted holiday reservations in his area were so dire that the Far North was facing its worst school holiday bookings since the pandemic began, he was not wrong! When the kids hung up their aprons and put away their pencils for the 2021 September break their families did not flock to the Tropical Far North. Sadly, TNQ is an area beset by worn out workers, financial hardship, and a lack of job security. Tourism campaigns seemed to attract an ebb and flow of visitors to other iconic holiday destinations in the Sunshine Coast, Gold Coast and Yeppoon but the north was sadly whisper quiet. Post school holiday feedback from tourism and accommodation operators on the Sunshine Coast revealed many locations were much quieter than expected. The ability to park your car on Hastings Street is the tried and tested measure for how busy Noosa is, but parks were reported to be plentiful. On the whole Sunshine Coast occupancy

Images supplied by TTNQ

levels disappointed, the area felt the absence of Melbourne and Kiwi visitors who usually stay for (sometimes) two weeks at this time of year and Noosa especially felt their loss. At the other end of the scale Mooloolaba was reported to be “very busy”. Mooloolaba, it seems was successful in attracting families with the average occupancy for the area above 75 percent. The Australian Accommodation Monitor STR recorded the top-performing hotel in Mooloolaba, and it was Landmark Resort & Spa. Its owner and manager Brett

Thompson told us he was happy with the 85 percent occupancy levels his resort achieved for the school holiday period, although the levels did not match those achieved in September 2019 school holidays. Visit Sunshine Coast reported that it’s too early for them to put a dollar figure on losses, but they say for many Sunshine Coast operators, the loss will be "substantial”. Matt Stoeckel, CEO of Visit Sunshine Coast said: “The September holiday season on the Sunshine Coast is down 20 to 30 percent compared

TOURISM

to what it would be in a ‘normal’ holiday season. “The region would usually be at capacity during this time of the year as it is a holiday favourite for interstate visitors, particularly the Victorian market. The loss of these markets has also impacted rates and length of stay.” The Gold Coast, another iconic family holiday favourite location, also suffered significant losses. Paul Hammond, Business Development Manager Pacific at STR shared the company’s insights on Queensland’s accommodation performance on his LinkedIn page.

ResortNews | October 2021

Photo by Ethan Robertson on Unsplash

The STR data compared bookings (one week out) for the June/July 2021 school holiday period to the September/October period. Mr Hammond confirmed that although the Sunshine Coast’s occupancy levels saw a marked drop, the Gold Coast suffered even bigger losses, with its occupancy levels only reaching around the 40 percent mark. However, he confirmed that Tropical North Queensland experienced the most drastic downturn in occupancy levels in Queensland, in what should have been their peak season. This is just another major blow in a series of setbacks for Far North's tourism industry. Earlier in the month Green Island Resort announced it will temporarily close after the school holidays because of what owners Quicksilver Group cited as a shortage of advance bookings, largely because of stay-at-home orders across NSW and Victoria. Green Island staff have been stood down temporarily. Many TNQ operators and employees are in crisis. On June 18, 22 tourism employees, operators and stakeholders from the Tropical North Queensland region participated in a series of Tourism Workforce Workshops, as part of the Advance Queensland funded “Queensland Tourism Workforce Strategy V2: A crisis resilience and recovery plan” Project. The study found that employees experienced anxiety with job ResortNews | October 2021

Officer of Tourism Tropical North Queensland (TTNQ) said 3150 more jobs would be lost by Christmas as the tourism workforce was slashed to half its pre-pandemic size. Mr Olsen said tourism had employed 15,750 full and parttime staff and, with indirect tourism spend, supported a total of 25,500 jobs before the pandemic. But he said by July 2021, tourism in his region had lost 6000 jobs, “even with the support of Job Keeper and a returning domestic market.” Photo by Mike Fox on Unsplash

security and were financially stressed by income losses. Some considered switching industries for more secure jobs. Operators’ job security concerns were reflected by “environmental uncertainty” during the crisis. This was followed by financial hardship and well-being issues because of a decline in travellers, working extended hours and dealing with various stresses due to changes in operations. Often leading to business closures and lost livelihoods. The study found that the resilience of those in the tourism sector in North Queensland was showing signs of diminishing because of a compounding effect impacting on their job security and well-being. The decrease of resilience in 2021 was “due to a loss of hope with repeated lockdowns.” and

the study found that workers who migrated to other industries were unlikely to return. Andrea Cameron, the coowner of a Port Douglas touring company, told the ABC that her town was “empty, there is just nobody here”. Ms Cameron said she had been forced to sell off one of her tourist buses to stay in business after selling her house earlier in the pandemic. "[This is] in order to try to hunker down as long as is going to be necessary, with no money coming in," she said. Tourism Port Douglas Daintree CEO, Tara Bennett, said occupancy was around 30–35 percent this year when 95 percent was the norm pre-pandemic. Mark Olsen, the Chief Executive

TOURISM

Mr Olsen said governments needed to understand the impact of the decline in visitors to North Queensland given that one in five jobs there depended on tourism. Daniel Gschwind the Chief Executive of QTIC, Queensland’s peak tourism industry body told us that right now, the tourism industry is navigating very turbulent waters. This is because operators are struggling with sudden border closures and snap lockdowns which cut them off from their customers but when restrictions lift, they are then having to deal with a gross shortage of skilled workers. The sector is fighting two battles he said, on the one hand, there is no work and on the other hand, when there is work there is no staff. He added: "The industry needs to look at ways to keep its skilled workforce."

THE LAST RESORT

Tiny house big heart By Mandy Clarke, Editor

Queensland’s first Tiny Away “tiny house” accommodation property has launched in the Sunshine Coast. Tiny Away Kookaburra Cabin is located in the Sunshine Coast hinterland near the small rural town of Palmwoods. This “tiny house” opens onto lawns and forest with the backdrop being a 17-acre property it’s far from the hustle and bustle of city life. The cute and sustainable property is set in the heart of an arts and craft hub which typifies the remarkable region. The house is close to the south-eastern gateway to the Kondalilla National Park. The compact accommodation is part of the interesting tiny house company concept called Tiny Away, which is all about experiencing nature in comfort. Since its start up the Tiny Away concept has opened the doors to a growing network of rural getaways across Australia. Founded in 2018, the Tiny Away network includes a range of comfy eco-friendly tiny houses for travellers seeking alternative and unique accommodation experiences typically in rural areas. The idea evolved from the tiny home movement that began in America and has become an international trend. The tiny home philosophy advocates simple living in small, affordable, and ecofriendly homes, and the Tiny Away concept offers these homes to guests for unique holiday accommodation

experiences, based on a profit-sharing arrangement. To become a host, you must be a suitable landowner who is able to allow Tiny Away to provide the specially designed tiny home, this partnership can see landowners earn up to 45 percent of rental revenue. Tiny Away says it considers itself a partner with hosts with a drive to create rare and exceptional accommodation experiences. Jeff Yeo, co-founder of Tiny Away said: “Tiny Away allows guests to immerse themselves in nature while enjoying comfortable accommodation. It’s all about leaving the worries of the daily grind behind and really connecting with the natural surrounds. This new property will offer our guests exactly that, and a chance to explore more amazing regions across Australia.” Tiny Away now has over 75 unique short-stay tiny house accommodation options across Australia. Its tiny architecturally designed houses are set on private land in rural and regional locations and are designed to get visitors out of the city and into the outdoors. The properties on offer are definitely a step up from glamping and boast a range of stunning designs and state-of-the-art features both inside and outside. The homes are impressively selfsufficient made with sustainable materials and include waterless compost toilets, rainwater collections tanks for showers, and solar panels. They also offer hot showers, air conditioning, a cosy queen bed, and a kitchenette. TOURISM

ResortNews | October 2021

TOURISM

EVENTS

What about “Women In”? BRISBANE EVENT

The Brisbane luncheon held at La Costa Restaurant & Bar was an engaging, fun afternoon with many new connections and friendships made.

APPOINTMENTS

Organiser Marisa Millane said: “It was a privilege to spend the day that turned into evening with so many likeminded women. A big thank you to Zoe

Brown & Tania Stewart from SSKB Group for collaborating on such a successful event.” The Gold Coast luncheon held at the newly renovated Surfers Paradise Beergarden was all summer vibes. It was a successful event filled with great conversations, value, delicious Mexican food and good fun. Don’t miss the last event of the year in November.

Vanessa Sciortino has been appointed to the Urban Development Institute of Australia (UDIA) Queensland Property Law and Community Management Committee The UDIA is the development industry’s most broadly representative industry association, with more than 4,500 member companies spanning top tier global enterprises and consultants, to local governments and small-scale developers.

As a member of the committee, Vanessa will provide feedback and advice to government and other stakeholders on a range of issues impacting the industry. This includes issues relating to body corporate legislation and property law matters, property purchase, sale, management, and regulation, aspects of local controls and state government

legislation; preparation of evidence-based

Vanessa Sciortino

responses and submissions to proposed policy changes and thought leadership and innovation for the industry in this area.

EVENTS & APPOINTMENTS

ResortNews | October 2021

GOLD COAST EVENT

Accommodation Industry Golf Series update A great day was had at the last golf day on September 9 at the Palms Golf club, Sanctuary Cove. The weather was perfect as was the challenging “Palms” course. The day was a teams’ event so individual hiccups were compensated most of the time by your partners better scores. This format certainly was a fun event particularly as this was the Annual Wine Skins format where the best team score on each hole received four bottles of quality wine. With six dozen bottles of wine for the skins event plus extra prizes for nearest the pins, longest drive and the business card draws it ensured that everyone who

played went home a winner. Mike O’Farrell certainly got the ball rolling with a fun presentation! This day was one of the highlights of our calendar so if you couldn’t make it, please keep in mind for next year. It’s all looking good for our next golf day at the Brisbane Golf Club on the Thursday 21st October. Tracey says we have 100 players registered already. Another great day coming up! A huge thanks to Tracey Taylor (golf coordinator) for making these golf days so special. There are only spots available for two additional teams so if you are wanting to play, please email Tracey taylor77@bigpond.net.au.

2021 ARAMA INDUSTRY EVENTS CALENDAR For registration and/or event information please contact us on 1300 ARAMA Q (1300 27 26 27), email national@arama.com.au or visit: https://www.arama.com.au/ BRANCH

EVENT TITLE

DATE

TIME

LOCATION

REGISTRATION

Sunshine Coast

Members Social Lunch

Tuesday, 19th October 2021

12pm-2pm

Alex Surf Club

Opening Soon

Online

Information Webinar

Wednesday, 20 October 2021

11am - 12pm

Opening Soon

All

ARAMA AGM & Face to Face Members Forum

Tuesday, 26 October 2021

10:30am – 12pm

Riverside Hotel

Opening Soon

All

Management Rights Industry Training Program Wednesday, 27 October 2021

8:30am - 4pm

Riverside Hotel

Opening Soon

Sunshine Coast

Sunshine Coast Roadshow

Wednesday, 3 November 2021

6:00pm - 9:00pm

Kawana Surf Club

Opening Soon

Gold Coast

Gold Coast Roadshow

Thursday, 4 November 2021

6:00pm - 9:00pm

Surfers Paradise SLSC

Opening Soon

Mackay

Mackay Roadshow

Tuesday, 9 November 2021

6:00pm - 9:00pm

Lanai Riverside Apartments

Opening Soon

Airlie Beach

Airlie Beach Roadshow

Wednesday, 10 November 2021

6:00pm - 9:00pm

Toscana Village Resort

Opening Soon

Port Douglas

Port Douglas Roadshow

Tuesday, 16 November 2021

6:00pm - 9:00pm

Oaks Port Douglas

Opening Soon

Carins

Cairns Roadshow

Wednesday, 17 November 2021

6:00pm - 9:00pm

Brothers Leagues Club

Opening Soon

Brisbane

Brisbane Roadshow

Tuesday, 23 November 2021

6:00pm - 9:00pm

Colmslie Hotel

Opening Soon

All

Management Rights Industry Training Program Monday, 29 November 2021

8:30am - 4pm

Riverside Hotel

Opening Soon

Online

Educational Webinar

Wednesday, 1 December 2021

11am - 12pm

Opening Soon

Gold Coast

Members Social Lunch

Tuesday, 7 December 2021

11:30am - 2pm

TBC

Opening Soon

ResortNews | October 2021

EVENTS & APPOINTMENTS

IVORY PALMS | NOOSAVILLE, QLD

Sales Report The trusted source for buying Management Rights, Motels and Caravan Parks from all the leading brokers.

MANAGEMENT RIGHTS Gold Coast Magnoli Palm Beach

Mike Bell & Sue Newman

Palm Beach

Central Park Apartments

Ben & Terry Neal

Varsity Lakes

Handford Grove

Grace Ge

Taigum

Story Apartments

Stacey Ireland

Kangaroo Point

BrisbaneOne PM Portfolio

Duncan Allan

Windsor

The Avenues Morayfield

StayCo

Morayfield

Aspect Murarrie

Connie Chen

Murrarie

Aspect Yeronga

Connie Chen

Yeronga

Brisbane MRS

Sunshine Coast / Wide Bay / Fraser Coast Left to right - Anita Smith, Malcolm Farrell from StayCo, Glenn Millar from ResortBrokers, Geoff Hussin, and Chenoa Daniel from ResortBrokers

ResortBrokers Sunshine Coast specialists Glenn Millar and Chenoa Daniel congratulate Anita and Malcolm as the incoming operators of Ivory Palms at Noosaville. ResortBrokers sold Ivory Palms on behalf of industry veteran Geoff Hussin.

THE VERVE ON COTTON TREE | MAROOCHYDORE, QLD

Bluewater Point Resort

Danielle & Gareth Fisher

Minyama

Edgewater Lake Kawana

RSG

Kawana Island

Northwind Apartments

Cameron Lawrence

Mooloolaba

Verve on Cotton Tree

RSG

Maroochydore

Camargue Apartments

Catherine Novella

Maroochydore

Ivory Palms Resort

StayCo

Noosaville

White Crest Apartments

Pownall

Hervey Bay

Noosa Hill Resort

Noosa Blue Lakes Property Management Noosa Heads

RMS

La Mer

Sabio Pronostico P/L

Sunshine Beach

RMS

View Point

John Dent

Twin Waters

RMS

CRE

MOTELS & OTHER Queensland

Left to right, Glenn from ResortBrokers, Gavin from Verve and Chenoa from ResortBrokers

NORTHWIND APARTMENTS | MOOLOOLABA, QLD

Blackwater Motor Inn

Adler Family Holdings P/L

Blackwater

Bottle Tree Gardens Motel

Rodney Drain

Roma

Country Rose Motel

Sugars

Warwick

CRE

Clifford Gardens Motor Inn

Sargent

Toowoomba

CRE

Royal Hotel

OZ Pubs

Gympie

CRE

Country Life Hotel

Kin Kin Partners

Kin Kin

CRE

Billabong Hotel Motel

Connor

Cunnamulla

CRE

Hatton Vale Motel

Sandel

Hatton Vale

CRE

Colonial Tweed Caravan Park

Philip Clark

Tweed Heads

Eden Motel

Holly & Scott Nicholas

Eden

Garden Motor Inn

Patel

Gundagai

Rainbow Motor Lodge

Pot of Gold Motel P/L

Rainbow

Ararat Colonial Lodge

Lakhveer Brar

Ararat

Kerri Mazis

Victor Harbor

Chris and Leanne Roberts

Strahan

New South Wales RB CRE

Victoria

South Australia Victor Harbor City Inn

Tasmania Franklin Manor

Note: Agent/Broker involved in the sale is listed last. Glenn from ResortBrokers, Laura and Cameron (New Managers) and Chenoa from ResortBrokers

Agent - KEY: RMS - Resort Management Sales; CBMR - Calvin Bailey Management Rights; CRE - CRE Brokers; MRS - MR Sales; QTHB - Queensland Tourism & Hospitality Brokers; RB - ResortBrokers; RS - Resort Sales; TO Tom Offermann; TB - Tourism Brokers; TMR - Think Management Rights; SC - Stratacorp; WCH - Ward Commercial Hotels. * In conjunction

PROPERTY

ResortNews | October 2021

Management Rights – New Exclusive Listings ID 8911 YOUR SEA CHANGE AWAITS

ID 8941 LARGE VARSITY LAKES PERMANENT EXCLUSIVE AGENCY

• • • • • •

EXCLUSIVE AGENCY

99 lots with 56 in the letting pool Gated estate 21 years remaining on agreements 3 bed, 2 bath manager’s residence No set ofﬁce hours Just 10 minutes to the beach

NET PROFIT: ASKING PRICE:

$351,103 $2,686,618

EXCLUSIVE BROKER: Phil Trimble – 0418 478 966

• • • • • •

ID 9030 UNIQUE NOOSAVILLE BUSINESS EXCLUSIVE AGENCY

• • • • • •

Point Lookout – North Stradbroke Island Boutique style island resort Short walk to beach and village hub Strong repeat client base 2 bed, 2 bath manager’s residence Whatever you do – don’t miss this one!

NET PROFIT: $213,000 ASKING PRICE: $1,643,500 EXCLUSIVE BROKER: Peter Ross – 0447 710 891

ID 9031 LIFESTYLE PERMANENT COMPLEX EXCLUSIVE AGENCY

Motel style management rights No onsite owners No requirement to live onsite Zoned short term letting only 2 bed, 2 bath residence Call now!

NET PROFIT: $333,427 ASKING PRICE: $2,370,000 EXCLUSIVE BROKER: Tony Johnson – 0433 335 679

• • • • • •

Southport permanent complex Great rental location No set ofﬁce hours Immaculate 3 bed, 2 bath residence Pet permitted with BC approval 5 minutes to Surfers Paradise

NET PROFIT: $111,126 ASKING PRICE: $1,150,000 EXCLUSIVE BROKER: Lyn Pearsall – 0425 168 244

MR Sales have an extensive range of listings Australia wide. Visit www.mrsales.com.au to view them now or Phone: 1300 928 556 | Email: sales@mrsales.com.au

www.mrsales.com.au

Your Management Rights Financing Experts Management and Letting Rights Quarterly Pulse • September 21 • Twelfth Series

Data provided by The On-Site Manager website

Market Snapshot - September 2021

STOCK LEVELS - The total dollar value of listings has bounced back this quarter January 2019

May 2019

Sept 2019

January 2020

June 2020

October 2020

January 2021

March 2021

June 2021

Sept 2021

$969m

$914m

$1,010m

$985m

$863m

$717m

$646m

$576m

$565m

$616m

697 Properties on the market

739 Properties on the market

716 Properties on the market

641 Properties on the market

518 Properties on the market

500 Properties on the market

463 Properties on the market

444 Properties on the market

436 Properties on the market

$UH ZH DW WKH ERWWRP RI WKH PDUNHW" )RU WKH ͤUVW WLPH LQ \HDUV VLQFH WKH WRWDO GROODU YDOXH RI OLVWLQJV LV JURZLQJ January 2019

May 2019

Sept 2019

January 2020

June 2020

October 2020

January 2021

March 2021

June 2021

Sept 2021

+ROLGD\

358 Permanent

330 Permanent

343 Permanent

335 Permanent

Permanent

187 Permanent

186 Permanent

309

336

311

Multipliers have also bounced back this quarter BUSINESS MULTIPLIERS (Avg) OVER $1m Purchase Price [

[

DAYS LISTED January 2019

DAYS LISTED May 2019

DAYS LISTED Sept 2019

DAYS LISTED January 2020

DAYS LISTED June 2020

DAYS LISTED October 2020

DAYS LISTED January 2021

DAYS LISTED March 2021

DAYS LISTED June 2021

DAYS LISTED Sept 2021

'D\V

7KH GD\V RQ WKH PDUNHW KDV MXPSHG XS ZKLFK LV OLNHO\ WKH UHVXOW RI WKH LQFUHDVHG OLVWLQJV KLWWLQJ WKH PDUNHW RYHU WKH ODVW WKUHH PRQWKV

Market Movers

The Sunshine Coast has been the market that has driven he upwards movements in the key numbers. Brisbane remained basically steady and the Gold Coast market has seen the impact of sales activities and potentially vendors perception of better times ahead, meaning that new stock has been taken off the market or not listed.

1300 886 103

ͤQH[LD FRP DX

LQIR#ͤQH[LD FRP DX

FRPSDQ\ ͤQH[LD VHFXULWLHV

Management and Letting Rights Quarterly Pulse • September 2021 • Twelfth Series

Management Rights for Sale - Market Analysis - September 21 Letting Pool Coverage – proportion of the total units to those within the Pool Agreement Coverage – refers to % of total agreement term available upon purchase. Total stock ($)

Total stock

Days listed

Average price

Multipliers

Letting pool coverage

Gross return %

Agreement coverage

5HVRUW +ROLGD\

186

Permanent

Corporate

Off The Plan

Caretaking

Retirement

$611,662,547

432

$1,415,886

4.29

24%

49%

81%

Historical Comparison of the Market

Standard Agreements multipliers have dropped from an average 4.13x to 3.94x. Accommodation Agreements have risen slightly this quarter from an average of 4.30x to 4.38x.

Brisbane

P LQ 3URSHUWLHV IRU 6DOH P LQ -XQ

LQ 3URSHUWLHV IRU 6DOH LQ -XQ

700

694

716 641

650 600

529

550 500

501 463

450 400

3HUPDQHQW LQ -XQ

+ROLGD\ LQ -XQ

444

436

Sep 2021

739 695

187 220

186 214 Sep 2021

750

Jun 2021

Accommodation Agreements

800

Jun 2021

Mar 2021

Jan 2021

Standard Agreements

NUMBER ON THE MARKET

Oct 2020

Avg Purchase Price

Jun 2020

BUSINESS MULTIPLIERS (avg)

Jan 2020

Purchase Price

Total properties on the market has hit another record low

Sep 2019

Comparison by Agreement Type - September 21

May 2019

‘On the Market Analysis’ - Market Pulse

Jan 2019

Grand Total or Average

'D\V RQ $YHUDJH /LVWHG LQ -XQ

$YHUDJH 0XOWLSOLHU LQ -XQ

'D\V RQ $YHUDJH /LVWHG LQ -XQ

$YHUDJH 0XOWLSOLHU LQ -XQ

358

350 300

330

336

343

309

335 311 328 283

250

'D\V RQ $YHUDJH /LVWHG LQ -XQ

$YHUDJH 0XOWLSOLHU LQ -XQ

1300 886 103

ͤQH[LD FRP DX

LQIR#ͤQH[LD FRP DX

FRPSDQ\ ͤQH[LD VHFXULWLHV

187

3HUPDQHQW

5HVRUW +ROLGD\

Jan 2020

+ROLGD\ LQ -XQ

150

234

219

Sep 2019

3HUPDQHQW LQ -XQ

200

May 2019

LQ 3URSHUWLHV IRU 6DOH LQ -XQ

238

247

Jan 2019

Sunshine Coast

P LQ 3URSHUWLHV IRU 6DOH P LQ -XQ

244

Mar 2021

+ROLGD\ LQ -XQ

400

Jan 2021

3HUPDQHQW LQ -XQ

Oct 2020

LQ 3URSHUWLHV IRU 6DOH LQ -XQ

NO. OF BUILDINGS ON THE MARKET BY TYPE (Holiday & Permanent)

Jun 2020

Gold Coast

P LQ 3URSHUWLHV IRU 6DOH P LQ -XQ

PROFILES Cascade Gardens

Operator with tenacity and family history in MR

PROFILES

ResortNews | October 2021

By Mandy Clarke, Editor

For the last 18 months Cairns resort manager Sam McLean has been warmly welcoming guests to his delightful central garden accommodation, Cascade Gardens. The resort offers affordable self-contained accommodation in the heart of Tropical Northern Queensland, it’s close to the airport and only 300 meters to Cairns Esplanade, and its shops and restaurants. Cascade Gardens is set over

three levels and features a poolside pavilion with an outdoor kitchen that overlooks the newly renovated resort style pool. The airy, bright, and clean accommodation, of studio and one- and twobedroom apartments are tastefully decorated and fully air-conditioned.

Over the years, I have worked in both large hotel chains and smaller operators but then I decided to purchase my own management rights. Having a family history within the business is perfect because my father is always available to give me some advice or make a nice excel spreadsheet!”

Sam is fairly new to Cascade Gardens, but he is no newbie to management rights. His experience in the industry began when his parents bought a management rights business back in 2004. He told us: “I spent so much time there that it led to a career in hospitality.

You decided to purchase Cascade Gardens, was this resort exactly what you were looking for in a management rights business? “Yes, I looked at a few properties but when the opportunity at Cascade Gardens presented

itself, I knew from the moment I walked through the door that it was the right property for me. The resort offers wonderful tropical living with a friendly and comfortable holiday feel. The rooms are well presented and there is also a proactive body corporate committee. “I especially love the location, but I also like the comfort, cleanliness and tropical feel of the property. I honestly think Cascade Gardens gives off one of the best holiday vibes for a resort that I’ve ever experienced. Also, I haven’t mentioned Cascade Garden’s best asset - its own resident cat - Bruiser!”

We are delighted to have Sam McLean as a valued client. Best wishes from Mike and all the team.

ResortNews | October 2021

PROFILES

Cascade Garden’s best asset - its own resident cat - Bruiser!

Cascade Gardens settled on April 1, 2020, which was right at the beginning of the national three-month lockdown. Then Sam suffered another stroke of bad luck when he found out that he was not eligible for any of the government grants because it was a new business. This wasn’t a great start for your business how did you cope? “I had to adapt very quickly,” he said. “I decided to capture any guests I could find, people who were looking for accommodation in the area at that particular moment in time. I ended up with

guests originating from the USA, Denmark, Germany, Austria and Japan but they all had one thing in common - they were all waiting to get back home.” You recognised the importance of ﬂexibility under such unusual circumstances. “Yes, even though I had to almost completely change how you would traditionally run the letting side of a management rights business I was at least able to provide the owners and of course the business some income.” Your choices were smart and how you have managed your new business under these

difficult circumstances is a huge achievement.

in my experience is a leader of the industry,” he said.

“I think we all need a pat on the back in this industry, considering what we have been through and are still going through due to this pandemic. It is a huge achievement,” he said.

“I usually have a receptionist, but I haven’t replaced the last one at this point in time. Being such a small team, I do find the consistent upkeep of the property along with all the other tasks challenging.

“I try to remember that in Queensland we’ve had it easier than some of the other states but getting through this without any government assistance has certainly been one of my biggest achievements.” Tell us about your resort team. “The team is just me and one head housekeeper, who

“However, I do like structure and routine and I strive to present my building at its best every day. I get a lot of job satisfaction from meeting the guests, getting to know them and hearing their feedback, I also enjoy meeting the personal goals that I set for myself, especially with regards to occupancy and returns.”

WOULD YOU LIKE YOUR PROPERTY FEATURED? Profiles are a fantastic opportunity to:

PROFILE FEEDBACK:

• •

Thanks very much to you and your team for your assistance and support in creating a professional resort profile, for Oscar on Main, in your wonderful publication.

• • •

Impress your unit owners Receive recognition for your hard work (and that of your staff) Lift the awareness of your property within the industry Help build relationships with other managers Lift the profile of your property for when you are ready to sell

resortnews Issue Iss ssue ue 235 2 | Mar March rch 201 2016 2 6 | $1 $13.75 $13.7 3.75 3.7 5 Inc. Inc. GS GST T

The Monthly

Magazine for Accommodation Industry Profe ssionals

www.accom news.com.a u

Who writes the article? The article will be written by one of our qualified journalists.

Print Post No. Australia Post Registered by

It doesn’t cost anything to have a profile in Resort News apart from a little of your time when helping to coordinate the profile material.

PP442298-00 015

What does it cost?

The profile read well and told our personal story as well as that of our business and the building. It was surprising how many people saw it and commented back to us.

Special Repo rt

Regional airpo rts from internatio benefit nal links

Profiles

Le Cher Du Monde Raine & Horn e Onsite Righ ts management rights •

hotels • mote ls •

Interview Steve Daws on on Airbn b, corporate buyers and why WA is the place to invest from international links resorts • holid ay

parks • time share

I was a little concerned that it would take a lot of time and effort on my part – something building managers are always stretched on – but your team made it very easy and took the hard work out. We were very proud our wonderful resort was featured in such a professional way.

• hosted

Many thanks for the extra copies of the magazine. We have given them to some of

the owners and the body corporate committee members. They were really proud to see their building highlighted in the industry magazine. Thanks for helping us to raise our profile with the Oscar on Main feature and for making it a quick and easy, professional process. – Angela, David & Sonya Oscar on Main, Main Beach Thanks to the team at Resort News for profiling our property. We are really happy with the results, and the feedback from owners has been fantastic. The article was great, and accurately reflected both our property and everything we are trying to achieve. Very much appreciated! – Eric & Tanya Sealey, Aqua Vista, Maroochydore

CONTACT OUR PROFILE COORDINATOR GAVIN BILL ON 07 5440 5322 OR SERVICE@RESORTPUBLISHING.COM.AU TO BOOK YOUR PROFILE

PROFILES

ResortNews | October 2021

With everything you’ve been through in the last 18 months do you have any words of advice? “Be organised” he laughs. “I try to be on top of everything that’s going on, so that when the inevitable curve ball is thrown at me, I don’t have several jobs half done. My main advice to others is, do not wait for a quiet time to do something you need to do, do it now.” Sam strives for success in both business and life and admits this is what motivates him. He said: “I also strive to be a good role model for my family and give them the best chance

at being financially secure that I can.” In his spare time Sam seeks to get out and explore Far Northern Queensland but because everything was closed when he first moved, he still has so much of the tropics to experience. What are your thoughts on the future? “What a wonderful opportunity Australians have to visit their own backyard. The worldwide recovery will take time, so I hope that travellers take this advantage to see our beautiful country in the next couple of years before we start to welcome back international guests.”

Sam McLean

Specialising in management rights and other accommodation business syndicates

Trent and the team are proud to have acted as the legal advisors for Sam McLean on the purchase of Cascade Gardens Management Rights.

Work with the firm that delivers nationwide, industry leading transactional services and advice across all accommodation based business types. Helping hundreds of resident managers and operators each year to acquire, sell, protect and grow their business.

175 Lake Street, Cairns Queensland 4870

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Phone: 07 5562 6111 After Hours: 0412 092 969 www.pevylawyers.com.au ResortNews | October 2021

(07) 4047 6300

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www.cascadegardens.com.au Mates Rates for Resort News readers when booking direct

Beaches on Wave

Golf pro hits a winner at Beaches on Wave

By Grantlee Kieza, Industry Reporter

Beaches on Wave is proving to be a big hit, just like the 65 David once shot in the Canary Islands and the 67 he recorded at a Pro-Am at Massey Park in Sydney in his most memorable rounds of golf.

It’s a fairway from being a golf pro in Warsaw, Poland to running a holiday apartment complex at Mermaid Beach. But David Ekberg, who helped golf become a hit in the capital city of that central European nation, is now making the long drive to success in the Gold Coast accommodation business.

David grew up in Victoria, went to university on the Gold Coast, and then spent 17 years building up a highly successful golf business in Poland. He runs Beaches on Wave with his wife Eva and has some priceless advice for anyone entering the

management rights industry. His beautifully presented accommodation is available as one, two or three-bedroom air-conditioned apartments featuring self-catering amenities that include fridge, dishwasher, washing machine, dryer, microwave and all cooking appliances. There are 36 units in the complex and 17 in the letting pool. The building is set in landscaped gardens and just a two-minute walk to Nobby‘s Surf Beach

Eva Ekberg

and less then 100m to shops, restaurants and bars. It is within walking distance of Broadbeach Oasis, Star Casino, Pacific Fair Shopping Centre and the Gold Coast Convention Centre. “But it’s far enough from the nightclub scene to make sure guests have a very quiet, relaxing holiday,” David said. “In this business so much depends on the location of the property.

David Ekberg

PROFILES

ResortNews | October 2021

“My plan was to go to Europe just for one year to get some experience. In Poland golf was a fairly new sport that was taking off and there was only one course in the capital Warsaw. I ended up as the pro there for five years. “I met Eva in Poland and I ended up staying there for 17 years. We built up a really good business. I had a golf academy, where I coached players, we organised golfing holidays, and I was also the representative for Ping clubs in Poland.” “We get a lot of repeat guests who just want to put their feet up and relax. The location makes a big difference to the clientele that you attract.” David had no real background in the accommodation industry before he and Eva took over Beaches on Wave two years ago. His advice to anyone wanting to get into management rights is to seek out the best professional guidance. “People are spending $1m and sometimes a lot more to get into management rights, which is a huge amount of money,” David said. “They should spend just a few thousand more and get really good advice. Believe me, it’s money well spent and makes a huge difference. “I did an ARAMA course and went to one of their training days. I asked the CEO of ARAMA, Trevor Rawnsley about getting help in the business and he recommended Mike O’Farrell. Mike is a board member on ARAMA and has a big complex called Riverside Hotel in Brisbane. “Mike gave us advice right from the beginning, even making sure we got the right complex. I looked at a few properties that I thought would be good, but he advised us

against them for various reasons. “Then we found Beaches on Wave and when we bought the business, Mike helped us sort out a lot of things early on to help it run smoothly.”

But David and Eva decided on an Australian sea change. “The golf season in Europe generally lasts for nine months of the year. When winter comes it’s summer in Australia,” David said.

David explained that through no fault of the previous manager, the management rights contract was “really basic and hadn't been changed for 20 years”. He said: “There was nothing in the contract about gardens for example, so we organised a new contract to include maintaining them.”

“We’d come back to the Gold Coast every year and spend two months in Coolangatta. “I would talk to the managers there about management rights and it seemed like a very good business to be involved in.” Two years ago, David and Eva, who have a young son, teed off at Beaches on Wave. “It’s been a great business,”

The rooms were not up to par, either, and David and Eva worked hard improving them. “We're making improvements to the building and the business all the time, meanwhile”, David said: “The management rights are becoming more valuable, and our investment is growing.” David completed a Bachelor of Business in Professional Golf Management at Griffith University on the Gold Coast and turned pro, working at Royal Pines for six months.

David said. “The average stay is six nights." “Even with COVID we’ve done really well except for the last few weeks with border closures. We are probably running at 80 percent now, but for most of the year we've been running at 90 percent. “I think that's due to three things; one location; two the price; three the product. I’m always checking and adjusting the price and we are one of the cheaper properties so we get people who are not just on holiday but also people who might have just sold their house and need somewhere to stay until they move into their next one. They stay for a month or two.” What about a long-term future in management rights? “Eventually we will probably expand to a bigger property,” David said. “That's the normal progression in this industry. The good thing about this one is that we're doing everything, except cleaning the rooms. “We’re getting good experience at all aspects of the business and I'm sure it will help us later on.”

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“That was in the late 90s and I then got the travel bug,” David said.

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ResortNews | October 2021

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ResortNews | October 2021

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ResortNews | October August 2021 2021

BUILDING MAINTENANCE SERVICES

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Across the Sunshine Coast Call 0438 302 591 www.firstresort.com.au

ENERGY MANAGEMENT CONSULTANTS & SERVICES

Professional & friendly service Over 30 years finance experience Accommodation funding specialists

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Brisbane: 07 3252 2219 • Gold Coast: 07 5576 7059 enquiries@pcsfinance.com.au

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ACL (364 314)

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1300 876 055 dennis@hotelinteriors.com.au www.hotelinteriors.com.au

Phone (07) 5446 2135

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fresh finance... Mike Phipps

0448 813 090

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cameron@mikephippsfinance.com.au 4/31 Mary Street, Noosaville, Qld - 07 5470 2194

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Commercial Specialist Direct Importers Sales, Service & Repairs ¾LARGEST RANGE¾FURNITURE ¾UMBRELLAS¾SUN LOUNGES Cnr Main Drive & Nicklin Way, Warana, Qld 4575 | Ph 07 5493 4277 Acres Centre, 1/37 Gibson Rd Noosaville 4566 | Ph 07 5449 9336

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PREFERRED SUPPLIER DIRECTORY

ResortNews | October 2021

We get results. Pure & simple.

GYMNASIUM EQUIPMENT

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Look for the sign of an Industry Specialist

We’ve got you covered

MAIL BOXES

EBM is your Management Rights insurance specialist. As industry partners and members of ARAMA, we are proud to support the Management Rights sector. 1300 755 112 | ebm.com.au

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AFSLN 246986 ABN 31 009 179 640

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MANAGEMENT RIGHTS AGENTS

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Calvin Bailey LREA

0414 889 593 calvin@cbmr.com.au

Alex Barker-Re LREA 0414 835 128 alex@cbmr.com.au

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 Discreet Silent Listings  Free Market Appraisals …When you need us most! MGA was founded in 1975 and has since opened up 38 offices around Australia, offering Insurance products for:  Business  Strata  Landlord Protection With quick quote turnaround and hassle-free claims service Call us today on (07) 3720 6000 or email: quotes.brisbane@mga.com

INTERNET SERVICES

“Always passionate, committed and professional, you can trust the team at Property Bridge.” info@propertybridge.com.au propertybridge.com.au

Specialists in management rights Off the plan sales qld & victoria Buying or selling best advice Rod Askew 0411 758 236 (QLD & VIC) Eric Brizuela 0413 060 683 (QLD) Nationwide: 07 3554 0040 Email: sales@rcabb.com.au

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Australia’s Leading Hotel Bedding Suppliers

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Look for the sign of an Industry Specialist ResortNews | October August 2021 2021

07 5437 8544 info@mainlinen.com

PREFERRED SUPPLIER DIRECTORY

info@resortsales.com • www.resortsales.com

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SOLICITORS

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SPECIALIST AGENTS COMMITTED TO MAKING EVERY DEAL A SUCCESS

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Call Sharon Flood, Director 0459 070 871 or 02 6674 5118 sharon.flood@floodlegal.com.au www.floodlegal.com.au

ResortNews | October 2021

think

management rights, think...

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Call John Punch on 5570 9322

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1800 080 349 www.propertytraining.edu.au LIVE CLASSES at Logan Central

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www.accomnews.com.au/business-directory ResortNews | October August 2021 2021

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ResortNews | October 2021