Industry Focus

For 30 years Steven Devine has worked in real estate, which, he acknowledges, is "a very cyclical business". "I have no doubt that while the next 12 months will be very prosperous, at some point in the future the market will turn again," Devine says. "I guess the strength of any business and any salesperson is the ability to weather good and bad markets. There are pluses and minuses for both, but unfortunately most people don't plan for the downside." As CEO of Devine Real Estate, which has a foothold in Sydney's Inner West, he plans for exponential growth but also potential down times, and he doesn't shy away from a challenge. In 1955, Devine's late father started Strathfield Real Estate, which Devine purchased from his father in 1998 as "effectively the rent roll and sales business". Devine's aspirations to expand the business led him to rebrand in 2003. "You can't expand with a suburban name in two different marketplaces, hence the dominant reason to change the name to Devine," he explains. While the head office remains in Strathfield, the 59-year-old business now has offices in Concord (since 2008) and Drummoyne (since 2011), the latter opening during what Devine says was one of the most challenging years in real estate. While Devine spends time at each office, he says the business has continued to grow through the management structures that are in place, and he concedes the offices and their markets work well together because the individual suburban market dynamics complement one another "very effectively". In fact, they see a lot of client movement between offices, he says: "For example, Strathfield is traditionally a family-oriented suburb. Many people live there for the proximity to private schools. Then, what typically happens is the empty-nesters 'migrate' to apartments in Concord or Drummoyne. They don't want a house but they want the lifestyle, so something along the water works very well." The past few years have been difficult for property. Tempering cautious optimism with realism, Devine has managed to successfully sustain the growth of his business despite the many challenges. First, he says, the industry's top KPI is volume. "From an industry perspective, when volume is up it doesn't matter if price is up or down; as long as the properties are turning over and generating revenue," he explains. "In 2011, Sydney's Inner West probably had NSW's lowest volume of real estate and, on top of that, prices were down." That meant income took a fall and "competitors were extremely destructive when it came to fees", he explains. "It was the toughest year we've ever had. You had to watch your every dollar, watch your expenses, watch your liquidity," Devine recalls. "But we still chose to expand our business because it was a once-in-a-lifetime opportunity. Expanding in the downtime is easier than doing it in the boom time." While Devine says the business is looking for opportunities to expand through mergers or acquisitions, prospects are light. "We'd certainly look at other offices that would complement our demographics and our geographic area. That's absolutely on the cards," he says. "But we'd also look at rent roll acquisition for the right businesses, and organic growth is a real focus for us." The company has specialised business development teams to guide its property management growth, which Devine says has been successful. Additionally, he is looking at opportunities for vertical integration into complementary areas that aren't currently the business' focus. "Basically, auxiliary services. Economies of scale and growth will enable us to do that. It's something more for the 18-month plan than an immediate plan, but it's certainly on the agenda." Not every business can boast longevity, but for Devine Real Estate in Strathfield, Sydney, the family legacy continues. CEO Steven Devine speaks about his successful business and its expansion during challenging times WORDS: AMAL AWAD Devine provenance "The strength of any business … is the ability to weather good and bad markets. There are pluses and minuses for both." LEFT: Steven Devine is always planning for changing conditions in the market. Real Estate Services • Issue 3 7 GROWTH

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