Shane Wilkinson speaks to SCHWARTZWILLIAMS about creating his own development company, and about the unprecedented level of demand for architect-designed townhouses in Melbourne.

How did you first get into property development?

My background as a builder was the impetus to start developing my own projects. I started on small subdivisions and townhouses, and the early success from these projects was the start of an unrelenting passion for property which I channelled into forming Pace Development Group.

I have continued to follow this passion through many cycles of the property market, growing in knowledge and capability to transition Pace into increasingly larger projects ever since, to now be one of Australia’s most successful property development brands. 

What do you enjoy most about your job?

The most enjoyable aspect of my job is watching young people come through the business and being a part of their achievements along the way.

I’m particularly proud of the young women in my business and have enjoyed seeing our industry evolve to have more female leaders, who I think bring a more diverse set of skills and qualities to the industry – they are incredibly smart, empathetic and adaptable. 

What makes a good property developer?

I believe being a good developer is about making a commitment to quality design and construction, and investing into initiatives that foster a sense of community. These attributes contribute not only to the legacy we leave behind as developers, but also to our individual brands. 

We don’t waiver on these commitments depending on the site’s location – we deliver to the same standard in every location we develop in. Pace of Carnegie is a perfect example of this, in an area where many competitive developers have opted to scale down their offering to a suburban location. By contrast, we saw an opportunity to elevate the standard of development in this area and have experienced incredible success with this strategy, selling out two thirds of this project within our first month of launching.

You’ve recently bought a site in outer Melbourne for Pace Development Group's first townhouse development. What prompted you to move away from inner-city apartment development?

Our move into premium townhouse estates does not represent an abandoning of apartment projects for Pace, which I envisage remaining as our core business. Rather, I see an exciting opportunity to bring what we do so well in the apartment space to a booming area of the property market. 

We’ve identified an enormous opportunity to apply our learnings from the apartment market into estate developments, where there is unprecedented demand for quality, architecturally designed townhouses in inner-city areas.

How do you choose your development sites?

I choose development sites that offer convenient transport links with ease of accessibility to the city; sites that have the ability to integrate with and enhance the local community; and that lend themselves to the creation of a community neighbourhood that can sustain every amenity residents have come to expect from Pace. 

We have a robust acquisitions process that places significant importance on brand attributes rather than just commercial viability. Of the 200 commercially attractive sites that I have been presented to buy over the last six months, only two met our stringent criteria. 

Have you noticed a decline in the investor market? How has that affected your business?

We have certainly seen a decrease in the number of investors buying into our developments since 1 July, but with the substantial additional stamp duty requirements, this was expected. Investors simply brought their purchase forward or have now opted for another asset class.

This change now brings us into line with NSW and I would guess that we’ll start seeing some price adjustments over the coming months and the investors will start to return. That said, our developments have always been weighted to the owner-occupier and first-home buyer so this change has not significantly affected our business.

What’s your outlook for the Melbourne property market?

I believe we will see a sustained flat-lining of the property cycle for the next 18-24 months, however this is an important and healthy readjustment that we needed to endure for the long term sustainability of our industry. No developer who is a long-term player wants to see this market overheat - we are all supportive of the industry remaining viable for many years to come.

Our banks and policy makers seem to be managing their risks well and as such we are unlikely to see interest rates like the early 90s again.  This is likely to make the industry stable for the foreseeable future.

Where do you live now, and where would you live if you could live anywhere in the world?

I currently live in a Pace development within Melbourne’s Bayside. I love its central location being so close to the city, and amongst great local eateries and the bay. I wouldn’t live anywhere else!

Read other Get to Know profiles in The Real Estate Conversation:

Get to know Raghav Goel of Oz Property Group

Get to know Ronald Chan, CEO of developer Growland

Get to know Rick Impala, new project funding specialist with Kokoda Property