Investa CEO, Campbell Hannan
At just 43 years of age Investa CEO, Campbell Hanan is one of the youngest CEOs of a major Australian business. He speaks with Bob Forshaw about the commercial property market.
It was a difficult time to find work in Australia in the early 1990s. It was the time of the ‘recession we had to have’ and like many trying to forge a career back then, Campbell Hanan wasn’t immune to doing the hard yards just to get a foot in the door.
However it is that characteristic, the one in which people shed blood, sweat and tears to make an impact that allows you to break into your chosen field and build a respected career. Campbell displayed these characteristics early on and finally found his place with Colliers, where he began his career in commercial property.
“Back in those days AMP was the big institutional client. I wanted to be seconded to them.”
Campbell is a man who knows his mind.
He spent six years on the AMP secondment and worked on major projects including the Angel Place development and NRMA building. In 2001, Campbell joined UBS and worked his way into the position of Director Equity Sales, before landing at Investa. He worked his way through leadership roles before becoming CEO in July 2013.
“I have always been a person with a clear cut plan. I was lucky that I met a guy early in my career who was an ex Harvard MBA graduate who spent months with me to help me figure out what my life’s game plan would be.”
To further that ambitious streak he also completed an MBA.
“I did an MBA on the way through,” Campbell says. “That was a real game changer because it rounded out things for me. I had on the ground experience, but hadn’t fully realised how the management piece of the puzzle could better come in to play.”
He says everything that he has done in his career to date was to get to this point.
“Now I feel refreshed that I am here. The next steps are the harder ones, but I was lucky to have the variety in the jobs that I have held, especially at Investa where my role changed every two years and I was given added responsibilities.”
He says role diversification is crucial to an organisation’s wellbeing.
“It is the concept of developing personal development plans for people to continue to grow in the roles they are in and within the organisation so they don’t become so socialised and embedded in the role that they are key risks if they leave.”
Campbell is responsible for the? strategic direction and leadership of the ?Investa Office group, controlling assets of? over $7.5 billion. He has ultimate? responsibility for all of Investa’s managed ?funds, including Investa’s balance sheet ?portfolio and oversees the performance of ?the office assets through ensuring the ?effective operation of the office ?management platform.
Investa is one of the largest office real estate companies in Australia and a leading residential and industrial land developer. It is an interesting time for commercial property management.
“I think we are in a new paradigm,” Campbell says. “We are coming to terms with the fact that we are in a low growth, low interest rate, low inflation environment and we will have to accept lower returns. Currently we are paying more for the same income stream than we did a year ago and meanwhile the cost of capital is becoming cheaper. There is an abundance of capital, so there is disconnect between what operating markets and capital markets are doing. Asset valuations are going up for the wrong reasons; as rents grow, capital values go up, but right now rents aren’t moving but capital markets are.”
Another change in the market is the globalisation of commercial real estate.
“All major players offshore like Goodman and Westfield have brought their money home and are specialising in activity and location. What globalisation has done is force businesses to decide what they are really good at. There is now a growing pool of unlisted capital. Seven years ago most institutional real estate was controlled by Listed Real Estate Trusts, this has changed so there is a whole lot of money going into unlisted real estate. And we will see more of that.”
Campbell sites Colliers as an example of one company that refocused.
“In 2007, Colliers had too much leverage and had to think long and hard what they would specialise in. They focused on two activities rather than four or five.”
Investa is also a specialist and people who work within the organisation understand how their role is aligned to the company’s vision. According to Campbell this means everyone feels relevant; they know what the job description is, what the KPIs are and how it is all aligned.
“The people who succeed in this business and any other are those who understand what they can do every day to make a difference. They are custodians of someone else’s assets; they are a service provider. And young people, in particular need to remember that personal behaviour reflects the business brand. In the end we should all take the time to listen to what stakeholders want because you have far more power when listening than talking.”
Investa has a range of stakeholders to whom they listen. And they are in very diverse segments: Phytek is very different from Independent Monitoring Consultants, who is different again from Frank Ross and Associates and Springmount Services. Then there is The Plant Management Company, Posh Services and Ultra Clean Services. That’s everything from cleaning to landscaping, engineering and sampling and testing water systems. Each has a unique function and it is imperative that relationships with these businesses are built on the ability to listen to their needs. They are as important as staff and customers in the full and successful operation of Investa’s services.
Another message Campbell has, and one he learnt at UBS, was that it is important to create value for stakeholders. That means creating value in what you do every day. At Investa it is to understand how the income stream comes together and creates value.
“What UBS did was taught me was how to optimise value. Once you understand the income stream, you understand how to bring debt and equity together to create value.”
That is no mean feat when you are managing $8 billion in assets. However what drives the group is to be the first choice for tenants, investors and staff. It is to provide a unique customer experience. This may mean there is a little more rent paid, but that delivers more investment and therefore better returns.
“If investors see us outperforming the market, they give us more capital to invest and we buy more real estate. The business then generates more fees and we can pay our staff more. It is circular. This whole concept of how to successfully manage a business is to keep the business aligned to the vision and then the business continues its strong performance.”
Good businesses deliver on a vision that is reflected in KPIs, job descriptions, hiring policy, IT systems and how you tell your story through marketing. When that is set, growth comes naturally through the “best business model that is designed around relevance to the customer.
“We have been through this massive customer-centric journey. Businesses will ignore customers at their peril. Everything we do around suppliers revolves around what they want. We appreciate that we are custodians. It is amazing how many businesses forget that. In supply, they are a facilitator of our brand. They have a big flow on impact. Therefore we have a lot of communication, do a lot of listening and delivering all of those things that form stable partnerships.”
The thing Campbell is most proud of is the way the business has moved to a customer centric approach.
“We figured what excellence looks like and then asked ourselves whether we were structured as a business to reflect this. We weren’t, so we organised business around tenants and their corporate needs.”
There is still room for improvement though and Campbell feels it comes down to understanding the difference between a tenant and an occupant.
“The tenant is the CEO or CFO who make the decisions, the occupants are those who influence the decision makers. So it is about what we can we do for them and how we can make their lives easier.
It is a different way to look at the property industry. When we consider this industry we usually only see the sale of a property or the service of a building. Yet, as Campbell has explained this is a very customer centric service and it is imperative that to deliver the best service, it is important to understand what the business stands for and how this reflects on the client’s requirements.
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