Step 4 John Herniman - Architect

I think we're live, John. Okay. Hi John, how are you?

Oh, terrific, Jacks, how are you On a gorgeous, beautiful Friday.

Excellent. I love it. Now just to give you a quick intro. John is a world renowned architect. He has done projects all around the world. He's doing one in America at the moment and he can tell you a little bit more about it in a second. And he's a part of our network. He works with a team in the office. They're out of the office at the moment, but also with some of the team that I work with and that's how we connected and we've met a few times and we just vibrated on the same frequency and I showed him this site and we love trees and a few other things that really connected us to us and I thought I'll get him on, have a look what we can do on this site. And it's a real pleasure to have you John. Thank you for joining us.

Good on you, Jack. Thank you. It's good. Fun to be here too.

Yeah, excellent. So can you give us a bit of a background other than what I've just said about you?

Let me tell you, first of all I'm sitting here in Collingwood, I'm not in America or any of the other places and I'm sitting here on my own. So I don't mind that at all. But too much, it's not good, not much fun at all. So what else did you want to know?

So I guess you did mention you've been doing architecture since you were 23.

Since I was 23, yeah. And you said to me that's only a couple of years. And I think I respond to saying I've been around the block. Yeah, look, I've been doing it for a few years now and it's gradually evolved. In the old days it was really about design and beautiful buildings and gradually more and more as I've done stuff myself and done my own developing and my own investing other vice clients the same way. I'm an avid reader of what's happening in the economy and analyzing why. I read a lot about the stats. So by now I reckon I know pretty well how to go about stuff, how to do it. I've written a white paper about townhouses which really happy to share with you. And so this coming weekend I hope I'm going to finish off my book which is all about how to make money in property without taking major risks. Doing it with really good planning and knowing exactly what you're doing in advance. Thank you.

Great Excellent. We've got see through you window cleaning on. Thank you for joining us guys. So John, that's really great and look, I'd love to get you on when the book's published to give a bit of a wrap on that and I know some of our investors in the Growth membership site would love to have a look at that. So we'll get you back on that. But today we're talking about our Huntingdale site. I know you've talked to Lloyd and you've seen some of the videos that we've done. Discussion on what Claude the real estate agent predicts at the end of this. What are you seeing on this site and what do you like about it?

Well, I think probably even a better question is how do I go about this? And the first thing I do and the first thing that you and I did when we first started talking about it was I jumped onto Google Earth and where is it in Melbourne, you know, and what has it got around it? Like it's got parks around it which is really cool. It's close to the freeway without being really close it means I've got really good access and down, down to the west I've got a valid railway station which has got to be worth something a lot to us because getting, getting around these days has become an issue. I also look at whether there's any schools nearby as I said shops must be coffee, must be coffee nearby otherwise I personally will die. And yeah, I've got a coffee machine here, coffee machine at home and a coffee machine that plug nickel downstairs and it's great coffee so gotta have that. But these days it's changed, it's changed just in two months to a different lifestyle and we've got to really plug into what that really means. How permanent is it? Because I think bits of it are definitely permanent. Then I like to look at what else is happening in the area. So I like to look at the street and I thought the street was just fine where we are. But further to the south and near North Road there is some pretty heavy duty retail and warehousing and it doesn't spoil where we are at all. But we have to be conscious that that is down the road. That's I don't think going to change in a hurry but it looks in reasonably well maintained shape. So I don't have a problem with that. Where we are is fine. It's what I call middle suburbia. It's not in your low demographic or in your really high demographic. So I look at that as well then I also look at the value in the area and I think Claude has told you roughly what sale prices are and roughly what this property is worth today. In crude terms, nobody knows exactly. And then I looked like to look and I can do all this on street view. Look at the scale of the area. Is everybody building one story or two stories or three stories or you know, sort of, you know, multi storey apartment buildings. And there's no doubt in this area that we're talking one and two stories.

Yeah, it'd be nice to get three. But there's no market for it, is there?

Well, I think that's exactly the point is that there is no market for it. We get pushback on a regular basis with three stories. We're doing one three story at the moment and possibly two. And we have analyzed the market really carefully before hopping into it because there is an issue there and it generally means that the living is at the middle level, not at the ground level. The ground level in the three storey is generally car parking, staircase entry, maybe a little bit of garden, maybe a bit of an office study. But the main living is upstairs, which for some people is great because there's no gardening. For other people is a real restriction because there's no garden. Real different. But in this area I wouldn't be going three storeys. I personally wouldn't try and do two bedrooms is the way to go.

Claude was very adamant that there's no two selling there. We've got Bruno. Hi, Bruno from One Central Property. He helps people buy their first property, investment property. And we were actually talking about this site as well. So good to have you on. So yeah, two betters are out in this area.

Yeah, that's right, that's it. So three bedders, I would think two bathrooms upstairs, ground floor would be. And keeping in mind there's a regulation which says that at least one of those units must have bedroom on the ground floor, must have access for people who are in wheelchairs or walking frames.

Okay, good to know. Thank you. That's great.

You need to know that. So one of the units will have that. And I'm really conscious also with this particular site that the value is in having as many units with street frontage.

Yes. And with a big street frontage of 53 meters, that's a good opportunity to be able to get a lot of street frontage properties on there. All the way down both sides of the streets. Yeah.

And you've got to be very careful there that you don't have a wall of units so council will chop you into pieces. If it's a wall of units, it's got to be articulated.

Yeah. And I guess that's very clear. I know some developers and people in the growth program are looking to save money and cut some corners. And I think I just want to delve into that quickly because some of them have indicated they want to use a draftsman for some of these things. And I always push them towards architects because there's a number of reasons why I do that. But, John, I'm guessing you've got a very clear.

I'm biased. Don't forget I'm biased. I think about 30% of our work a couple of years ago in townhouses was taking over from failed draftees.

There you go.

There are some very good drafties around and there's some shocking architects. So I think you choose somebody who is good for you. We were all about. Not about beauty and stuff like that. We're all about maximizing a site, Dax. We try and fit as many units as we can on it. And this particular site needs as many as we can.

Yep. What do you think? I mean, I know we talked about six with the potential of seven. I know some developers I talked to, they have this strategy, my members have raised this with me, that, you know, some developers have 20 or 30 units and they'll go for 30, 35, but their real plan is to get 30 because they know council will go 35 is too much. Then they come back with their plan B, which is actually their plan A. Is that a strategy we could apply here with seven and go to six or. What do you think?

Look, I think that strategy you talk about is great with apartments where you can easily chop a story off. We did that recently mainly because the feasibility didn't work. The feasibility didn't allow for a basement to work economically, so we had to reduce the height because of the number of cars. But for something like this, if we got a 50 unit townhouse site, for instance, yeah, we'll go for 55 or something like that, hoping to come back to a level that's more sane. But for something like this, I'm thinking it's going to be more like six units. And I want to go in hard for the number that I think is right here. So I would be wanting to do site layouts very early on, not doing the room layouts or any of that stuff. But let's have a look at how many would fit on this. Let's look at what our setbacks are, what is our orientation Relations north sun and east sun. How do we get access to the site? We've got trees on site, some of which we definitely want to keep, some of which we don't have to keep. We've got. In Beaufort street, we've got the side street. We've got a stay on a telegraph pole. And it's sitting over your right ear. Yep. You're pointing right at it. And there's a line on the. On the roadway. So we really want to be west of that pole to get access to the site.

We.

Or you can take access off Franklin Street. But seeing I want the big frontage with as many units as possible, I'm starting to think that access will be off Beaufort and that probably one of the units may face Beaufort as well. With frontage off Beaufort.

Okay.

I'll be really disappointed in myself if I didn't get every single unit with frontage.

Very nice.

Might happen. Might happen. But I'd be disappointed if that happened. Mind you, it's a perfect site when it comes to shadows. Yes, perfect. So we're not overshadowing anybody except the guy at number 65 Beaufort street and only first thing in the morning. So I don't think he would be an issue or they would be an issue. And of course, any shadows will be over Franklin and over Beaufort, so Street. So shadows are not a problem. Overlooking is always an issue. So we need to make sure we don't have any overlooking issues.

Yeah. And just let's go back to shadows because I think that's a key thing that a lot of people miss. Because it can be a big problem if you've got a lot of housing on the south of the property that'll be in darkness and that will restrict all sorts of things like heights and all. You know what sort of. Some of the things that you've seen that have really just stopped a development due to shadowing.

Well, you don't design something that's got a shadowing issue. End of discussion. It doesn't get built. There are a number of examples where the architect has deliberately sloped a roof so that shadowing won't occur.

Yeah. Okay.

I can think of one example on Beach Road in. I think it's Rye, where that's exactly what they've done for that exact reason.

So they've just pitched. It doesn't. If you pitch, it creates a great big dirty, big shadow over the neighbours. And you can't do that.

That's right.

Good. Excellent.

There's also something called a B17 line, which is all to do with the height of the building versus the setback from the boundaries.

That's what. Yeah, we've got to be clear on that. And we've got those. I mean, with that, if we'll be able to. Are you saying we should run a driveway at the back of the block? Running down. Running down Beaufort.

I am being a bit cagey on that because that's my first reaction. But not necessarily all the way on the western boundary.

Okay. Okay. So not. We're not really open. Maybe not all have street access from. For the road, for the cars. So we'd have multiple driveways but have one going down the back. That would then access.

I'm. I'm wanting to. I'm thinking that way at the moment. I don't want any cars off Franklin street, if possible. And I want to really reduce garage doors and garage doors really impose upon the viewer. And councils don't like it. And I don't think people like buying it.

Yeah, yeah. I have seen a lot. And it just looks like a warehouse, doesn't it? Garage. Garage after garage. And like, that's terrible design, like.

So why would you want to live there?

Yeah. And so if you. And one of our pillars of success is around social and if you have a front yard and you have access, people will be going out there to their letterboxes and they'll be enjoying that front street. And that massive, beautiful tree that we're going to hope to hold onto.

Yeah, the one on the corner. We are holding onto that. Dax, you and I have plotted a course on that.

Excellent. I love that. That's fantastic.

The thing is that a tree, apart from the fact that I think you're becoming a pariah if you knock down valid trees. The thing is that that tree is right on the corner. It's within the setbacks. It's root structure we need to be a bit careful of, but it's brilliant marketing as well.

Yeah, it's going to add to it.

Yeah. It's sitting right over your left ear.

Yeah, it's magnificent. Beautiful. The investor. And just to tell some people, I know Craig will be watching these afterwards and I hope he doesn't mind me revealing this, but he told me that he loves that tree so much that he goes and hugs it every so often.

Does that conform with all the COVID 19 rules?

Yeah, trees are exempt, I think. I hope.

Okay, I'm glad to hear that.

But, yeah, he was wrapped. When I told him, John, that, you know, we were like, nah, we're not touching it. So that's right. And all those. He told me all those trees and I think I did mention it to you, but for the members, the whole street was lined with them and they were beautiful trees. And now they've all been cut down except for that one. So it'll be really nice and great. Like you said, from a marketing point of view that, you know, and us being eco and sustainable. It's beautiful. Sits with our.

Yeah, yeah. On the west boundary. There's two other trees that are interesting, which I would like to keep if possible. We don't know how we'll go with that because. Mainly because of sewer lines and stormwater lines. So. Sir. So we don't know that yet.

Yep. Okay. And that's. I mean, Lloyd did raise that. We should get an arborist very soon in to trees and which ones we can remove and which ones we can't and then start making a plan around that. So that's your site plans and stuff.

What we do is we get a land surveyor in to start with who plots our site and levels and neighbors, and we also ask him to plot any major trees.

Okay, great. Any other things you wanted to point out from an architectural point of view that would be of interest to the members or, you know, potential developer for this?

We've, I think, covered most of the major issues. Certainly whoever buys this site will be wanting to develop. They should allow about 12 months to get a planning permit, assuming no VCAT. Sometimes it's shorter, sometimes a bit longer. Often depends on neighbours and whether you've got objections. We're a great believer in talking to council a lot and talking to neighbours. We end up by getting a quicker and better result by doing that. Takes longer for us to do, but we get a better result, which is what this is all about. And we're all about maximizing, putting in as many rooms as we can, getting it so this place is as livable as possible and stacks up financially. Some people will develop it and rent, rent out. So we need to be able to justify being able to rent and still get good returns. Great.

Good. Well, thank you, John. That's. That's awesome. From that perspective, I think you've covered all the areas that I would usually ask architects and stuff like that. What's the next step from here? What do you usually advise your clients when they've come to you?

Next up is to do a site layout and to do feasibility study.

Yep.

You don't need any. You don't need any fancy land surveyors or any of that stuff. We just Do a site layout. How many units do we fit on? We're pushing hard for six. So do your numbers on that and we'll see how it works out. But we need to justify it. As I say, do a site layout and all that. Starting to work. Good. Then we can hire all the right people and really go in all guns blazing.

Great. Excellent. Yeah, that, really, that. So it will pretty much follow that plan. So. So we'll look at the feasibility. We'll look at. We'll probably get a financier in afterwards. So we've got Kelly, the landscape gardener, a designer, gonna give us some advice.

Kelly's a landscape architect, actually.

Landscape architect. Thank you.

Yep, yep.

She's amazing.

She is amazing. Has been known to wield a pick and a spade. So she's not just sitting in an office.

Yeah, we had a really good chat about native gardens and native food as well.

Good, good. And you know, she's hands on. I like people who are hands on. I was on two roofs this morning, so I love being hands on too. It's much more fun.

Excellent. Yeah, that's great. So thank you for coming on. I usually ask these two standard questions. One is, what is something that people may not know about you of interest?

When I was at university, I subsidized some of my expenses by selling French perfumes at David Jones in Bourke Street. It was the only male on the floor. It was fantastic fun.

Oh, that's a great place to work.

There you go.

Fantastic. Well, John, thank you so much for spending the time on the site talking to everyone like that. I think it's a great site. And the last question, how do people contact you other than the members can contact you through me, but definitely want to know how they can contact you.

Look, Pat's just go to the website. Herneman Group. And that's spelled H E R Hermanru Man Herneman. So, John Herneman, just. Just go onto the website and it's all there. All my contact details are there. You know, they ring me, email me, whatever you want.

Yep. And if they've got a site you're happy for, you know, for the members to reach out for a 15 minute chat about their site and see where they can go from there.

We do it all the time. I personally love it because it's exactly where I. We're supposed to be in life.

Yes, excellent. I love to hear that. That's really good. There's some of the things people. We really love, the people that are passionate about their job and it's not a job. It's. It's a passion for life and that's what they love doing.

Can't help myself. Yeah. Love it.

Fantastic. Thank you, John.

And I'll tell people. I'll tell people what's in all, what's good and bad about a site.

Good, Good. Yeah. We really want to know that because.

The noise like it, but I will say it.

Good. Yeah. Because we want people like that on your team. And John's right. You want to make sure you got your right team on that we can call it out early so that you're not spending money and not spending time spinning the wheels going, oh, is this worth doing or not? So really great.

Waste of time is our great enemy.

Correct. Everyone from Instagram, thank you for being on. Really great to have you. If you want a copy of this post below, DM me, we'll get you into the member site and you can see all of the video series. But thank you for coming. And you'll see the next one with Kelly next week signing off.

And.

Thank you, everyone. This will be on the member site. You'll know that we cut this all up so you won't see all the off takes and me talking and all that sort of stuff. John, stay on. Thank you.

Okay. And thanks, Dax. It's actually been good fun.

Yes, thank you.