In conversation with Trilogy’s Head of Property Assets

David Hogan is one of Trilogy’s founders, Head of Property Assets, and the Chair of our Lending Committee. With over 45 years’ experience in property acquisition, development and financing.

Prior to joining Trilogy, David was an Executive Director at Challenger Property Capital Pty Ltd where he played a significant role in leading the development of its global syndication and commercial property portfolio. He was also a member of the lending committee for the Howard Mortgage Fund.

Recently David shared insights with us into his career, his learnings, and the enjoyment he has gained throughout his experience in property.

David, can you share a little about your background and how you established yourself as Trilogy’s property expert and the chair of our lending committee?

I entered the industry in 1970 with Mortgage Guarantee Insurance Corporation. After embarking upon a property valuation course, I developed my career and after some time assumed the role of Group Underwriting Manager where I was tasked with establishing and monitoring risk standards for all mortgage insurance liabilities. At the same time I managed a mortgage fund which comprised a portfolio of mezzanine debt. I had to go out and source institutional funds for lending and then manage our investment in the loans. This is when I really cut my teeth in mortgage management, and what’s now known as managed investment schemes.

I then moved into merchant banking with Partnership Pacific which was owned by Westpac, Bank of Tokyo, and Bank of America. Here I developed the commercial property loan book. I was also a co-founder of the Mortgage Brokers Association of Australia which laid the framework for securitisation of mortgage debt and sought to develop the market.

What do you value the most from these experiences?

I’ve been very fortunate to have been coached by some excellent mentors. Very few genuinely appreciate the value that these relationships add throughout their careers. I feel that it’s critical to encourage people in any profession to access a mentor. In my case I had a brilliant economist, a graduate of Oxford University. He also helped me develop my communication skills.

Can you think of a moment in your career that was your most valuable learning experience?

My days at Challenger were very interesting. When I started I was the 13th employee and I was on the ground floor when the company went into property. I was involved in the launch and operation of the syndication division of the business. I also played a pivotal role in the acquisition of commercial property assets in Australia, Great Britain, and the United States. When I left, we had built a global portfolio worth over $2.6 billion dollars.

When we left Challenger and started Trilogy, my job became much more hands on and much more fun. I was humbled by this because I got to appreciate the effort that goes into bringing a product to life. Rodger [Bacon] and I did everything from sourcing a property, completing the due diligence, and then taking that product to the market by writing the PDS and coordinating distribution efforts.

Throughout this time I have never stopped learning. Every day I genuinely value every opportunity to grow my knowledge and capabilities and help those around me do the same.

Is there a significant shift in the property market that comes to mind?

Over the course of my time in the industry, I’ve seen a lot. The biggest shift was in 1983 and that was the floating of the Australian Dollar and the deregulation of the Australian banking system. Before then, the turmoil brought on by the Australian economy in the 1970s and early 80s saw the country suffering the impact of an enduring recession, in addition to double digit unemployment figures. By floating the Australian Dollar, the Reserve Bank of Australia was able to focus on managing inflation and stabilising the economy. In terms of real estate, we were now competing on a global stage. Physical ownership of real estate in Australia has been re-configured. When I came into the industry, the foreign owners of property were largely British and the property was financed by consortium banks and finance companies who were subsidiaries of banks. Today, ownership of the Australian property assets is largely diversified with a significant amount of properties owned by offshore investors.

“Today, growth in Australia’s real estate market is phenomenal. The industry comprises more than 13% GDP and it contributes more than $200 billion to the nation’s income.”

Another significant shift I’ve noticed and something I am passionate about improving in Australia’s property industry is gender equality. We’re in a much better place than we were when I entered the industry, and there’s still a long way to go. I believe that gender equality affects men too and that breaking down gender stereotypes is important. Something I love about Trilogy is that majority of our department heads are women and that our business is part of the gender equality movement. This diversity in leadership and employment means that we’ve got a wider spectrum of input, so we’re better placed to solve problems to benefit our investors.

David, many of Trilogy’s investors are with us to either help boost their retirement savings, or to get their money working smarter to generate an income. What’s something you can share with us, that can help investors on their own investment journey?

I can’t stress enough the need to make a considered decision. Read and understand the PDS. For some, it can be dreadfully challenging to completely understand the terms and conditions of investing. I do sympathise with many investors who try and read and understand the document but struggle.

If this is something you do struggle with, think about consulting a Financial Adviser. Second to making a considered decision
is analysing the quality of the income stream.

Many investors get lost in high ratings, but when you get down to the underlying investments that are generating the income stream, you may not be that impressed.

Lastly, I see many investors following the herd, or simply chasing a high rate. Chasing a high rate is common particularly with perpetually low interest rates. Because there are too many retirees underfunded in their super, many feel they need to make a capital draw down or take on higher risk to supplement any shortfall.

Before thinking about jumping on a bandwagon, or being wooed by a sky-high return, have a chat to a Financial Adviser.

How would you consider the health of Australia’s commercial property market?

Australia’s major capitals are strong. There is good medium to long term growth potential in the Brisbane commercial market. This is because there has been an undersupply and depression for too long. We’re seeing larger corporations move and grow operations in Brisbane and this is likely to drive demand for office space in the near future. Sydney is historically at an interesting point – we’re seeing the lowest vacancy rates ever and rents are strong. Melbourne has a possible over supply of offices that could be an issue in the future.

With such an impressive career, what do you wish your legacy to be?

I really hope my legacy will be that I will be remembered and respected by my peers, both within the industry and within Trilogy as someone with high professional standards and absolute integrity and as someone who managed a clean and well performing book of loans and properties.

Interest in reading more about the Trilogy team? Get to know our National Adviser Services Manager, Nicole Ott in just 4 questions.

This article originally appeared in Issue 03 of Angle Magazine. The material on this website is intended only to provide a summary and general overview on matters of interest. Trilogy is only licensed to provide general financial product advice on its own products and does not consider your objectives, financial situation or needs when providing any information or advice. You should consider whether the advice is suitable for you and your personal circumstances and we recommend that you seek personal financial product advice on your objectives, financial situation or needs and obtain and read the relevant product disclosure statement before making any investment decision.