In the past 40 years that Brisbane-based Consolidated Properties developed everything from high-rise apartment towers to beachside subdivisions and gas field business parks, chairman Don O’Rorke has focused on keeping clear of one thing commonly seen in property – suing people.
On his desk, O’Rorke has a framed cheque with a plaque that reads: “$600,000 dispute, $5 million in legal fees, $200,000 settlement.”
“I use that for theatre where arguments bubble up into disputes. It reminds everyone of two things; one, the futility of litigation and two, don’t f— with us because we will go the distance.”
The dispute was with Concrete Constructions, which sued Consolidated Properties.
O’Rorke recalls it was a technicality and that his company was not in the wrong. They fought for nine years.
“After nine years we sat down at the table and on our side there were all the same people as in the beginning, but on their side there was not one.”
O’Rorke is frequently referred to as the “baby-faced assassin” of the industry – his charm seems to help him get what he wants.
In the early days of development, O’Rorke was insistent on his schoolboy friend and now chairman of one of the country’s biggest private construction companies, Scott Hutchinson, being the construction partner for their first high-rise tower development – 175 Eagle Street (which still houses their corporate office).
“We had to convince the bank – Commonwealth Bank of Australia – to allow Hutchies to build it. But the bank baulked because Hutchies hadn’t built a high-rise tower before. We just said he is building it and if you don’t give us the funding we will go to another bank. They gave it to us in the end.”
O’Rorke’s Consolidated is now regarded as the leading Brisbane-based developer. There is hardly a project the company won’t be across – whether it is the early stage tender to redevelop News Corp’s headquarters, or a new request for a brand new office from listed companies such as Aurizon.
Residential property has been a key pillar for the company as well.
Last week Consolidated Properties and CVS Lane Capital Partners unveiled the $850 million Yeerongpilly Green urban renewal precinct in Brisbane – the group’s second major urban renewal project following its $650 million Cornerstone Living project at Sunnybank, also in Brisbane. The project requires strong relationships with government.
O’Rorke has made government relations a key part of his operations. He has been a donor to both sides of the political debate and says the key is just to get in early and make a serious effort.
He remembers the first experience of this and how it paid dividends.
“Sir Joh Bjelke-Petersen had been in power in Queensland for 20 years and we could get no traction. He and Sir Leslie Charles Thiess were best friends. So when Wayne Goss got elected we thought we should perhaps change the guard. Others ran in, too, but we just ran in quicker.”
This helped secure development opportunities in Brisbane. The company used this momentum to go on to win bigger tenders – the first of which being the Commonwealth Law Courts in partnership with the federal government.
An eye for deals
O’Rorke has always had an eye for deals. In his youth he spent summer holidays picking watermelons in the Queensland country town of Esk. He was almost going to quit before he struck an agreement with the watermelon farm owner to share the profits.
In the post financial crisis property lull, O’Rorke sought out a Chinese buyer for one of the company’s development sites and after dozens of trips to China found Golden Horse Nine Dragon Lake Holdings. The company paid Consolidated about $12 million for the Links Hope Island Golf Club and a hotel development site.
O’Rorke celebrated that at one of his famous Christmas party bashes where even industry competitors feel obliged to turn up.
Consolidated Properties – which is simply copied from the late Kerry Packer’s Consolidated Press company – now has a $2 billion pipeline over the next five years.
The original partners – O’Rorke, David Watson, Steve Tyson and Revon King – came together via a working relationship at real estate agency CBRE, but over the years the partners have come and gone. O’Rorke has remained the key identity and has always maintained a positive approach to wealth creation in property.
“It is a simple sum – the only thing that drags down property growth is when there is no population growth,” O’Rorke says.
He names Brian White – chairman of the Ray White Real Estate group as his “idol” who taught him and guided him through property deals.
“He was my first employer. We asked him to come on a surf trip that ended up with a trip every year on his boat, the Indies Trader III, for the last 20 years. It has been a never-ending source of joy and happiness for us. We have hatched so many plans on that boat.”
White says he saw O’Rorke’s talent early.
“His ability to see an opportunity is his hallmark,” White says. “And he has got the smarts – you would never hear him say ‘I’m not sure what you are talking about’.”
O’Rorke has had his personal ups and downs. In 2004, he merged Consolidated Properties with the publicly listed Trinity Ltd. But an acrimonious and litigious split over the future direction ended with him resigning as a director, buying back the Consolidated Properties business name, and starting afresh.
He also has two ex-wives and seven children. But O’Rorke never panics.
“I never worry. I occasionally slam the book shut, but I never lie awake at night.”
And he applies the same mentality to the business. When funding was getting tight in property he turned to then NAB banker Andrew McCasker to seek capital partners and wound up with the team at CVS Lane. They got along well. O’Rorke even went to Israel with CVS Lane backer Josh Liberman “to understand all that is Israel” and came backed amazed at the Jewish ingenuity in technology and development.
The CVS Lane relationship has continued to grow. It has been central to Consolidated’s retail property fund, which has been one of the biggest successes for the business.
With a target of up to $600 million in assets, listed groups such as Charter Hall’s Retail REIT or Shopping Centres Australasia Property could have a serious competitor on their hands.
At 58, O’Rorke still gives 30-year-olds a run for their money in both business and leisure – his surfing skills are to be commended. How long it will last is anyone’s guess.
O’Rorke says he has another decade. Most of the industry reckons that is a conservative estimate, but one thing they can be assured of is that there won’t be any litigation.
Keep up with Commercial Real Estate news.
Keep up with Commercial Real Estate news.