Commercial Property for Lease Transformation

Lifecycle

Lesli Berger is intent on transforming his family’s company into a more sophisticated beast.  Berger is general manager of Sydney’s Fivex Property Group, begun originally by his grandfather but steered into property development by his father Joshua.  “Most of my lessons were learnt over the dinner table growing up,” he says.  “Dad would just talk about business and work.  Through osmosis I learnt how business works.”

After dabbling in politics while studying law, he joined Fivex as a development manager, taking the role of general manager two years ago.  The learning curve was steep, and Berger cut his property development teeth on a small house project at Woollahra.  “For most of the project I was terrified I would stuff it up,” Berger says. “The idea was to take on a relatively small project so, if I did do it wrong, it wouldn’t send the family broke.  I learnt a lot of hard lessons.”

The project didn’t send the family broke, and neither did it make a profit.  But in breaking even, it gave him the skills and experience he needed.

Berger has since taken on bigger projects and begun changing Fivex.  An environmentally friendly office project in Sydney’s Double Bay, launched in March 2007, gave the company experience in green development.

Berger believes the project was 10 years ahead of its time, but helped set the company boundaries for profitability in sustainable building.  “Strategically, what we did made sense,” he says.

Fivex has followed up it Double bay project with a similar proposal for a building at nearby Woolloomooloo.  Using lessons from its Double Bay development, the Woolloomooloo project is not as environmentally ambitious.  “We won’t take it as far as Double Bay because, quite frankly, it was hugely expensive,” Berger says.  “The real problem with [ecologically sustainable development] is it’s not profitable.  While large companies can afford the leases that ESD involves, small companies cannot.”

Although toning down Fivex’s sustainability initiatives, Berger is increasingly the company’s sophistication.  “The focus now is very much on professionalizing our operations,” he says.  “The family’s wealth is tied up in the business.  We see opportunities out there in the marketplace but we’re limited because of how much of our own equity we want to put into a development.”

Limiting risk also means limiting opportunities, so Berger is working to create a funds management arm to allow the company to enter into joint ventures for future developments.

‘BRW Magazine March 20-26, 2008’

Interviewed by Chris Larsen