2019 CEO Survey wrap up

2019 CEO Survey wrap up

3 January 2020

In The Australian’s annual CEO Survey, selected CEOs were asked how low interest rates, technology, government policy and other factors would impact their company and the wider economy.

Here’s a summary of findings from CEOs in the property industry.

Steve McCann, CEO of Lendlease

Due to the low interest rate environment, McCann believes the RBA is limited in its use of monetary policy to stimulate the economy. As a result, he recommends a greater focus on broader structural issues. To improve Australia’s international competitiveness, McCann suggests removing red tape, tax reform and streamlining planning processes will move the needle the most.

Peter Allen, CEO of Scentre Group

Allen’s Scentre Group has benefited from low interest rates because of investors looking for yield. He believes better access to credit will help small-medium sized businesses invest and grow, especially in challenging economic times. Regarding adoption of technology, Scentre will continue to focus on customer experience. Their customer listening tool, CX Loop, will provide the platform for better decisions on the ground.

Allen recommends a greater policy focus on population growth and skilled migration to power the economy. Investment in skills, transitioning to a services-based economy and a more stable energy policy will increase business confidence.

Mark Steinert, CEO of Stockland

Low interest rates have been positive for Stockland, especially in Sydney, Southeast Queensland and Perth, which responded positively following rate cuts. However, Steinert believes fiscal policy and business investment to improve productivity are the keys to boosting economic sustainability. This includes continued investment in infrastructure and the access to credit for small-medium sized businesses. Steinert sees education and skilled labour — especially for digital roles — as critical to Australia’s competitiveness.

Productivity loss due to excessive red tape had a big impact on Stockland’s business, especially the inconsistencies between local and state government, delayed land releases and the assessment of development applications.

Owen Wilson, CEO of REA Group

Wilson is bullish on the impact of low interest rates on REA, which he sees as increasing consumer confidence and increased spending. He also believes the removal of inefficient taxes and increasing government spending on infrastructure, will result in the biggest economic stimulus.

REA Group were heavily impacted by the manufacturing slow-down and a range of cooling measures introduced by APRA around interest-only loans, investor loans and foreign investment loans. This resulted in few buyers in the housing market, falling house valuations and lower consumer confidence.

The banking royal commission further impacted already low confidence. REA’s home loans business felt the pinch from increased compliance and regulatory costs as well as the time taken to process a home loan.

Wilson believes the government should focus more on innovation and increased investment in research and development. He also believes Australia’s talent shortage is constraining global competitiveness, especially around the demand for digital skills. Wilson also commented that a broader land tax in preference of inefficient taxes like stamp duty, will reduce revenue fluctuations.

Click here to read the full report.