Perhaps no one has had as much impact on Sydney’s skyline as Harry Triguboff. The 84-year-old property developer has built more than 55,000 apartments during a career spanning half a century.
His company Meriton, whose World Tower at 230 metres is Sydney’s highest residential building, is developing 3,000 apartments on a former tobacco factory site in the city’s eastern suburbs. At a cost of about A$3bn ($2.3bn), it is the biggest single development in the company’s history.
Yet fortunes are not fixed. Sydney house prices have doubled since the financial crisis and regulators have tightened up on property lending for fear of a housing bubble.
In March, Australia’s banking regulator unveiled rules aimed at slowing credit growth and cooling house prices. It is limiting the issuance of interest-only loans to 30 per cent of banks’ total mortgage lending and placing restrictions on lending at loan-to-value ratios above 80 per cent.
Meriton would be among the most exposed in the event of a downturn. Mr Triguboff, whose A$11.4bn fortune makes him Australia’s second-wealthiest person on the latest Financial Review Rich List, thinks that the regulators are clamping down too hard and this could precipitate a crash in prices.
“The bubble can only be created by the regulators. They are all the time pushing the banks to be tougher,” he says, running his hand through his white hair in a show of exasperation.
Mr Triguboff, who visited Ireland during the financial crisis, says there are big differences with Australia now. Sydney suffers from a severe housing shortage — the government estimates there is an undersupply of 100,000 homes in New South Wales — and has high levels of immigration. Ireland was plagued by “ghost estates” with more than 300,000 unoccupied new homes.
Mr Triguboff warns that regulator tinkering could undermine sentiment. He adds that the Australian government should tread carefully as its fortunes are intertwined with the housing market.
Mr Triguboff says he told John Howard, prime minister, in 2007 that “people were losing money on their houses and this was very bad. He didn’t do what I said, and he lost his seat at the election to a lady we’d never heard of.” Maxine McKew, a former journalist, took his seat in the election that year.
Mr Triguboff, whom local media call “high-rise Harry”, has seen dozens of politicians come and go since he founded Meriton in 1963. None has solved the housing supply problem in Sydney, the least affordable city for property after Hong Kong. The 2017 Demographia International Housing Affordability Survey found prices were 12.2 times median annual pre-tax income.
“We have a very bad planning department here,” says Mr Triguboff. “It takes me two to three years to get approval to build in Sydney. In Queensland it takes six months.”
Mr Triguboff is a self-made billionaire, whose Jewish parents fled Russia for China following the revolution. He was born in Dalian, China, and in 1947 moved to Sydney, where he attended school. He graduated from the University of Leeds in the UK.
After spells working in a family textile business in Israel and South Africa, he returned to Australia in 1960. He had two choices: buy a home, settle down and get a salaried job, or become an entrepreneur. He chose the latter, starting a milk round and buying two-thirds of a taxi in order to start raising funds.
He later bought some land in the Sydney suburb of Roseville but decided to develop the property himself after disagreeing with a builder.
He realised that people struggle to raise capital for property. “I thought if I build apartments, it would be cheaper [for buyers]. I also built close to the city, where people wanted to live.”
He imported high-rise living from the US. A population booming thanks to immigration provided a steady demand for new housing.
Mr Triguboff maintains an iron grip on his company. “He negotiates hard and from a position where he knows all the facts,” says Richard Butler, a property consultant with Inc RE.
In the early 1970s Mr Triguboff listed Meriton on the stock exchange, but hated not being in total control and bought the shares back. He works tirelessly and demands the same. He uses a public address system to call staff to his office and every cheque for more than A$10,000 must be signed off by the boss. “It can be a ship of fear,” says a former employee.
But Mr Triguboff can be charming and treats the company like his family, often wandering around the office in his socks chatting to people.
Mr Triguboff says he is not ruthless but insists on results. “The building has to go up and, if people get in your way, usually this is government departments, then you have to beat them up in courts,” he says. “But you never see me having any fights with the little guys.”
Some of Meriton’s earlier apartments were criticised for their Spartan appearance. But Mr Triguboff has a knack for knowing what the market wants.
Over the past five years Meriton has benefited from Chinese buyers, who account for about half of all unit sales. Beijing is making it harder for people to take their money out of China by imposing tougher capital controls. This prompted Meriton to provide vendor financing loans to Chinese buyers, totalling about A$190m in April.
Mr Triguboff says that he rebuffed a multibillion-dollar offer for Meriton made by Chinese developer Country Garden. “I just didn’t know what I’d do after I sold the company,” he says. “I have never thought of retirement.”
Second opinion: The right-hand man
Peter Spira worked as general manager and director at Meriton before retiring in late 2014.
“Meriton has incredibly high staff retention. For some on his construction team this is the third generation of a family that have worked continuously with Harry.
“There were a few times when I thought he’d made the wrong choice with a development or land purchase but then he would prove me wrong. He has the best instincts I’ve seen.”