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The Australian Private Equity and Venture Capital Association (AVCAL) supports the federal government’s decision to extend the consultation period for proposed changes to rules for superannuation funds, rules that if implemented, could have a negative impact on startups.
AVCAL chief executive Yasser El-Ansary says the proposed changes, which require commercially sensitive information to be published by super funds, have the potential to stifle potential investment in startups by super funds.
The new rules were due to start this year but are now set to go into effect in a little over a year’s time, on 1 July, 2015.
The proposal requires superannuation funds to disclose every investment held, along with the relative market valuation of that investment every six months.
“We want to ensure the policy and regulatory frameworks support and facilitate as much investment into the startup and venture capital sector as possible,’’ El-Ansary says.
He says the proposed changes are an attempt to improve the level of access, transparency and disclosure of information to super fund members.
“The policy objectives are pretty clear, and not really objectives that many would debate or argue.”
He says a balance needs to be struck in how much and what type of information is provided. 
“What we’re concerned about especially is that the circumstances that an asset is held by a private equity or venture capital fund that is about to be sold, either through market or trade sale; requiring the disclosure of that asset could have the effect of jeopardising the capacity of the venture capital or private equity fund to realise the best price of the asset.
“For private equity and venture capital funds, these rules are the equivalent of asking the vendor of a property to tell everyone what their reserve price is before the auction.”
In a statement yesterday, the Finance Minister Mathias Cormann said the government remains “fully committed to these reforms as part of our efforts to improve the efficiency, transparency and competitiveness of our superannuation system”.
According to El-Ansary, the proposed rules are at odds with those in the US, which recently examined the issue and concluded it is in the interests of fund members to keep some information confidential.
“The US may well provide a good yardstick that we can measure our own framework against,’’ he says.
El-Ansary says it’s difficult to know whether the government will be convinced by AVCAL’s arguments before implementing any of the proposed changes.
“What I can say is the arguments we’ve put forward to the government over the past few months have been well received. The context of what we’re trying to do here is to design the framework that strikes the right balance, meets objectives and boosts engagement with super fund levels,’’ he says.
This piece originally appeared at <a href="https://www.startupsmart.com.au/">StartupSmart</a>.
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Superannuation disclosure pushed back until next year

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GUEST OBSERVATION
So you’ve made it to the crucial stage of selling your home: the inspection.
Think of the open house as a first date with your prospective buyer, you only get one chance to make a lasting impression.
While it is common knowledge to de-clutter and clean every nook and cranny in the house, what is the key to making your home stand out so that it has the best chance to sell for a great price quickly?
It’s important to remember that a well-presented home gives buyers the impression that the property is well maintained and therefore, chances of encountering hidden problems post-sale are minimal.
You are permanently on show
Although you will not be letting people into your home all day, every day, there is a good chance you will have people driving by to look at the home and assessing the street appeal from the minute the property hits the market.
In some cases, this is a way that properties are shortlisted. If a potential home buyer likes photos of your home, they might go ahead and do some research on the street appeal and what other houses in the street are like before they attend an inspection.
You always have a chance to make an impression before the buyer contacts an agent, so here are some “housekeeping habits” to get into in order to maximise your chances of drive-by buyers wanting to see more:
<ol>
<li>Make sure your front gardens and lawns are well kept and maintained; 
</li>
<li>Remove all junk mail and newspapers from the letterbox and yard as they arrive; 
</li>
<li>Park the cars in the garage, if possible; 
</li>
<li>Avoid having rubbish out for collection on the kerbside, and; 
</li>
<li>Each night before sunset, turn on all outdoor lights.</li>
</ol>
Set the mood
You might not know what the potential home buyer is thinking, but you can do your best by making them feel positive and by creating a welcoming and comfortable atmosphere in your home.
A great way to set the mood is to think about the senses; what the prospective buyer will experience when inspecting your home.
For instance, you can open all windows at least an hour before an inspection to chase away any “house smells”. You can also try placing a cinnamon stick in a cup of water in the microwave for two minutes, or plugins, candles and oils to add a subtle fragrance in your house.
To add to the mood you can play some non-offensive music in the background, keeping in mind that everyone has different tastes.
And do remember to adjust room temperature accordingly, making sure that it is comfortable for visitors walking in and out of the house.
All trimmings great and small
Whether you already accessorise or not, it’s the little things that help create a great impression.
For example, sprucing up cushion covers, putting your newest towels in the bathroom and clearing your paperwork off your desk [no matter how neat it is] go a long way in creating a large but lasting impact of the house and its owners.
Other tips and ideas include:
<ol>
<li>Buy fresh flowers, even if it is simply a centerpiece for the dining or coffee table. 
</li>
<li>Straighten and align photographs and art on walls. 
</li>
<li>Turn off all electronic devices such as computers and televisions. 
</li>
<li>Leave toilet seats down. 
</li>
<li>Leave all internal lights and lamps on during inspection.</li>
</ol>
A home that is a fresh, cared for, low-maintenance property is a something most people are very attracted to so the day your home goes to market should be the best it has ever looked.
Inspection time is the moment to make your home shine and stand out from the competition and where you aim to gain the maximum price in the shortest time period.
Naomi Findlay is the award winning founder of the <a href="https://www.instituteofhomestaging.com.au/" target="_blank">International Institute of Home Staging</a> (IIHS) and <a href="https://www.silkstaging.com.au/" target="_blank">SILK Home Staging &amp; Styling</a>. She is also the author of a bestselling book, 'Ignite Your Property Mojo'.
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Open house inspections: Applying the finishing touches

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GUEST OBSERVATION
Prime Minister Tony Abbott has suggested that <a href="https://www.couriermail.com.au/news/opinion/opinion-any-budget-pain-will-be-australias-gain-in-the-longterm/story-fnihsr9v-1226898755245">“You can’t fix the economy unless you fix the budget</a>“.
If we are to believe the over-the-top Commission of Audit report it will take far more than this to bring the budget to surplus by 2023. But few seriously think many of the recommendations will be implemented.
While it is correct to say that lower debt would allow more government revenue to fund worthwhile projects to improve economic outcomes, it is not clear why lower (or zero) deficits or debt necessarily implies the economy will perform better.
A balanced budget may be a very valuable, but not essential, condition for good economic management. There are even fellow economists who argue (in my view wrongly) that increasing deficits and debt are necessary at the moment to increase current economic growth and reduce unemployment.
How Australia’s economy is faring
A good way to judge how Australia’s economy is faring is to compare key indicators such as inflation, unemployment rate and GDP growth compared to other industrialised countries, especially those who make up the <a href="https://www.oecd.org/about/membersandpartners/list-oecd-member-countries.htm">OECD</a>. I’ve chosen OECD countries comparable to Australia: the United States, United Kingdom, Germany and Japan, as well as the OECD average.
Inflation: By almost all the standard economic indicators the Australian economy is doing better than most other industrialised countries – even though our inflation rate is somewhat higher, we have an enviably high rate of growth and low rate of unemployment compared to other OECD countries.
<img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47507/width668/ynjv5tcr-1398912827.jpg" alt="">
Inflation: Australia compared to OECD
Australia is a very rich country by world standards and the economy does a pretty good job of developing wealth and opportunities for most people. These comparatively glowing figures, however, mask the fact that there are those who do not fare so well in the market economy.
Welfare and unemployment: Despite being one of the richest countries in the world, 20% of Australian households rely almost entirely on welfare payments. Those of working age receiving benefits, rather than being in work, make up over 16% of the labour force.
<a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47508/area14mp/6dj3x44s-1398912828.jpg"><img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47508/width668/6dj3x44s-1398912828.jpg" alt=""></a>
 Unemployment: Australia compared to OECD countries
In addition many are underemployed, working fewer hours than they want to. By changing the way we measure joblessness we could easily double the official estimates of unemployment.
As Ken Henry <a href="https://theconversation.com/why-rising-youth-unemployment-demands-our-urgent-attention-25990">pointed out recently in The Conversation</a>, youth unemployment is a particular concern. The rate among 15-19 year olds is currently over 16%, and is 9% among 20-24 year olds.
<a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47506/area14mp/sdwncqpb-1398912827.jpg"><img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47506/width668/sdwncqpb-1398912827.jpg" alt=""></a>
Youth Unemployment: Australia compared to OECD countries
Productivity: Also, recent concerns have been expressed about Australia’s <a href="https://theconversation.com/why-we-should-approach-claims-of-a-productivity-crisis-with-caution-26000">levels of productivity</a>. In other words, we need to make better use of the resources already employed as well as do better by putting unemployed resources to work. This becomes particularly important given the ageing of the population.
<a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47512/area14mp/kqwqbg56-1398912836.jpg"><img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47512/width668/kqwqbg56-1398912836.jpg" alt=""></a>
OECD Labour Productivity
Debt: While there has been a lot of public concern expressed about reducing Australia’s debt levels, Australia’s debt-to-GDP ratio - a key indicator of how well a country can pay back its debt without incurring more debt - is significantly lower than the OECD average and also much lower than countries such as Japan. In fact, Australia’s position <a href="https://media.smh.com.au/news/federal-politics/joe-hockey-grilled-by-british-presenter-5373145">is the envy of other countries</a> in the OECD.
<img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/47510/width668/kyz8gwkp-1398912830.jpg" alt="">
OECD Govt Debt
<h2>How the budget is faring</h2>
The structural deficit: So, it can be demonstrated that Australia’s economy is strong. However, there is concern that Australia, on its current trajectory, is heading for (or well on the way) to an unsustainable structural deficit. This is where the budget may most influence economic growth, as it impedes the ability of a government to plan future spending.
It is generally accepted that the actual government budget will (and should) fluctuate between deficit and surplus during, respectively, downswings and upswings in the economy. While there is a lot of public attention on whether the year-on-year budget balance is in deficit or surplus, and by how much, the structural balance is the more important concept. The structural balance is basically the budget deficit or surplus after accounting for cyclical movements in the economy - the balance when conditions are normal or average.
We have heard much in recent budgets about Australia’s structural deficit, backed by <a href="https://www.aph.gov.au/~/media/05%20About%20Parliament/54%20Parliamentary%20Depts/548%20Parliamentary%20Budget%20Office/Parliamentary%20Budget%20Office%20Stuctural%20Budget%20Balance.pdf">several reports</a> indicating the structural budget balance is in pretty poor shape.
As I have <a href="https://theconversation.com/pbo-and-treasury-reports-confirm-it-the-deficit-is-unsustainable-14559">pointed out previously</a> in The Conversation this structural imbalance is a result of irresponsible spending policies of successive governments, both Coalition and ALP but particularly by the Rudd/Gillard governments. New spending initiatives, such as the Gonsky funding changes and the NDIS, have been brought in without plans to raise the revenue to pay for them, and often, without due analysis.
And bad luck for Tony Abbott that he is left with unfunded big budget items in the future to deal with, as a legacy of the former government. The only way to reduce the deficit is through reduced expenditure and/or increased revenue. As each idea of how this can be done is <a href="https://theconversation.com/abbott-on-back-foot-over-tax-levy-parental-leave-26043">shot down</a> on a daily basis, the Coalition government is realising what a difficult thing this is to sell. The hostile reaction to the Commission of Audit report at least might mean some of the unpopular decisions in the May budget are, by comparison, greeted with relief
How to “fix” the budget
There is, however, more to government policy than balancing the budget. Policy should be made in the context of a long-term vision for the economy. This includes getting everyone who wants to into work, providing the public infrastructure needed to increase productivity, the right mix of private and government provision of health and education, and reform of the regulatory environment.
The continuous economic growth that the Australian economy has achieved, even during times when other countries’ economies experienced recessions, are largely due to the economic reform process carried out during the Hawke/Keating and Howard terms in government. Economists credit the increased productivity levels of the second half of the 1990s and early 2000s as resulting from microeconomic reform and the adoption of new technology.
For policy to facilitate reform in the economy it needs to address impediments to growth in the current tax system and in government programs – it is not only the quantity (size of the deficit) but the quality (of taxation and spending) which is important.
Among the obvious things that need to be addressed are – education participation, infrastructure spending, industrial relations, a greater role for markets, and reducing work and investment disincentives inherent in our benefits and taxes.
While short term measures such as expenditure cuts and debt levies may have an impact on the size of the deficit, they cannot “fix” the economy. The economy is not in disarray, and long-term budget deficit and debt issues require well thought-out policy on the structure of taxation and expenditure.
Phil Lewis is professor of economics at University of Canberra.
This article was originally published on <a href="https://theconversation.com">The Conversation</a>.
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Australia’s economy is healthy, so how can there be a budget crisis?

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Property developer Fridcorp was last night the host of a glitzy party at the launch of their newly completed 16 storey tower, Avenue.
Avenue, situated on the corner of Chapel Street and Alexandra Avenue, South Yarra, is a $120 million section of the <a href="/news/south-yarras-forrest-hill-precinct-the-vision-behind-the-rejuvenating-transformation">Forest Hill rejuvenation</a> plan.
The result is an impressive rippled rose colour glass design by architect Elenberg Fraser, peering over a key stretch of the Yarra River.
“Avenue is about great things coming together. It's where three of the most recognised design teams in attainable luxury collaborate; Fridcorp, the developer, Elenberg Fraser, the architect and Hecker Guthrie, the interior designer,” said Fridcorp director Paul Fridman.
“We are extremely proud of Avenue, with its uninterrupted City and Yarra views across 16 levels with every apartment meticulously designed for modern day living,” said Fridman.
The completion party was a suitably stylish affair, with white-feathered models greeting attendees.
But the centre of attention for this party was My Kitchen Rules judge, celebrity chef Manu Fiedel, who was at hand in the kitchen catering for the event.  Lydia Schiavello of The Real Housewives of Melbourne was also in attendance.
The development of Avenue was often controversial. Initial plans for a 25 storey tower atop the former Lamborghini dealership site were bitterly contested by parents at the nearby Melbourne High School, and billionaire Lindsey Fox.
In 2011, <a href="https://newsstore.fairfax.com.au/apps/viewDocument.ac;jsessionid=7FD264BAB550BD8A90CA3103EC19909F?sy=afr&amp;pb=all_ffx&amp;dt=selectRange&amp;dr=1month&amp;so=relevance&amp;sf=text&amp;sf=headline&amp;rc=10&amp;rm=200&amp;sp=brs&amp;cls=279&amp;clsPage=1&amp;docID=SAG110828204T13BUR9B">Fairfax reported</a> that Fridcorp had doubled the density of the project, rebranding it as Avenue.
Although the party celebrated the completion of Avenue, Fridcorp is still active in South Yarra with construction continuing at the nearby mixed-use development, <a href="https://www.fridcorp.com.au/projects/lilli-apartments" target="_blank">lilli</a>, home to Fiedel’s new restaurant <a href="https://www.legrandcirque.com.au/" target="_blank">Le Grande Cirque</a>.
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Fridcorp host completion party for Avenue in South Yarra

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BitCoinCloudMining.com has launched, making it Australia’s first global bitcoin mining cloud service.
Cloud mining consists of a customer leasing mining hardware capabilities through a cloud based service.
According to the company, BitCoinCloudMining platform has been designed to reduce complexity for investors and offer the easy creation of a passive bitcoin income without incurring the cost of mining hardware and operations. Its website claims it is the “world’s most affordable bitcoin mining company”.
The platform is a key business in the operations of the Bitcoin Corporation (BTC Corporation), founded by Australian digital media pioneer and entrepreneur Domenic Carosa. The specialist bitcoin investment group also includes <a href="https://buyabitcoin.com.au/" target="_blank" rel="nofollow">BuyaBitcoin.com.au,</a> where Australian users can buy the currency with further bitcoin-based products and services in development for the online interactive gaming industry.
“Bitcoins are changing the way we live, transact and do business. The digital economy has removed the traditional restraints of geographic boundaries with the rise of bitcoin currency facilitating the evolution and growth potential of both private and commercial transactions in ways that the market has not yet conceived,” says Carosa.
A recent report by investment firm Wedbush Securities estimates more than US$200 million (A$215m) was spent on bitcoin mining equipment globally during 2013, with the utility costs of running the equipment continuing to rise.
Carosa says the entry of BitCoinCloudMining.com provides relief from these rising operating costs for individual bitcoin miners by removing the overheads from the process and delivering simple access and an easy to use interface to the bitcoin process.
BTC Corporation chief executive Simon Oliver says as an early adopter of the bitcoin technology, the Australian market also provides an accommodating regulatory ecosystem.
“The recent launch of Australia’s first bitcoin ATMs is a promising sign the market is seriously embracing this new digital currency,” Oliver says.
There are already a number of established global bitcoin mining cloud services in the market.
This article first appeared on <a href="https://www.startupsmart.com.au/" target="_blank">StartUpSmart</a>.
Photo courtesy of Antana/Flickr/<a href="https://creativecommons.org/licenses/by-sa/2.0/" target="_blank">Creative Commons</a>.
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Australia’s first bitcoin mining cloud service launches

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The release of the Commission of Audit yesterday has recommended the federal government abolish support for funding through the <a href="https://www.propertyobserver.com.au/https://www.startupsmart.com.au/financing-a-business/commission-says-startups-should-not-receive-government-help/2014050112201" target="_blank">Commercialisation Australia and Innovation Investment Fund</a>.
The commission believes the government should stop providing assistance to startups as there was no greater public benefit, with benefits only for the companies.
“The intellectual property, and any profits arising from these new ideas remains with the business, and there are no clear public benefits arising,” the report says.
“The process of commercialising new products can often be a difficult one.
“However, skills and finance can be acquired from the private sector, and there is no clear reason for the Commonwealth to provide this assistance in competition with private sector providers.”
We spoke to a number of investors about their reaction to the recommendation and what impact, if any, it would have on the community.
Rui Rodrigues, investment manager, <a href="https://www.tankstream.vc/" target="_blank">Tank Stream Ventures</a>:
Rodrigues says that while the tech sector is not reliant on these grants, and nor should they be, there will be an impact in the industry should the recommendations be approved by the government.
“There grants are important in early stage startups and there will be consequences for the sector if they are abolished,” Rodrigues says.
He points out that Commercialisation Australia was responsible for commercialising Wi-Fi (a method was developed and patented by Australian CSIRO researchers to "unsmear" radio waves that echo off indoor surfaces making Wi-Fi possible) something the government was still reaping rewards from through licensing.
He says the audit was not well executed and there were no ideas on how to support innovation and no recommendations on how things could be done better.
“Companies will continue with these grants or not, it’s not critical, but they will be impacted,” Rodrigues says.  
Governments should not be responsible for investment in startups, but they do need to put incentives in place to facilitate it from the private sector.”
Adrian Stone, chairman, <a href="https://www.investorsorg.com/" target="_blank">Investor’s Org</a> and early stage investor:
Stone says his concern is for early stage startups, which were never well-supported by their Commercialisation Australia or the Innovation Investment Fund.
“They were relics of the old days developed along a manufacturing model that did not support startups well,” he says.
The crucial factor here, according to Stone, is that early stage investment represents better “bang for your buck.” Using government money to get in early would represent a greater reward to the economy in the long-run with smaller amounts of money needed.
“The Commercialisation Grant should stay, but it needs to be simplified,” Stone says. “Governments should be co-investing with investors and accelerators that know and understand the market.”
He says IIR was never relevant and in setting up accelerator Inspire 9, of which he is a partner, there was no government support available.
He says a new process that was quicker and simpler was needed by the industry and the current commercialisation grant, which insisted on startups being “pre-revenue”, went against lean startup best principles, forcing startups to apply at a stage where they hadn’t proven their viability as a business.
Clearly the government had a mandate to save money without giving much thought to the longer term impact beyond two years, he adds.
This article first appeared on <a href="https://www.startupsmart.com.au/" target="_blank">StartUpSmart</a>.
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Investors react to Commission of Audit recommendations

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GUEST OBSERVATION
If you own a rental property you could be one of the 110,000 investors who will be getting a letter from the Australian Tax Office (ATO) about your tax liabilities.
The ATO has announced that it will be writing to a sample of rental property owners about their tax obligations and entitlements, after new data mining technology identified that property investors may have submitted incorrect tax claims in prior tax years.
The ATO are targeting aggressive expense deductions and particularly the estimated two thirds of property investors who are negatively gearing their investments and claiming losses on their investment properties to offset their tax bills.
If you fall into this category, the following tips might be worth considering when you are completing your tax return.
What’s the status of the property?
Firstly, it’s vital that, if you’re claiming deductions, your rental property needs to be rented or available for rent. If a property is not available for rent, then expenses incurred by a taxpayer are not deductible.
This would seem an obvious point, but it’s worth remembering particularly if your property – as a holiday home or other part-time accommodation - is not rented out across the entire year. If that’s the case, remember that you can only claim deductions for the period that the property is rented or available for rent.
Who’s the owner?
It’s also worth remembering that the legal ownership of the rental property determines the proportion of ownership and entitlement to deductions on your individual tax return. This means that if a husband and wife purchase a rental property in joint names, then their levels of ownership will be 50/50 unless stated otherwise in the purchase contract.
Categories of deduction
Generally, the ATO specifies three types of rental property expenses:
<ul>
<li>Those which you cannot claim a deduction. 
</li>
<li>Those which can be claimed as an immediate deduction in the financial year in which they were incurred. 
</li>
<li>Those that can be deducted over a number of years.</li>
</ul>
Capital or personal expenses aren’t deductible, although you may be able to claim decline in value deductions (depreciation) or capital works deductions, or include certain capital costs in the cost base of the property for capital gains tax purposes. Other examples across each of the three categories are outlined in the sidebar alongside this article.
The picture also gets a bit more complicated when other considerations are factored in. For example, if you take out a loan to purchase a rental property, you can claim the interest charged on that loan as a deduction. However, if the loan is taken out for more than one purpose, you can only claim the interest relevant to the amount borrowed for the rental property. Depending on your circumstances, there may also be potential to claim prepaid interest to maximise your deductions.
Another factor which often confuses owners is the area of repairs and improvements to the property. Spending on repairs and maintenance is tax deductible, but you can’t immediately deduct costs on improvements and total replacements of items, as these are considered capital in nature. However, you might be able to claim depreciation and capital allowances on some improvements.
And, if you’re looking to fix something straight after buying the property, remember that you cannot claim initial repair costs for deterioration and damage already there when you bought the property until at least 12 months after purchase
You should consider getting a quantity surveyor’s depreciation report to ensure you can claim the maximum depreciation and capital allowances deductions. A specialist quantity surveyor can visit your property and prepare a depreciation report that will cover the actual building and the items within it (such as air-conditioner, stove, hot water service, etc).
It’s also worth consulting your accountant before you leap into the property investment space. Given the issues outlined above, tax time can be complex for property investors. When it comes to completing your tax return, working with your accountant to get it right can save a great deal of paperwork – and cost – down the track.
Daniel Deutsch is a partner at <a href="https://www.marinaccountants.com.au/" target="_blank">Marin Accountants</a>, a firm specialising in advice for individuals, investors and family businesses. 
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Rental properties – keeping deductions working for you

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Commonwealth Bank customers will be the first in Australia to be able to withdraw cash from ATMs using only their smartphones.
From May, customers will be able to use their Commonwealth Bank app on an Apple iOS or Android smartphone to withdraw up to $200 cash in one transaction per day. The plan follows the development of ‘Tap &amp; Pay’ technology, and is designed to give customers access to cash when their card isn’t available.
Michael Harte, chief information officer at the Commonwealth Bank, said in a statement demand for contactless and mobile payments is on the rise.
“Mobility is not a trend,” he said. “It is increasingly our way of life. These new mobile offerings will improve our customers’ banking experience by placing information-rich, value-added services and additional security at their fingertips at the time they need our help.”
More than 2.3 million users have registered to use the revised CommBank app since its launch late last year.
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
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CBA customers to withdraw cash using smartphones

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GUEST OBSERVATION
When Woolworths delivered its half-year <a href="https://www.woolworthslimited.com.au/icms_docs/137436_First_Half_Profit_Report_and_Dividends_announcement_for_the_27_weeks_ended_5_January_2014.pdf" target="_blank">results</a> in February, the numbers for its Masters hardware chain were sobering. On sales of A$393 million, Masters, a joint venture between Woolworths and US company Lowe’s, lost $71.9 million in six months. Put another way, for every dollar of sales in Masters in the second half of 2013, it lost around 23 cents.
Quarterly sales <a href="https://www.woolworthslimited.com.au/icms_docs/137803_Third_Quarter_Sales_Results_-_Financial_Year_2014_13_weeks_to_6_April_2014.pdf" target="_blank">results</a> released by Woolworths today indicate things could be going from bad to worse at Masters. Woolworths management have touted that quarterly sales increased from $128 million to $179 million year-on-year. Masters added 16 new stores (from 29 to 45) in the last 12 months. It’s the growth in the number of stores, rather than growth in sales per store, that has ensured Masters is “Australia’s fastest growing hardware store”.
The bad news is that quarterly sales per store decreased from $4.41 million in Q3 2013 to $3.98 million in Q3 2014 (a decline of 9.4%). In Perth on Tuesday, Wesfarmers announced store on store sales growth of 9.1% for Bunnings, Masters' key competitor. Customers are still buying, just not from Masters.
Today’s analyst webcast had more questions on Masters (which commands less than 1% of Woolworths' sales) than any other Woolworths business, indicating serious disquiet among investors about how things have gone so wrong so fast.
Masters' new management team (Matt Tyson joined Masters in January from Europe’s Kingfisher) face some serious challenges, some unavoidable and some self-imposed.
As a late mover into the “big box” hardware sector, Masters has often had to lease or develop sites that have been passed over by its larger competitor, Bunnings (which is owned by Woolworths’ arch-rival, and Coles owner Wesfarmers). At times, its rush to grow led to real problems. For example, its application to develop a store in Ballina (near Byron Bay) on a flood plain was rejected by the local council in March 2013. This led Masters to apply only months later to develop a store in Lismore, some 30 kilometres to the west. This new site is next to an existing Bunnings store and was clearly not Masters' first preference.
The rush to secure and develop sites has created investment decisions that seem, at times, capricious. As fast growth seems to have been the imperative, Masters' “big bang” approach created massive up front development costs that are a major drag on corporate earnings.
Aldi’s systems and strategies
Not all new entries into the Australian retail industry have been as inauspicious. Notable among the successes has been the German retailer Aldi that has patiently built a portfolio of 340 stores over 14 years – a new store on average every three weeks.
As a privately-owned firm, Aldi does not publish sales and profit figures, although informed estimates suggest it garners around 10% of Australian grocery sales from its Australian stores. <a href="https://corporate.aldi.com.au/en/about-aldi/" target="_blank">Aldi has signalled</a> its intention to open new stores in South Australia and Western Australia over the next few years, continuing its patient, staged approach to its Australian rollout.
Strategic management researchers often suggest firms should “stick to their knitting” – doing what they know well and knowing what they do well. Aldi knows what it’s good at – selling discount groceries. Founded in war-ravaged Germany in 1948 by the Albrecht brothers (the name is a derivation of Albrecht Discounts), Aldi keeps a limited product range of less that 1500 SKUs – or products – per store, while Woolworths and Coles often have more than 10,000. This limited range has many benefits - it enhances Aldi’s buying power, facilitates smaller stores, increases product turnover and simplifies inventory management.
In store, Aldi uses simple and effective palletised logistics for its fast turnover products and keeps its staffing levels low. Around 95% of its products are own-brand, and the quality of these products is often excellent. These are sourced both locally (for most fresh foods) and from its global supply chain (for many longer shelf life products).
Real estate wars
Aldi’s patience has allowed it to build retail scale slowly, centred on its five major Australian distribution centres (two in Victoria, two in NSW and one in Queensland).
Getting access to new retail sites has been a real problem for Aldi, as Coles and Woolworths <a href="https://www.theage.com.au/national/aldi-brands-coles-safeway-retail-bullies-20080628-2yjt" target="_blank">reportedly</a> locked them out of many suburban centres through restrictive agreements with landlords. In response, Aldi was patient, pursuing shopping centre vacancies when they arose, but also building a large number of standalone sites when the opportunities emerged.
These tactics are a sign that Woolworths and Coles are too big and too dominant in the Australian grocery industry. With a combined share, by some estimates, of 80% of Australian grocery sales, new growth has to come from areas where Woolworths has limited know-how and little brand equity.
Slow and steady wins the race
With the benefit of hindsight, it could be argued that Woolworths’ Masters rushed foray has been driven more by machismo than fundamental strategic management thinking.
Wesfarmers’ success with Bunnings was a sore point for Woolworths’ corporate management - whose grocery business had seen off the challenge of Coles prior to Wesfarmers acquisition of Coles in 2007. The launch of Masters has certainly created an internecine war in the hardware industry, but so far Woolworths has been the main victim.
In comparison, Aldi has a fundamentally valuable point of differentiation in its market – namely low prices. Aldi delivers this differentiation through strong internal consistency in terms of efficient systems and processes, a culture of corporate modesty and the patience to successfully execute its growth strategy over a long period of time. In essence, its management is driven by sound reasoning, disciplined consistency and patient execution.
Masters is on track to lose half a billion dollars before Woolworths hopes it to become profitable in 2016. That is serious money, and the Masters investments continue to limit Woolworths’ abilities to invest in and renew its existing portfolio. The worst-case, but highly possible, scenario is that the turnaround does not happen and the losses continue to escalate.
John Rice is associate professor in strategic management at Griffith University<a href="https://theconversation.com/institutions/griffith-university"></a>.
John Rice is a current member of the Australian Labor Party and the National Tertiary Education Union.
This article was originally published on <a href="https://theconversation.com" target="_blank">The Conversation</a>. 
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Masters could learn a lot from Aldi

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Popular insurance and home loan provider Virgin Money has paid more than $30,000 in penalties after the Australian Securities and Investments Commission found it misled customers through online and television advertising.
ASIC issued three infringement notices imposing a penalty of $10,200 each. The notices related to the promotion of Virgin Money’s “Quick &amp; Easy” <a href="https://www.smartcompany.com.au/finance/32519-tombstoning-financial-advisor-banned-for-life-by-asic" target="_blank">life insurance</a> product, which was advertised on television until May 2013 and online up to May this year.
The corporate regulator found while the advertisements claimed no health and lifestyle questions would be asked, the insurance application form contained specific health and lifestyle-related questions. Customers were queried about their smoking habits and weight and their responses used to calculate premiums and determine the coverage offered to them.
ASIC deputy chairman Peter Kell said in a statement the misleading advertisements were particularly concerning because life insurance is such an important decision.
“Purchasing life insurance is an important decision and consumers should be able to confidently rely on representations made to them in advertising,” he said.
Melissa Monks, special counsel at law firm King &amp; Wood Mallesons, told SmartCompany ASIC’s decision is sending a clear message to businesses.
“This is a good reminder to ensure that the terms and conditions of the claims you make in a particular campaign are accurate because the fallouts can be quite significant,” she said. “These things come very easily to a regulator’s attention when they are so obviously wrong.”
The payment of infringement notices is not an admission of a contravention of the Australian Securities and Investment Commission Act. However, Monks says infringement notices are a cheap and quick enforcement mechanism for the corporate regulator.
“It is still not an ideal outcome [for the business] and many consumers see it as some sort of admission,” she said. “Increasingly regulators are using these and particularly ASIC. This is a good warning to the financial services industry that they really need to get their messaging right because the regulator is very willing to act.”
Monks also points to the non-financial repercussions cases such as this one have on businesses.
“The brand damage that flows from something like this is significant,” she said. “And the lack of confidence customers will have in the company going forward.”
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
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Virgin Money coughs up $30,600 for misleading advertising

<a href="https://www.apartments.com.au/developers/consolidated-properties">Consolidated Properties Group</a> (CPG) is approaching the launch of its latest Brisbane riverfront development, Castile, on the dress circle Skyring Terrace in Newstead.

VIP buyers are now being engaged, with a full public sales launch coming later this year.

Positioned as the final opportunity to secure a new absolute riverfront residence on the East bank of Newstead, Teneriffe or New Farm, Castile at 47 Skyring Terrace has been designed by <a href="https://www.apartments.com.au/architects/woods-bagot">Woods Bagot</a> as a timeless addition to the Brisbane skyline.&nbsp;

[smartcode_project:default project_id=150489 project_image_fid=371113]

The name Castile draws on themes of permanence, sophistication and legacy, reflecting a broader vision centred on enduring architecture and timelessness in the rarest of riverfront positions.&nbsp;

CPG Chairman and CEO Don O’Rorke said the project had been envisioned as a future Brisbane icon.&nbsp;

“With 47 metres of direct river frontage and never to be built out views, 47 Skyring Terrace is the definitive address on the Brisbane River,” O’Rorke said.&nbsp;

[smartcode_project:default project_id=150489 project_image_fid=371114]

“Rather than following trend-based apartment design, Castile draws inspiration from Brisbane’s great heritage buildings, reinterpreting classical architecture into a contemporary riverfront landmark designed to stand proudly for the next 100 years,” he said.&nbsp;

The approved development will comprise 227 apartments across a 25-storey tower alongside a boutique six-storey riverfront building of just 12 residences.&nbsp;

Construction is scheduled to commence in September 2026.

[smartcode_project_cta:default project_id=150489]

Joel Robinson

CPG unveils Castile Newstead ahead of upcoming sales launch

Australia’s online shopping habits have shifted dramatically over the last decade. As eCommerce volumes surged, so too did the frustrations that came with traditional parcel delivery: missed deliveries, long Post Office queues, parcel theft and the challenge of being home during business hours.

Australia Post’s Parcel Lockers emerged as one of the more practical responses to that changing consumer behaviour.

What started as a relatively niche delivery option has evolved into a nationwide network of more than 1,400 self-service Parcel Lockers positioned at train stations, shopping centres, supermarkets and Post Offices across the country. The system allows Australians to send, collect and return parcels 24 hours a day, fundamentally changing how many people interact with deliveries.

The appeal is relatively straightforward: flexibility.

Instead of waiting at home for a delivery driver or rushing to a Post Office before closing time, users can direct eligible parcels to a Parcel Locker location of their choice. Once the parcel arrives, Australia Post sends a notification with a collection code or QR access through the AusPost app, allowing customers to retrieve their package at any time within the collection window.

For apartment residents in particular, the system has become increasingly valuable.

Higher-density living has created logistical challenges around deliveries, especially in buildings without concierge services or secure parcel rooms. Missed deliveries are common, while parcel theft has become an increasing concern as online shopping volumes continue to rise.

Australia Post itself has repeatedly highlighted the growing issue of “porch pirates” during peak shopping periods, encouraging customers to use Parcel Lockers as a safer alternative to unattended home deliveries.

That security aspect is one of the key reasons the Australia Post Parcel Locker network has grown so rapidly.

Parcel Lockers are positioned as secure, monitored collection points that reduce the risk of theft while also improving delivery efficiency for Australia Post. Instead of multiple redelivery attempts, parcels can be consolidated into a single secure destination.

The Parcel Lockers themselves are free to use through a MyPost account and support a range of parcel sizes up to 16 kilograms and dimensions of approximately 35 x 44 x 61 centimetres.

Beyond receiving parcels, the system has increasingly become integrated into the broader eCommerce ecosystem.

Customers can now use Parcel Lockers to return online purchases, while retailers have embraced the model as a way to improve delivery success rates and reduce friction in the shopping process. Australia Post has actively expanded partnerships with major retailers and promoted Parcel Lockers as part of a broader out-of-home strategy.

The timing of that expansion aligns with broader changes in Australian shopping behaviour.

The acceleration of online retail during and after the pandemic placed enormous pressure on delivery infrastructure. Parcel volumes reached record highs, particularly during Black Friday and Christmas periods, with Australia Post delivering more than 100 million parcels during peak festive seasons.

That growth forced logistics providers to rethink the “last mile” of delivery, widely regarded as the most expensive and operationally difficult stage of the process.

Parcel Locker systems have increasingly been viewed as part of the long-term solution.

The concept itself is not unique to Australia. Parcel Locker networks have become common globally, particularly across Europe and Asia, where dense urban environments and apartment living create similar logistical challenges. But Australia’s geography and suburban sprawl made adoption slower initially.

Now, however, the convenience factor is driving mainstream usage.

For commuters, Parcel Lockers near train stations allow parcels to be collected on the way home from work. For apartment dwellers, they remove the uncertainty around access and missed deliveries.

The rise of the AusPost app has also streamlined the experience, centralising notifications, tracking and Parcel Locker access into a single platform. Australia Post has increasingly pushed customers toward app-based delivery management, partly as a way to combat phishing scams and fake delivery notifications, which have become more sophisticated in recent years.

The Parcel Locker model is also beginning to influence property development itself.

Parcel management has become a growing consideration in apartment building design, particularly as online shopping becomes embedded in everyday life. Many new residential developments are now incorporating dedicated parcel rooms or Parcel Locker systems into foyers and communal spaces.

For developers, parcel management is increasingly viewed as part of the broader resident amenity offering, alongside gyms, wellness spaces and communal work areas.

That reflects a wider evolution in how residential buildings are designed.

Apartment buyers are placing greater emphasis on convenience, security and operational functionality, particularly in higher-density urban environments. Parcel delivery, once considered a minor operational detail, has become an increasingly important part of that equation.

Australia Post’s Parcel Locker network sits at the centre of that behavioural shift.

What began as a simple alternative delivery option has evolved into a key piece of infrastructure supporting Australia’s growing eCommerce economy and changing urban lifestyles.

And as online shopping continues to expand, the role of Parcel Lockers is likely to become even more embedded in how Australians live, shop and receive goods.

How Australia Post Parcel Lockers changed parcel delivery convenience in Australia

Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.

Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;

David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;

“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;

[smartcode_project:default project_id=110291 project_image_fid=302785]

<h2>Affordable product leads, premium demand remains resilient</h2>

Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;

Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;

At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.

Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.

Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;

[smartcode_project:default project_id=148957 project_image_fid=364102]

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.

David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.

“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;

Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.

[smartcode_project:default project_id=108869 project_image_fid=317905]

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;

Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;

However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.

Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.

The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.

Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.

“Brisbane was the right step for Sammut,” Sammut said.

“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" />

Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.

The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.

“We are DA approved now which is very exciting,” Sammut said.

“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”

<img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" />

Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.

“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.

The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.

“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”

The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.

The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.

Sammut secures approval for debut Brisbane apartment development in Toowong

Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.

Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.

The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.

“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.

“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.

“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”

The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.

“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”

From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.

“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”

The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.

“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.

Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.

“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.

“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”

The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.

“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.

Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.

&nbsp;

Jacob Robinson

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