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In today’s Q&A we talk about productivity, technology, the entrepreneurial journey and where those three have combined into Jarrod’s and Peter’s latest AI venture.

Andrew Crosby from Xpect  catches up with Jarrod Renall and Peter Melrose. We discuss how they had a problem in their consulting business and have now used technology enhanced with AI to provide a solution – and now it’s for available for the rest of us to use.

OK Gentleman, nice to meet you both. Now I know you are dying to tell me about this fantastic new application you have both built, but let’s step back for a moment. We don’t want to make this some boring story about two guys who had a real problem in their business, harnessed Artificial Intelligence, and developed a solution that makes your team more productive, keeps clients happy and saves a bundle of cash do we?

Jarrod: ummmm.

Peter: ahhhhhh.

Surveying. You guys are both surveyors, right? Land surveyors, measuring hills and setting out buildings, sorting out boundaries and the like I mean. Please tell us a little bit about what you do and your company.

Jarrod: Yeah, we cover these things and a fair amount more than that, but yes, I am the Director of Survey Worx. To put it simple with surveying, we help clients locate or capture positions of matter. We have about 100 staff and 11 locations. 60 staff in our Penrose HQ and the rest dotted around the country.

Peter: And I’m the Director of Survey Group. We are a lot smaller with about 15 employees, but we do similar work for somewhat similar clients.

Ok, compete head-to-head on jobs?

Peter: Absolutely we are always trying to deliver better service than Jarrod!

So, two competitors have joined forces then presumably to fight evil – how does that come about?

Peter: Me and Jarrod have been mates for 20 odd years so we are always talking about our problems and how we think we can improve. Jarrod took a bit of the lead on this project, and I thought we can help make this idea a reality.

Jarrod: Peter has been an influential sounding board throughout the entire journey. I think that it is critical to have someone to bounce ideas off. And it helps when we are in the same industry and see the same things happening. That’s why we built…

Hang on, I know you are busy and want to get straight to it but first, let’s dig deeper. Tell me about you career journey so far. I want to hear how you laid the foundation for your solution.

Jarrod: Yep, did the surveying degree at Otago, it’s the only place that has one you know, and spent 10 years in Sydney. Eventually I became General Manager and started an office in New South Wales and grew from just myself to 45 staff in 18 months.

Then in 2017 I came back to New Zealand and took on a General Manager role at Survey Worx. At that time Survey Worx had about 15 staff, all based in Auckland. I sort of applied the company acceleration formula I learned back in Australia and now lead a much larger exceptional team around the country.

Peter: Not as an impressive I should say but a bit different, yeah, I worked in Aussie for 6 years – as a surveyor. After graduating at Otago like Jarrod – in fact so long ago but me and Jarrod worked at the same company in Aussie. Anyway, I head off to London, spent 5 years there. And Hong Kong for three before coming back to New Zealand at the end of 2022.

In London I worked as a project manager – the London Bridge upgrade was one of mine. In Hong Kong, it was during Covid and an uprising and a real ‘interesting time’. I was doing an MBA at Hong Kong University and with a couple of friends started up an air-refreshener business start-up. ‘Airguard’ was its name, we had a patented raw natural cleaning / sanitiser product for insertion into building heating and ventilation systems. With Covid all around us, we were easily able to raise quite a lot of funding and grew very quickly. We went from one to 18staff in 12 months.

And then we left Hong Kong and came back to New Zealand. Once again, I was employee number one. Two and a bit years later, we have 15 staff, and just about to open a second office in Hamilton.

You both have proven how to start or pickup from others and grow businesses very fast. That is very impressive – what do you put that down to? Is it systems? Processes? Mindset?

Jarrod: Yeah, systems and processes are important, as much as it is with building a culture that staff want to stay and clients want to work with you.  I had studied a MBA from Macquarie University in Sydney and there I learnt fast how to know your customer and give them what they want.

Is it worth doing an MBA then, still with everything online at your fingertips nowadays?

Peter: I think so, definitely put me in a great position to figure and to sort out Survey Group.

Jarrod: Yes, and things just move faster overseas compared to New Zealand. In Australia you get used to things moving at a drop of a hat. I mean in surveying they use the same technology and business practices, it’s just they have a more mature industry over there. Things need to happen fast otherwise you don’t get ahead. All about communication and service levels.

Peter:  Hong Kong moved fast. It is just so dominated by the financial industry, so I guess that rubs off on you.

Ok, so you applied big fast moving foreign city country principles to small ole NZ. Both with a strong desire – that’s a mindset thing- to grow and obviously the ability to scale businesses. Technology in Surveying though – where is that at? From a property development perspective, it feels like surveying has been through quite a lot of technological change, maybe more than any other consultant in the industry. Like drones, didn’t you guys have to spend days walking over mountains – stockpiles- of dirt measuring volume? And now you have those scanners that can measure buildings?

Jarrod: Yeah, what started out as a big productivity gain, the with drones for at least our surveying business it has taken jobs away from surveyors because contractors can do that themselves. And really your mobile phone can automatically scan and dimension spaces now. What I see as the most importantly technological change was GPS and more recently, laser scanning. That made a huge difference to how we do business.

Peter: The current surveying tech can scan 2 million points per second! And robots. Robotic technology in the surveying instruments & equipment. Before you might have to have two people on a site, now it’s one. And they are only on site for the same time as they used to. So that is a 50% decrease in onsite staff costs.

All those gains which have conveniently sidestepped much of the rest of the construction industry -it just seems everything keeps getting more expensive! Although maybe technology has slowed the pace of increase, so has Surveying pricing become any cheaper over the years?

Jarrod: Yeah, it definitely has. We are time driven, where tech is the driver that keeps on moving the price point lower.

Peter: Those topo surveys used to take 2 days now you can fly drone it in 2 hours. That’s technology increasing productivity dramatically and that’s what we wanted to create here with….

Guys, I can see how antsy you have become. You might be sick of your respective stories, but I like to set the scene for the readers. You want me to promote your software and start talking about features and all that but I’m sure there are others who will benefit -maybe even get inspired- from your entrepreneurial journeys. Let’s hear the reasons why first. Then you can talk to us about the how and the what!

So why did you have this bright idea for a piece of software you have recently launched? Before we even mention its name (apart from the title of this interview of course!)  what was the trigger? What was the issue you were trying to fix?

Jarrod: I think it came as a function of growth pains. Being the Director, eventually if a client had an issue with us, they would contact me. There was a recurring theme, many clients were frustrated that they didn’t know what was happening with their projects.

Who are your clients?

Jarrod: Yeah, this is mainly about the mums and dads type clients, the business to consumer (B2C) clients. Typically, the ones getting a new house built. The business to business (B2B) clients, developers and large property owners are much more prone to following up with our team where everything is at themselves. And because  our surveyors are working with them on different projects, or very large projects daily, the “where is that task at” conversation is just a routine part of the comms, of the back and forth.

But for smaller clients, a lot of Survey Worx bread and butter, many wanted feedback and progress updates and frankly my team was not delivering on that.

Believe me we tried. Every monthly meeting, it became a bold point on the minutes -update your clients! And so, everyone did, for a few days and then they fell back into their old habits. And then I would get the phone call. 

It’s just human nature – a surveyor’s core role is to survey, to get a job and complete it. All the follow-up was a burden to their other work. And it’s time that we were not getting compensated for. So, the client is not getting great service, and we are not getting compensated anymore when we try to do so.

Then another penny dropped. In the open plan office, all around me I used to hear the same conversations. Every day, multiple times. I could overhear staff saying pretty much saying the same things to clients. We had curious clients, and they wanted not only to know where a surveying task was at – like when will the topo survey be complete – but the actual process, the steps along the way. Developers we work with already know most of that and they have been there and done it before. But the smaller one-off clients, they didn’t understand, they wanted to know that everything was on track in the background. And I heard my staff repeatedly telling them the same process, over and over again. That was not productive!

Peter: We had exactly the same issues. We had the same problem. And it was going to be a growth bottleneck if we didn’t address it. Hard to grow in the difficult market that we have had, but once things are back on track, we didn’t want this ‘problem’ to impede us.

It’s a bit fuzzy, but let’s say its late 2023 and whilst having a few beers our mutual frustration with this problem grew into a robust conversation. We threw ideas at each other. That night of course we solved it. Then the next day we woke up and had to work to solve it all over again!

Ok, Houston we have a problem. Now we need a solution. On that fateful night of realisation and commitment did you decide you were going to build some sort of AI powered widget or how did you really start?

Jarrod: No, we had no real idea, so we said let’s pull this apart and research. First let’s talk to clients, so we talked to homeowners. We talked to other companies. We went looking for the sources of the pain points and basically did a whole heap of research.

Peter: We went back to existing and past clients and asked for feedback. Mostly they wanted more communication. Of course, we already knew that so then we had to work on improving communication and hopefully automating it.

But surely you looked at your competitors and others in your industry – how did they overcome this problem?

Jarrod: They either don’t update their clients, or if they do at all they are relying on manual processes and the diligence of their staff.

What was your experience with Artificial Intelligence before you set out to solve your business problem?

Peter: Very limited, honest with you.

Jarrod: I had done a bit of using and trialling AI. With surveying you need to keep up to date with the latest technology, just to stay competitive so I am always looking at integrating whatever we can into our company. Those who nail it prosper first is my way if thinking.

So, you jumped on the bandwagon and decided to use AI. ChatGPT had only been around about a year by that time. And everyone was solving their problems with AI by this stage, right?

Peter: Well not us. We were thinking quite traditional, at least in a tech sense. Maybe it could be a structured email template. We even thought about hiring a person to correspond progress on behalf of staff. But that was only going to cost us more opex and then still had the human error part. Not sustainable.

Jarrod: the conversation started with a template, every project was templated, so we had workflows built for that.  and we only added AI later on.

Peter: AI only came about as part of the solution for a specific component of the software, and once again that came from feedback through our testing process with other companies and clients. We wanted to create a very simple business communication tool. In the end it just happens to use AI to help compile messages and that is all.

Jarrod: So far that is…

Let’s put you out of your misery. What is the name of your solution?

Jarrod and Peter: Zipp.

Jarrod: We have the getZipp.com domain name for the American market. Firstly, we couldn’t get the Zipp.com domain and we thought, well you only have to get the Zipp app once so getzipp.com was it.

And how did you arrive at the name?

Jarrod: Well, I originally had called it BeeStork.

Sorry?

Peter: Yeah, I hated it too!

Jarrod: Hey, my kids and I loved it at the time! You know bees with their great sense of communication amongst each other. And well the Stork delivers. So as a tagline ‘Communication that delivers’.

OK…I get ya. BeeStork.com

Peter: Yeah, do you want to buy that domain name?

Jarrod: Anyway, we decided on Zipp. Like a zipper, the two parts coming together. Bringing clients together with their projects, ‘zipping’ as in ‘communicating’.

Peter: you know that is the first time I have understood that!

To summarise, Zipp is an online application that uses a little Artificial Intelligence to solve the problem of surveying companies communicating with their clients. Is that right?

Actually, you tell me. Give me your 10 second elevator pitch?

Jarrod: We help businesses update their clients. We have enabled anyone to view the progress and process of their projects in real time.

Peter: Zipp is a business communication tool that gives the end user full transparency on internal workflow. It allows any business to be more productive and to communicate and update clients on project workflows.

Not bad pitches, however I would prefer to see how much dollars you propose to save companies in those ten seconds!

Peter: And not just surveying, I see this tool as providing real value to all sorts of industries, basically any consulting firm or subcontractor that does projects for consumers. Tradies, engineers, of course surveyors and architects.

Jarrod: And even as it has evolved, with an endless list of features clients would like us to add, the core principles remain the same. To update multiple clients across multiple projects at multiple stages and multiple types of projects and do it fast.

You got the problem, you have researched your options and somewhere along the build process you settle on Zipp. How was it building the Zipp application?

Jarrod: This is my second time building software. The first time in 2018 I built ‘HomeProfile’. It was a platform amassing all sorts of IP about a property to accompany the sale of a property, including 3D models. The biggest lesson with that flash in the pan was that you need a strong team.

So, I had worked with software developers before and knew we needed someone that could take us all the way. We wanted them to have a proven track record. That’s how we chose Edition Studios. They had recently built an application called ‘Kernel’, it had won some awards. I knew one of the owners and I pitched him the idea, at least the problem we were trying to solve. They understood the challenge, provided an immense amount of feedback and we were into it.

Peter: After 3 months research, six months building a prototype we then spent nine months in beta working with clients and other companies to refine. It was closed beta testing, just with some trusted partners. We had Survey Worx a larger company, Survey Group a medium sized one, a few builders, an electrician, a painter trade and an accountant. They all helped us during beta working with their clients and gathering real time feedback on Zipp.

And what about staff?

Jarrod: We have now decided to do our product development in-house along with business development. We have hired a real achiever in this space to be the person to take us to the next level. We found Stevie Mayhew, who as Chief Technology Officer, had successfully exited other applications. Around him we will build an internal development team to add more features to the product and continually improve.

Peter: I knew Steve for ten years. We would catch up when he came back and forth from the States.

We mentioned features briefly. Are these features ones that your clients want – or are they what you want?

Peter: Keep it simple!

Jarrod: There are about 400 features I want, but yeah, the core is to keep it simple for companies to use. That’s so they get all the benefits of keeping their clients informed without a massive investment in time on how to use Zipp.

The template feature is key to keep it simple. Essentially the process, or each step of a particular service is identified and written down for industry or project. You only have to write that process down once and it is stored as a template. Or you simply choose one of our standard templates. We have about 30 now across a number of industries, from architects to lawyers, surveying -obviously- to house building.

When you tick the step off, a prompt to notify the client is automatically generated. Then this is where we had started down the track of providing message templates, but our software developer said we can use AI to automate the message. Client feedback was great, that saved anyone having to create message templates. Our AI automatically writes the email to the client in different message styles the writer can choose. This provides standardisation across the business, so all communications have the same flavour and allows some customisation if the user wishes to. And at the end, the user can choose to add a templated message to highlight tips and tricks or to upsell their services in the final correspondence. We put that in, because most of our beta testers were doing that manually to their clients. End of a project, add a perhaps you need to buy this, type message.

Ok, I think we’ll leave the how it works part for readers to figure out on their own. I have had a good go at it, and it’s very simple. And that’s where its powerful – in its simplicity. Easy to use, easy to update clients on job progress, easy to set up the projects in the first place. I see applications in my business as I am running all sorts of projects. And I see a tonne of applications for consultants to advise their clients. Planners, everyone involved in the RC process, architects and the like.

However, and this is important, what are the benefits that your clients and your beta testers clients have demonstrated?

Peter: Well one of the big things is the transparency. Clients can now see where their project is at and when a milestone is hit, they receive the auto AI generated update. That gives them piece of mind and more importantly saves everyone a phone conversation or an email back and forth on where the project is at. That is a huge time saving, money saving, productivity enhancement for us. Two birds – better client service & satisfaction and internally we are much more consistent and less time wasting.

Jarrod: Another angle is for those customers tendering projects. They put a brief blurb about using Zipp in their proposals to their clients, for example how the client will receive AI powered automated progress and behind the scenes transparency. That value-add helps them win projects!

You launched Zipp on August 25, 2025, what’s next and where next?

Jarrod: Well, we are constantly refining our offering based on feedback.

Peter: But besides that, we have the final product right now – its live and its making users more productive and providing a better level of service to their customers.

What is the future? What does success look like in 12 months’ time (which is an eternity in the world of AI)?

Jarrod: We have penetrated the global market.

Peter: Ok, maybe not that far… Success looks like we are trading, on the ground, within the United States within 12 months.

Jarrod: 1,000 users in NZ.

Peter: I would like us to hit it 300 users in New Zealand –that would mean 250 different companies and from 10 to 15 different industries. Currently we have Architects, builders, surveyors, planners, accountants and lawyers.

Jarrod: And engineers, last week we onboarded a structural engineering consultancy, and that was a great fit for Zipp.

And how did you come up with the price – how much is it again?

Jarrod: Well from our testing, our clients saw that for the value it provides it should be a high price point – that was the feedback.

Peter: This is one of our biggest disagreements! So, we did a survey and decided to provide a low price point, to minimise the barriers to entry in the New Zealand market. It’s $24.95 per month per user. Anything higher for such a simple tool, is taking the …well you know.

Does every user have to pay?

Jarrod: No, there is a free tier for small companies. However, a user is essentially a manager overseeing multiple projects -they can have one user on unlimited projects within that small monthly fee. For example, at Survey Worx with 100 staff, we have only five users. Most small companies only need one.

You want to grow your user base right? What is the final message, the final call to action you want me to send out there?

Jarrod: Communication technologies are improving rapidly. AI cannot do what we do alone, so Zipp is here to help improve organisation’s relationships with their clients. This software can be the simple improvement to drastically improve your client satisfaction and retention. Get in early to make use of the competitive advantage it provides!

Peter: Zipp gives your clients what they want; transparency and detailed information at their fingertips. Use it once and you’ll see that the value it provides clients is not even comparable to the low cost of the software.

And that’s the pitch people! Go and try Zipp yourself at GetZipp.com. Thank you to Jarrod and Peter for your time today.

https://www.getzipp.com

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http://www.aenspire.com/xpect/Xpect-ZippQandA-2025.11.04.pdf

Now that you have sold them you also need to manage those who have bought them. When your agent sells your existing house, you may not even meet or know who purchased your home and probably will never have anything to do with that person ever again. The agent, at best, may deliver flowers on settlement and keep the buyer in their sales database, following up every year or so. However, when you sign up a buyer for your subdivision then you will be making a significant commitment beyond the assistance your agent provides.

The commitment is proportional to when you make the sale in the development process. Before the section or house settles the agent has a vested interest in maintaining good relations with the purchaser — for the one simple reason they have a commission payment riding on there being no issues until settlement. After the property has settled, the agent has little incentive (except for repeat clients) for engaging with the purchaser (probably also low motivation as it can only mean there are problems). Therefore the agent will be motivated to assist you before closing, and you are largely on your own afterwards.

You will most likely need to deal direct with purchasers on upgrade selections, colour options and physical variations that have been agreed to in their contract. In addition, if you are pre-selling homes or sections before you have consents or before construction has started you will need to keep the buyer’s enthusiasm up with progress updates. Even if you have unconditional buyer contracts, this communication will help you if you encounter problems and need to engage with purchasers to renegotiate items. It can also smooth the wheels for when they take over the house. Signing up a purchaser on a new subdivision that will be 18 months before it is delivered requires some commitment by the developer. Don’t underestimate the amount of purchaser liaison required.

Purchaser management involves different facets during each stage of the development sales cycle:

1. Pre-Contract. As developer you may find yourself directly involved in the selling process, helping the agent as you attempt to convert a buyer to a signed contract. Some buyers will have a lot of questions on timing, quality, design and product specifications beyond what you have presented in your marketing materials. A good agent will sell without providing the buyer with additional detail (the details of which may not even be known when first marketing). However, there will still be questions that get through to the developer. To be prepared, before the next time the same question is raised, prepare and update a list of frequently asked questions (FAQs) for the agents to refer to. You could also put this on your project website and hand out with the brochure.
2. Contract Signing. Once the purchaser is unconditional (at least from their side), they are now in your system — so you better have a system! Do not leave managing purchaser information, correspondence and requests to the real estate agent, as they simply won’t be as good as you need them to be at it. Too much will be open to assumption and misinterpretation. Your lawyer, who administers the legal side of the contacts, if experienced with projects, should have an electronic database recording and updating all the key details. This database is a good starting point to append all the requirements you will need in managing purchasers. It will be prudent to protect the information the lawyers are responsible for from mistakes by using a shared but un-editable system where you can link that to your own information requirements. I have developed purchaser management systems and commonly find each project has so many bespoke requirements that you end up using a spreadsheet. A relational database, if properly set up and maintained, is ideal but, just like most proprietary feasibility models, nothing tends to completely fit the uniqueness of each project. There is a lot of information to keep track of and updated, for example:
   • Purchaser name and contact details
   • Purchasers’ lawyers name and contact details
   • Section and house number or address
   • Plan type
   • Sale date
   • Sale price
   • Variations to sale price
   • Deposits paid
   • Deposit interest accrued
   • Settlement costs to be added (land tax/rates)
   • Settlement sum remaining
   • Upgrade costs paid
   • Colour option selected
   • Upgrades selected
   • Variations to plans, design, specifications
   • Special conditional clause dates (planning approval, presales, sunset, pre-settlement access)
   • Special terms (variations from standard contract)
   • Agent details who sold, commission paid and outstanding
   • Scan of actual sale and purchase agreement.
3. During Development. During the pre-sales, consenting and construction period it is mainly a one-way communication approach with you updating the purchasers on the expected completion date and showing progress. It will quickly become two-way if you do not provide regular enough updates, or the updates don’t reflect the purchaser’s original expectations. This correspondence is also an ideal marketing opportunity to use your purchasers to help market your development to their associates, friends and family. The way you do this is by providing high quality communications emphasising smooth progress (regardless if it is or not) that include subtle incentives for your buyers to forward it on. Consider these categories of communication:
   • Section or Home Specific. This is primarily to show where you are at in the delivery programme with the purchaser’s individual house, section or super lot. You could provide a site photo and extract where the builder is currently at from your project minutes, for example, ‘roof complete, pre-lining commenced’. This one to one correspondence will be via email and you may also be addressing specific requests from the purchaser at the same time.
   • Project Specific. This is to give updates to all purchasers in the project. This is best done regularly (say every two months or at milestones when you have something new to convey). It could be acknowledgement that consent has been approved, a drone flyover showing progress of civil works, a photo of the ground breaking, the first roof on, the first houses settling and buyers moving in. You could use email, social media, a mailed project newsletter or link to a progress page on the website. You may discuss how well sales have gone if you are almost sold out, use it to profile the next stage or discuss new amenities in the area that will add value to any buyer’s purchase. Put enough in the communication that the buyer feels proud of their purchase and wants to spread the word.
   • Company General Newsletter. Use email, social media, and/or mailed (yep, via a postman) newsletters to correspond to your buyers about your company’s projects, success, interesting facts, milestones, introduce new employees and profile recent buyers. Set the newsletter up to be regular and have someone dedicated to producing it. Demonstrating the success of your company will instil confidence in the buyer that you can deliver. You could include a ‘For Sale’ page, showcasing other projects with sections and homes for sale. You could offer preferential terms before public release of new projects or invite them to events. Consider interviews with key partners such as financiers, urban designers, architects, interior designers and contractors. You could interview local politicians and key people in the community like principals and retailers. You can also include testimonials or quotes from buyers who have recently settled and moved in.
4. Pre-Settlement. As the section or home nears completion you should increase correspondence explaining when completion is likely. Provide buyers an estimate of when a call to settlement will be made and manage expectations around the margin of error. Most likely you will be relying on a local authority approval for meeting all conditions of building consent or the legal certificate of title. These approvals can take time and experience delays so you can only give your buyer an approximate settlement date. The buyer will push for exact dates for a number of their own reasons (for example, they have to organise funding or cancel the agreement on the place they currently rent). Don’t over promise, and make the purchaser well aware of potential delays.
5. Purchaser Inspection. Prior to settlement you should organise a purchaser inspection — at least if there is a house. This inspection is the best time to note down any defects as it is before they or their tenants move in and start to damage things themselves. Items identified now can be relayed to the builder to be fixed before the home is occupied. You or your project manager should be present with the purchaser and take great notes and photos. Don’t leave a pre-purchase inspection to the agent because defects often become a point of contention with the purchaser later on. Also refrain from making promises that any defect will be remedied before the purchaser settles and certainly do not leave the purchaser with the expectation that fixing something minor is a condition before they settle. It shouldn’t be. At this time the buyer may require other documentation for funding, so have a pack of information ready that can be quickly tailored to each buyer and their valuer if requested.
6. Settlement. Finally, you will start to receive income, but plan ahead to limit inevitable last minute hiccups. Have your lawyers followed up to make sure settlement does happen within the contractual period? Have requests to extend settlement been dealt with? Do they have all the correct information as to the full cost of options and variations so they can adjust the settlement price? Have you organised the set of keys (and security alarm codes, garage door openers, swipe cards)? Ensure all official documentation has been provided to purchasers. This can be provided as part of a ‘New Property Owners Welcome Pack’ including:
   • Warrantees and guarantees from suppliers.
   • Maintenance guidelines and schedule.
   • Manuals (appliances, security systems, plant, fire systems).
   • As built drawings, specifications, colour schedules, utility maps.
   • If delivering sections, any house plans promised, geotechnical completion reports and consents to be complied with.
   • Any Home Owners Association or Body Corporate rules and regulations and contact details of the manager.
   • Documents required for insurance.

The welcome pack is to look professional and to pre-empt inevitable questions later. Provide a compendium that includes photos (perhaps at milestones during construction), describes amenities in the area and summarises, in everyday language, key purchaser questions like connecting utilities, security systems, evacuation processes, limitations on noise, signage requirements, business use restrictions, visitor parking, garbage collection, mail, couriers, use of loading areas, allowable times for moving furniture and replacement of smoke alarms.

7. Post Settlement. Now that the agent has fulfilled their commitment (they have their cash) you are on your own with the purchaser. The main communications will concern remediating defects. It pays to have a good record and scheduling system to manage defects as the process can get very cumbersome. Consider this approach:

• Clearly advise the buyer of the procedure and deadline for notifying the developer of defects and the period the developer has to complete defects. This should be spelt out in the sale and purchase agreement but there may also be legislation that regulates this. Limit multiple off-the-cuff requests by asking buyers to submit one full and final remedial list. This won’t always happen but use your best efforts to minimise the back and forth to make it easier for you and your builder to get the work done.
• Have defects agreed first. Some items the purchaser will raise will not be a defect — it may just be how something is designed. You may have to argue some points with correspondence from your architect.
• Reconcile the purchaser’s remedial list with the builder’s to-do list that has already been provided by the architect (if these issues have not been dealt with prior to settlement). Give the builder one list per house and as many houses at the same time as possible — this helps them organise sub-trades more efficiently.

• Where defects need to be fixed when the house is occupied a degree of decorum and practical sense is required. Allow direct contact between a sub-trade and the occupier for access only when you have established the relationship will work. You want to first ensure that the sub-contractor will leave the place clean and that the occupier commits to being available if required for access.
• Database everything: when remediation works are scheduled to be complete; who is doing it; and contact details for owner, tenant, subcontractor, main contractor, property manager. Tick off issues when the works are complete, inspected and have been ‘approved’ by the purchaser.

• Communicate with each purchaser, using one updated master list, showing what has been completed, what is outstanding and when it will be complete. This helps mitigate multiple lists appearing for each house and incorrect assumptions from all involved. Communication can often get murky when the owner does not occupy the home and there is a tenant and a property manager involved.
• Where the issue is a manufacturer’s defect, encourage the home owner to contact suppliers direct, especially for items like appliances. This will ultimately be easier for buyers moving forward.

8. Post Project. Continue distributing your company newsletters, emails and social media feeds to your previous buyers. They can be a valuable revenue source for your next profitable project.

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com

Agents need to be closely managed. They are your direct link to the income you need to generate and that will determine how profitable your project will ultimately be. Many lone real estate agents are not the best at organisation and structure — the ‘salesman gene’ often in conflict with the ‘organisation gene’. They can be more difficult to manage. Agents who have project teams with a mix of sales gurus and organised administrators experienced in selling projects (as opposed to one-off houses) will typically have good systems in place that allow them to be more easily managed.

You should have regular weekly meetings with your agents, and get to know all the agents in the team that will be involved in selling, as well as the administrators in the background (whom you will depend on to get deliverables such as marketing feedback and produce advertisements).

Think of it as the developer’s job to keep your agent motivated throughout quiet periods and especially after the initial excitement of launch dissipates. Keep the agent focused on your project — they will have other listings as well if they are any good with equally demanding clients. Great rapport and communication is critical. Make sure you are talking to your agent on the phone, texting, email, having lunch, coffee – whatever, but you should be communicating almost every day. Not only are you following up on their performance but you are communicating your performance at delivering the project. So the conversation is as much about how their sales are going as it is about how your planning approval or construction is progressing. In a standard listing the agent only gets paid when the sale is unconditional and/or settled. That can be 12, 18 or even more months from launching the project. It’s a long wait for the agent to get paid, so you need to keep them focused on the riches at the end and how relatively close that is. Otherwise they may start to think about cutting their losses, especially if issues start to arise that potentially put the project in jeopardy. Whilst few will terminate the listing (as presumably they have made some commission payable sales) their motivation will wane and they will look for other projects to work on where the commission comes quicker. This is also one reason for using agents who have a dedicated project sales team, as the agents are experienced and used to the longer term nature of the project sale.

            Sales management will follow one of two different directions depending how sales are progressing.

Sales Going Well

When sales are meeting or exceeding expectations then sales management is all about maximising your sales prices and making sure you don’t sell too cheaply or do suboptimal deals. Mainly you can let your agent do their thing since it is obviously working. However, when signed sales contracts are coming in thick and fast, regularly sit down with your agent to make sure you are not under-pricing your product. Where possible push your prices higher. As tempting as it is to raise prices to increase your profit make sure you don’t push beyond what the market will bear. If you push too hard you run the risk that your product sits around a lot longer and goes stale with your sales programme losing momentum.

            This is a good time to look at trends and sales velocity and to keep ahead of the competition. Measure the number of leads that are being generated, the conversion rate and look at improving it even more. Obtain the records of everyone the agent has been in contact with (the agent may be reluctant, but it is your project, your money and your leads). Question the agent on who the potential buyers are and what motivations the agent has uncovered — this could provide valuable details that help you make tweaks that further maximise profit. It is also the time to reconsider releasing further stages earlier to take advantage of good sales. Further, make sure the agent is still working the project hard. With the pressure off they may get complacent and expect contracts to just happen, rather than hunt down the best deals.

            Obviously the key output of sales management is to help make sales. How do we make sure that happens in the first place? Well some reasons are within your control and others, unfortunately, are at the whim of the market. Reasons why sales are going well:

• You are priced right, offering more value compared to your competition.
• Your research paid off and you found a product type demand gap in the market.
• You are not forced to raise your prices above the market — such as caused by delays or rising construction costs or paying too much for the land in the first place.
• Your project is underway, and the objection to when you are going to start construction has disappeared.
• Your design is attractive to your target market.
• Your location is better than your competitors’.
• The market is on an accelerating cyclic upswing.
• Your agent’s team is well organised and knows how to sell.
• You are marketing the right message to the right targets in the right way.
• New competition hasn’t eventuated.
• Supply in your effective real estate neighbourhood is decreasing (and demand is stable or increasing).
• Expected positive externalities have come to fruition, or new ones have opened up — such as a new shopping centre down the road, a new school opening or a new park.

Sales Not Going Well

If sales are slower than planned then sales management is all about fixing the problem as quickly as possible. Property development is a constant process of evaluation and decision. You must decide and move forward otherwise your sunk costs and debt will eventually catch up with you and could sink the project — and maybe your solvency. Therefore if sales are slow and you cannot legitimately adjust your expected timeline (delay construction for example) without onerous costs impacts (and there typically are) then you need to make new decisions.

Firstly, identify what advertising plainly isn’t working and what is working. This is where measuring how your advertising is working becomes more important. Look at the advertising channels you are using and the message you are trying to convey. If something is working then do more of it and change or stop what isn’t working. If you can’t figure out why something isn’t working then change it anyway. How many leads are being generated and how many of these leads are being converted? What specifically can be done to increase more leads of the type that have a higher chance of being converted?

Secondly, review the objections to your product. There must be some as you are not selling! This is when it becomes important that your agent keeps diligent records and asks potential buyers all the right questions. If you don’t know the objections then you are flying blind. Get your agent to question everyone to solicit the real objections and form a database of responses. Be wary of the last anecdote the agent heard an hour before your meeting. Analyse this information so to form a picture of what the problem is. Uncovering the real objection is a challenge, but you must try. Of course there is always a price that solves all objections.

Thirdly, see the agent (and their display suite staff) in action and use a secret shopper to visit the display suite during open homes. Make contact via the website, phone and email using friends or aliases. Is your agent doing your product justice and can they actually close sales? Are they working the market or just turning up to meet and greet? Meet other agents to garner their opinion (acknowledging they will likely say almost anything to get your listing, but some will point out big issues with your product or sales approach as they see it). You need to determine if the problem is how you are selling as opposed to what you are selling. If it turns out you just have selected an incompetent or lazy agent, then make the quick decision to use someone else. This is why having a performance clause in your listing agreement is useful.

Fourthly, canvas wide opinion and relook at all your research in light of the current market. From what you have identified from everything above figure out the reasons why you are not selling, these could be:

• You are forced to price your product too high (therefore offering less value than your competitors) because you paid too much for the land, construction costs were underestimated or are rising and/or are having delays with consents.
• Your research has been poor and you have not identified the correct surplus demand capacity or the right product.
• Advertising is not reaching your target market (you are doing too little advertising, in the wrong publications or not creating a high enough profile and buzz in your effective real estate neighbourhood).
• Advertising is not conveying the right marketing message to describe your products value to the target market
• Marketing messages not aligned to the target buyer’s criteria. You might have assumed the target market is already looking for your product, when in fact they may need to be educated in your product in the first place (for example, three bedroom homes in a larger home suburb may go unnoticed until you educate buyers interested in this location of your smaller homes’ superior value).
• Your functional design is lacklustre compared to your competitors (for example, the second living area should really be another bedroom, or everyone needs double car garaging in this location).
• Architectural aesthetics have missed the mark — it doesn’t look good to your target buyer profiles.
• Your agent and sales team are not performing.
• The project has lost momentum and gone stale in the market. People now gloss over it and ask ‘why should I buy if no one else is?’ Or other negative perceptions persist such as the product now appears cheap and low value.
• The market has flattened and the media have turned negative on housing — you have missed the market upswing, or caught at an inflexion point.
• Affordability and available funding for your purchasers has decreased.
• Investors have left the market — investment yields are too low or banks are tightening up lending criteria.
• Your target market has left the effective real estate neighbourhood (foreign investor restrictions, immigration issues or the location is overtaken by a new type of gentrification or has entered a decline).

Finally, recalibrate your sales and marketing strategy to fix the problem. If the problem is minor (perhaps you haven’t been sending out a strong enough call to action, or advertising is slightly off target), then you may only have to tweak what you are doing. If your product is simply overpriced and you have no room to move on construction costs then you will need to make some big changes such as redesign or, worse case, cancel the project.

It can be demoralising to have to make significant changes, especially with all the hard work done to date. Unfortunately that is the reality of property development whether you are first time or experienced. There are so many variables difficult to control, or completely outside of your control that rarely does a project proceed without issue and some degree of change and rework. In a rising market, these issues are easily covered by the flow of money; in a down market the lack of money exposes and amplifies the problem.

Price solves most problems, even in the worst of markets and underlies many of the reasons above (someone will pay if the issue is appropriately discounted). Everything has a price and the quickest way to recalibrate your marketing is to leave everything else in place and lower the price. However, reducing your price should be a last resort even if your project can afford it. Throwing incentives (such as free holidays or reduced first year interest rates) to potential buyers is a half way measure, perceived by many as simply avoiding lowering the price. Including upgrades is a more discrete version of throwing incentives at buyers, but you have to get them in the door in the first place.

To maximise your profit, make sure you are comfortable and capitalised to enable new decisions and make potentially significant changes as part of your sales (income) management.

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com

After all this you mean we can finally launch our development? The launch can be key to your sales and marketing strategy. Like advertising, agents can receive significant profile on your ticket when launching a development, so make sure they don’t over-embellish the opportunity. You may decide to have more than one launch as you target different buyer groups or if you are offering different products (like a new stage). Launching the development is both an exciting and nervous time and the options to best present your project to the market are only limited by your imagination. Here are some examples:

• Registration of Interest. You advertise limited information about your project in order to collect a database of interested buyers and feedback before you formally launch. Sometimes used to test the market, the feedback may influence your development and how you subsequently launch.
• Soft Launch. This is where you sell homes or sections without any formal or advertised launch. It may be to your database of buyers, your social media network, repeat customers, friends and family or direct selling from the agent. A soft launch may be accompanied by something more formal later.
• Traditional Launch. You take out the best advertising your budget allows and with website operational and an open home time you invite buyers to your display suite the following weekend. This is when all your marketing collateral is complete and you have everything in order to close sales.
• Formal Function. Typically a few days before public release you hold a formal function onsite or at your display suite. This could be an evening wine and cheese or hors d’oeuvres formal event with noted signatories like the local mayor or politician giving a speech.[1] Invite consultants and contractors to be part of the audience. The event may double as a party to congratulate them on their efforts on the development to date. The key for sales is to have your agent bring as many VIP potential buyers along to this event.
• Associated Launch. This is where you dovetail the launch of your development with some other unrelated event to entice potential buyers to attend. Of course you will need to find some loosely related link to your development. It could be a ‘learn how to cook’ event from a local celebrity chef, ‘how to make drinks’ from a barista or mixologist, or a new furniture brand launch — all in your display suite.
• Special Cause Event. This is where you launch your development under the guise of, or in combination with, a special cause. It may be a large charity donation, providing affordable housing, providing community amenities such as a new playground or clubrooms or opening a farmers’ market. This can be made all the more attractive with the pulling power of a local celebrity.
• Big Carrot Launch. Think timeshare, where you win a holiday to some exotic location for attending (only to find out airfares are not thrown in) or any other sales gimmick. Attendees to the event have a chance to win a car, a furniture package or some other prize to go with the house they are about to buy. You could offer ‘attendees only early bird pricing’ for your sections and homes. If you are this way inclined, try to make the carrot as tasteful and related to your development as possible, rather than some type of used car promotion.
• Investment Seminar. Typically held in the ballroom of a central city upmarket hotel, your development is promoted as an investment opportunity to attendees — either on its own or in conjunction with other investments touted by the organisers. Choose your promoter partners carefully as this space is rife with sharks and charlatans.
• Milestone Launch. One of the most well-known examples is the breaking of ground, with the obligatory photo of the developer and a politician pretending to turn the first sod of dirt with a golden shovel. Another is the cutting of the ribbon by developer and proud home owner to indicate the first home in the project is complete.
• Media Launch. Housing is always in the news and if you are creative enough or just lucky enough to be on the right side of something topical you could get your project’s launch into radio, television or print as an item of news. Having a politician or celebrity attend also gives you a better chance of making the news.
• Auction. This is when you kick off your development with an event that surrounds an auction to draw interest and an immediate call to action. In a really hot market, where you know you are going to have oversubscribed interest (multiple bidders per property) this can work really well.
• Influencer. Either using someone with some sort of celebrity status or a staged event to essentially advertise your development through the influencers social media networks. The ‘subtle’ influencer endorsement creates a call to action to buy. Or the staged event gets so much attention, your development reaps in the publicity. Either way the goal[dream] here is for a post to go viral, and garner attention that builds upon itself, until that post itself is reported in the mainstream media. Early days for selling developments in this ‘influencer’ space, although sporting personalities have always been tapped in real estate.

The primary goal for your launch is to create enough buzz to make sales quickly and propel the project forward — profitably! To maintain sales momentum and profile in your market you may consider using a regular combination of the above during your sales programme.

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[1] To secure the attendance of the mayor to give the opening speech I once held a launch event in the middle of the day, in a marquee on the vacant development site — it received local newspaper and television coverage.

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com

To sign up your buyers you will need a sale and purchase agreement. In many jurisdictions there will be a standard sale and purchase agreement put out by the local professional real estate association. These contracts cater mainly towards existing home sales and often are not always appropriate for new developments, especially where you are pre-selling the home before construction is complete. Therefore, a bespoke sale and purchase agreement or a number of special conditions attached to the standard S&P agreement is typically required.

The sale and purchase agreement should identify the section or house number and the price. Typically you will include the house or section plans as well as outline specifications. For the developer the less information that is included the better to provide maximum flexibility. For the buyer the converse applies.

As a developer you need the sale and purchase agreement to both lock in the sale and protect you from implications that arise due to obstacles and unforeseen issues during planning, design and construction. You also want to protect the value of the development as you continue to sell it down as well as potentially lock-in further revenue streams. Engage an attorney to draft a number of pro-developer vendor clauses[1] into your sale and purchase agreement to address potential issues, for example:

• The right to cancel the contract if a planning or building consent is not achieved.
• The right to cancel the contract if a minimum number of sales is not achieved.
• The right to cancel the contract if unforeseen events prevent completion of the homes. An aggressive clause would be for any economic or practical reason, like an increase in construction costs and a conservative clause would limit it to war or acts of god.
• Ability to make like for like replacements in the specification without consulting the buyer — this is so you are protected if an item (like the type of tile) becomes obsolete and no longer available.
• Minor changes can be made to the plans without consulting the buyer; you need some wriggle room to make changes that may be forced on you by regulatory approval process or design issues that were not fully resolved at the time of marketing.
• Prevent the purchaser from lodging complaints, or taking legal action over noise resulting from construction and marketing activities on the development site. This is important where you expect to settle homes while construction is still underway nearby or when you have future stages to complete at a later date.
• Right for the developer to provide exclusive utility, property management, property maintenance, and other services to the property and could be accompanied by restrictions on whom the purchaser may use. Typically this is registered on the title as well so the condition runs with the land rather than the home buyer.
• Right to create easements, rights of entry and access. You may need to provide for services that run within private boundaries, maintenance strip easements allowing others to access tight spots to undertake work and shared private driveways. These ‘instruments’ will be registered on the titles.
• When selling sections, there are covenants on the timing, type, design, size, and/or value of the house that must be built on the section. Similarly you may want to stipulate restrictions on what is allowed to be onsite prior to construction — no caravans or trash or unsightly mess.
• Rules describing how long the buyer has to advise the developer of defects to fix after settlement.
• Rules of conduct required within the development once settled such as keeping front yards clean, no washing on decks, no business signage, no real estate signs, noise limits, and anti-public nuisance regulations. There could be local authority rules and existing legislation that limits what you can enforce.
• Rules over occupation such as maximum cars per household, maximum people per household, whether the house can be rented and minimum or maximum durations of rental and who the house can be rented to. There is highly likely to be local authority rules and existing legislation that limits what you can enforce (or even ask for).

Pro-developer does not necessarily mean anti-buyer, as value protection clauses do ultimately benefit the buyer. Many of these clauses can be used in marketing the development, distinguishing it from the competition.

Developments take time, markets change and the contract you put in place now may have to deal with completely different issues later. Clauses that seem extreme in a buoyant market come into their own when markets change or circumstances turn sour. These clauses are one of the developer’s best risk mitigation mechanisms. If the worst happens and your project has negative value (you are about to lose your shirt) having a clause allowing you to cancel the contract and re-sell it at a higher price or renegotiate the price can save your profitability.[2]

Of course, just because you include a restrictive clause in the agreement does not mean a savvy purchaser will agree. In a hot real estate market you may be able to secure a very one-sided developer-friendly contract as buyers are competing just to purchase the property. Conversely, a soft real estate market quickly results in soft, pro-buyer clauses in order to get sales. Sometimes these can have negative implications. For example, when sections are oversupplied and the developer just needs to get out, covenants may become less restrictive on the quality of house that must be built (so to increase the buyer pool) and this can result in an upmarket subdivision becoming downmarket in later stages quite quickly.

Pro-buyer clauses include:

• Ability to cancel the contract if completion or start of construction, or issue of title is not by a certain date (sunset date). This is almost always requested by purchaser’s attorneys if the developer has a clause that allows them to cancel the contract if minimum sales numbers are not reached. If you agree to sunset dates ensure you give yourself months if not years of contingency for the unexpected. There is no point committing to a date that is unrealistic unless everything goes perfectly (because it rarely does).
• Withhold a final payment (retentions) to incentivise the developer to remedy defects.
• Staged payments of deposits.
• Sections or super-lots, what is commonly called ‘builder’s terms’ clauses. These allow the buyer to have access to the section upon local authority approval to start construction and settle the land months later.
• Compensation if size changes by more than a certain percentage (for example, if section size is smaller by 5%).

Sale and purchase agreements have different formats for a tender or an auction. For a tender the agreement may list the documents provided for the purchaser to consider as well as conditions that will or won’t be entertained. For the auction, typically it will be a take it or leave it contract, occasionally allowing flexibility on settlement timing.

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[1] The vendor (developer) can choose to invoke the clause, not the buyer.

[2] This is another area where legislation in your jurisdiction may already have strict rules in place that you must follow.

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com