The Agency strikes out with rental play as housing booms

The country’s soon to be only listed real estate agency has flagged a bigger push into property management as investors turn to it to handle rentals.

The Agency boss Geoff Lucas is planning to take advantage of the business’s new-found lone star status as the only listed residential real estate agency. Picture: Supplied

The Agency chief executive Geoff Lucas is planning to take advantage of the business’s new-found lone star status as the only listed residential real estate agency.

Now, with less competition for investors’ attention, the firm is looking to continue growing its pool of properties under management as part of a strategic play, with its rental arm to underpin company operations and give the business a stable base.

“It allows us the opportunity to highlight how we’re different, and it allows us to gain exposure to investors that want exposure to the Australian residential property market,” Mr Lucas said.

In 2022, The Agency was appointed to manage the property management portfolio of MDC Trilogy Wholesale Yield Fund 1, a joint venture between fund manager Trilogy Funds and corporate advisory firm Murray Darling Capital, to acquire and manage a significant portfolio of property management assets.

The total portfolio currently has more than 10,200 properties under management with an asset value of around $9 billion. Of these, 4,300 are managed on behalf of MDC Trilogy.

“That’s quite a significant business and growing rapidly,” Mr Lucas said. “We think that puts us in about the top five in the country, and we’ve got an aspiration within the next couple of years to be number one.”

Last month, the founder and boss of rival business McGrath, John ­McGrath, made the shock announcement that the business planned to ­delist from the Australian Securities Exchange after seven years following a joint buyout offer from British firm Knight Frank and New Zealand agency Bayleys, saying the peaks and trough of residential property made it difficult to ensure ­“annuity-type predictable income”.

The board is set to vote on the plan at a scheduled board meeting in mid-June.

The Agency was established just months after McGrath’s troublesome float – in which the share price plunge from the listed price of $2.10 in a matter of months – by some of the firm’s leading agents: Matt Lahood, Ben Collier and Steven Chen. Mr Lucas, who was chief executive of McGrath for several years, took over the helm in 2021.

The younger business operates on a different model to most real estate businesses, rejecting the popular franchise model and instead relying on business hubs around the country that report to The Agency’s head ­office in Sydney.

“By diversifying our geographic markets, we actually mitigate the volatility of specific markets as we’re not as exposed,” Mr Lucas said.

At its half-year results in February, The Agency reported a 17.2 per cent jump in revenue to $43.9m. Its shares last traded at 3.5c.