Suite Talk: Campbell Hanan

What obstacles does the current macroeconomic environment pose for Mirvac?

We've certainly been through a challenging period as a sector. Real estate is quite sensitive to interest rates, and when rates rise, property values tend to decline since real estate is often viewed as a bond proxy.

However, perhaps the even greater challenge has been the surge in inflation within the construction industry over the past few years. Initially driven by supply chain issues, inflation was later fuelled by post-COVID government stimulus, record infrastructure spending, the energy transition, and increased demand for data centres and housing. All of this is happening alongside an unprecedented demand for housing.

I’d say the biggest challenge we've faced is that demand for construction outstrips the available workforce. This has led to labour shortages and, unfortunately, many construction companies and subcontractors have failed. They locked in fixed prices only to face skyrocketing costs, which they couldn't sustain. This has added immense pressure to housing costs, and we've felt the impact as well.

How are you responding?

We've gone back to the fundamentals. The first priority is ensuring the balance sheet is robust enough to withstand any pressures. As a leadership team, we've focused heavily on this, with a renewed emphasis on cash flow management. There’s an old saying that "cash never lies," and that’s particularly true right now. Delays in construction impact settlement proceeds, while costs keep rising, so managing cash flow effectively is crucial to keeping the balance sheet in good shape. We've become more disciplined in this regard over the past couple of years, and we've made solid progress.

Delays in construction impact settlement proceeds, while costs keep rising, so managing cash flow effectively is crucial to keeping the balance sheet in good shape. – Campbell Hanan, Group CEO & Managing Director, Mirvac

We are also making strategic adjustments to ensure we're deploying resources in areas with the best long-term potential. For us, that’s the living sector. We see strong tailwinds in this area, driven by a chronic housing undersupply, one of the fastest-growing populations in the Western world, and record-low rental vacancy rates. Much of the rental stock is obsolete, and we believe the dangerously low levels of rental product represent a significant opportunity.

Shelter is a fundamental need, not a luxury, and we are well-positioned to lean into this opportunity over time.

A major strategic focus for Mirvac is growth in the ‘build-to-rent’ sector, where it was one of Australia's first movers. Why is this sector important for Mirvac?

In Australia, build-to-rent is still an emerging investment sector, though it's well-established globally, with ‘multifamily’ housing making up 12 per cent of the housing stock in the US. With just 27 build-to-rent assets completed here, the sector is in its infancy. For growth, tax settings need to support institutional rental products, which we've focused on since pioneering this space.

We listened to renters' concerns, such as the need for security of tenure and fairness compared to owners. This gave us the opportunity to create a better, long-term rental product, and our first asset is now four years old.

What’s in store for the future of office spaces in Australian CBDs? Is it fair to characterise moves by developers as a ‘flight to quality’?

That’s absolutely right. COVID has fundamentally changed how we work, but being together for learning, mentoring, and collaboration remains key to productivity and culture. While businesses now take less office space than pre-COVID, the workplace still drives business improvement.

Large companies have moved on from 10 people sharing 7 desks to 10 sharing 5, making it impossible to have everyone on-site at once. As a result, many are investing in higher-quality spaces to attract workers back. At Mirvac, with an overall portfolio vacancy rate below 3 per cent, compared to an average of 15-20 per cent in Sydney and Melbourne, we’ve focused on quality and sustainability, with 91 per cent of our portfolio designed with these principles in mind.

What attracted you to joining Mirvac as Group Chief Executive Officer & Managing Director?

I talk about this in terms of the two great flames that Mirvac has, which underpins who we are.

The first one was lit by Bob Hamilton, our founder. And his belief was all around design excellence, integrated construction and delivery, enduring quality and legacy that would stand the test of time.

The second flame was lit by Sue Lloyd-Hurwitz, my predecessor – she's the reason why I came to Mirvac. For her, while quality remained important, the focus was about being a force for good, leading on sustainability and innovation, and enabling communities through innovation.

How would you describe your style as a leader?

When I reflect on what I stand for as a leader, the first thing I’d say is that I much prefer the term ‘followership’ over ‘leadership’. How can we, as leaders, create an environment where people genuinely want to follow?

To me, several traits are important. People want leaders who have strong executive presence, who can stand before a crowd and captivate them. They also value consistency – leaders who communicate authentically, whether they’re speaking up, down, or across the organisation. There’s nothing worse than seeing someone’s authenticity shift depending on the audience. It’s hard to watch. People are also drawn to passion – they want leaders who care deeply about what they do. Equally important is the ability to listen more than talk.

I’m particularly attracted to curiosity and curious people. If I had to highlight two essential qualities of great leaders, it would be a deep willingness to give up micromanagement – to trust and delegate fully – and the preparedness to provide honest, real feedback.

I much prefer the term ‘followership’ over ‘leadership’. How can we, as leaders, create an environment where people genuinely want to follow?
– Campbell Hanan, Group CEO & Managing Director, Mirvac

What key experiences have shaped the values you hold today?

I was one of those people who tried hard to delegate, but before I knew it, I was taking people’s work away from them. I’d wonder why I was still at the office at 8 p.m. while everyone else had left at 6pm. That’s when I realised I was an ‘oxygen thief’ – taking up space in the room without even noticing it.

I had a boss at Investa, the CEO, who kept giving me more and more parts of the business to manage, to the point where I thought I was going to explode. I’ll never forget when he said, "This is great, Campbell – you might finally learn to delegate effectively." I was getting hit with that message from all sides – my MBA learnings, my work experiences, and my boss’s feedback – all at once. It was one of those wake-up calls that changed everything for me.

Making that shift is critical, and I call it working on the ‘business architecture,’ which includes people, processes, systems, and strategy. If leaders focus on these elements and let the doing happen through proper delegation, trust, and respect, businesses thrive.

Looking to the future, what are Mirvac’s mid- to long-term objectives, and what are the metrics for success?

Strategically, we’re focused on the resilience of our income. For us, that means ensuring that the 70 per cent of our balance sheet invested in income-producing real estate is working as efficiently as possible to deliver the best returns, without requiring large amounts of capital expenditure. This is what I call true cash flow resilience. We’re very focused on making sure that the money we spend goes into asset classes that have the best chance of achieving rent growth above inflation, without needing excessive investment to support it.

At our core, Mirvac is about creation, from addressing housing shortages to building high-quality assets. This positions us to grow a sustainable funds management business, attracting investors to partner with us for the long term.

This interview has been edited for length and clarity.