SOUTH Perth-based Jaxon Construction’s announcement that it had bought into the North Fremantle Rivershores project is the company’s first step in refocusing its operations following a year-long strategic review.
SOUTH Perth-based Jaxon Construction’s announcement that it had bought into the North Fremantle Rivershores project is the company’s first step in refocusing its operations following a year-long strategic review.
Jaxon, which has a 50-year history in retail housing, is seeking to triple its business by 2015 to become a serious player in large-scale residential developments and project management.
Jaxon general manager Peter Goulios told WA Business News that, at its peak, the company was building more than 400 homes a year and had a range of nine display homes.
“In April of last year there was a decision made that we move out of the retail housing business and start growing our residential builder/developer capabilities,” Mr Goulios said.
“This is more in line with what we do in our day-to-day business, where we project manage and contract projects.
“It’s in line with the size of the business and the focus of our project ranges – the $10 million to $100 million projects.”
Mr Goulios said the housing industry boom of 2007 had created challenges within the business that had been addressed in the strategic review.
“In 2007, in the peak of the boom, all builders struggled to find trades in the industry, houses were taking 12 months, but these were the catalysts that made the business reinvent itself,” he said.
“With any business you sometimes need to look to where you can make a difference and strengthen what you do well.
“We feel we still do the same, albeit just a different approach.
“Because the Rivershores project will still be owned and occupied by owner-occupiers and investors, we’re still delivering a similar product in a different form.”
The Rivershores development is a $120 million, five-storey, 58-apartment luxury complex to be built on the last remaining patch of Swan River-facing land between the Old Fremantle Traffic Bridge and Stirling Bridge in North Fremantle.
Jaxon holds a 50 per cent joint venture interest in Rivershores with property syndicate Northbank Bridges, and will act as the builder for the project.
Project marketer Watersun Properties’ director, Garry Garside, said Northbank Bridges was a private syndicate of local investors formed specifically to progress the Rivershores project.
As the project marketer, Dr Garside said Watersun liaised with both Jaxon and Northbank Bridges on Rivershores.
“As a result of the GFC there was an increased requirement for funding for any development project in order to satisfy the banks’ requirements, so it was an opportune time with Jaxon looking to change its position and strategy in the market to do this type of project,” he said.
Mr Goulios said Rivershores would be Jaxon’s flagship in 2010 and act as a catalyst for the strategy shift towards builder/developer.
“It’s really a long-term strategy of becoming a leading builder/developer in mainstream WA,” he said.
“We will do housing, albeit its not detached sale homes for mums and dads.
“We’ll still be building and nurturing regional and metropolitan communities, but just on a different scale.
“We will do group housing and those sorts of projects and we are looking with other mainstream land developers for opportunities where we can either joint venture or do the building component of those works.
“We feel very confident that the Jaxon brand will strengthen in the next two to five years.”
Mr Goulios said Jaxon would be seeking to diversify its operations further, following its completion of a $40 million Karratha housing project for Woodside, and project management of the $100 million South Hedland New Living urban renewal project.
Jaxon will also be active in the affordable housing sector, with contracts in place with affordable housing provider Foundation Housing to provide 16 dwellings in Ellenbrook and Bayswater by December.
The company also recently won $27 million worth of schools-based work from the federal government’s Building the Education Revolution.
Commercial engineering and construction group Doric bought Jaxon in 2005.
Mr Goulios said the refocusing of Jaxon’s operations would strengthen the synergies existing between the two companies.
“It cements a lot of synergies but it also strengthens what we’re very good at, which is project management, project delivery, using our financial strength, business systems, values and excellence.”
