“What would make people want to call this place home?”
This question set David on an innovative course as Founder and Executive Chairman of Intrapac Property.
In the mid-1980s, residential land subdivision was not an attractive asset class. Despite this, former law and economics lecturer David Payes recognised that Australia’s combination of migration policies and associated high population growth would increase land development opportunities.
Intrapac Property was not the first company David founded. In the early 1980s, as a young lawyer, David saw an opportunity to apply emerging personal computing technology to business applications. HiSoft was one of Australia’s first personal computing software and hardware companies. Within 4 years, he and his co-founders had grown the company to over 200 employees and established offices in every state and a software division in the UK. Following the successful sale of HiSoft, David began investing in land.
David was not interested in purchasing nondescript land in any location and carving it up for a profit. Feeling strongly that any returns should be justified, he wondered, “How could you increase the value proposition to customers?”. David reasoned that people wanted more than just an un-landscaped block of land without amenities. Accordingly, he introduced ideas such as mature trees, well-designed urban spaces, and parks, emphasising the streetscape as significant drawcards. He applied his talent, business experience, and academic background in economics to acquire land strategically based on expected population growth and demand. He developed a tailored vision for each project, differentiating it from other housing options in the locale.
Fast forward 40 years, and Intrapac Property is a rare example of a privately owned property development company with many successful and award-winning projects throughout Australia. The company’s projects are principally equity-funded.
Many projects are master-planned communities, requiring an appropriate long-term funding model. Intrapac has adopted an equity-funding approach that provides financial stability and enables projects to develop consistently through economic cycles without the attendant risks of debt-funded approaches and providing surety to purchasers.
Many of the company’s projects are procured and jointly funded by investors. An entity of the Smorgon family acquired a 30% interest in Intrapac Property in 2007. Escor’s CEO Norman Smorgon holds a position on the board – the only board position he holds in a non-family-owned entity.
“We have known David for over 30 years, and we were delighted when we were provided with an opportunity to invest in his property business 15 years ago”, explained Norman.
“We feel a close alignment of values and are extremely impressed with the talented management team he has assembled.
“We are proud to be associated with the outstanding projects Intrapac has delivered and the numerous industry awards Intrapac has received since we invested, and we are incredibly excited about the amazing developments currently underway.”
Intrapac also regularly partners with landowners long-term, helping them generate proud legacies and handsome financial returns.
Proto-placemaking evolution
David grew up in 1950s New Zealand, an environment he describes as socialist and egalitarian – a country where, in his words, “it was all about giving back to the community”.
He learned his business ethics from his late father, Maurice, a leading scientist, businessman and entrepreneur in New Zealand. Maurice taught David that “you have to create value to receive a return; you can’t just take.” This motto has provided the basis of David’s business philosophy.
Well before the term ‘placemaking’ caught on in Australia, David believed that creating neighbourhoods that he and the community living there could be proud of was the right thing to do. This philosophy also happened to make good business sense.
Intrapac Property has had a strong focus on urban design and landscaping, working with leading design consultants to implement the vision for each project. The company was also a pioneer of residential design guidelines in Australia, avoiding the monotonous appearance of many residential subdivisions and ensuring projects convey a unique sense of place.
Silkwood Rise, Intrapac’s first residential community
In the late 1980s, Silkwood Rise, located in Rowville, was one of Melbourne’s first projects to use extensive value-added landscaping, design guidelines, and covenants to maintain control over the built form. The early lots in the estate were divided into 2,000m2 lifestyle parcels, which differentiated the neighbourhood from the circa 750m2 lots that were prevalent in the market. Unique design features included extensive brick paving, heritage street lamps and planting mature trees. Architect-designed homes were constructed at the entry to the estate, which generated a prestigious perception.
Since then, Intrapac’s projects have attracted numerous industry awards, including 8 awards from the Urban Development Institute of Australia.
“I am incredibly proud of all of our completed projects, in particular, Somerfield, which transformed Keysborough South and won UDIA awards for Residential Development and Environmental Excellence and The Quay and Quay 2, which our industry peers also recognised with two UDIA awards.”
Somerfield transformed Keysborough South and won several awards.
A ‘sea change’ is coming
The company has gone on to consistently apply this considered approach. The team predicted the ‘sea change’ phenomenon, initially partnering with the established local McCann family to acquire and develop the family’s former farm in Torquay in 2001. Their now-completed Urban Development Institute of Australia award-winning projects, The Quay and Quay 2, house around 25% of the total population of Torquay.
The Quay was the first of a series of coastal acquisitions, with another four projects along the northern New South Wales and Southern Queensland coasts acquired in the years following, including Banyan Hill, Kingscoast, AUREUS and Terranora.
The Quay delivered an early example of a comprehensive approach to water-sensitive urban design. Quay 2 extended this approach and introduced greater housing diversity. The project showcases Avant Townhomes – a subsidiary of Intrapac Property – with a range of apartment and terrace home products that provide more affordable housing options and cater to a broader range of demographics than traditional housing lots.
The Quay and Quay 2 (pictured) now account for 25% of Torquay’s population.
On the horizon
The team at Intrapac currently has a pipeline of 20 projects, some actively trading and others working through the detailed planning phase. One of these projects is Kinley, the largest urban infill project in Victoria, on the 163Ha site of the former Lilydale Quarry, with a long-standing connection to the Mitchell family.
The project’s significance and complexity are emblematic of the expertise developed over the last 40 years and the potential of the Intrapac team moving forward.
Kinley involves a remediation exercise of colossal proportions. Intrapac Property and their development partners, Brencorp Property and Bayport, are substantially through filling the old quarry, which will take 7 years to complete. This and the historic aspects of the project were covered by The Monthly in 2018 Filling a big hole in the property market.
David has high aspirations for the project, “We want to make the Kinley development a landmark project that can sit comfortably on the world stage.”
CEO Maxwell Shifman echoes this sentiment, “Kinley is a once-in-a-lifetime project that has made us challenge ourselves with regard to what sort of place we want to create. It’s critical for the region, which hasn’t seen a lot of new housing for a long time. We’ve challenged ourselves to push the envelope on sustainability and are putting continual effort into the built form and the open space design. We intend to make it a beacon for the area.”
Kinley’s will deliver a world class vision including the redevelopment of the Heritage Quarter and transforming the old Cave Hill quarry into a vibrant community and open spaces.