A roof over your head

Thursday, 01 September 2022

Susan Muldowney

    When former commercial property executive Robert Pradolin GAICD woke up to Australia’s growing housing crisis, he decided to do something about it, founding the innovative Housing All Australians program.

    Every night across Australia, about one in 200 people lack a safe, stable or affordable place to sleep. Many stay in boarding houses that fall below minimum community standards for living. Some seek shelter in their car or have no option but to sleep rough on the streets. A third are aged under 18, but women aged 55 and over are the fastest-growing group to experience homelessness.

    So, is housing a human right? For Robert Pradolin GAICD, the question risks dividing the country along ideological lines, but he says there’s no time for debate. As founder and director of not-for-profit Housing All Australians (HAA), Pradolin is calling on business-led innovation to address the country’s chronic shortage of affordable housing and avert what he describes as an “intergenerational economic time bomb”.

    “We want to unite people on this issue, not divide them,” says Pradolin. “No-one has ever disagreed with me that housing is a fundamental human need — or that if that need is not met, the unintended human consequences have both social and economic impacts.”

    Counting the cost

    A new economic study, — Give Me Shelter — commissioned by HAA, shows decades of underinvestment by governments in “non-market” housing has led to social housing numbers falling to record lows — just four per cent of national housing stock, compared with six per cent in 1996. Prepared by SGS Economics and Planning, the study puts the long- term financial outlay of underproviding public, social and affordable housing at $25b per year by 2051 — and presents a business case for increasing the supply. Some businesses are already stepping up to address a housing shortage that is impacting their ability to attract and retain workers. Examples include the consortium behind the $120m Hotel Continental redevelopment on Victoria’s Mornington Peninsula — comprising the Trenerry Property, Victor Smorgon and Kanat groups — which has spent close to $10m converting a nearby vacant aged care facility into low-cost accommodation for hotel workers.

    While the Jobs and Skills Summit, to be held this month at Parliament House in Canberra, aims to develop strategies to address the country’s labour shortage, Pradolin says an important item may be missing from the agenda. “Yes, we need more immigration to help with the skills shortage, and the regions are crying out for more workers. But where is the housing they can afford? Are we creating another problem if we don’t think strategically about what workers need in terms of affordable rentals?”

    He says business must lead the housing discussion in the interest of Australia’s long-term future. “If this happens, government will want to be part of the conversation, and it will be an extremely different negotiation position if they approach us, rather than if we approach them. You can call that arrogance, but I call it strategy. We want government to approach us to collaborate, because we can’t afford to wait another decade and only see incremental change over that period. It requires a quantum leap in thinking if we’re going to solve this problem, and it will take 30–40 years to solve if we start today.”

    Confronting the issue

    A former general manager of Frasers Property Australia, Pradolin founded HAA in 2019 to facilitate private sector solutions to homelessness and to reposition the discussion with an economic lens. “Like most Australians, I just assumed that government was looking after the vulnerable members of our society, but it wasn’t,” says Pradolin. “In fact, we’ve gone backwards.”

    HAA draws on the pro bono services of corporates, including partners such as professional services network PwC, Quest Apartment Hotels and global law firm Norton Rose Fulbright, which aligns its skills and resources with the cause. Its board, state and territory management committee members and support staff all volunteer their time, and HAA recently reviewed its purpose, strategy and structure in order to maximise its impact (see breakout opposite). HAA’s work includes repurposing vacant buildings awaiting redevelopment to create pop-up shelters for people in need. Its first, The Lakehouse in South Melbourne, has housed more than 95 women with support from YWCA. A former aged care facility owned by CaSPA Care, the building had been vacant for more than two years and was earmarked for redevelopment. HAA negotiated a commercial lease at a peppercorn rent, Metricon partnered to provide building works, and Crowne Plaza, part of the InterContinental Hotels Group, donated the bedroom furniture from their hotel, which was undergoing refurbishment.

    HAA is currently working with Mercy Health to utilise an empty building acquired as part of a future expansion of the Mercy Hospital. Pradolin says HAA is talking to a potential NFP tenant that provides support to young people at risk. “Once the terms of the lease with Mercy Health are finalised, HAA will then refurbish the building, at no cost to either the owner or the NFP,” he says.

    Building supply

    HAA views safe, affordable and stable housing for all Australians as essential economic infrastructure — just like the provision of roads, schools or hospitals. Its economic report shows that tackling the lack of affordable rental accommodation would produce $2 of benefits for every $1 spent. This rate of return is higher than that of many major Australian infrastructure projects.

    HAA’s report also estimates it would cost about $55b to bridge the gap between “affordable rent” — below the international benchmark of 30 per cent of household income — and market rents. However, it notes that the benefits would be worth almost $110b, accrued through health cost savings, reduced domestic violence, reduced costs of crime, better education outcomes and higher productivity.

    Pradolin describes homelessness as the “canary in the coal mine” for a much greater issue with Australia housing continuum. “You’ll never solve homelessness unless you solve the upstream supply of subsidised or non-market housing,” he says.

    Along with its pop-up shelters, HAA is seeking to create financial mechanisms for private sector developments to provide affordable housing mixed with private rental. It’s also aiming to increase the supply of rental housing on government land via long-term lease agreements, rather than government selling the land to the private market.

    “During the recent federal election campaign, we saw both sides [of government] try to address housing affordability by offering different mechanisms for first home buyers,” says Pradolin. “Now, on face value, you might think that’s great, but the federal government does not control supply. So, all they’re doing is stoking demand without the pressure-relief valve of supply, because that rests with the states.”

    From a property development perspective, Pradolin says the lead time for additional housing supply is about five years. “Let’s go back to basics. If you’re starting a new mine in WA, for instance, what’s the first thing you do? You provide accommodation for the workers, otherwise you don’t get them to work,” he says. “But in a metropolis like Melbourne, the segmentation is blurred, and everyone thinks the market will solve the housing problem. It won’t, unless it’s economically viable.”

    Home Truths

    $25b Annual cost to community of failure to act on shelter needs by 2051

    -2.5% Drop in Australia’s stock of occupied social housing between 2001 and 2016 Census

    116,000 People experiencing homelessness in Australia on Census night 2016

    $110b Estimate benefits of providing adequate housing

    25% Growth in population between 2001 and 2016 Census

    Sources: Housing All Australians Give Me Shelter report, Australian Bureau of Statistics

    Creating respectful unrest

    HAA’s national objective is to educate people about the homelessness and housing space with the aim of stimulating what Pradolin describes as “respectful unrest”.

    “We’re not out to march in the streets. We’re from the private sector and we are politically agnostic. Our objective is to start a national barbecue conversation about this issue. We’re out to create respectful unrest by educating the Australian public and business about what they don’t know,” he says.

    “Once they are fully informed, then let democracy decide at the ballot box. Without respectful unrest, there will never be any political self-interest to enact for the long-term housing policy changes our country needs.”

    The sight of people sleeping rough on the street causes some to avert their gaze and others to take action. Louise Rutten MAICD is in the latter category. As co-founder and chair of Housing All Australians, she aims to lead a “strategic board” to help ensure everyone has a stable place to call home.

    “When you start any organisation, you need to bring together a board that’s competent, skills-based, has a collegiate style and is aligned in its values. We were supported by Adapt Executive Search, recruiting on this basis, and at the end of last year, we were really happy with our board appointments,” says Rutten, who has spent more than two decades working in business strategy and innovation, including as founder of strategy and transformation consulting practice Brains in a Jar.

    “We’d been in startup mode for a while and needed to take our time to make sure we got the right board members in place supported by the governance protocols we’d put in place earlier,” she says. “We’re still at the sleeves-rolled-up stage, but working towards being a solely strategic board.

    Framework for growth

    HAA has spent much of this year formalising and documenting its processes, using the people and culture skills of board member Julie Coleman GAICD to create structure around board recruitment and onboarding processes, and to formalise governance frameworks to support its growth.

    A former executive director of people and culture at Monash College, with more than three decades of experience implementing strategic people and organisational development solutions across a range of sectors, Coleman joined the board for similar reasons to Rutten. She was also alarmed to learn that women aged 55-plus are the fastest- growing cohort of homeless people.

    “I’m quite inspired by Finland’s ‘Housing First’ policy, which takes a holistic approach based on cooperation between the state, city councils and third-sector organisations,” she says. “HAA is doing something unique in terms of our economic study, because it provides a new platform for discussion with business, government and community housing and service providers so we can together come up with joint solutions.”

    Some existing HAA procedures were formalised, and new processes introduced. For instance, new frameworks were put in place for the expansion of its state management committees. Board members are now formally appointed through the AGM process. “If new directors come on through the year, it’s a casual appointment, then they’re elected formally at the AGM, so it’s all in line with the constitution and means there’s greater clarity,” says Coleman.

    “We now have position descriptions for every director role and have put delineation of responsibilities between the company secretary and the treasurer,” she says. “We’re also starting to look at how we track volunteer hours, which we’ll need to report on. This is also really important from a resourcing perspective.”

    Values in alignment

    In June this year, HAA held a strategy workshop where it re-established its values. Rutten explains that the first letter of each HAA value forms the word “unrest” — unity, respect, engagement, strength and transparency. “There’s not a single person in our organisation who doesn’t live and breathe those values, but sometimes we forget how to identify and name them,” she says. “Our strategic workshop brought them to life for everyone.”

    Bringing the board and statement management committees together allowed HAA to identify subject-matter experts and assisted in the creation of project groups to drive its three-year plan.

    “Prior to the workshop, everyone had a slightly different narrative for what HAA was or what we do,” says Coleman. “We had to pull it right back to say, OK, let’s be clear, our narrative is to achieve our vision, and our vision is an Australia where everyone has a stable place to call home, no matter if they’re rich or poor. To achieve our vision, we will focus on our key result areas for the next three years through demonstrating our HAA values of respectful unrest.”

    With the foundations in place for a strategic board, Rutten is turning her attention to succession. “When we first started recruiting for the federal board about two years ago, I was mindful to look at emerging leaders,” she says. “We didn’t have the state management committees in place, but I kept a list of people I thought would be fantastic on these committees and to build their experience to work towards being on the federal board.”

    The board has taken on a trainee company secretary. “He’s just done a double degree in financial planning and accounting, and has been wanting to work with HAA for a long time. I wanted to make sure we could give him the experience that would help him professionally and deliver a clear pathway in HAA, demonstrating succession planning at board level, creating an environment for the next generation to grow and learn and eventually lead. The company secretary is an incredibly valuable role and we wanted to invest time, energy and expertise in him personally and in the future of HAA. He’ll have clear KPIs to meet during his traineeship and will be undertaking AICD courses and upskilling. The plan is to give more young people exposure to being on a board, and do it in a meaningful way.”

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