From humble beginnings migrating to Melbourne from Italy at the age of four, Mario Salvo has come to be one of Australia’s most prominent & respected business identities. After many years in the automotive industry, Mario transitioned full-time into property creating the highly successful Salvo Property Group. Over the past decade SPG have developed in excess of 3,000 apartments with a market value of more than $1.5 billion. We recently sat down with this self-made success story to explore his 45+ years of experience and insights.
Development Ready: Thanks for joining us Mario – Now your entry into the property market has always interest-ed us, as it’s definitely one of the less-traditional jour-neys that we’ve come across; can you take us through it?
Mario Salvo: Well my journey starts with automobiles. When I was 16 I did my apprenticeship as a mechanic and it was during this time that I started buying and sell-ing cars. My brother was a panel beater so he would fix them and I would sell them. Business was going well and after some legislation changes we decided to buy a car yard in Coburg. The business grew and being good Italian boys, we weren’t blowing the cash – it was go-ing into investment properties.
After about 10-12 years we were making more mon-ey from the uplift of the property value than we were from cars, so I decided to “semi-retire”.
DR: Sounds like a pretty enviable position to be in.
MS: Well it turned out to be the most boring six-months of my life – I was 38! So, I started looking for some-thing else to do.
DR: And this is when you started in the car rental business?
MS: Yeah, I purchased a car rental business named Del-ta, which I came across in the Financial Review. Things were shaky at the start with around 150 old bombs – but I was quickly buying newer and better cars. Even-tually I expanded the business with different branches and took on some franchisees as well. Over the course of 16 years we went from 150 cars to over 7,000 vehi-cles. I was approached by Europcar to be an Asia Pacif-ic franchisee, which we agreed to and then they made me an offer to buy the business – it was too good to re-fuse, so I accepted and retired again.
DR: So, you had money, you had time, is this when you started in property development?
MS: Pretty much. Before the sale of Europcar I had been in the property development business but as a silent partner. We built the Franklin Lofts and the An-sett Tower, among others, but I was passive through it all. After my business partner and I parted ways, I con-tinued developing on my own.
DR: And was it at this point that you founded Salvo Property Group?
MS: Yes, my start in it all was quite interesting. I had this property that was on the corner of City Road and Clarendon Street in Southbank. I bought that site in the early 90s for around $300,000 and used it during the car rental days. In the early 2000s I received an offer from a gentleman to purchase it for $3 million, which I couldn’t say no to. He paid the deposit and secured a permit to develop a 30-storey building, but unfortu-nately couldn’t settle. Unfortunately for him, but fortu-nately for me, he lost the deposit and I gained a reval-ued site with an approved development permit. I then received a second offer for $3.5 million from new buy-ers who increased the permit to 33-levels, but they were unable to settle too.
At this stage, I’ve retired from car-rental and I was looking at the site and thought – how hard could prop-erty development be? So, I decided that this would be first one I would build on my own.
DR: You would have been one of the first in that South-bank area – was that a difficult position to be in?
MS: We were laughed at initially by agents who thought the area was un-sellable. But I put together a team and we sold out the building in three months. Then we bought the adjoining property, and the adjoining prop-INTERVIEW: MARIO SALVO
erty, and the adjoining property – now Southbank is a residential development hot spot.
DR: You’ve done a couple of projects in Southport on the Gold Coast and a couple in Sydney, but you’ve main-ly stuck to Southbank – why is that?
MS: If you’re finding gold nuggets in your backyard, why would you go hunting elsewhere? We know Southbank, our clients know us, we have local builders and it’s been working well. There’s great opportunities in Melbourne, so at this stage I don’t see much need to travel.
DR: Having experienced multiple successes across var-ious business, do you think there is a fundamental atti-tude that has helped you each time?
MS: My personal philosophy is that you can break suc-cess down into three equal parts; common-sense, balls and determination. You’ve got to have the brains to eval-uate the situation, the courage to take the risk and the willpower to get the job done.
DR: Do you think this applies all the time – or is it differ-ent during periods of weaker markets such as the 2008 GFC or the more dip?
MS: I’ve been in business for over 40 years and we’ve seen the economy rise and fall – but I’ve never felt any of them. When there are periods of adversity, I see op-portunity.
If you can buy the sites at a low price, you can pass the savings on to the purchaser. He who has the low-est overheads and therefore can be competitive, will al-ways survive and prosper in a weaker market. I’m not ever concerned; when it’s boom times we’ll do well, when it’s bad time we might even do better.
DR: And what’s your take on the market at the moment?
MS: We’ve got one under construction and one just launching – we’re selling quite well. But as I’ve said be-fore, it’s all about being competitive. It doesn’t matter if your business is a café, car rental or property, if you can give your customer more for the same price, you’re going to stay in business. Everything is in the buying, in the cost of goods sold. Do your research, find the right properties for the right price – I always say, look at 100 and buy one – if you stay competitive you’ll do well.
DR: Are there characteristics that you ensure are con-sistent across all your projects, or is each one treated completely different?
MS: The one thing that stays consistent is that we pur-sue quality amenities in each development. Our aim is to deliver value to the customer – and many develop-ers overlook the importance of this. They install slow lifts, low quality pools – why even bother. Of course, you need to be wise with your spending, but you need to focus on quality and delivering value.
DR: Do you have any grand plans for the future?
MS: No, my life has never been planned very far in the future. I didn’t plan to be a car-rental operator. I didn’t plan to be a property developer. Things just happen – but if you make the most of it and know your strengths, you can be successful.
DR: What did you identify as your strength?
MS: I think I’m good at finding the right people, who are good at what they do. You have to know your stuff, but no man is an island; it’s a team that gets things done.