Real estate

The Interview: The owner of Fernleigh Grand Estate, on building a landmark equestrian property

The owner of Fernleigh Grand Estate – a landmark 300-acre property on the outskirts of Sydney, newly listed for sale talks us through its evolution over the last 20 years, from the acquisition of 14 titles to black swans, Blue Mountain sunsets, and hosting the World Polo Championships.

Boulevard: What attracted you to the property in the first place?

Mr FO: It should be said from the outset that this property didn’t exist – you can’t just find a property like this. You’ve got to create it. And that’s what we did, over 20 years. It’s a real jewel.

My wife and I accumulated a number of properties, 14 titles in total, and put them all together, with three street frontages and a waterfront, being the river varying from a turf farm and a milking dairy to having horse studs, cattle pastures. We acquired all these properties because we wanted to own the 35-acre lake, which is in the middle of the property.

So we then went and set about creating a master plan and we put all the roads and the fences through. We spent four years building onto and into the existing assets and infrastructure, which was the milking sheds and the feedlots that were there.

We converted them to assets like stables, a barn, the private bar area plus the kitchen and so forth and so on. Then, we renovated the major farmhouse. And all the while we created plantings and ended up planting 14,000 trees. We’ve still got a nursery on the property, which has 40,000 plants on it.

So there was no opportunity to just go there and say, ‘Hey, this property looks great, we’ll buy it.’ We wish there was, but there wasn’t. There’s nothing like it. This is why it’s such a jaw-dropping asset. People get here and two things are really apparent: one is the beauty of it; the second is how close it is to the city. It’s right on the doorstep of the Sydney metropolitan area.

There’s nothing like it. The feedback that we often receive is how beautiful the wildlife and natural habitat reserve is. There’s been over 145 different species of birds identified there over the years. Because they’ve been recorded by the Cumberland Bird Watchers Society.

They’re all habitating on our lake, which is named Lake Fernleigh. That’s where the property gets its name. There are birds that migrate from Siberia to the lake every year. There are black swans and pelicans, as well. There’s thousands of birds there. It’s just unbelievable. It’s like our own private wildlife sanctuary.

Blvd: Besides the headline inclusions of the property, what have been some of the special moments here? What’s the character of the estate?

FO: It’s interesting. It’s got all four seasons. It can be snowing up on the mountain because it’s the base of the Blue Mountains. And, I’m not going to lie to you, it can be stinking bloody hot in the summer. When the leaves in autumn change colour, it’s dramatic. Come winter, we’ve got a mix of deciduous and non-deciduous trees. It’s very stark with a lot of trees there with no leaves on them. Come spring, boom, leaves come out. The cherry blossoms come out.

Personally, my favourite moment… as much as I love the early mornings with the fog coming through, I prefer the sunsets over the lake. So I sit over by the lake, have a glass of wine or too many, and watch the sunset over the Blue Mountains. I almost want to put that in the contract: ‘Let me come back for a bottle of wine every now and then.’

Blvd: What sort of potential does the property have? What do you think the scope of it is?

FO: It’s really diverse. The opportunities are quite significant. First and foremost, a high net worth family could never find a better asset from the point of view of proximity to the biggest city in Australia, as well as its privacy. If you wanted to bring children up riding horses and quad bikes and motorbikes, and canoeing and kayaking and swimming, and all that kind of stuff, you’ll never find a better spot.

Economically, Sydney is the city that, for the last 100 years, has outperformed every other city year on year in regard to land capital appreciation growth. And the fact that we’re in the Sydney metropolitan area, it’s nice to have an emotional asset that can be supported economically. It also has passive income: it sells turf wholesale, it sells plants wholesale. It also does some movie shoots and things of that nature – movies like The Great Gatsby, for instance, its opening scene was shot at the property. Peter Rabbit 2 was filmed there, as well.

The big factor which would drive someone to buy this from a financial point of view, if they were looking to land bank it, is that it’s currently priced so cheaply because it’s floodland. If it was not floodland, it would be worth many hundreds of millions of dollars. The reality of it potentially not being floodland within the next 10 to 20 years is high.

The driving factor here is whether the Warragamba Dam wall gets raised. Then all the land in the area where we are and all the supporting suburbs and so forth would never flood. The Gillard government, going back a decade or so now, said that they would raise the dam wall. It didn’t happen. Two years ago, Dominic Perrotet’s state government said they will raise the dam wall. Then the new government came in and they haven’t done anything about it.

It’s not a question of whether or not the wall will be raised, it’s more of a question of when. If you’ve got some patient capital, you’re going to get ten times your investment. But even if it doesn’t go ahead, you still have the appreciation benefits from being in Sydney. So either way, you’re in a no-lose situation. Any running costs for the property are completely covered – it’s only got two staff on it, so it’s low maintenance, low overhead.

Blvd: In terms of development potential, is there a sort of scope for residential, hospitality or resorts? What’s the opportunity?

FO: You’d have to do what everyone has to do, which is to go through the Department of Planning. It’s allowable to do so many different things. You can have a restaurant or restaurants.There’s already accommodation for houses, and you can expand each house and make them larger. Would you run it as a hotel? No, t it would probably be a challenge to get it through, simply because there is currently the risk of flood.

But you can have private corporate events and those kinds of things, that’s something we already do here. We’ve launched a lot of motor vehicles there – such as the Bentley GTC. Many of them are all-day hospitality events. Weddings and functions are permissible.

As far as how to commercialise it, there’s 38 stables there – for horseriders, it’s one of those places where people could go on weekends or midweek, and it becomes their life. There’s a big opportunity to create income that way.

There’s also cattle. We buy and sell cattle all the time and make hundreds of thousands from that.

Blvd: You’ve also had some quite significant equestrian events as well, haven’t you?

FO: We ran the National Showjumping Championships for about 10 years there. We hosted the World Polo Championships in 2017 there and it was regarded as the best polo event ever. I was made an ambassador by the Federation of International Polo.

Blvd: Can you talk us through the estate’s international appeal as a landmark Australian property?

FO: It is an incredibly international property. We’ve had so many people from so many countries there, who have said to us, ‘I’ve never seen anything like this. Where did you get all these ideas from?’ And I tell them that I stole them, you know? Just go to Dubai or to Florida or Argentina or South Africa, and cherry pick. I even got inspiration from London. The stables are all copies of the Queen’s box for her horses. It has all these ideas from around the world, and we put them all together.

It’s got a real wow factor to it.

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