Learning from the Rich

The Australian has just released its annual Rich List, which ranks the 250 Richest Australians.
 
The much-anticipated list landed late last week, revealing that the top 159 richest Australians are billionaires, and the entry-level wealth of those cashed-up Aussies was a whopping $590 million.
 
Not bad for a little country of 26 million people, huh?
 
While the list itself is interesting, what is more interesting to me is how these Australians made their money.
 
Well, let me tell you – one in three of the 250 richest Australians made their wealth through property investment.
 
Interestingly, just under half of these made their initial money elsewhere but amassed the bulk of their fortune through property.
 
Harry Triguboff (5^th richest) made his initial wealth in textiles before turning it into $26 billion by becoming the country’s biggest private landlord.
 
Lang Walker (17^th wealthiest) made his initial wealth in earthmoving before amassing the majority of his $6 billion thanks to property investment.
 
Frank Lowy (12) and John Gandel (18) are worth $10 billion and $5 billion respectively, not so much because of their shopping centre empires, but more because of owning the land their shopping centres are built on.
 
The duo behind United Petroleum, Eddie Hirsch (23) and Avi Silver (24), are among Australia’s billionaire set, not because of their service station empire, but rather the land on which their businesses operate.
 
Spotlight Group owners Morry & Zac Fried (34/35), along with Harvey Norman boss Gerry Harvey (50), made the bulk of their billions because they own the land on which their retail empires operate.
 
A quarter of the ‘Richest 250 Australians’ amassed their wealth through mining and agriculture – which could technically also be classified as property because without the land there are no mining royalties or agriculture to grow and sell.
 
So, if you’re picking up what I’m putting down, you’ll see that when forensically drilling down on the detail three out of every five Australians on this list made their wealth from property and businesses connected to property.
 
Then some make their fortunes elsewhere but seem to pile that money into property as a means of preserving and keeping their wealth.
 
We all know there are a multitude of ways to drive wealth, which can be seen when we consider that more than 10 different industries account for the top 250.
 
But for mine, property makes the most sense. If it’s good enough for the richest Australians, it’s good enough for me.