On Tuesday 5 October 2021, Jonathan Callaghan joined Cromwell as its new Chief Executive Officer, following a distinguished and successful 15-year career at Investa Property Group. In this ‘In conversation’, we talk to Jonathan about his career so far, first impressions of Cromwell, views on the property market, leadership, as well as his passion for sustainability and love of the outdoors.

1. What’s your professional history?

I started my career as a lawyer and spent time at Gilbert + Tobin and Corrs Chambers Westgarth prior to joining Investa Property Group in 2006 as General Counsel and Company Secretary.

I wanted to get more involved in the broader commercial aspects of running a business, so completed a Master of Applied Finance. I subsequently became Investa’s Finance Director and Joint Managing Director before becoming CEO in 2016 after leading the successful sale of Investa’s office and land business.

While I very much enjoyed Investa, 15 years is a long time and I eventually felt as though I needed to take a break and do something different. I had a few months off after leaving Investa and joined Cromwell in early-October.

2. What attracted you to Cromwell?

I’ve always admired Cromwell. In particular, the entrepreneurial spirit and ‘can do’ attitude with which the business operates.

However, it seemed to have lost a little bit of focus recently, so when approached about the vacant CEO role, I thought it could be a great opportunity to help get it back on track and growing again. That’s exciting and ultimately what brought me here.

3. What are your first impressions of the business?

I’ve been deeply impressed by the quality and calibre of Cromwell’s people. This is not something you can generally see from outside a business, but everyone I’ve met so far has been warm and welcoming, and I’ve really enjoyed getting to know them.

4. What do you think is the biggest current issue facing real estate markets?

The threat of rising inflation. The inflationary warning bells have started sounding in the United States, Europe and now in Australia. Bond rates and the cost of capital are going up, and that’s ultimately going to put a strain on returns and downward pressure on valuations.

However, it’s difficult to know exactly when and by how much, and that will depend on whether or not the current inflationary spike turns out to be permanent or just temporary. My gut feeling is that the spike will be temporary, but you can never know for sure.

Regardless, the key to hedging inflation risk is to ensure your portfolio is comprised of well-specified, well-located stock suitable for modern tenant-customers. These assets will be more resilient in periods of higher inflation and better able to protect, create and grow income.

5. What real estate sector do you favour and why?

That’s an interesting question and it very much depends on your perspective and the cost of capital.

The logistics sector is obviously red hot off the back of the growth in e-commerce online sales and changes to supply chain management. Would I personally invest in a shed leased on a sub-4.0% yield? No, but it will make sense for some. Some additional repositioning or development activity might make it more worthwhile.

Retail is the flipside of the same e-commerce trend but I think the death of bricks and mortar retail has been overstated and omnichannel retail strategies are the way of the future. It feels like this is being recognised, and some recent improvements in some listed retail names in Australia and the US seem to suggest this may be the case.

Ultimately, office is where my heart is. The sector hasn’t been as hot as logistics or as cold as retail and has some obvious headwinds due to demand questions arising from the working-from-home phenomenon. While this will change the way in which tenants interact with their office space, I think overall it will have a marginal impact on demand, but it will take some time for this debate to be resolved. I firmly believe companies with operations will continue to require office space to meet, collaborate and create a sense of culture, a sense of identity. Offices are definitely not dead!

6. In your opinion, what will the office of the future look like?

I don’t think anyone truly knows what the future office looks like as it is continually evolving. Cromwell’s Head of Research, Tom Duncan, recently posted a short graphic illustrating this point, which I’ve reproduced below.


Following on from the pandemic some companies and their people discovered that it is possible to work from home effectively (it was not a secret to a lot of the more progressive companies…), but in the long run it is not the most efficient way to work. Businesses need to come together at some point to maximise productivity. That’s not to say we shouldn’t have flexibility, but if you have an established network in a business, know the strategy, the people and have ‘equity’ in your working relationships, flexible working is a lot easier. If you don’t have these advantages, particularly if you are new to a business, it’s a lot more difficult.

We are all social creatures and what makes a business more than the sum of its parts and creates culture is the ability of its people to interact, create and innovate. For most businesses, I believe this requires a level of personal interaction.

While I am not entirely sure what they will look like, I know that the office, the home of a business, will be important to any successful business strategy.

7. What do you believe are the characteristics of a good funds management business?

A good funds management business relies on great people and trust.

First, it’s hugely important to have a team comprised of great people working towards a clearly articulated strategy. Then, you have to always remember you are the custodians of other peoples’ money, and it is your responsibility to do everything for their benefit. It is vital to do what you say you are going to do and to be transparent – this builds trust and are the prerequisites for a successful business.

8. Where do you stand on the importance of ESG?

The property industry is responsible for about 40% of global carbon emissions and I believe we have an obligation to do everything we can to reduce this impact. I would like to see the industry, and Cromwell, be much more ambitious and proactive in this space.

This view is also supported by our investors, who are demanding a higher standard. Frankly, the companies that do not implement a sound environmental, social and governance (ESG) strategy will be left behind.

I must also stress that it’s not just about the ‘E’ or the ‘S’, but also the ‘G’ - governance. As I have said before, trust, transparency and authenticity are paramount.

If you don’t have these, investors will not invest with you.

9. What has been the biggest challenge of your career to date, and how did you overcome it?

The Global Financial Crisis. Investa found itself highly leveraged with falling asset values and the banks knocking on the door. It was a very confronting situation.

We were upfront, honest and transparent about what we could do and the next five years became a bank workout. We got there in the end and I believe our success was off the back of this authenticity.

10. What’s your leadership philosophy?

I enjoy being part of a team. As CEO, a certain amount of decision-making comes with the role, but I don’t have the answer to every single question. That’s why I see myself very much as a team leader, with the emphasis on ‘team’. This allows me to interact with people, talk through issues and appreciate different perspectives.

11. What’s the biggest thing you hope to accomplish at Cromwell?

Quite simply, I would like Cromwell to articulate a clear strategy and then be known for successfully doing exactly what we say we will do. Ultimately, that’s what builds your brand and reputation with the market, investors and capital partners.

12. Finally, what are your interests and hobbies outside of work?

Outside of work my focus is family. I believe in work-life balance and keep weekends free for both my immediate and extended family. I have two teenage boys so that means a lot of activity! We typically spend our free time in and around the water, on the beach, swimming, sailing, and surfing.

Apart from that, I’m a rugby tragic and will watch any union or league match, anywhere, anytime!