Business Now Interview - Steve Mercieca
A risk taker by nature, Steve constantly promotes doing things differently and encourages his team to enjoy life and whatever they do on a daily basis. To remind himself of this, Steve wears unpaired socks every day and brushes his teeth with his passive hand. Steve is married to Zanna and is the father to gorgeous daughters India and Lyla.
How has the past year, post-COVID-19, impacted your business and your team?
Following an initial shock to the real estate market during the pandemic, careful planning and fiscal incentives helped the real estate market bounce back to the extent that it exceeded pre-COVID performance levels. This came as a breath of fresh air considering real estate agents did not make the cut in receiving individual support (wage supplement) from the government. However, we've always been an industry of hard workers and hustlers, so when the incentives were presented to us, we worked harder to recuperate the lost ground. We invested heavily in new tech and training to be sure we came out of the curve quickly and on top. Once we started seeing light at the end of the tunnel, we started to feel the pressures the pandemic left behind on an international level and soaring prices. If this was sufficient, the war between Russia and Ukraine brought along new pressures. The cost of raw materials shot up and disposable incomes felt the crunch. This, coupled with a strong performance in the previous year, resulted in a slower-than-average sales level in real estate, which in turn affected my team. Needless to say, the international climate and financial challenges left people mentally tired which requires more physical effort to get things done. Thankfully, Malta's extra boost of sunshine and sociable life helped with softening the blow.
Which of the following has been the most challenging and why: inflation, supply chain issues, global energy crisis, rising salaries and cost-cutting in public spending?
Inflation and supply chain issues are surely the top culprits. Malta's average rate of completing construction work is infamously slow. As mentioned before, the average cost of raw materials in the construction industry rose by 20 to 30%. If you also take into account the inflation rate of other goods, this leaves a lot of extra money leaving people's pockets. Despite Malta's inflation rate being amongst the lowest in the EU, salaries did not catch up with these increases which impact people's affordability and disposable income, which is the main determinant factor for banks to approve credit. New policies by the central bank have made it even harder for second time buyers, however Malta's home ownership culture has still thrived with over 80% of Maltese owning their own home.
How do you see 2023 play out in this regard?
Despite Malta being small, it is nonetheless connected to the international sphere. We are Maltese but also European. We live in a connected world. Historically, Malta has always performed well in comparison to other countries in challenging times and I am confident we will manage through the next 18 months, which are believed will be the most challenging, especially with the fluidity of the Russian-Ukrainian conflict. This is a test of resilience and Malta has a strong track record on the matter. I believe the key is not to be complacent or underestimate the situation as well as to focus on what's within our control and what isn't. Understanding a period of additional grit and determination is required as well as the need of making smarter choices is one of those things within our control.
Looking ahead, how do you plan to meet the challenges?
By simply going back to the roots of what made our company Malta's real estate agency and be diverse, innovative and purposeful. More than ever, observing the changing landscape and how people, including our clients, are responding to it is essential. Continuously, the role that data plays in our decisions is increasing. This is accentuated by the fact people need us to be more efficient, understand their needs faster and be available to fit into their busy lives, possibly more technologically than before. We must truly believe in a greater PropTech proposition. The market is changing. We must understand it. Our clients and their needs are changing. We must understand it. Society is changing. We must understand it. Our relationship with our team is changing. We must understand it. Whilst cultivating what is within the box, we must also make decisions which are innovative, diverse and purposeful.
What do you have planned for your business?
Like all companies we have a firm 5 year vision for the group and the key people in our organisation. Without going into too much detail, we plan to focus more on PEOPLE. No one is connected to the market and to our clients as much as our Property Specialists and Administration Team. Circular, versus vertical, decisions continue to be the best way forward. Listening more and doing more based on what we heard is surely a key to success. I'm all for reports and research and analysis but numbers don't mean much if we disconnected from the ones to contribute to those figures. If you really want to know the market and know your clients, feel the pulse of your people. On an international level we are trying to penetrate the Spanish and Cypriot market by trying different models in different jurisdictions. We have launched a new company and partnered up with Jack Cator, a genius in the tech world and we've raised a seven figure investment for our international ambitions. We've learnt a lot along the way and this has given us massive experience and intel on the Real Estate Brokerage world. We are super excited to see what the next few years have to offer.
What opportunities do you think will present themselves in 2023 for your business, your industry, and the Maltese economy?
If all involved stakeholders come together as one, the Maltese economy has a chance to once again outshine larger countries in navigating through these tempestuous times. A stronger stand on the environment, I believe it is high time to change the planning policies to have a more holistic and long term vision for the island. Further digitization to reduce bureaucracy which will attract stronger talent to Malta which usually brings along higher salaries which are consumed in the economy. This will also result in the Maltese up our game on education as well as research and development from which current and future generations can thrive from. Improved employment opportunities for locals and expats, create a multiplier effect such as the need for better-quality rentals, an increase in buy-to-let properties and improved design in construction.