A 500-apartment development in Melbourne's inner west will be the first project for a new build-to-rent platform funded by Macquarie Asset Management and launched by two property executives.
Grocon’s former head of development Matt Berg and former transaction manager Dan McLennan are behind the venture, Local, which has secured $500 million funding for its future projects.
The first project, at a previously secured site Kensington, is in the planning phase and is expected to be delivered by 2024.
The project is specifically aimed at three groups; key workers such as nurses and hospitality workers, people living with a disability and women aged over 55 who are at risk of homelessness.
The lack of affordability for housing and the rise of build-to-rent has been pronounced during the pandemic.
While house prices have increased 21.6 per cent in the past year, renting has become more attractive for many Australians.
In what has been described as a breakthrough year, build-to-rent has taken off here on the back of the United Kingdom’s $18-billion boom, with multiple projects in the works across the Australia.
In the past three months, planned projects have included Pellicano’s multiple city sites, Samma Property Group’s Dockland project, Aware Super and Altis’ hotel conversion as well as US property giant Greystar’s double towers.
Macquarie global real estate chief information officer Jelte Bakker said that globally they were seeing an evolution in tenant demand.
“We strongly support the build-to-rent sector in various parts of the world and believe it has significant potential to grow in scale in Australia, driven by demographics including a growing renting population,” Bakker said.
“Globally we are seeing changing demographics and an increased focus on sustainability driving an evolution in tenant demand.
“We believe Local is well placed to deliver a great living experience for the increasing number of Australians who rent.”
Local co-chief executive Matt Berg said there was a real gap in the market for a platform to deliver quality returns while embracing inclusion and sustainability.
“We’ve been involved in build-to-rent housing and adjacent sectors for several years and we’re excited about the vision of providing a better rental experience for renters,” Berg said
“Our ambition is to provide positive and sustainable outcomes for our residents and communities that incorporates wellbeing, customer service, flexibility and security of tenure.”
Local co-chief executive Dan McLennan said there was huge untapped potential in these apartments to achieve net zero operational emissions.
“For us, a strong focus on environmentally sustainable design will deliver a better longer term income stream, future proof our assets and offer a genuine alignment with the values of our investors, customers, and staff,” McLennan said.
