You may have seen in the press recently that Mirvac has launched its ‘build-to-rent’ residential club by securing the Clean Energy Finance Corporation (CEFC) as its first investor. ‘Indigo’ will be located at Mirvac’s Pavilions project at Sydney Olympic Park.
Build-to-rent is similar to the multi-family housing concept that is popular in the US and Europe, where institutional investors hold large numbers of homes for long term rental. This is a new approach to home occupation. It is housing that is purpose-built specifically for long-term renters with management and leases centrally and professionally managed, typically with onsite support.
This concept has been slow to establish in Australia whether for home ownership cultural reasons, investor wariness or a host of other reasons. Yet experts say it only takes a few large projects to kick off the sector. This is probably becoming more likely with the changing housing affordability, population growth and a growth in renters.
Mirvac chief executive Susan Lloyd-Hurwitz has said “Renting has become a lifestyle choice for a much wider group of people. We believe build-to-rent can provide renters with better choice, better quality and better security of tenure”.
Melbourne property developer Salta Properties is also said to be developing its second build-to-rent residential property, a $390 million mixed use development in Richmond, next to its Victoria Gardens shopping centre.
Salta Properties managing director Sam Tarascio said the 426 apartments will be developed as “at market” build-to-rent products, despite a government push to for more affordable housing in the newly evolving space.
According to its press releases, Indigo will be Mirvac’s first purpose-built build-to-rent asset. CEFC’s involvement means the future homes will be green and sustainable. Indigo will be designed to achieve a minimum of 40 percent less greenhouse gas emissions than a typical apartment building. Other features will include upgraded glazing to improve the thermal performance, LED lighting throughout, energy-efficient appliances, solar PV and water-efficient taps, toilets and showers.