Hines picks up third Australian BTR block

The South Melbourne site will make way for Hines’ biggest Australian Build to Rent project.

Hines has acquired its priciest Australian Build to Rent site yet, at South Melbourne.

The 3366 square metre parcel covering 15-37 Bank Street is setting the New York based investor and fund manager back c$40 million.

The asset was picked up in two parts – #15-33, covering 2874 sqm (pictured, top), which China backed developer Ousia listed last June, and #35-37, which happened to be for sale off-market at the time.

Hines intends to construct about 400 units on the holding (artist’s impression of proposal, right) – almost half the (c850) BTR dwellings in its Australian development pipeline.

The Brunswick property sold permit-ready for a high density project.

The group entered the local market with the 2019 purchase of a Collingwood site for an uber-green office, now being marketed for pre-lease.

Last month, it made its maiden industrial acquisition here – a $211m portfolio with four east coast warehouses.

Third BTR site in nine months

The South Melbourne deal comes nine months since Hines paid $16.5m for its first Australian BTR block – 10 Ballarat St, in Melbourne’s inner north Brunswick; on 4247 sqm, it is earmarked for about 230 dwellings

In February, the investor spent c$30m for a second – 36-58 Macaulay Rd, North Melbourne.

Covering 3068 sqm opposite Arden Oval and a major urban renewal precinct, this parcel was offered permit-ready for a 220-unit project which will proceed.

Other cities on the radar: Hines

Despite the Victorian focus, Hines is chasing interstate sites for this product – specifically in Brisbane, Canberra and Sydney.

“Australian BTR is a key strategic growth market for our firm and investors,” Sam Bisla, head of the company’s local Living division, said.

“Our global expertise coupled with local track record in residential and BTR development operations and investment management has allowed us to secure a portfolio of over 850 BTR units with an end value of approximately $820m,” he added (story continues below).

Greystar is proposing 722 units within three towers at 15-85 Gladstone Street, South Melbourne.

The Bank St amalgamation is walking distance to the Royal Botanic Gardens and South Melbourne Market.

“Already well serviced by transportation, this acquisition will be further enhanced with the expected 2025 opening of the Anzac metro station, providing direct access to the CBD and beyond,” according to the buyer.

“We believe this project is well positioned to benefit from the return of population and jobs growth in Melbourne and the shortage of quality rental housing in this location”.

South Melbourne a BTR hub

Ousia paid $30m for its Bank St holding in November, 2015; with a multi-level car park and low-rise offices, it was listed with a scheme but not a permit for a mixed-use project; Tiga Commercial’s David Sia, Nicholas Hii and Martin Leong were the agents.

The vendor of #35-37 held since 2007.

Elsewhere in Melbourne’s inner south, Investa, Oxford and PDG recently formed a partnership to deliver a 42 storey, 434-unit BTR complex on a slice of the ex-JH Boyd Girls School site at 132-136 Kavnagh St, Southbank.

Near there, the state government last November sold a 4509 sqm parcel at 194-206 Lorimer St, Docklands, to Samma Property Group and Brightlight, which are planning c300 flats of this type, in a 30 level tower.

Gurner and Qualitas are also constructing a BTR asset with 300 dwellings at the St Kilda Junction, not far from a Queens Rd ex-hotel, which Aware Super and Altis Property Partners purchased last year for one.

Charleston’s Greystar is behind South Melbourne’s biggest project of this kind – containing 722 units in three skyscrapers at 15-85 Gladstone St.

Earlier this month, Grocon’s Home division – backed by Singapore sovereign wealth fund GIC – opened its first Australian BTR project, again in South Melbourne, on City Rd.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.