Two inner south Melbourne sites are set to make way for Build to Rent projects.
At Southbank, Investa and Oxford – via their recently launched BTR platform, Indi – will team with land owner PDG to replace an 1834 square metre slice of the ex-JH Boyd Girls School with a 42 level complex containing 434 dwellings.
At 132-136 Kavanagh Street, abutting Kings Way, the proposal follows several incarnations; in 2019 the parcel was mooted for a $200 million, 32 storey tower with 216 apartments and a hotel.
A revised plan, lodged with council last year, dropped the guesthouse component, upped the height by 10 floors and sought 394 flats, the bulk (73 per cent) of which would be studios and one bedrooms.
The newest design, with 40 units allocated for social housing, carries a $350m end value.
“PDG is proud to be partnering with Oxford and Indi on this exciting BTR offering as developer and delivery partner,” PDG founder and managing director Vince Giuliano said.
“We look forward to delivering a high quality finished product that will set a new benchmark for modern apartment living in the highly coveted Southbank market,” he added.
PDG paid $16.5m for the ex-JH Boyd Girls School in 2018, later converting a historic building fronting City Rd with a community hub.
That seller, the City of Melbourne, acquired the parcel from the state government for $10.5m in 2007.
The Investa/Oxford deal comes two and a half years since PDG sold a 38-storey BTR complex with 490 flats near the Queen Victoria Market to Mirvac for $335.5m on a funds-through basis.
Indi on track to manage 5000 flats
Including the Southbank tower, Indi will hold 1370 Australian units spread across Sydney and Melbourne.
“The Kavanagh St acquisition grows our pipeline and builds economies of scale for the…platform,” Indi fund manager James Greener said.
“The acquisition offers an attractive risk adjusted return with significant upside, supported by strong demographic and demand fundamentals,” he added.
Construction will start in the second half of 2022 and take two years (story continues below).
Indi is earmarked to control 5000 Australian flats including 702 on a Footscray site its parents picked up last year, also due for completion in 2024.
Australia a key market: Oxford
Oxford is the real estate arm of Toronto pension fund OMERS.
“Oxford…owns and operates an extensive apartment portfolio across North America, with a development pipeline of approximately 15,000 units,” head of Australia, Alec Harper, said.
“It is a co-owner of Get Living, a leading UK BTR platform, which owns approximately 3000 operational units with a pipeline of a further 5000,” he added.
“Growing our exposure to the Australian BTR sector represents one of Oxford’s highest conviction investment strategies,” according to the executive.
“We are combining our capital and global experience of investing in, growing and delivering BTR businesses and development projects to create new supply and improving housing choice”.
Gurner moves on St Kilda Junction site
Meanwhile, at St Kilda, Gurner and Qualitas are moving ahead with plans to replace 8-12 Punt Road and 1-7 Wellington St with a $300m BTR complex with two towers of 12 and 28 storeys, being marketed as Beach House.
Lodged with City of Port Phillip last year, the investment will contain 300 dwellings – 53 studios and 139 with one bedroom – 230 car parks and a bar on the rooftop of the tallest building.
The bulk of the 2353 sqm site fronts Queens Way/Dandenong Road.
The partners recently raised $1.2 billion to fund BTR projects; last month they purchased a Parramatta site with plans for a 61 level complex with 385 dwellings.
Gurner acquired its interest in the St Kilda property from LAS Group which, with Qualitas, initially planned to replace the block with a traditional residential complex.
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