Works start on build-to-rent apartment project in Kensington
Work has begun to build a 362-apartment development in Kensington in what marks developer Assemble Communities’ first build-to-rent project as part of its bid to help address the housing crisis.
The development, at 402 Macaulay Rd, is also the first housing project to benefit from the state government’s Affordable Housing Investment Partnership, which is expected to support the financing of up to 6000 new social and affordable homes.
Through the initiative, which is being rolled out alongside the landmark Big Housing Build, a $32 million government loan will help build the Kensington project, including 73 social homes, 73 affordable, 14 specialist disability and 202 private market homes.
Backing the development is industry fund Hesta, which has committed more than $100 million. Hesta is also working with specialist affordable housing fund manager Super Housing Partnerships and Housing Choices Australia to deliver the project.
A sod ceremony for the development’s launch (pictured) was held on September 14 with now former Premier Daniel Andrews joining Minister for Housing Colin Brooks, and City of Melbourne Lord Mayor of Melbourne Sally Capp to celebrate the occasion.
Also present were Hesta CEO Debby Blakey, Super Housing Partnerships CEO Carolyn Viney, ANZ group executive Mark Whelan, and Housing Choices Australia CEO David Fischer.
Ms Blakey said the project showed the potential for the superannuation industry in helping address Australia’s housing crisis.
“Breaking ground on our inaugural build-to-rent project is a moment of great pride for HESTA and our partners,” Ms Blakey said.
This milestone propels us closer to realising our vision for how we as a long-term responsible investor can create strong, stable returns for our members by meeting Australia’s huge need for affordable and secure housing.
A build-to-rent model is when developers and their financiers build multi-unit buildings but instead of selling them, they retain them and rent the units to tenants.
However, as reported last year by North West City News, the development was met with criticism from Kensington residents when the proposal was endorsed by the City of Melbourne on October 18.
Residents said its size would be “far too big”, impacting the neighbourhood’s character and amenity while parking and traffic issues were “not considered properly”.
Under the proposal, the development would include four buildings between four and eight storeys high. They would also feature shops, a supermarket, a cafe, offices, and a ground floor community space.
Kensington Association spokesperson Simon Harvey said for residents’ single-storey homes immediately to the west of the site, “the development gives them no cause to celebrate”.
“Of course, the sod turning was symbolic of the state government’s Big Build, which on the surface is a positive i.e., providing homes for Victorians, including a significant proportion of affordable and disabled accessible homes,” he said, but added “unfortunately, behind the scenes there are other agendas.”
“The state government has begun to take more development control away from local councils on the premise that it is local councils and resident objections that are causing a lack of housing supply. This is simply not true.”
“The state government is not comprehensively dealing with other loose regulatory settings which have facilitated an increase in the cost of land and a decrease in the supply and quality of housing.”
Assemble managing director Kris Daff said 402 Macaulay Rd represented the results of “a strong collaboration across sectors”.
“These homes are a proof point for how together we can create impact into housing. Most critically they provide a diversity of housing options now, and for future generations.”
Hesta is expecting to invest potentially $240 million in a range of Super Housing Partnerships build-to-rent apartment projects. •
Caption: former Premier Daniel Andrews joining City of Melbourne Lord Mayor of Melbourne Sally Capp and other dignitaries at a sod turning event on September 14. Photo: Dijana Risteska.