Bringing build-to-rent to Canberra
The Property Council’s ACT executive director, Adina Cirson, hosted a build-to-rent panel discussion in Canberra last week, and says there is significant interest in the model in the nation’s capital.
“In a market with some of the highest median rents, highest wages, and lowest rental vacancy rates, rental product is in hot demand.”
Cirson says build-to-rent is an attractive option for both young and ageing populations. “But we need to make sure we have the right policy and taxation settings to make build-to-rent stack up.”
Build-to-rent – which refers to multi-unit residential buildings owned by a single entity – is a “potential game changer” that could resolve Australia’s housing affordability challenge, Cirson adds.
Many of Australia’s largest property companies have been looking at the emerging asset class, which accounts for up to a quarter of the AUD$2.5 trillion in institutional property investment in the United States.
Built-to-rent, often referred to as “multi-family” is a long-established asset class in the United States, and is gaining favour in the United Kingdom. The US multi-family model, for example, is centred on short-term leases, primarily of six to 12 months in length. Other markets, such as the Netherlands, Germany and Denmark offer infinite leases.
Speaking at the event, Dan Batterton, Legal & General’s fund manager for build-to-rent argued that “a focus on long-term income means a focus on the resident”.
He said the benefits of build-to-rent were far reaching and included additional housing supply and greater speed of delivery and occupancy, improved rental standards, and event stability to development and construction industry.
Build-to-rent can support more affordable and accessible housing, offers a more efficient use of land and can be a catalyst for regeneration, Batterton told the audience.
Batterton’s presentation is available for download. Or download Adina Cirson’s build-to-rent podcast on Radio 2CC.