Justin Arter, Chief Executive, Cbus Super
As part of the National Housing Accord, Cbus Super, Australia’s biggest blue collar superannuation fund, will commit up to $500 million over five years to assist the development of new social and affordable houses through the Housing Australia Future Fund (HAFF).
Cbus Super CEO Justin Arter stated that the fund is a pioneer in non-market housing financing, and that the fund’s commitment to the National Housing Accord is an extension of the fund’s leadership in the sector.
The news came after Treasurer Jim Chalmers hosted an Investors Roundtable in Sydney last Friday, which the Property Council attended.
The HAFF will be a $10 billion fund managed by the FutureFund, with investment returns coming to National Housing Finance and Investment Corporation (NHFIC) to finance the development of at least 30,000 social and affordable housing units over a five-year period.
“We have worked with the NHFIC since 2018 to help develop financing models that deliver for Cbus member returns and also deliver affordable financing for Community Housing Providers (CHPs),” Mr Arter said.
“NHFIC’s work has been an incredible success and we are determined to help supercharge the financing of new social and affordable housing across the country.
“Of course, Cbus Super’s commitment is subject to the finalisation of commercial terms for the HAFF, but we are confident of reaching terms that will be in the best financial interest of Cbus Super members while unleashing billions in new funding for community housing projects.”
Figures from the Industry Super Australia revealed industry funds are poised to invest $35 billion in unlisted property over the next decade, “if the right model is found there is a substantial capital pool to draw from for affordable housing”.
“With the right financial models and a steady pipeline of projects industry fund members get a low-risk investment that delivers secure returns even when the economic seas are rough, and thousands of Australian families get the quality affordable housing they need,” Industry Super Australia Deputy Chief Executive Matt Linden said.
The announcement from Cbus comes as Housing Minister Julie Collins unveiled in Parramatta last Friday an agreement between NHFIC and AXA IM Alts and community housing provider St George Community Housing (SGCH) to deliver 350 new affordable homes in Westmead.
Under the first step of a larger financing commitment, NHFIC will offer a loan of roughly $150 million with funds from AXA IM Alts acting on behalf of customers for the Westmead housing project. The homes provided under the agreement will be managed by SGCH.
Market and affordable build-to-rent houses will be among the new homes. The development is part of the new Westmead Health and Innovation Precinct, one of Australia’s major health, education, research, and training zones.
The new dwellings will feature affordable accommodation, aimed at critical hospital employees. Work is slated to begin early next year, with a completion date of 2025.
This is the first project with AXA IM Alts and SGCH as part of NHFIC’s larger $300 million finance commitment.
“This partnership is a wonderful example of leveraging government funding to attract institutional investment in affordable housing,” Minister Collins said.
“We want to see affordable housing where it’s needed, and more workers at the hospital will soon be able to live conveniently close to their place of work.
“The Australian Government will facilitate even more investments like this through the Housing Australia Future Fund and the new Housing Accord. It’s more important than ever that government, at all levels, and the private sector work together to address this housing crisis.”