Dutch public pension fund manager APG and Ivanhoé Cambridge, the real estate arm of Canada’s CDPQ, have backed Australia’s biggest ever build-to-rent real estate fund.
Greystar’s US$1 billion Australia Multifamily Venture I fund has been seeded with two BTR projects set to start up in Melbourne this year, which will develop at least 1,300 rental homes. The long-term objective is to exceed 5,000 homes. Currently at a nascent stage, the sector is set to grow fast over coming years, assisted by changes to the land treatment tax.
State-owned investors have been piling into the Australian real estate market in recent years with US$18 billion invested since 2016, according to Global SWF data. Annual investment peaked at US$4.7 billion in 2019, but fell by around 30% last year to US$3.3 billion as the pandemic shook the market.
Attention has been focused on office towers and shopping malls, but 2020 saw a shift in emphasis with a move towards diversification. Logistics assets featured strongly, totalling US$940 million of SOI allocations to real estate – 29% of the total.
The real estate arm of Canadian public pension fund OMERS, Oxford Properties, also made a foray into the BTR segment in 2020 with a US$335 million investment in at site in Footscray, Melbourne which will comprise 700 apartments on a 7,000 square metre site. It is also developing a 39-storey BTR residential tower, the first of two towers for the Sydney Metro Pitt Street over-station development with 234 apartments. Oxford entered the Australian market in late 2018 with its $4.5 billion takeover of Investa office fund. The other tower is set to comprise offices.