As Australia faces a critical housing shortage, two NAB-backed Melbourne-based enterprises – commercial builder Hacer and developer Local: Residential – have embarked on a collaborative venture.
Supported by NAB, the companies are spearheading a build-to-rent residential project in Kensington, aiming to provide more accessible rental options to the community.
The build-to-rent model, which has seen success in the UK, US, and Canada, focuses on developing properties specifically for the rental market rather than sale to individual buyers. This approach is gaining traction in Australia as a viable solution to the housing affordability crisis.
NAB CEO Andrew Irvine (pictured above) expressed his enthusiasm for the project.
“Simply put, housing is one of Australia’s biggest issues, and one of our biggest opportunities,” Irvine said.
Scheduled to house more than 800 residents across six buildings with 477 apartments starting August this year, the Kensington project exemplifies Local: Residential’s commitment to community-aligned values.
“At a time when housing affordability and rental increases are incredibly difficult, Kensington is a suburb very aligned with our values,” said Matt Berg, co-founder and Co-CEO of Local: Residential.
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Local: Residential aims to rectify the prevalent issues in the Australian rental market, including poor customer service and inadequate maintenance.
“The existing rental market in Australia is broken,” Berg said.
The company’s build-to-rent model not only aims to provide superior tenant services quickly and effectively but also offers stability with lease options ranging from one to five years.
A significant aspect of Local: Residential’s mission is to provide impact housing, which encompasses affordable housing for key workers, social housing, and specialist disability accommodations.
“Affordable housing is key worker housing. It’s for people on low to moderate incomes who need to live close to the city for their jobs,” Berg said.
The UK’s build-to-rent sector serves as a proof of concept, demonstrating the potential benefits and success of this housing model.
Jennie Fojtik, head of operations at Local: Residential, pointed out that renting in the UK has transformed from a necessity to a choice, thanks to the build-to-rent model.
“Build-to-rent shows renting doesn’t have to be a second-rate option,” Fotjik said. “We can create homes for people to be proud of.”
NAB’s support has been instrumental from the inception of Local: Residential.
“NAB did a lot of research to understand the drivers behind it, why it will succeed in the Australian market, why it’s needed but also why our particular brand of build-to-rent is something they wanted to align themselves with,” Berg said.
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