Make Ventures has bought a Toyota dealership site in Preston in Melbourne’s north from McMillan Property Group for $40 million with plans to develop a build-to-rent (BTR) property.
The 1.6-hectare site is located at 687-717 High St, 19 Regent St and 58-60 William St, and will be developed by Assemble Communities into a mixed-precinct with about 500 BTR units and 5,000 sqm of commercial space.
The transaction comes after Altis Property Partners and Aware Super also bought a commercial building in Preston for $14.04 million this week with plans to develop a BTR property.
The property will remain under a long-term lease agreement with Eagers Automotive, with settlement anticipated for late 2024.
The deal marks the second site acquired by Make Ventures and to be developed by Assemble in Preston with a 459-dwelling development on St Georges Rd.
They also have projects at Sydney Rd, Coburg and 4 Ballarat St, Brunswick in Melbourne’s inner north.
“The future community will enjoy access to key health, education and employment areas, while being surrounded by established quality high-streets and transport nodes including the future Suburban Rail Loop Reservoir station,” Assemble Managing Director Kris Daff said.
“With three existing developments in Victorian’s inner-city northern corridor alone, this acquisition paves the way for the business to grow our affordable housing offering. This is a strategic investment, part of our long-term warehousing strategy.”
The deal will bolster Assemble’s $3 billion privately funded social and affordable rental housing portfolio, which includes an existing pipeline with 5,000 dwellings.
In other BTR news, Oxford Properties and Indi acquired a new Build-to-Rent (BTR) development in Melbourne’s Southbank last December, while Gurner and Qualitas unveiled a new BTR project in St Kilda.
Last November, Macquarie Asset Management announced that it was funding Local’s first BTR asset, a 500-apartment project at Kensington in Melbourne’s inner north-west.
New Savills research has found that nearly 70% of local government areas across Australia’s five major capital cities were in need of rental homes.
The Savills research team suggested that the current undersupply of rental homes could present opportunities for BTR investors and developers.
The report found that 2021 annual new apartment completions were down 30% compared to September 2017 with falls expected to continue into 2022 and 2023.
However, more than 5,000 BTR apartments were currently under construction, with 2,300 forecast to be completed in 2022.
Savills analysis predicted that there would be more than 10,500 BTR apartments delivered in 2024, the largest annual delivery of BTR homes to date.
The 2024 BTR stock delivery would coincide with forecast record highs in immigration, while new completions of residential stock would be at its lowest point since 2014.