ART makes first major move into build-to-rent housing

Australia’s second-largest super fund has made its first domestic build-to-rent investment, adding more than 2,000 apartments across major capitals to its portfolio.Australian Retirement Trust (ART) has entered Australia’s build-to-rent market for the first time, investing in the $1.7 billion LIV Mirvac Fund, which owns about 2,200 apartments across Brisbane, Sydney and Melbourne.

ART general manager mid-risk assets and UK, Michael Weaver, said the fund had been assessing opportunities in the sector for some time, drawing on its existing exposure to build-to-rent in the United States before settling on the Mirvac partnership.

“Australian Retirement Trust is incredibly excited to be making our first investment in a build to rent portfolio here in Australia,” Weaver said.

He said the LIV Mirvac Fund offered ART immediate access to five operational properties across Australia, including sites at Newstead in Brisbane, Olympic Park in Sydney, and the CBD and Brunswick in Melbourne.

“Broadly speaking, the majority of the portfolio is stabilised with positive cash flow, which makes them an attractive proposition for a large, long-term investor like ART.

“Our previous partnerships with Mirvac on a number of successful projects underpin our confidence given their track record and professionalism on developments like this.”

Mirvac group CEO and managing director, Campbell Hanan, said: “Australian Retirement Trust is a highly valued capital partner.

“[The] transaction is testament to our strong and deepening relationship, as well as a shared commitment to growing our build to rent portfolio, where we see strong tailwinds and significant potential for scale and growth.”

Weaver said ART would continue to consider additional opportunities in build-to-rent where it aligned with members’ best financial interests and contributed to Australia’s housing supply.

“We’re all aware of the supply challenges in the local housing market, so to be able to contribute to supply while seeking strong returns for our members is a fantastic combination.

“We’re hopeful this model could be used by ART and other super funds in the future to help address some of the challenges facing the local housing market.”

Weaver said the Mirvac partnership showed how long-term superannuation capital could be deployed to support housing.

“This new investment in the LIV Mirvac Fund for ART and the potential to grow the portfolio further, including from Mirvac’s pipeline, is a fantastic example of the opportunities where super funds can play a more active role in contributing to housing in Australia while still seeking strong returns for our members,” he said.

“We are investing in community and economic growth by supporting the housing Australia needs, while delivering for our members’ retirement.”