Rent-to-Live Co plans $1.5bn housing project for Marrickville
An artist’s impression of developer Rent-to-Live Co’s plans for a $1.5bn housing precinct in Marrickville
The national boom in build-to-rent projects is finally gathering steam in Sydney with a huge $1.5bn precinct proposed for the inner west suburb of Marrickville, that will put the housing crisis at top of the agenda in Anthony Albanese’s backyard.
The project, which would see multiple high-rise blocks built where a local timber yard once stood, is in the Prime Minister’s seat of Grayndler and comes as concerns about housing emerge as a key election issue.
The plan has been lodged by the founders of the country’s biggest student accommodation platform, Scape, whose towers already surround major universities.
Their new Rent-to-Live Co business has similar ambitions to house the rest of the country, and is targeting 10,000 units.
They believe they can overcome the classic Sydney traps of soaring land and building costs and the sclerotic planning system in what has been a hotbed of anti-developer sentiment.
The developer is betting that by addressing the desperate need for housing as the city’s population explodes – and including affordable units – it can win over locals.
It would also own and manage the whole precinct for the long term, giving it the incentive to bring what has been dubbed “Westfield standard service meeting a five-star hotel” at affordable prices to the area.
The overall Rent-to-Live Co business was set up last year by the student accommodation pioneers Craig Carracher and Stephen Gaitanos, who are behind the Scape business.
They are optimistic that Scape will survive the caps put on international student numbers, and have shifted into build-to-rent as the country faces a worsening rental accommodation crisis despite a raft of measures by governments to stimulate new building.
The crisis has been worsened in Sydney as few large towers are under way beyond those by the very top developers. The build-to-rent industry has been dominated by Melbourne projects, though Sydney has become more viable due to rising rents.
Rival company Coronation Property has been snapping up inner city sites and in Brisbane, where sites are cheaper, international giant Hines has bought two rental buildings run by Arklife.
The Marrickville property, acquired from long-term landholders on undisclosed terms, will become the largest “for rent” site in Sydney at over 2.2ha and will have more than 1000 apartments.
The project, to be known as The Timberyards, will include more than 100 affordable apartments and about half the ground area will be for public use.
RTL Co is billing the site as fully financed and ready to start, subject to development approval, unlike large traditional apartment developments that have all but stalled as they require high levels of pre-sales.
The group’s first RTL Fund partners, including Dutch groups APG and Bouwinvest, are backing the scheme and RTL’s founders are now working towards a second close of their fund given the size of the asset.
Scape co-founder Craig Carracher is upbeat about the prospects for build-to-rent. Picture: Jane Dempster/The Australian.
“The Timberyards will deliver much needed rental apartment supply to the inner west of Sydney, as well as create a dynamic community precinct that we hope will add to the already vibrant and effervescent fabric of Marrickville. The project is fully funded and once we receive State Significant Development Approval, we will immediately commence construction. Our strategy is to bring much needed affordable and aspirational rental housing to Sydney’s inner west as soon as possible,” Mr Gaitanos said.
Rival groups have projects in inner Sydney under way, including the Indi project in the CBD, but have struggled to make them stack up in areas like Parramatta.
The Marrickville site was rezoned in 2017 from industrial use to mixed use and high-density residential, with maximum floor space ratios of 3:1, as part of a broader proposal to revitalise the Victoria Road corridor.
“The Timberyards is the first of many projects in our ambition to democratise the rental market and to support our ambition to be the earth’s best living company. Sydney is our focus and with our scale and expertise in this market we believe we can make an immediate impact,” Mr Carracher said.
“Our position as the leading local operator in the residential-for-rent sector means that we can offer inspiring spaces and intelligent design, with a unique value proposition to renters.”
Scape Australia, which the pair established in 2014, is the largest residential-for-rent owner and operator in the country, with almost 19,000 beds across 38 assets located in key gateway cities in Australia. It has another eight projects under way that will add 4000 beds.
