Strategic partnership to deliver $1 billion of Purpose Built Student Accommodation
Initial seed asset – $108m student tower development in Perth CBD
12 October 2023 – Real estate investment manager MaxCap Group, mutual wellbeing company Australian Unity, and leading operator UniLodge have formed a long-term partnership to develop $1 billion of new purpose-built student accommodation (PBSA) assets across Australia. The social infrastructure strategy is focused on meeting the increasing demand for high quality student accommodation facilities servicing the 1.8 million students enrolled at Australian universities.
The initial seed asset in the planned portfolio is the development of a 732-bed tower at 319-335 Wellington St, a few hundred metres from the new 60,000sqm Edith Cowan University city campus development (ECU City) in the Perth CBD, Western Australia. The cost of construction for the 30-storey student tower is circa. $108 million and is due to commence operating in line with the opening of the new ECU campus in Semester 1, 2026.
Perth-based urban renewal specialist, Sirona Urban, has been appointed as joint development manager (alongside Australian Unity). Built has been appointed the project’s construction partner and is currently undertaking pre-construction works. The asset will be operated by UniLodge once complete.
MaxCap Group’s Head of Direct Investment Simon Hulett said student accommodation was booming as a global sector.
“Education in Australia is the leading non-resource sector asset class and international student numbers are growing rapidly,” Mr Hulett said.
“Currently, 25 per cent of enrolments are international and are seeking quality housing given the dearth of on-campus stock, which represents only about five per cent of supply.”
“Student accommodation is a well-established and sophisticated asset class in Australia that generates strong income profiles. PBSA product has matured in the post-pandemic environment providing a high-quality offering that is thoughtfully curated through the provision of extensive amenity and services.”
“We are privileged to be able to partner with groups of the quality of Australian Unity and UniLodge to execute a scalable long-term social infrastructure strategy in Australia’s supply-starved housing sector,” he said.
Australian Unity has an extensive track record delivering and managing social infrastructure assets while UniLodge is the largest operator of student accommodation beds in the country currently managing around 38,000 beds.
Australian Unity Social Infrastructure Executive General Manager Ryan Banting said he was delighted to be partnering with MaxCap and Sirona Urban, and to extend their existing relationship with UniLodge.
“We partnered with UniLodge in 2021 to create the 695-bed Lady Lamington student accommodation buildings at Herston Quarter in inner Brisbane, as part of the broader Herston health and education precinct including University of Queensland and Royal Brisbane Hospital,” Mr Banting said.
“We plan to create a national portfolio of prime student accommodation assets across Australia. We are excited to make this Perth development a reality.
“Student accommodation is a compelling investment and a vital component of Australia’s social infrastructure mix that directly contributes to the growth of our economy and the wellbeing of our communities.
“This development advances Australian Unity’s participation in the sector, that also includes seniors living, specialist disability accommodation, childcare, and healthcare infrastructure.”
Australian Unity’s social infrastructure development pipeline currently totals ~$2.5 billion, which includes the ~$1.4 billion healthcare property pipeline and the remaining stages of the Herston Quarter redevelopment in Brisbane.
“The new student accommodation in Perth’s CBD will contribute to the precinct’s vibrancy and will help students unable to live close to their place to study because of severe rental accommodation shortages. In an environment where housing supply is falling well short of demand, students no longer decide on a course and figure out the living arrangements later—it is now a factor in which course they can take.
“Student accommodation has an increasingly important role to play in our cities and regions contributing new housing and adding to overall stock. Australia’s housing shortage has created real issues for domestic and international students in need of accommodation with recent data revealing that in Western Australia, in 2022-23 the number of student visas lodged was approximately two times higher than in 2018-19 and around 2.5 times higher than 2021-22”, Mr Banting said.
Based on Australian Unity’s estimate of full-time students and bed numbers in Perth, approximately 92 per cent of students are unable to access purpose-built student accommodation, highlighting a significant supply shortage compared to other Australian states. The West Australian residential rental market is also experiencing significant supply shortages, with a rental vacancy rate of 0.8 per cent and average weekly rents for houses and units increasing by approximately 17 per cent over the last 12 months to September 2023.
Peter Bates, Executive Chair of UniLodge said “this new purpose-built accommodation would be an important addition to UniLodge’s expanding Perth portfolio and will support its mission to help students make the most of their university years.
Perth is home to some of Australia’s finest universities, and, as a study destination is growing in attraction for both domestic and international students. We are therefore forecasting demand to be strong for Semester 1 2026 intake.”
Mr Hulett said he was optimistic about the possibility of growing the partnership between the groups.
“We are working with Australian Unity and UniLodge to curate a national pipeline, including potential sites in Sydney, Melbourne and Brisbane.
“The uniqueness of student accommodation is that it is largely geographically agnostic given the quality of Australia’s tertiary education institutions that underpin occupancy, so we intend to create a diversified portfolio of approx. 3,000 beds covering the major markets,” he said.
Tory Packer from Cygnet West negotiated the land acquisition and Planum Partners supported the capital raise with Australian Unity.
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Note to editors:
MaxCap Group, a strategic investment partner of Apollo Global Management, is one of Australia’s leading CRE investment managers and is an established manager for domestic and global institutions with current Funds Under Management and Advice of circa $7.0bn, having invested more than $17.0bn across more than 650 loans and investments since inception in 2007.
Established in 1840 by a group of everyday Australians to support the health and financial welfare of their families and community, Australian Unity has grown into one of the largest mutual companies in Australia with 7,000 employees, 385,000 members and 700,000 customers. Its portfolio of diverse thematically linked health, wealth and care services support wellbeing and aim to make a positive impact in what ‘matters’ to individuals and communities.
Sirona Urban is a multi-award-winning real estate developer based in Perth, Western Australia. Sirona has left its mark on some of the state’s most iconic projects, including major mixed-use developments incorporating residential, retail, commercial office and hotels. Sirona has also been an influential change-maker in the urban renewal of Fremantle, bringing to life a new metropolitan vision for Perth’s historic port city. Building on these successes, Sirona is well positioned to continue to deliver an exciting mix of built form projects across WA.
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 Projected as at 30 September 2023