Build-to-rent investment manager Apt.Residential has forked out $55 million for two century-old commercial buildings at Ultimo in Sydney’s inner-south with plans to convert them into apartments and studios.
The refurbishment of the properties, located at 1-3 Smail Street, adds to a growing list of works by Apt.Residential which earlier this year announced a $1.5 billion partnership with Dutch pension fund manager PGGM to deliver a portfolio of build-to-rent projects nationally.
Apt.Residential has confirmed to Business News Australia that this development is part of the PGGM deal, which kicked off with a $280 million mixed-use build-to-rent precinct at Meadowbank in Sydney and which is planned to deliver 291 apartments across four low-rise buildings.
Apt.Residential says the Ultimo project will require a measured approach that aims to preserve the history of the buildings which were bult in the early 1900s and were later amalgamated by retailer Grace Brothers for use as a warehousing facility.
“The building’s heritage value to Ultimo and Sydney is important,” says Matt Carolan, the managing director of Apt.Residential.
“By maintaining and restoring certain design elements, the site’s history will be celebrated in our development application.
“The Smail Street site is close to Broadway Shopping Centre and within walking distance of Central Station, the city and two major universities. We think it is a prime location for high quality rental apartments and studios.”
The buildings, which have a net lettable area of 7,796sqm, are currently occupied by commercial tenants.
Apt.Residential is currently undertaking a development plan for the buildings that the company says will honour their heritage “while maximising liveability for future residents”.
The company says the development timeframe for the project is dependent on planning consent and approvals by the City of Sydney.
Apt.Residential sees conversions such helping to fast-track the delivery of housing supply “more expeditiously than building from scratch”, while also providing significant social and sustainability benefits by creating “new and vibrant amenity on the city’s fringe”.
“We are constantly looking at all opportunities as to how we can develop rental apartment product and contribute positively to Australia housing shortage,” the company tells Business News Australia.
Apt.Residential, which was co-founded by a group of seasoned property and finance industry players including Carolan who is a former CIO of Urbanest Australia, hinted at plans for this second project for Sydney when it announced its partnership with PGGM in May.
Under the partnership, Apt.Residential will manage and operate the BTR projects once developed by the joint venture that is initially aiming to deliver a portfolio of more than 2,500 apartments.
The Meadowbank project will include a retail and community precinct that Apt.Residential says will provide “much-needed supply to Sydney’s tight rental market”.
The Apt.Residential team is experienced in project delivery across the Australian, UK and South-East Asian residential markets, including a track record in build-to-rent, purpose-built student accommodation and institutional banking.
"Through our projects, we are aiming to deliver a positive contribution to Australia’s housing shortage,” says Carolan.
The Netherlands-based PGGM manages pension assets worth about $400 billion for 4.3 million people and its partnership with Apt.Residential is being undertaken through the PGGM Private Real Estate Fund.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support