Greystar’s $500 million South Melbourne development breaks ground

Global property developer Greystar Real Estate Partners has officially commenced construction of a $500 million project in South Melbourne, which is set to become one of Australia’s largest build-to-rent (BTR) developments.

Situated at 15-85 Gladstone Street, the project will deliver 700 new residential apartments located within the Fisherman’s Bend Precinct, less than a kilometre from Melbourne’s CBD.

The apartments – which are aimed at being powered by 100 per cent renewable energy - will be built across three towers and house up to 1,500 residents.

Working with construction firm Icon, the development will target a five-star Green Star Design and As-Built certification and feature rooftop solar, a recycled water pipe network, as well as electric vehicle charging points.

Slated for completion in 2024, the project will provide 1,000 full-time construction jobs, with roughly 100 jobs generated upon completion.

“The Greystar team is energised to have reached this key milestone for the Gladstone Street project and to be marking the occasion with an official groundbreaking ceremony,” Greystar managing director – Australia Chris Key said.

“We are looking ahead in anticipation to 2024 when we will be unveiling 700 residential apartments across three towers and 850 sqm of exciting retail space.

“We are thankful for all the support this project has received and we look forward to bringing this innovative design vision to life for the South Melbourne community.”

A long-established phenomenon in Europe, the BTR model is based on residential accommodation that has been purposely built and designed to house long-term tenants, rather than being sold to individual owners.

According to real estate services firm Cushman & Wakefield, BTR assets are most commonly owned by the developer for a period of seven to 10 years. Known elsewhere as multi-family residential homes, the BTR model is more established in markets such as the United States and Japan.

The demand for high-quality rental housing in inner urban areas, particularly in Melbourne, continues to grow as vacancy rates across the capital cities reach record lows.

Melbourne’s rental market has recovered to pre-pandemic levels with vacancy rates having fallen sharply to 1.3 per cent from a high of 5.2 per cent in December 2020.

“The groundbreaking ceremony is an important event and takes us another step closer to realising our vision for this iconic BTR project,” Icon Victoria director Daniel Cawley said.

“The development will bring a new experience and exceptional service to the rental market here in Melbourne.”

Headquartered in Charleston, South Carolina in the United States, Greystar manages and operates more than $240 billion of real estate in 226 markets globally with offices throughout North America, Europe, South America, and the Asia-Pacific region.

The project’s milestone was marked with an opening ceremony attended by Martin Foley MP and key representatives from contributing parties.