AXA IM Alts has expanded its Australian build-to-rent (BTR) strategy by acquiring a development site in West Melbourne for a 100-unit residential project.
The deal represents the manager’s entry into the Melbourne BTR market and its second project under its affordable housing strategy in Australia.
Antoine Mesnage, head of Asia Pacific at AXA IM Alts, said: “Expanding into Melbourne marks a significant milestone in our strategy, bringing both portfolio diversification and scale.
“We like the residential space very much. We think that Australian capital cities - Sydney, Melbourne, Brisbane - have a particular supply-demand imbalance. The specific market conditions offer the opportunity to invest at scale. So we want to continue to find projects similar to these two,” he told IPE Real Assets.
Despite market scepticism on the viability of affordable housing, Mesnage said: “We voluntarily allocate a minimum 50% of our projects to affordable housing. We have track records investing in that space mainly in Europe and recently in Australia. The returns are comparable to market rents.”
He added: “We actually manage a portfolio of roughly 13,000 affordable housing units globally.” AXA IM Alts’ affordable housing portfolio is valued at around €2.3bn.
AXA IM Alts has partnered with Australian developer PDG to undertake Melbourne project which, on completion, will be managed by St George Community Housing.
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