Qualitas has launched Australia’s first build-to-rent (BTR) real estate debt fund with a cornerstone investment commitment of up to A$125m (€76.3m) from the government’s Clean Energy Finance Corporation (CEFC).
The Melbourne-based real estate debt specialist’s Build-To-Rent Impact Fund (QBIF), which is expected to grow into a billion dollar fund, has been created to finance construction and management of energy-efficient, low-emissions residential buildings.
Tim Johansen, managing director and global head of capital at Qualitas, told IPE Real Assets: “A big fund like this takes a while to raise. We have identified a deal pipeline of A$700m. You don’t need a lot of deals to use up the capital.”
Qualitas will now roll out the marketing of the fund to both onshore and offshore, particularly European, investors.
“We are having meaningful discussions with institutional investors and are hopeful that some of them will invest,” Johansen said, adding that a number of these institutions had previously invested with Qualitas in various strategies.
While in Australia BTR was a new product, in Europe it was a well-established sector. Investors were familiar with the returns and risks, he said, and investors liked the “sustainability overlay” of the fund.
Johansen said QBIF would target strong and growing demand for residential rental accommodation, while supporting Australia’s transition to a low carbon future.
It would also capitalise on the financing gap created by tight capital constraints on traditional banks for the BTR sector.
CEFC CEO, Ian Learmonth, described QBIF as a significant opportunity for the CEFC and for private sector investors to contribute to a low emissions foundation for an emerging market sector.
“The CEFC is committed to supporting innovative investment products like QBIF that attract private sector investment into projects that reduce carbon emissions while delivering attractive returns,” he said.