Developer Daiwa House Australia has formed a partnership with Lendlease to develop a A$650m (€394m) build-to-rent (BTR) project in inner Melbourne.

The development at Flinders Street, will be the second BTR residence to be delivered by Lendlease in Australia as it continues to expand its international capability in its home market.

Lendlease which will develop, construct and act as the investment manager for the development, will retain a 25% interest.

The development, which offers almost 800 apartments, forms the final piece of Lendlease’s Melbourne Quarter regeneration project.

The Daiwa House/Lendlease partnership marks the entry of Daiwa House, Japan’s largest home builder, into Australia’s BTR market.

Dale Connor, CEO of Lendlease Australia, said: “Daiwa House’s investment in our build-to-rent project in Melbourne further strengthens the relationship between our two organisations as we bring the best of our shared global expertise to this development opportunity.”

Connor said the announcement highlighted continuing demand from the group’s Japanese partners for high quality opportunities across its global project pipeline.

He added: “We’ve now secured Japanese investment in projects totalling approximately A$11bn in end development value. It also represents a major vote of confidence in Australia’s property market.”

Koji Morishige, CEO of Daiwa House Australia, said: “We are committed to broadening our development footprint in Australia and welcome the opportunity to further expand our global relationship with Lendlease to deliver to the Melbourne community this quality build-to-rent opportunity.

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