Mirvac is to acquire 490 completed build-to-rent apartments on the fringes of Melbourne’s central business district for A$334m (€207m).

It is the first Australian listed real estate group to commit to the nascent sector, having already begun to build rental apartments in Sydney.

Foreign investors Abu Dhabi Investment Authority and US multifamily developers Sentinel and Greystar, in a joint venture with Macquarie Capital, have also entered the market.

Mirvac’s most recent investment is through a joint venture with Melbourne-based developer PDG, which will build apartments opposite the Queen Victoria Market on a fund-through basis.

PDG was appointed by Melbourne Council to develop the Munro precinct as part of the Queen Victoria Market renewal.

It follows the construction of Mirvac’s first purpose-built build-to-rent asset in Australia, the Mirvac Pavilions project in Sydney Olympic Park.

The Olympic Park project is due for completion in September 2020, with leasing to commence in June 2020.

Mirvac CEO and managing director Susan Lloyd-Hurwitz said: “Renting has become a lifestyle choice for a much wider group of people who want to be closer to work and other lifestyle amenities.

“We believe build-to-rent can revolutionise the rental experience with improved choice, quality and security of tenure.”

Lloyd-Hurwitz said build-to-rent was one of the largest real estate asset classes in the world and entering the space made “good business sense” for Mirvac.

The acquisition of the Melbourne project will be funded partly by a A$750m fundraising last week.

According to EY real estate advisory services, Australia’s build-to-rent sector needs to create at least 20,000 apartments before it is able to attract domestic superannuation fund investment. It will take another six to seven years to reach that level, it said.