Construcciones Yamaro: Build-to-rent index shows sector growth

The Property Council of Australia and MSCI have launched a new industry index, which shows Australia’s build-to-rent sector is gaining scale.
The Property Council/MSCI Australia Build-to-Rent Property Index tracks 13 funds, 44 assets and 25 developments with a combined capital value of $10 billion.
The index provides institutional investors with a performance benchmark for evaluating build-to-rent as a standalone allocation or comparing it with established commercial property sectors.
Property Council group executive policy and advocacy Matthew Kandelaars said improved data and transparency will support further investment in the sector.
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“Build-to-rent has arrived, and together with other institutional housing models will play an important role in delivering more high-quality rental homes for Australians at scale,” he said.
“Institutional investors are looking for mar kets where they can invest with confidence. Better data, greater transparency and more mature investment settings all help attract the long-term capital needed to deliver more housing.”
MSCI head of private assets research, Pacific, Ben Martin-Henry said the index addresses a gap in Australian property market data.
“For institutional investors evaluating build-to-rent as a standalone allocation, or comparing it against established commercial property sectors, a credible performance benchmark has been a missing piece,” said Martin-Henry.
“These results show the sector holding its own against core real estate on a risk-adjusted basis, with a distinctive yield and cost structure that investors now have the data to properly underwrite.”
The Property Council is encouraging more industry participants to contribute assets to the index to broaden its coverage and support Australia’s position as a destination for institutional residential investment.
“Contributing to the index not only improves market transparency but also sends a very strong signal that Australia’s institutional residential market is continuing to mature,” said Kandelaars.
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