Stockland has offloaded one of its west Sydney properties for $41 million to Coronation Property who plan to construct their first build-to-rent apartments.
The site at 52-54 McFarlane Street next to Stockland Merrylands Shopping Centre was approved for five high-density towers with 562 residential apartments, as well as 4,500sq m of ground level retail and basement parking.
Coronation Property managing director Joseph Nahas said following development approval, the Merrylands Town Centre planning controls were amended to increase the yield at the site.
“Our goal is to deliver a mixed-use precinct with a combination of build-to-rent and build-to-sell apartments, as well as a bustling new retail offering for the community that will include a gym, supermarket and a wide variety of food and beverage vendors,” he said.
“We very much view the Merrylands site as a seed investment for our build-to-rent business–whilst this property sector is relatively new to Australia, it is gaining traction and we see the robust potential.”
Coronation Property director Les Landerer said in recent years, there was a prolific shift in housing dynamics in Australia, which should ultimately spur the success of build-to-rent.
“With buyers moving away from the ambition of housing ownership and increasingly into private housing rental, there is an environment where build-to-rent makes more and more sense for property developers,” he confirmed.
“This trend towards rental living has largely been evident in the younger generations and is driven by a lack of housing affordability, tighter credit conditions, and changing lifestyle preferences, with millennials seeking mobility, flexibility and convenience.
“We believe that the confluence of economic conditions, the current supply and demand dynamics of the Australian residential market, as well as the change in generational housing and lifestyle preferences, the conditions are ripe for the establishment of an Australian residential build-to-rent sector.”
“For Coronation Property, this acquisition also represents the next stage in our ongoing commitment to and belief in Greater Western Sydney, as evidenced by our existing projects in Liverpool, Parramatta and Harris Park.”
The Sydney-based developer has more than $5.3 billion in mixed-use developments in the pipeline and has a target of delivering 5,000 apartments over the next seven years.