While popular in Europe and parts of the Unites States, the build-to-rent model has been slow to take off in Australia.
So, what is build-to-rent? In its simplest form, build-to-rent refers to a residential development in which all the units are retained by the developer and leased out, rather than sold off.
Due to challenges within Australia’s tax system, as well as high upfront costs and the complexities of management, developers have traditionally preferred a build-to-sell model, where the investment capital is quickly paid off with each apartment purchased.
But with Australia’s rental market on the increase, coupled with integrated service providers (such as WINconnect in the energy sector) removing the need for expensive upfront capital infrastructure and management costs, the build-to-rent model is becoming more attractive.
That is why WINconnect’s Simon James is speaking at the second Build to Rent Australia conference this week. The conference comes at a time when Australia is trying to find new ways to house its rapidly growing population and we believe we can be part of the solution to making the build-to-rent model simpler and more affordable.
The solution is our tried and tested community energy network model. We pioneered community energy networks in Australia and now deliver our services to around 1,000 sites.
They work by creating a private “micro-grid” within the building itself. This model makes utilities easy by providing a one stop solution for your electricity, gas, hot water and internet.
Firstly, simplicity. Building a new apartment block is complicated enough without the added pressure of managing tenants.
The layers of bureaucracy and red tape that must be navigated is enormous. While there is certainly need for stringent regulation – think the combustible cladding crisis – developers and investors need to see a simple way to navigate complex frameworks that are straightforward and don’t cost a fortune.
Our community energy network model makes build-to-rent simpler for developers. Our project team coordinates with the builder and the relevant suppliers to secure gas and electricity connections to the site – taking away this hassle from developers.
As far as utility distributors and retailers are concerned, they only have one customer to deal with – WINconnect.
Then, once the project starts, we liaise with the builders and sub-contractors to deliver equipment on time for installation. We supply all the infrastructure and servicing as part of our ongoing service. Easy.
Secondly, we help make the build-to-rent model more cost-effective. We provide the micro-grid infrastructure at no upfront cost to developers. This cost is simply born out over time depending on how the owners corp decide to distribute the benefits.
Our community energy network model also means more cost-effective living for residents when they move in.
Our system can feed solar into the private network to power communal areas or provide additional discounts to residents – depending on the number of solar panels able to be installed. Smart metering technology measures tenants’ and common area consumption respectively.
This enables a user pays system that is far fairer than the commonly used model of one meter, divided up among all residents. Another great benefit of user-pay is that extra services can also be added to the residents’ bills, such as electric car charging or power provision to storage units.
Renters also receive all the consumer protections required by the regulator and owners and developers can breathe easily knowing we have this all sorted.
And renters have just one point of contact through our Melbourne-based call centre when it comes to dealing with their utility bills and energy needs.
We have designed this model to contribute to the overall wellbeing and quality of life of the community, minimising tenant turnover and complaints.
With the rental market becoming more competitive, it is these little things that add real value to buildings, enabling higher rental yields coupled with high renter satisfaction
For the build-to-rent market to succeed, getting the core services right are integral to tenant satisfaction and the reputation of your property.
Quite simply, WINconnect delivers industry best practice in terms of infrastructure, metering, technology, customers service, maintenance and owner safeguards. And best of all – developers and investors need only call one number. We call it a WIN-WIN!
The Urban Developer is proud to partner with WINconnect to deliver this article to you. In doing so, we can continue to publish our free daily news, information, insights and opinion to you, our valued readers.