This article is from the Australian Property Journal archive
REAL estate asset manager and investment firm Pro-invest will begin making the move into the residential sector with a view to growing its new division to as big as its 6,000-key hotels business, and has identified hotel and office assets that it will acquire and convert into apartments.
Months after publicly stating its intentions was to move into the build-to-rent sector, Pro-invest yesterday confirmed it would enter the residential market with its “flexible living model, developed to capture the extensive potential of co-living across Australia”, with a focus on conversion of assets, predominantly hotels, of up to 200 units.
The company is set to own and operate approximately 2,000 residential apartments across ten assets in its first tranche of development.
Co-living is part of the build-to-rent sector, and usually includes smaller apartments with more emphasis on communal facilities and spaces. Pro-invest’s offering will be located in CBD and in suburbs and will be aimed at tenants looking for smaller, self-contained studio and one-bed apartments, with shared community spaces and flexible rental options. This includes short-term serviced apartment options and longer-term rental leases.
Led by industry veteran, Ronald Barrott, Pro-invest Group has been involved in hospitality investment and operations around the world for over three decades. In Australia, it has 32 assets open and in development across all major markets, and $3 billion of assets under management.
Its move into the residential sector comes as Australia’s residential market sees vacancy rates hovering around historic lows, causing rents to surge, and more and more Australians being priced out of the housing market.
“This convergence of issues has given rise to a growing number of co-living investment opportunities, which have long been a successful and dominant part of many established rental markets including the US and UK,” Pro-invest said.
It said that with its flexible living model, it is “actively pursuing co-living to maximise returns for investors in this sector”.
“These opportunities will focus on the conversion of existing assets – predominantly hotels – of up to 200 units, with new-builds considered where appropriate. With decades of expertise in upgrading, repurposing and redeveloping hotel and office buildings around the world, the company is well-equipped to maximise conversion opportunities.
“This includes identifying underperforming hotel assets that can be quickly and efficiently reimagined and repositioned by Pro-invest’s in-house development team; while Pro-invest’s hotel management business maximise yield from the asset as planning and preliminary works are undertaken.”
Barrott, chair of Pro-invest Group, said, “We recognise that the growing number of renters today desire convenience, quality, and the hotel-like amenities and services that have long been associated with hospitality.
“The seamless integration of hospitality in residential living is gaining momentum as property developers and investors acknowledge the immense value of infusing hospitality into residential projects.”
