This article is from the Australian Property Journal archive
CANADIAN private equity group Brookfield Asset Management has purchased 100-106 Franklin Street near Melbourne’s iconic Queen Victoria Market from Landream.
The transaction, which took place back in January, would have the 1,693sqm site, previously earmarked for a build-to-rent project, instead developed into student accommodation.
Brookfield has submitted to amend the previous approval and instead develop a 39-level tower with 1,013 rooms for student accommodation.
The previous permit would have seen the site transformed into a 40-storey 267-apartment tower and was received by Landream and Alt Living in a joint venture back in 2022.
With the original planning permit enabling the partial demolition of Burbank House at 100 Franklin Street and the total demolition of No.104, a 1926-built three-storey warehouse.
Landream acquired 100 Franklin Street for $28 million in December 2020, before spending another $21.5 million for 104 Franklin Street.
Back in 2020, Landream sold another Melbourne CBD site where h it had planned to build a Mandarin Oriental Hotel designed by renowned late architect Zaha Hadid for about $200 million to US real estate firm Hines.
“We see ongoing tailwinds for the sector. The thematics driving student housing in Australia are strong,” said Ruban Kaneshamoorthy, Australian managing director at Brookfield to Sydney Morning Herald.
“There has been significant growth in international student enrolments during the past 10 years, driven by a burgeoning Asian middle class who view Australia as an attractive studying location.”
In a recent Australian Property Journal’s Talking Property Podcast, Simon Hulett, Head of Direct Investment MaxCap Group and Ryan Banting, Executive General Manager Social Infrastructure Australian Unity, highlighted the strength of the PBSA sector.
Australia has only 80,000 beds in operation in a sector with 1.6 million students, which is significantly lower than the United Kingdom.
Meanwhile in February, Brookfield announced it had appointed Multiplex to deliver its first student housing project in Australia, a joint venture project with Citiplan and Journal Student Living in Carlton.
With the student accommodation sector rebounding over 2023, GPT announced it was expanding its partnership with QuadReal Property Group, to invest in the Australia and New Zealand market.
While Australia’s largest owner and operator of purpose-built student accommodation, Scape, in October last year converted a $1.4 billion loan into a sustainability-linked loan, in a first for the sector.
The January transaction was managed by Oliver Hay, Leon Ma and Daniel Wolman from Cushman & Wakefield.
