Debby Blakey, the chief executive of $78 billion pension fund HESTA, says the government’s plan to build 1.2 million homes in the next five years is “certainly ambitious”, and will only be possible if “investment settings” are fixed to entice institutional asset managers into residential property.on Wednesday that a “more smooth, quicker planning approval process” was also needed to enable funds to invest in affordable housing at the scale the government wants.
HESTA on Thursday will announce it is pouring more than $100 million into a new building with affordable, social, specialist disability and market-rate rental apartments. The super fund is providing equity, along with debt from ANZ and Treasury Corporation of Victoria, to fund a $210 million, 362-unit mixed-tenure development in Melbourne’s inner northwest.
“There are some challenges in the Australian context in terms of uncertainty,” Ms Blakey said of the affordable housing sector. “If we could change the risk profile we could have a higher allocation to affordable housing and still get a good return.
Super funds have embraced the build-to-rent sector, including affordable housing, in the US and Europe, but have largely avoided residential property investments in Australia.