Build-to-Rent – the next frontier in alternative investment
For investors, Australian commercial property has rarely looked so good. The office and industrial sectors are booming, with strong capital growth and excellent returns, particularly in Sydney and Melbourne. The downside, however, is that the strong performance in recent years has resulted in a very tight market, making it increasingly difficult to secure traditional assets at an attractive price point.
For those thinking outside the square, investments in alternative asset classes such as student housing, healthcare and data centres have proven to be an excellent alternative. These emerging sectors are less mature and therefore less competitive, and they allow investors to benefit from long-term secular economic and demographic trends that look set to provide secure sources of income returns for many years to come.
But there’s a new alternative asset class which is capable of transforming the investment landscape in Australia; Build-to-Rent (BTR). A concept that is well established in markets such as the US and Germany, and is rapidly growing in the UK, BTR is on the brink of completely revolutionising Australia’s housing industry. Knight Frank predicts that within the next five to ten years, we’ll see the BTR sector thriving in Australia.
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