Samma Property takes Docklands tower to market as build-to-rent takes off
The private Samma Property Group is seeking a backer for its flagship build-to-rent project in Melbourne’s Docklands as it looks to expand its holdings.
The group has tapped Colliers to take the shovel-ready Waterfront Tower project on the western end of Yarra’s Edge to market, with expectations the project is worth more than $250m.
The site, which carries planning approval for 404 apartments in a purpose-designed scheme by architects Fender Katsalidis, is poised to benefit from Melbourne’s rental shortage at a time when few build-to-sell unit towers are getting off the ground.
Samma is but the latest player to seek a capital backer as the industry matures. Mirvac won the backing of Japanese giant Mitsubishi and the federal government’s CEFC, and other platforms are backed by major international players.
Colliers directors Jozef Dickinson and Robert Papaleo are handling the sale, which could see the project either find an institutional backer or be snapped up by a rival platform.
“Waterfront Tower presents an outstanding opportunity to secure a partnership with an established and well-credentialed developer to deliver a high-quality BTR project located directly on the Yarra River in the fast-growing Docklands, having the benefit of being only a short bus trip or stroll along River Esplanade into the CBD,” Mr Dickinson said.
The 31-level tower will have two dedicated levels of resident amenities and ample car parking. It is positioned on the Yarra River, with views over the Docklands and towards the CBD and Port Phillip Bay.
“Docklands and in particular the Lorimer St precinct has undergone a massive transformation in the last decade and is now a mature precinct of central Melbourne with an abundance of services and amenities, conveniently located just 2km from the heart of the CBD,” Mr Dickinson said.
The move comes just a month after Malaysian developer UEM Sunrise and US build-to-rent specialist Greystar struck a deal at Melbourne’s inner-city Collingwood. UEM will develop about 400 apartments for Greystar in the $277m project.
Samma executive director Simon Abdelmalak indicated that Samma saw the benefits of the site. “We have purposefully purchased this site as a BTR location, and see delivering Waterfront Tower at a fixed price and fixed time as a really attractive investment opportunity,” he said. “Alongside our delivery capability, Samma have long been working on enhancing our communities’ platform. We have over 1200 dwellings under management and are keen to explore this further should the opportunity be presented via this process.”
Samma has a 28-year track record and has been growing in the specialist sector. “We’ve had significant interest from investors keen to provide funding for completed BTR buildings,” Mr Abdelmalak said.
The group is also talking to other investors about the remaining sites in its pipeline, while also expanding.
Mr Papaleo predicted that strong rental growth would continue due to the upcoming peak of new housing demand and unprecedented challenges for new housing supply to be delivered.
US private equity giant Blackstone is also testing the country’s surging build-to-rent market by putting two major blocks up for sale. The group’s Realm operation will put its specialist apartment buildings in Melbourne and Brisbane on the market in a key test of the value of completed stock.
The new kind of apartment buildings are being promoted as a potential solution to the housing crisis, as they provide long-term homes for renters and are backed by major institutions.
In late 2021, Samma and impact investment firm Brightlight unveiled plans to expand in the sector, beginning with four premium build-to-rent projects in Melbourne.