On Thursday 18 May 2023, national law practice Colin Biggers & Paisley held the annual Brisbane Property Think Tank event where we discussed the recent planning changes for build-to-rent (BTR) and affordable housing.
With the sector garnering significant attention and investment recently, the audience heard from a range of industry experts including key note speaker, Councillor Adam Allan, Civic Cabinet Chair - City Planning and Suburban Renewal at Brisbane City Council, who then joined panellists Cameron Stanley, Director at Urbis and Riye Arai-Coupe, Managing Director of Bluebird. The panellists engaged in an active discussion on the current issues facing the BTR and affordable housing sector. In particular, what more could be achieved in order to assist developers in the sector, what is currently being reviewed by Council, the distinction between BTR and affordable housing and how they intersect.
Different perspectives, ideas and opinions were shared and discussed by the panellists and the audience during the panel session. The key themes that came out of our discussion included:
There is a growing interest in the BTR sector and although it is not the answer to all of the housing challenges, it is expected to play an important role moving forward in Brisbane as part of the available mix of rental housing.
There are a number of different BTR models. The larger build-to-rent developments which include high quality facilities and management services are expected to be rented at a higher price point. It is also expected there will be BTR developments at a lower rental price point. The lower price will be dictated by the location of the development as well as facilities and amenities on offer in the development.
Although there are currently incentives for developers to include an affordable housing component within the BTR development, (50% discount on land tax payable for up to 20 years for developments that include at least 10% of rentals as affordable housing), the BTR sector is separate from, and not specifically focused on, affordable housing but may assist with the housing supply generally.
There are gaps that need to be addressed in the planning framework. Brisbane City Council is assessing BTR development applications under the Multi-Unit Dwelling Code, however, a separate and specific build-to-rent code is preferable as well as a definition of BTR under the planning framework.
Although the current incentives such as delayed payment of infrastructure charges may assist developers, there needs to be greater focus on the speed at which the councils are supporting and assessing developments. This includes clarifying planning frameworks so that future developments are not being stalled. There are also continuing issues with construction costs and the shortage of materials and labour which need to be addressed to bring more BTR developments to the market.
Overall, while the sector presents significant opportunity, there are some apparent issues in the BTR sector. It's important to note that while these challenges exist, the BTR sector in Brisbane and elsewhere continues to evolve, and efforts are being made to address these issues and support the growth of the market.
This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2023.