Gurner™ and Qualitas announce new $400m BTR Tower in joint venture with OSK Property

7 December 2023

The GQ Build-to-Rent (BTR) platform, backed by GURNER™ and Qualitas, has entered a joint venture with Malaysian developer OSK Property to develop and operate a BTR residential tower within the $2.8 billion Melbourne Square precinct in Southbank, Melbourne.

The new opportunity has been secured by GQ and offers international investors an opportunity to be a part of the group’s growth which has so far been restricted to a single investor to date.

The OSK Group is a publicly listed developer in Malaysia with over five decades of experience – will retain an ownership stake in the BTR asset alongside GQ who will develop, manage and operate the BTR residential tower.

The new BTR tower will be designed by Cox Architecture and will further enhance the mixed-use offering at the Melbourne Square precinct, delivering around 500 residences and extensive communal amenities.

The iconic tower design will be a striking addition to the Melbourne Square precinct with a focus on world-class resident facilities, health and wellness amenities, and a range of apartment options that will appeal to a diverse mix of residents.

The $2.8 billion Melbourne Square precinct encompasses five towers, a 3,745sqm public park, full- line Woolworths, childcare and number of retailers, with the GQ BTR tower set to add best-in-class amenity to the existing precinct.

In keeping with GQ’s industry leading commitment to sustainability, the tower will feature environmentally sustainable design including 5-Star Green Star certification, an inset energy network and a net-zero energy emissions outcome. With low cost, 100 percent renewable energy available, and an all-electric building, the development is set to be carbon neutral in operation.

Partnering with GQ to develop, manage and operate the BTR tower means OSK Property can convert one of the Melbourne Square towers into a retained asset within its portfolio, an appealing proposition that will see the developer diversify asset classes within a single project.

GQ and OSK Property have strong confidence in the Southbank market. GQ has a separate BTR project under construction on City Road in Southbank, while OSK Property recently completed two transactions, acquiring neighbouring properties totalling 7,800sqm at 87-117 Queensbridge Street and 190 City Road for a future mixed-use development.

The GQ BTR platform launched in 2021 with three initial seed sites: in Melbourne, the $300 million Beach House in Melbourne’s St Kilda – which is nearing completion ahead of the first residences hitting the market in early 2024 and a $350 million tower at City Road in Southbank, and in Sydney the 61-storey, $450 million project in Hassall Street, Parramatta.

Construction for the Melbourne Square site is due to commence in Q1 2025.

Quotes attributable to Gurner Group Chief Development Officer Robert Clarke:

“We are excited to be working with the team at OSK Property to deliver the Build-to-Rent tower at Melbourne Square – it’s a project we’ve been watching for many years, and we are looking forward to contributing first-class rental accommodation to the precinct.

“We are excited to be able to provide an opportunity for further capital parties to join in on our platform’s growth as we continue to grow throughout Australia.

“This joint venture makes a lot of sense for us as it’s a shovel-ready precinct that will deliver much needed rental supply to the market in an area that’s growing and supporting a large population.

“With the current demand for rental stock still at historical highs, we are actively looking at many different ways to add to our portfolio whether that be partnerships, joint ventures or traditional acquisitions.

“In the short term, GQ’s first completed Build-to-Rent asset is due to reach completion in St Kilda early next year and we are excited to show the market the new standard of renting and first-class luxury amenities that we are delivering.”

Quotes attributable to OSK Property Australia Development Director Andrew Hutchinson:

“When we met with the team at GQ, we immediately found a natural alignment with a mutual focus on delivering industry-leading residences, quality interiors, generous shared amenities and high-end service to residents.

Quotes attributable to OSK Property Australia CEO, Chong Boon Woon:

“Our development philosophy is very much focused on strategic, risk-adjusted decision-making and a quality over quantity approach to individual projects and acquisitions.

“This joint venture with GQ represents the next evolution of our Australian pipeline, allowing us to go where the market is, recognising the under-supply of the rental accommodation in Melbourne, while enhancing the offering at Melbourne Square and maximising the position of our existing portfolio.

“OSK Property has a strong reputation as a high-quality developer in Malaysia and given the success and proven track record of delivery at Melbourne Square we would like to think the Australian market can see that we are trustworthy and that we do what we say we will.

“We were motivated to seek a joint venture partner after recognising the under-supply of rental accommodation throughout Melbourne – we are looking forward to contributing to high-quality rental options in the city, while providing another architectural landmark building in an amenity-rich precinct.

Quotes attributable to Mark Fischer, Global Head of Real Estate and Co-Founder, Qualitas:

“We are pleased to secure this asset for the GQ platform. We continue to have strong interest from global investors in BTR and are excited to shortly launch our next capital raise with investors.
Sophisticated investors recognise the momentum in the GQ platform and are looking to partner with GQ on great assets like the BTR Tower at Melbourne Square.

“The GQ BTR platform’s thesis is underpinned by the current macroeconomic backdrop that sees residential vacancy at its lowest level due to an entrenched, and deteriorating housing undersupply in Australia. We believe the BTR sector is well-placed to service this growing deficit and the established GQ platform is attractive to sophisticated investors seeking this exposure.

“From an investment perspective, the long-term underlying fundamentals have created conditions ripe for the next phase of rental growth over the medium-term, plus the sector is aligned to investors demand for assets generating defensive and resilient cashflows through all economic cycles and we expect our investment partners will be attracted to this profile.