Charles Lloyd Property launch three more Melbourne co-living projects

Charles Lloyd Property launch three more Melbourne co-living projects
Staff reporterDecember 7, 2020

Melbourne-based property developer Charles Lloyd Property Group has added three new studio home developments to its portfolio, following high demand for its initial three co-living projects.

The developer said its first three projects, each comprising nine 25 to 30 sqm fully self-contained spaces, were generating consistent returns of around 14 per cent. 

Funded by the Group’s own capital, the “Studio Homes” concept was launched in 2018, one of the first entrants into the ‘co-living’ arena  having identified a gap in the market created by lack of housing affordability and increasing rental demand. 

The spaces are priced at 300 to $350 a week rental fee which included utilities and internet. Each unit has a private balcony or courtyard, ensuite and kitchenette, while full kitchen and laundry facilities are communal. 

Designed as an affordable alternative in the space between serviced apartments and hotels, they are targeted at singles, young professionals and students.

Managing Director Franco Bevacqua said that the first three developments – in Berwick, Bundoora and Frankston – had fully let within weeks of going to market and another three were in development – St Albans, Epping and Hoppers Crossing. 

“A lack of affordability is pricing too many people out of the property market, and so we created the Studio Homes concept as a cost effective and efficient solution for the consumer,” Mr Bevacqua said 

“Most importantly they are proving to be a very attractive income-generating asset from an investment perspective, with average returns of around 14 per cent at this point. 

“I expect that these developments will become a more popular investment option in the build-to-rent sector than some of the higher density developments we are seeing come to market. 

“Build to rent has been slower to take off in the Australian market, mainly through the length of time it takes to see any decent return. We don’t have those challenges with the Studio Home concept. 

“There is no planning permission required so therefore no planning risk (under the building classification), while the build cost is generally lower than commercial rates, with an average eight to 12-month build duration.

“High volume, high density developments are the norm in this market, and so it seems that build to rent is only viewed through that lens, which is not a very innovative way to look at it. It’s a completely different investment proposition.” 

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