AustralianSuper, HESTA ramp up investment towards housing development

Specialist affordable housing investment manager Super Housing Partnerships has merged with housing developer and manager Assemble, with backing from two of Australia’s largest super funds.

AustralianSuper and HESTA have taken majority ownership stakes of 40 per cent each in newly merged Assemble, which they have described as an “exciting” investment opportunity that will also address Australia’s housing supply.

Assemble focuses on solutions suitable for middle- and-lower-income earners, offering affordable, social, essential worker, specialist disability, and market-rate rental housing via an integrated build-to-rent model.

It also offers home ownership pathways via build-to-rent-to-own and build-to-sell living options in desirable areas with good amenities in and around capital cities.

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Assemble is aiming for $15bn funds under management over the next decade, which amounts to a target of 17,000 homes.

“Partnering in Assemble is an exciting opportunity to develop innovative solutions that break down barriers to large-scale investment in housing and that aim to deliver strong and stable long-term returns for members, by helping to address one of our nation’s biggest challenges,” said HESTA CEO Debby Blakey.

Notably, the fund was among the cornerstone investors in Super Housing Partnerships (SHP) with a $240 million investment in November 2022 towards the development of numerous build-to-rent (BTR) apartment projects in Victoria.

Meanwhile, Australia’s largest super fund, AustralianSuper, previously announced a nearly $500 million equity commitment with Assemble. Last month, its first completed project through the partnership welcomed residents into Australia’s first super-backed BTRTO housing development, situated in Kensington, Melbourne.

Assemble’s new capability addresses a key challenge for institutional investors that are looking for scalable opportunities to invest in a range of housing choices, said AustralianSuper CEO Paul Schroder.

“We believe all Australians should live well in retirement, and to do that they need both super and housing,” he said.

“Through investments like this, super funds can play an important role in responding to the current housing supply crisis while delivering on our purpose for members.”

With the merger, Assemble will leverage its existing development, operations, and investment management expertise to partner with the development industry, government, and community housing sectors.

The housing developer has adopted a co-leadership approach with the merger, with Kris Daff to continue as managing director, joined by Carolyn Viney as CEO.

“The merger between Super Housing Partnerships and Assemble underscores our commitment to addressing the housing crisis,” Daff said.

“Backed by two of the nation’s largest industry superannuation funds, we are able to scale up the various innovative housing models we have developed over a number of years, and in doing so, provide stable, long-term returns for our investors and their members while offering much-needed housing options for Australians.”