A residential apartment project in Melbourne is being considered as a housing model that can be replicated at scale to improve affordability and sustainability for buyers.
The development targets first home buyers, affordable housing clients and those working in key community occupations.
The project, Nightingale Village is a partnership between HESTA, the industry fund for the health and community services sector, which has committed $20 million to the project, housing organisation Nightingale Housing and Social Ventures Australia (SVA), a not-for-profit organisation that works with partners to alleviate disadvantage. More than 80 percent of HESTA members are women working in the health and community services sector.
“Having a home is a fundamental element of financial security and societal connection and the lack of affordable homes close to major infrastructure is a huge issue for the community and our members,” HESTA CEO Debby Blakey said.
“We want to prove that you can invest to achieve returns for members and help address big social challenges like housing affordability. This investment provides a possible blueprint to help grow the supply of more affordable housing that could attract other large investors.”
Nightingale Village is a carbon-neutral residential project in Brunswick, consisting of 185 apartments across six architecturally-designed buildings on former warehouse sites. While 20 percent of the apartments have been allocated to Key Contribution Workers such as nurses, aged care professionals, and those working in the not-for-profit sector, another 20 percent were pre-sold to Community Housing Providers, to be rented out to eligible clients at reduced rates. The remainder was sold to the general public, many of whom are first home buyers.
Older women are particularly vulnerable to homelessness in Australia with the number increasing by 31 percent between 2011 and 2016. SVA’s initiatives aim to change the system to dramatically improve outcomes for this group.
“Key Contribution Workers deliver critical, life-changing services in their communities and we are looking for investment opportunities that improve their access to secure affordable housing near infrastructure and in proximity to where they work,” Blakey said.
Nightingale Village is the fourth Nightingale Housing project with the organisation achieving greater affordability by selling more expensive, larger apartments to help cross-subsidise the cost of smaller and less expensive apartments for first home buyers and Key Community Contributors. First home buyers, for instance, were able to purchase smaller studio apartments with a 5 percent deposit and at a comparatively lower cost per square metre.
Due to the rising housing affordability problem, all Nightingale Housing projects have strong demand and a long list of buyers, eliminating the need to engage marketing consultants and real estate agents or invest in promotions, resulting in savings being passed on to the buyers.
Further cost savings are achieved by adopting an environmentally sustainable design and construction approach. Key project considerations also include energy efficiency and proximity to public transport to ensure long-term affordability for residents.
Nightingale Housing managing director Jeremy McLeod says, “We started with the idea that the answer to housing in our country was in design, in architecture, and what I discovered was that the answer was in an entirely new system.
“Nightingale Housing exists to revolutionise the way we live together. Nightingale is a triple bottom line housing model; it's designed to deliver housing at cost that is affordable, sustainable and delivers a sense of community.”
The $20 million Nightingale investment is the single biggest commitment HESTA has made through the Fund’s $70 million Social Impact Investment Trust (SIIT), managed by SVA. The SIIT is investing alongside SVA’s Diversified Impact Fund.
"This investment is a great example of how institutional investment can have a positive impact on the broader Australian community by making a meaningful contribution to the social and affordable housing market," SVA executive director, Impact Investing Michael Lynch says.