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Project

Victorian Public Housing Renewal Program

PROJECT STATUS
Under Procurement
Victorian Public Housing Renewal Program

Victoria's Public Housing Renewal Program aims to provide at least 1,800 new public housing dwellings, and grow the social housing stock in Victoria by at least 10 per cent. This will involve redeveloping old public housing stock, as well as the construction of new stock.

Work being undertaken as part of the Program includes redevelopment, in full or in part, at the following estates: 

  • Ascot Vale estate
  • New Street, Brighton
  • Gronn Place, Brunswick West
  • Bills Street, Hawthorn
  • Tarakan and Bell Bardia estates, Heidelberg West
  • Abbotsford Street, North Melbourne
  • Walker Street, Northcote                       
  • Oakover Road and Railway Place West and Stokes and Penola Streets, Preston Bangs Street, Prahran, and
  • Flemington estate.

Key Dates

2017 Project Announcement

PROJECT HISTORY

2018 A series of Development Agreements were awarded for sites in Northcote, North Melbourne, Preston and Brunswick West.
Mar 2019 The Victorian Government announced it would rebuild the North Melbourne, Northcote and Preston estates with development partners MAB Corporation and HousingFirst.
May 2021 The Victorian Government selected the Building Communities consortium to deliver the Ground Lease Model project in Brighton, Flemington and Prahran. The consortium comprises Tetris Capital, Community Housing Limited, the National Housing Finance and Investment Corporation (NHFIC), Icon Kajima, and Citta Property Group.
Sector
Social
Procurement approach
Other |
Location
Victoria |
Resources
Media releases
2021/05/15
Project pages
HousingVic
Homes Victoria Renewal
Major Contract

Ground Lease Model Project - Stage One

PROJECT STATUS
Under Delivery
Ground Lease Model Project - Stage One

The Ground Lease Model Project is the first package of the Victorian Public Housing Renewal Program, and will deliver a total of 1,110 new social, affordable and market rental homes. The Victorian Government is using a ground lease model, the first of its kind, to deliver the new dwellings, where the government will lease vacant land to a consortium who will redevelop the sites into integrated communities comprising social, affordable and market rental properties. This package of works will deliver: 

  • 619 new social housing dwellings
  • 126 affordable homes, and
  • 365 market rental homes.

Of the total dwellings, 52 will be Specialist Disability Accommodation. The new housing will replace 445 outdated social dwellings.

The Victorian Government will lease land across three sits to a consortium to build, operate and maintain housing on the sites for 40 years. At the end of this term, the land and housing will be returned to the Victorian Government. 

The sites are located at New Street in Brighton, Holland Court in Flemington and Bangs Street in Prahran.

In August 2023 the project was expanded to deliver an additional 286 social and affordable dwellings in Flemington. The expanded scope included:

  • 50 social dwellings, and
  • 236 affordable homes.

Key Dates

Aug 2020 RFT Open
May 2021 Contract Award
Feb 2022 Construction Commencement - Main Package
Mar 2024 Construction Completed - Main Package
Nov 2024 Construction Commencement - Flemington Expanded Scope
2026 Construction Completed - Flemington Expanded Scope

Funding contributions

Victorian Government

The Victorian Government will provide $50 million in funding, to be drawn from its $5.3 billion Big Housing Build. The total contract is valued at $517 million, with NHFIC providing approximately $400 million for the project, made up of loans and grants. About $51 million of this will be drawn from the National Housing Infrastructure Facility to provide critical infrastructure such as roads, water and power, for the sites. This will be the largest transaction for the NHFIC to date.

Procurement

Procuring Agency: Homes Victoria
Successful Tenderer: Building Communities consortium, comprising Community Housing Limited, Tetris Capital, the National Housing Finance and Investment Corporation, Icon Kajima and Citta Property Group.

PROJECT HISTORY

May 2021 The Victorian Government confirmed the Building Communities consortium had been selected to finance, design, construct, manage and maintain the new housing.
Aug 2023 The project has been expanded to deliver an additional 286 social and affordable dwellings in Flemington which are expected to be completed in late 2026.
Mar 2024 The Victorian Government has announced the completion of construction for Stage One's main package of the Ground Lease Model. The residents will now be moved into the new completed housing.
Estimated Total Cost
(2021)
Sector
Social
Procurement approach
Confirmed PPP |
Location
Victoria |
Resources
Government resources
Flemington Expanded Scope
Media releases
2021/05/15
Project pages
Homes Victoria (Ground Lease Model)
Major Contract

Ground Lease Model Project - Stage Two

PROJECT STATUS
Awarded
Ground Lease Model Project - Stage Two

The Ground Lease Model Project - Stage Two is the second package of the Victorian Public Housing Renewal Program, and will deliver 1,370 new social, affordable, specialist disability and market rental homes. The Victorian Government is using a ground lease model, following the successful procurement of Stage One.

Stage Two housing redevelopments will occur on Homes Victoria owned sites, including:

  • Horace Petty, South Yarra
  • Essex St, Prahran
  • Barak/Beacon Roads, Port Melbourne, and
  • Bluff Road, Hampton East.

The successful proponent will be responsible for the:

  • design and construction of a mix of social, affordable, specialist disability and market rental housing
  • operation and maintenance of homes to an agreed standard for 40 years
  • handover of all homes to Homes Victoria at the end of the term, and
  • provision of private sector finance for the project.

The project will include replacing around 500 dwellings on the four sites with 650 social homes, 180 affordable homes, 470 market rental homes and 55 Specialist Disability Accommodation Homes.

Key Dates

May 2022 Project Announcement
Jun 2022 EOIs Open
Jun 2022 EOIs Close
Nov 2023 Contract Award
2024 Expected Construction Commencement
2026 Expected Construction Completion

Funding contributions

Victorian Government

Financing

The project has received $517 million in conditional investment from the Federal Government through Housing Australia – formerly known as the National Housing Finance and Investment Corporation (NHFIC). This investment comprises $422 million in finance through the Affordable Housing Bond Aggregator and $95 million through the National Housing Infrastructure Facility (NHIF) – it has not been disclosed whether the NHIF investment is funding or finance. 

Procurement

Procuring Agency: Homes Victoria
Successful Tenderer: The Building Communities Consortium, comprising Tetris Capital, Icon Constructions, Community Housing (Vic) Limited, abrdn and Invesis.
Procurement note:

The project is being delivered under an availability-based Public Private Partnership using a Ground Lease Model, which sees the Victorian Government lease the land to the Consortium. The Consortium will design, construct, finance, operate and maintain the dwellings over a 40-year concession term, after which the land and homes will revert to Homes Victoria.

PROJECT HISTORY

May 2022 The 2022-23 Victorian Budget allocated $260 million to the Ground Lease Model Project - Stage Two, as part of the Big Housing Build.
Jun 2022 The Victorian Government issued Expressions of Interest (EOI) for the project's delivery, closing on 30 June 2022.
Nov 2023 The Victorian Government has selected the Building Communities Consortium, comprising Tetris Capital, Icon Constructions, Community Housing (Vic) Limited, abrdn and Invesis, to deliver the project. The project's funding and financing profile was also announced.
May 2024 The 2024-25 Victorian Budget provided an updated total cost of the project of $687 million. The Budget also outlined that the project would be completed by late 2026.
Estimated Total Cost
(2024)
Sector
Social
Procurement approach
Confirmed PPP |
Location
Victoria |
Resources
Media releases
2023/11/03 - Victorian Government
2023/11/02 - ANZ
2023/11/02 - Invesis
Tender notices
2022/06/03
Project pages
Victorian Government Big Housing Build
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