Less than five months after submitting plans to redevelop the former Cadbury office on St Kilda Road into a luxury apartment tower, development giant <a href="https://www.apartments.com.au/developers/dexus-property-group">Dexus</a>&nbsp;has been given ministerial approval to push on with the project.

Apartments.com.au <a href="https://www.apartments.com.au/news/vic/first-look-dexus-joins-st-kilda-road-apartment-ranks-with-gateway-tower-proposal">revealed the plans in October last year</a>.

The approved project will see the 19-storey office building at 636 St Kilda Road replaced with a <a href="https://www.apartments.com.au/architects/bates-smart">Bates Smart</a>-designed tower delivering more than 400 new apartments at the prominent intersection of St Kilda Road and Queens Road.&nbsp;

The design responds to the site’s gateway position at St Kilda Junction, with Bates Smart describing the tower as a “refined and sculptural built form that mediates between the scale of St Kilda Road and Queens Road,” reinforcing a civic presence at the key intersection.&nbsp;

<img alt="First look: Dexus joins St Kilda Road apartment ranks with gateway tower proposal" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_auto/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-10-06%20at%2012.52.37%E2%80%AFPM.png?VersionId=Tq3yyOWe0e0klvy5j4TIjiZT7yd3f1Xk" />

The development will comprise 402 apartments, including 40 studios, 87 one-bedroom, 203 two-bedroom, and 66 three-bedroom residences, alongside six penthouses. The project will also incorporate active frontages, new pedestrian through-links and a landscape strategy designed to integrate with the boulevard character of St Kilda Road.&nbsp;

Public realm improvements form part of the approved scheme, including a 138 square metre linear park, extensive landscaping and approximately 188 metres of active street frontage intended to improve permeability and safety at ground level. Four basement levels will provide 449 car spaces and 120 bicycle spaces.&nbsp;

The project includes a $9.6 million contribution to the Social Housing Growth Fund, equivalent to three per cent of the project’s estimated development cost, supporting broader affordable housing initiatives across Victoria.&nbsp;

<img alt="First look: Dexus joins St Kilda Road apartment ranks with gateway tower proposal" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_auto/https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/St%20kilda%20rd%20site.png?VersionId=m_ZioKYhwkvekE3ZUF6y7bz.5_5yFPnZ" />

Wholesale Australian Property Fund (DWAPF) Fund Manager Chris Davitt said the residences are intended to appeal to a broad mix of buyers seeking proximity to the CBD and surrounding amenities.

“We’re excited about the potential of the project to contribute new residential supply to one of Melbourne’s most sought-after areas,” Davitt previously said. “The landmark site at 636 St Kilda Road is at the gateway to Melbourne’s CBD, offering sweeping views and exceptional connectivity.”&nbsp;

The site’s three street frontages, St Kilda Road, Queens Road and Queens Lane, allow for generous setbacks and a flexible built form, while its proximity to the ANZAC Station tram-rail interchange and the St Kilda Road cycling corridor positions it within one of Melbourne’s most connected inner-city precincts.&nbsp;

St Kilda Road has become one of Melbourne’s most active apartment corridors in recent years, with projects such as Victoriana, The Muse and St Boulevard already completed overlooking Albert Park Lake, while Gamuda Land continues construction on Fareham and several other developments are planned nearby.&nbsp;

Joel Robinson

Dexus secures ministerial approval for St Kilda Road apartment tower

Just a few months after launching to the market,&nbsp;<a href="https://www.apartments.com.au/developers/gold-partners-australia">Gold Partners Australia</a>&nbsp;has sold 75 per cent of the apartments at&nbsp;Harmony on Broadbeach, its debut Gold Coast apartment development.

<a href="https://www.apartments.com.au/new-apartments/harmony-on-broadbeach-2797-gold-coast-highway-broadbeach-qld-4218">Harmony on Broadbeach</a>, which will rise 33 storeys on the corner of First Avenue and the Gold Coast Highway about 400 metres from the beach, will deliver a collection of two and three-bedroom apartments designed to appeal to a mix of local owner-occupiers, interstate buyers, and investors seeking newer stock in the tightly held Broadbeach market.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/dbi">DBI Architects</a>, Harmony will home just over 100 apartments, with a typical floorplate limited to four apartments per level. The configuration allows for larger layouts and greater privacy compared to many higher-density coastal towers.

[smartcode_project:default project_id=113098 project_image_fid=355608]

The residences comprise generous two and three-bedroom apartments with open-plan living areas, large balconies and floor-to-ceiling glazing designed to maximise natural light and capture views across the ocean, hinterland and Broadbeach skyline. Interiors feature natural stone benchtops, engineered timber flooring and Miele appliances, with finishes intended to reflect the coastal character of the surrounding area.&nbsp;

Amenities are centred on a dedicated wellness offering, including a 20-metre swimming pool, spa, sauna, gymnasium and yoga lawn, alongside communal lounges, private dining areas and outdoor barbecue spaces for residents. The building will also include a hospitality venue at street level, activating the ground plane along the Gold Coast Highway.&nbsp;

[smartcode_project:default project_id=113098 project_image_fid=355611]

Olympus Property Group is handling sales for the development. Director Deanna Lockett said the project has resonated with a wide buyer pool drawn to the combination of location and pricing.

“There’s been nothing new come to the market in <a href="https://www.apartments.com.au/developments/broadbeach-qld-4218">Broadbeach</a> at this price point for nearly a year,” Lockett said. “It hits the sweet spot of affordability, good sized apartments, in a great location.”&nbsp;

Broadbeach remains one of the Gold Coast’s most established lifestyle precincts, with residents within walking distance of the beach, dining along Surf Parade, Pacific Fair Shopping Centre, and the Gold Coast Convention and Exhibition Centre. The suburb has seen limited new apartment supply over the past year, contributing to strong early demand for Harmony.&nbsp;

Construction is due to commence in Q2 2026, with completion targeted for late 2028, as Gold Partners Australia expands into the Gold Coast market alongside its established pipeline in New South Wales.

[smartcode_project_cta:default project_id=113098]

Harmony on Broadbeach races to 75 per cent sold as Gold Partners Australia target construction commencement

Developer <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> is bringing some of the largest apartments ever delivered to the sought-after Domain Precinct, directly facing Albert Park Lake.

H&amp;F has recently launched <a href="https://www.apartments.com.au/new-apartments/the-queensbury-melbourne-71-queens-road-melbourne-vic-3004">The Queensbury</a>, inspired by London’s Queens Club, the historic home of the prestigious Wimbledon, the world’s oldest tennis tournament. The opportunity for apartment buyers is as rare as securing a ticket to the finals at the All England Club, with the site being one of the very few remaining positions offering uninterrupted, never-to-be-built-out views across Albert Park Lake.

The building has been designed to maximise the unique nature of the site and its prominent parkside position. Architecture firm Forum has crafted a design that responds directly to its setting. Its façade is defined by strong vertical elements and expansive glazing, oriented to capture the unrepeatable views over Albert Park Lake, the city and the bay.

[smartcode_project:default project_id=151832 project_image_fid=359764]

There will be 141 two- and three-bedroom apartments in The Queensbury, many of which have already been snapped up during the early marketing stage.

The apartments have been planned to maximise natural light and visual connection to the surrounding landscape. Living areas extend to private balconies, reinforcing the relationship between interior spaces and the lake or city beyond. Bedrooms are oriented to draw in daylight, while material selections focus on natural stone, porcelain tiles and brushed nickel fixtures.

Purchasers can choose between two interior schemes, Augusta and Ascot, which interpret neutral and earth-toned palettes across kitchens and bathrooms. Kitchens incorporate natural stone benchtops, integrated Miele appliances and panelled cabinetry, with detailing designed to balance durability and everyday functionality.

[smartcode_project:default project_id=151832 project_image_fid=359771]

Much like the private clubs that define Wimbledon’s tradition and prestige, The Queensbury has been designed to embody an exclusive, club-style way of living.

Its resident amenities are curated to mirror the refined atmosphere of a members’ club, with spaces to gather, unwind and entertain, delivering an elevated lifestyle that feels both rare and enduring.

[smartcode_project:default project_id=151832 project_image_fid=359772]

“The ground level is designed as an open lounge that brings the outdoors in,” says David Harrap, Director at Forum.

“The wellness centre is a sanctuary and spills out towards the garden, creating a sense of calm.”

The wellness centre comprises a fully equipped gym, spa, cold plunge pool and sauna. A resident lounge and dining space opens to an outdoor pickleball court, aligned with the sporting culture of London’s Queens Club and a first for a Melbourne multi-residential apartment development.

[smartcode_project:default project_id=151832 project_image_fid=359748]

While the proximity and orientation of the site and building are unmatched, future residents will also be within walking distance of ANZAC Station and multiple tram connections along St Kilda Road. The development is also close to the NGV, Arts Centre Melbourne and major sporting venues including the MCG and Rod Laver Arena.

St Kilda Beach, along with the hospitality venues that line the foreshore, is just over two kilometres from the front door.

[smartcode_project:default project_id=151832 project_image_fid=359764]

<a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> has been developing a mix of commercial and residential projects since it was founded in 2014 by Daniel Faigen and backed by Eddie Hirsch, co-founder of United Petroleum.

After recently launching its fourth Gold Coast project, <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> has also delivered local developments including Central Park in Box Hill and 107 Darling Road in Malvern East.

[smartcode_project_cta:default project_id=151832]

The Queensbury brings Wimbledon-inspired living to Albert Park Lake

<a href="https://www.apartments.com.au/developers/pdg-corporation">PDG Corporation</a> has been appointed by the Victorian Government and Development Victoria to transform a long-unused infrastructure site in Ivanhoe into a new residential precinct, delivering 275 homes alongside a 2,000 sqm public park.

The project will redevelop the former water tank site on Upper Heidelberg Road, which has been unused since 2004. The appointment follows an eight-year planning process and marks the start of detailed design, with a planning application expected to be lodged in mid-2026.

The redevelopment will introduce a new residential community in one of Melbourne’s established inner-north suburbs, with at least 10 per cent of the homes allocated as affordable housing. In addition to new housing supply, the project will expand local open space through the delivery of the public park, which will be accessible to the broader community.

PDG Managing Director and Founder Vince Giuliano said the partnership with Development Victoria presented an opportunity to deliver a housing outcome aligned with the character of the area.

“PDG is thrilled to partner with Development Victoria to bring new housing options to this popular part of Melbourne,” Giuliano said.

“This exceptional location offers a rare opportunity to create a vibrant, connected community, and we look forward to working closely with Development Victoria and other stakeholders to bring their vision to life.”

The Ivanhoe project continues PDG’s track record of delivering mixed-use and community-focused developments in Melbourne.

PDG has just sought to upscale its plans for its prime Southbank site on Queens Bridge Street. They are seeking to developer 637 apartments across a 71-storey tower.

PDG appointed to develop Ivanhoe water tank site by Development Victoria

National developer Fortis has received development approval for Crest &amp; Walker, its Newstead apartment development on Kyabra Street.

Construction by Binah is expected to commence on the 20-storey, Bureau^Proberts-designed building soon. There will be 65 two- and three-bedroom apartments on offer, starting at $1.8 million.

<a href="https://www.apartments.com.au/new-apartments/crest-walker-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> marks the fourth active development to be delivered by Fortis in Brisbane, following River House, now nearing completion, a residential project in New Farm, and a mixed-use development in Hamilton. Several additional projects remain in the pipeline as the development manager continues to grow its footprint across South-East Queensland.

Dan Boman, General Manager – Development, Queensland, said the continued expansion in Brisbane projects managed by Fortis reflects the company’s commitment to design-led development and thoughtful placemaking.

“We’re proud to be strengthening our presence in Brisbane with Crest &amp; Walker, particularly in such lifestyle destination as Newstead," Bonman says.

"Every Fortis project is shaped by its context, and we approach each one with the respect and care it deserves."

Bonman believes Crest &amp; Walker will&nbsp;attract a discerning buyer who values design, thoughtful amenity and a lifestyle that captures the best of contemporary Brisbane.

"Our focus is always on creating places that feel connected to their neighbourhood and elevate the everyday experience for residents. Newstead continues to evolve as one of Brisbane’s most sought-after urban communities, and Crest &amp; Walker reflects our ambition to contribute meaningfully to that story."

The building’s design features a contemporary brick podium softened by vertical greenery, creating a distinctive architectural expression within the Newstead streetscape. Positioned between Gasworks and James Street, the project sits within one of Brisbane’s most coveted lifestyle precincts, surrounded by dining, retail and cultural destinations.

A communal rooftop will feature a sun lounge and pool, BBQ facilities and a sauna, all set against panoramic views across Newstead and the Brisbane CBD.

Slaite Projects will handle the sales campaign, which will kick off in May.

[smartcode_project_cta:default project_id=145922]

Fortis to launch Crest & Walker, Newstead following development approval

Student Housing

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GUEST OBSERVATION
The <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2020-11-30/international-students-arrive-in-australia-coronavirus-nt/12933370">arrival at Darwin airport</a> on Monday of 63 students from China, Hong Kong, Japan, Vietnam and Indonesia on a charter flight from Singapore ended an eight-month hiatus in international student arrivals in Australia. They are now in the <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2020-11-27/nt-chief-minister-covid-cap-on-international-arrivals-doubles/12927552">Howard Springs quarantine facility</a>.
Quarantine capacity is a major issue, given the <a href="/news">numbers of international students</a>. Using student accommodation to quarantine newly arrived students is a way to increase this capacity. <a href="https://www.ahuri.edu.au/research/research-papers/enhancing-the-design-quality-of-purpose-built-student-accommodation">Our research</a>, released today, shows this could be important for solving the quarantine issue.
But shouldn’t Australians get priority?
Over the years we have become accustomed to hundreds of thousands of young learners crossing our borders. In airport arrival halls incoming international students rubbed shoulders with Australian students returning from exchanges, study tours and internships. In departure lounges departing international students, with perhaps some hints of an Australian twang in their accents, mingled with Australian students setting off on their big adventures.
Despite student mobility being a normal feature of modern Australia, it was inevitable “Australians first” critics would deride the arrivals. Tasmanian Senator Jacquie Lambie <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2020-11-30/international-students-arrive-in-australia-coronavirus-nt/12933370">said</a> she found the student quarantine program “sickening”.
The Department of Home Affairs <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2020-11-30/international-students-arrive-in-australia-coronavirus-nt/12933370">said</a> the students arriving in Darwin were in addition to the government’s <a href="https://www.smartraveller.gov.au/news-and-updates/limits-passenger-flights-australia">returning passenger caps</a>. And that is the way it should be. Just as international students do not displace any local students from university places, it is important their arrival does not delay the return of Australian citizens and permanent residents.
All Australian states are considering plans to create secure corridors for students to return for the 2021 academic year. Universities, schools and colleges across the country are planning for their return, albeit with some online learning continuing to allow for social distancing on campus. The Commonwealth has sadly remained lukewarm on the states’ proposals to date. 
Student housing provides an answer
The investment in purpose-built student accommodation over the past decade has been enormous.
Our research identified nearly 67,000 beds in this form of accommodation in Australia’s capital city CBDs alone. The <a href="https://www.propertyobserver.com.au/https://studentaccassoc.com.au/news/9376655">Student Accommodation Association</a> estimates there are over 95,000 beds Australia-wide. Major developments are due to open soon that will swell those numbers.
As well as dramatic increases in scale, the character of this purpose-built accommodation has changed significantly. Older student dormitories are relatively small and closely affiliated with universities, religious orders and other not-for-profit organisations. The newer commercial developments are large-scale properties, usually in city centres.
According to City of Melbourne data, between 2011 and 2018 the average height of purpose-built student accommodation increased from five storeys to 24. The average number of beds increased from 82 to 579! The largest planning application for a new property in Melbourne comprised 901 beds across 49 storeys, while the tallest building is 63 storeys with 740 beds.
A large proportion of these beds are now sitting empty. These facilities provide an ideal means for developing parallel pathways for these students to return to Australia without using existing channels for repatriating Australians. Whole buildings with hundreds of beds could easily be dedicated to housing the international students waiting to begin or resume their studies here.
How would student quarantine work?
The design of these buildings varies considerably. Authorities would be able to choose from many different bedroom and communal space configurations.
At first, it is likely quarantine authorities will want students to be kept in isolation for 14 days, so student apartments with their own kitchenettes and bathrooms are likely to be chosen. Over time, as confidence builds and systems to manage risks are refined, small clusters may be possible, using buildings in which several rooms share a kitchen and living space.
In either model, student accommodation properties are better suited to quarantine than hotels. They already provide pastoral care, security and staff attuned to the needs of newly arrived young people as a matter of course.
They should have no trouble implementing rigorous quarantine requirements to ensure no further outbreaks are caused by contagion through support staff, as has occurred in other contexts in Melbourne and Adelaide. Staff would have minimal contact with student residents. Meals could be left at the door, and rubbish collected at the door.
Staff and education providers could deliver support services by phone and video. Many universities are already providing daily exercise classes and arranging virtual meet-ups. These programs could easily be tailored to students in quarantine.
We have learned much this year about how to reduce the risk of transmission from incoming travellers. We know contact between quarantine workers and the broader community poses a serious risk. Thus, most staff working in student quarantine facilities would likely live on site. The scale of the newer properties makes this easy to implement.
Risks can be further reduced by arranging direct flights from a city with few cases to an Australian city where the students are transported directly to one facility, thereby avoiding flight transfers in busy hub airports. Testing would be required prior to departure and again before leaving quarantine. Staff would be tested regularly.
Students and education providers cover costs
These arrangements need place no burden on the Australian community. The Darwin model, in which students pay for their flights and the university covers quarantine costs, seems like a reasonable split.
 
Curiously, Charles Darwin University was not the first Australian university to organise charter flights and dedicated quarantine arrangements for students. In September, <a href="https://www.rmit.edu.vn/news/all-news/2020/sep/rmit-vietnam-students-returned-home-through-bamboo-airways-partnership">RMIT chartered a flight</a> from Melbourne to Vietnam to return 270 people, including many students from RMIT’s Vietnam campus who had been on exchange in Melbourne when the virus hit, as well as RMIT staff and business partners. A second RMIT charter flight from Melbourne landed in Da Nang on November 28.
Australia’s international education sector has the capacity to manage such logistics. Our universities have extensive experience in moving tens of thousands of students around the world every year. Our accommodation providers have huge capacity in new facilities specifically designed for students.
Expanding parallel pathways for students to return to Australia need not interfere at all with the return of Australians.<img src="https://counter.theconversation.com/content/150180/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/christopher-ziguras-956941">Christopher Ziguras</a>, Professor of Global Studies, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a> and <a href="https://theconversation.com/profiles/tom-alves-1183729">Tom Alves</a>, Head of Development, <a href="https://theconversation.com/institutions/australian-housing-and-urban-research-institute-1038">Australian Housing and Urban Research Institute </a>
This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/how-unis-can-use-student-housing-to-solve-international-student-quarantine-issues-150180">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

How universities can use student housing to solve international student quarantine issues

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A 17-storey student housing building at 500 Swanston Street is off to VCAT after the applicant, Journal Property Limited, decided to appeal the matter after City of Melbourne council failed to make a decision within the requisite 60 statutory days.

During its meeting on Tuesday night, the City of Melbourne's Future Melbourne (Planning) Committee resolved that it would have issued a permit subject to conditions, had the appeal to VCAT not been made.

These conditions would have included a reduction in height of two levels taking the overall height down to 15-storeys or approximately 51.5m, which according to Council planners would provide a better transition between Upper House to the north (17-storeys), Arrow on Swanston Street to the south (12-storeys) and The Eminence (15-storeys) to the north-east.

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/swanston_street_elevation.jpg" rel="gallery-all" title="Amended Swanston Street elevation dated March 2018. Image: Metier3 Town Planning documentation"><img alt="" class="image-article-full-width-580px" height="386" src="/sites/urban.melbourne/files/styles/article_full_width_580px/public/pictures/article-images/swanston_street_elevation.jpg?itok=fKJ22BUL" title="Amended Swanston Street elevation dated March 2018. Image: Metier3 Town Planning documentation" width="580"></a>

<figcaption>Amended Swanston Street elevation with reduced height (March 2018). Image: Metier3 Town Planning documentation</figcaption></figure>This would reinforce Upper House's prominence on the corner and ensure that the proposed tower is not as prominent when viewed from Swanston Street, argues Council. Additionally, Council would have required levels 11 and above to be reconfigured to increase the setbacks from the southern boundary reducing their dominance and bulk further.

Increasing the setbacks will also improve internal amenity for student accommodation modules and improve the external amenity impacts by creating a greater separation from surrounding residential properties.

Council's planners provided their appraisal based on plans prepared by Metier3 in November 2017, which were subsequently amended in March 2018 with the following changes:

<ul>
<li>Deletion of levels 15 and 16 to reduce the overall building height by two levels to 15 storeys;</li>
	<li>Increased setback of Building D upper levels (11-14) from the south boundary to provide a 9m setback from the Arrow building, as well as reducing the overhang to allow more natural daylight to lower levels of accommodation;</li>
	<li>Introduction of light wells to Building D upper levels (11-14) to allow for improved natural light and ventilation to hallways on levels 11 to 14;</li>
	<li>The removal of rooms to allow for two additional windows per level to improve natural light and ventilation to hallways in Upper Mezzanine to level 10;</li>
	<li>Deletion of all 13 rooms in the lower mezzanine to remove all rooms with restricted daylight access. Part office and communal areas relocated to this space allowing for the deletion of basement.</li>
	<li>Introduction of four rooms to ground floor. Two twin share rooms added to ground floor made possible as result of the consolidated office space spread across two levels. Rooms were introduced to offset 13 rooms deleted from lower mezzanine below as these four rooms have adequate access to natural daylight;</li>
	<li>Deletion of basement;</li>
	<li>Deletion of east-west facing windows on northern boundary;</li>
	<li>Rationalised internal communal space to levels 10 and 11 to allow for additional rooms;</li>
	<li>Relocation of bike store to ground floor to enable direct access off building entry/street level;</li>
	<li>Overall reduction in number of beds from 710 to 587;</li>
</ul>
The original plans included three building elements providing 710 student accommodation units via a mix of studio, two-bed, three-bed, four-bed and five-bed units.

A food and drink, and two retail tenancies are located at the ground level, while the basement would contain a laundry, workshop, storage for 80 bicycles, and building services.

The lower ground will largely accommodate communal student areas including two landscaped courtyards, lounge, communal and private study areas, kitchen and dining area, entertainment, well-being and gym areas and gaming room.
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Laurence Dragomir

500 Swanston Street off to VCAT - City of Melbourne provides conditional support

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The US and UK are the most mature student housing markets, and continue to dominate global investment deals, but new stock developed now in Europe and Australia paves the way for institutional investment in the future, according to a recent Savills report.
<a href="https://www.propertyobserver.com.au/images/2017/11/10/SavillsNov15Chart.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/11/10/SavillsNov15Chart.png" alt="">
Student Housing (SH) yields and sector comparisons:
<a href="https://www.propertyobserver.com.au/images/2017/11/15/SavillsSH.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/11/15/SavillsSH.png" alt="">
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Yields 
The US market stands out as particularly high-yielding for such a mature market. We expect yields to move in as institutional involvement increases, the sector matures and perceived risk diminishes. Although they are less developed markets, there is also potential for further downward yield shift in Australia and Spain over coming years. Whether Germany, the UK and France are fully valued at 3.75%-4.5% will depend on how much scope there is for rental growth in their main university cities. The gap between residential and student housing yields remain, although we expect it to narrow. 
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Source: <a href="http://pdf.euro.savills.co.uk/global-research/world-student-housing-2017-18.pdf?utm_source=PropertyObserver&amp;utm_medium=DigitalAdvert&amp;utm_campaign=CPOeNewsletterBanner-WorldStudent-8Nov2017&amp;utm_source=Property+Observer+List&amp;utm_campaign=24caa627fb-Commercial_Property_27_September_2017&amp;utm_medium=email&amp;utm_term=0_a523fbfccb-24caa627fb-245615189" target="_blank">Savills World Research</a> 
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Australia leads in student housing yields: Savills

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SPONSORED POST
Where once it was a niche investment, student accommodation has now become a global asset class.
According to the latest Savills World Student Housing Spotlight, 2015 was a record year for investment in student housing with US$14.9 billion invested globally in the sector.
The Local Market - Australia
The Australian market continues to attract significant attention and is a particularly popular destination for international students. Students from China and India together supply nearly 40 percent of international students, an increase of more than 13 percent and 15 percent respectively in 2015.
With Australia featuring in the list of favoured destinations in the world’s top outbound markets for international students, plus a fast-growing domestic population, student numbers have risen 37 percent in the last eight years. With 30 Australian institutions appearing in the top 750 of the QS World University Rankings, up from 25 in 2012, demand is likely to continue and, as a consequence significant new stock will be required.
The strong growth potential in Australia is set against a general shortage of supply; at the moment there is only enough purpose-built student accommodation (PBSA) available to accommodate 6 percent of the student population. In response, more than AU$2 billion of capital has been earmarked for development projects in student accommodation since the start of 2015.
Around the World
The Savills World Student Housing Spotlight has found that cross border investment in this fast maturing asset class accounted for 40 percent of all global investment activity. International investors who are seeking to diversify their portfolios have been attracted by the fact that US and UK student housing REITs have outperformed their All REIT indices by 19 and 16 percentage points respectively.
The first half of 2016 has seen lower total global volumes compared with 2015, but in mainland Europe investment levels have continued to rise off a low base. By the end of July, German student housing had attracted €350 million of investment – more than double the total invested in the whole of 2015 – while in France €345 million has been transacted in the year to August 2016.
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Investors have been attracted by mainland Europe's strong investment potential. Its combined student population of 20 million, and the very low provision in some markets of purpose-built student accommodation (PBSA) despite growing demand from international students attracted by an increasing number of courses taught in English, place it on an upwards trajectory.
A Resilient Asset Class
Growing international student numbers are therefore set to secure the market for a premium PBSA product, but there also remains a huge untapped market for more affordable private accommodation. High land values and development costs will impede this in many markets, but upgrading of existing university stock or establishment of new models may be a route in.
In either case, student housing has proven itself to be a resilient asset class and, with its counter-cyclical fundamentals, many institutional investors will continue to turn to the sector where they can achieve strong occupancy and rental growth.
To learn more about the trends in the current student accommodation market, view <a href="https://www.savills.co.uk/research_articles/188294/207929-0" target="_blank">Savills World Student Housing Spotlight 2016</a>.
Savills is a leading global real estate service provider offering the full spectrum of services from strategic advice to managing assets and projects and transacting deals. To learn more about Savills student accommodation services, visit <a href="https://www.savills.com.au/services-and-sectors/student-accommodation.aspx" target="_blank">savills.com.au/studentaccommodation</a>.
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The rise – and rise – of global student housing investment

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Australia is a popular destination for international students, particularly from Asia.
China and India together supply nearly 40 percent of international students, an increase of more than 13 percent and 15 percent respectively in 2015.
Total higher education enrolments grew by 2.7 percent over the same period. 
Growing demand is set against a general shortage of supply. The provision rate stands at 6 percent, which is low compared to mature markets such as the UK at 24 percent. In response, a number of universities have commenced on-campus procurement projects and private operators are rapidly expanding their pipeline. 
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More than AU$2 billion of capital has been earmarked for development projects in student accommodation since the start of 2015. The top ten providers currently own a total of 20,136 beds and have a combined development pipeline of 15,469, representing an increase of approximately 75% on their existing stock. 
Scaling up on new delivery presents challenges. Competing land uses, particularly from a strong residential sector, have pushed up land values and made development for PBSH unviable in some markets, most notably Sydney. 
Federal and state governments have recognised the shortage as a limiting factor in the future development of the country’s higher education sector (already Australia’s third biggest export, after iron ore and coal), and a number of strategies to enable new development are in the pipeline. 
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As an emerging market for student accommodation, transactional activity is limited as completed assets are generally tightly held. Savills research indicates there were just two transactions of operational residences totalling nearly AU$90 million in 2015. 
In 2016, Infratil (HRL Morrison) secured a 30 year concession of ANV’s portfolio of 3,760 beds and UniLodge @ UNSW was transacted at a net initial yield of circa 5.6 percent. 
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Australia's student housing plays catchup to meet foreign students influx: Savills

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The high quality of Australia’s universities is a major drawcard for international students, but accommodation availability is just not keeping up with supply in Sydney.
In the latest rankings, Sydney University sits on The Times Higher Education top 100, giving the long established international rivals a run for their money. It came in ranked at 61st in the world. The University of NSW joins Sydney among the universities in another ranking, the QS top 100. 
Australia's international student population continues to grow at a double digit rate, recent research from the estate agency, Savills International.
The OECD noted this reflects an international trend of student mobility when they reported more than four million international students were enrolled in tertiary education outside of their country of origin in 2013, an increase of 50 percent from 2005 levels.
Australia hosted the third largest number of international students at 6.2 percent in 2013, behind the US and UK at 19.4 percent and 10.3 percent respectively.
Sydney's standing contributes to robust demand for international student accommodation. 
New South Wales, then Victoria and Queensland have the greatest number of enrolments. 
NSW has around 327,000 domestic higher education students with another 93,000 international students.
The top nationalities, China, India, Vietnam, Republic of Korea and Malaysia. 
Chinese students provided over 27 percent of the total number of international students in Australia in 2015. 
Australia ranked as the third most popular destination for Chinese students (12.1 percent) after the US (33 percent) and Japan (12.3 percent). Australia was also third most popular for students from India after the US (48.2 percent) and UK (11.5 percent).
This has made property investors, institutional and private, move beyond the traditional property markets into student accommodation where the fundamentals are strong.
Some five percent of students are in university accommodation, five percent are in commercial accommodation with 90 percent renting privately or living at home.
At the moment there is a "critical undersupply" of appropriate Purpose Built Student Accommodation (PBSA) in Sydney, Savills Sydney student accommodation director Conal Newland said..
The high occupancy levels, robust revenue growth and attractive yield pricing make student accommodation is an attractive investment, he concluded.
The result of the growing levels of investor activity has meant that the student accommodation market is changing rapidly. 
Savills research indicates that more than $2 billion of capital has been earmarked for development projects across Australia since the start of 2015. 
Several new institutional investors have entered the market including Blue Sky Private Real Estate, Cedar Pacific, Global Student Accommodation, Scape, Valparaiso and Wee Hur. They have joined the likes of Unilodge, best known for their Central Park, Chippendale offering.
There are currently 67,695 PBSA beds in the eight Australian capital cities. All cities have an existing supply of less than 12 percent per full-time student with the exception of Canberra's 27 percent.
Melbourne and Brisbane have the largest development pipelines.
Sydney has a limited pipeline over the next four years with an additional 3,665 beds, of which around 38 percent are proposed by universities.
Savills nominated Urbanest as the most active off-campus developer with three properties completed since 2015 and another two in development.
Sydney saw 3,200 beds delivered in 2015 with these new properties trading at circa 70 percent occupancy in their first semester of operations.
In 2016 the average occupancy levels are at above 90 percent.
A number of universities, including the University of Western Sydney have commenced on-campus projects.
UNSW has been active delivering new halls of residence at the Kensington Campus in 2014 and 2015.
University of Sydney is an increasing participant – particularly at lower rental levels with the delivery of the Queen Mary building and weekly rents less than $300.
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 Student housing not meeting supply in Sydney

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Investors are moving beyond the traditional core markets and seeking alternative asset classes such as student accommodation where the fundamentals are strong, says the 2016 Australian Student Accommodation Market Report.
Growing investor and undersupply of student accommodation means that the market is changing rapidly. Savills research indicates that more than $2 billion of capital has been earmarked for development projects in student accommodation across Australia since the start of 2015.
Yields
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Current Indicative International Yields 
The following table provides an indication of Net Initial Yields for prime student accommodation investments across several countries with emerging and established markets as at March 2016. The spread of the prime yield to 10-year bond clearly illustrates a lower spread for the more mature and liquid markets of the USA and the UK. 
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Australia 
Net Initial Yields in Australia have remained relatively static over the last 12 months, primarily due to the lack of transactional evidence. There is strong sentiment to suggest that yields are in a downward cycle, given the weight of capital that has entered the market and also the spread of current yields to the 10-year bond rate compared to more mature transaction markets. 
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The following table indicates the current net initial yields for Australia in 2016:
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