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CAPITALAND'S Australian unit Australand is partnering another property group for a A$300 million (S$347.3 million) public housing redevelopment project in Carlton, Victoria.
Through a joint venture with St Hilliers, Australand will be replacing 192 old walk-up flats with over 240 public and social housing apartments and 500 inner city residential homes.
The project will span 7.5 hectares across three Carlton sites.
Australand said in a statement yesterday that the project is part of its strategy to diversify its residential business.
The consortium will deliver the redevelopment in seven stages over the next eight years.
'The multi-staged structure of the redevelopment enables us to re-use capital as stages are completed, making it a very capital efficient project for the consortium partners at a time when many other developers are experiencing difficulty in securing finance,' Australand said.
The consortium expects to finalise all development documentation by end-July, and marketing of the homes will begin in mid-August.
Prices of units in the first release at Lygon Street, which are targeted at investors and first home owners, will start from high A$200,000.
Construction is scheduled to start in November and the redevelopment project should be ready by 2017.
It is expected to bring in sales revenue of over A$300 million.
'Our research indicates this area is in need of additional market-based accommodation,' said Australand general manager Robert Pradolin.
'Given the existing amenity of the area and the rental shortages being experienced, we expect interest in the project from the market to be high'.
The new homes will come with environmentally sustainable features, which will for instance, capture solar and wind energy or recycle grey water.
There will also be new public parks as well as pedestrian and bicycle pathways.
Australand shares gained two Australian cents yesterday to close at 47.5 Australian cents.
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