Malaysian property developer UEM Sunrise has secured an investment partner for its first Build to Rent development in Australia, progressing a A$315.4m scheme in Melbourne through a fund-through structure that combines land disposal with a long-term development agreement.
UEM Sunrise announced that its indirect wholly-owned subsidiary UEM Sunrise (Collingwood) Pty Ltd, acting as trustee for the UEM Sunrise (Collingwood) Unit Trust, has entered into an agreement to sell the site for A$47.3m. At the same time, a second indirect wholly-owned subsidiary UEM Sunrise (Collingwood Development) Pty, has signed a fund-through agreement valued at A$268.1m, excluding goods and services tax, to undertake the design, development and construction of the scheme on behalf of the purchaser.
The buyer, ITG Australia TS Sub Pty Ltd, acting as trustee for the New Dawn Property A Trust, is wholly owned by an Australian living sector investment manager jointly owned by US private equity firm Warburg Pincus and property industry specialist Sam Bisla – Kio Investment Management Pty Ltd. Under the arrangement, Kio Investment Management will own and operate the completed Build to Rent development, while UEM Sunrise will remain responsible for delivering the scheme through to completion.
Located in Collingwood, approximately three kilometres from Melbourne’s central business district, the scheme represents UEM Sunrise’s first entry into Australia’s growing Build to Rent sector. The development will occupy a 5,390 sqm freehold site and received planning approval in December 2024. Construction is scheduled to begin towards the end of 2026, with completion targeted for 2030. Once complete, the development will provide 407 studio, one-bedroom, two-bedroom and three-bedroom apartments.
Amenities include a swimming pool, gym, cinema room, co-working spaces, concierge services, bicycle parking and electric vehicle charging infrastructure. The scheme will also incorporate retail and food-and-beverage offerings together with a public town square, creating a mixed-use destination within the inner-city suburb.
“The Collingwood project is a key part of our growth strategy in Australia and reflects our continued commitment to expanding our international development portfolio.”
Shaharul Farez Hassan, Managing Director and CEO, UEM Sunrise
The company also highlighted Melbourne’s low residential vacancy rates and continuing housing supply constraints as key factors supporting long-term demand for professionally managed rental accommodation, particularly in established inner-city locations such as Collingwood.
According to UEM Sunrise, the fund-through structure allows the business to monetise the land while continuing to generate development income from the delivery phase. The approach is expected to support capital recycling and provide greater financial flexibility for future growth opportunities.
The developer added that the transaction is not expected to have a material impact on its net assets or gearing for the financial year ending 31 December 2026, with the project set to be financed through progressive payments and reimbursements from the purchaser.
The agreement marks another significant institutional investment into Australia’s Build to Rent market, reinforcing continued confidence in the sector as developers and investment managers respond to sustained rental demand and limited housing supply in major metropolitan locations.
