From left: Shane and Anna Brealey of NZ Living, Simplicity CEO Sam Stubbs and COO Andrew Lance. Photo / Supplied
From left: Shane and Anna Brealey of NZ Living, Simplicity CEO Sam Stubbs and COO Andrew Lance. Photo / Supplied
KiwiSaver provider and investment fund manager Simplicity is today launching a new fund to contribute to its goal to finance a targeted 25,000 new homes nationally worth $12 billion in the next 10 to 15 years.
Sam Stubbs, founder and managing director of the business which manages $5.1b of fundsin KiwiSaver and investment portfolios, said the new venture would be called the Simplicity Homes and Income Fund.
That fund would aim to address “decades of this country under-building housing”, Stubbs said.
“Over time, we’re aiming for this fund to beat its benchmark and provide competitive returns,” he said.
A minimum $1000 is being sought from investors from today. The fund will aim to maintain 40 per cent in cash and equivalent assets to provide liquidity so investors still get access to their money without withdrawal fees or penalties.
Simplicity Living - the new joint venture launched with Shane and Anna Brealey - has already started to build the first of 10,000 homes but Stubbs said the new fund accelerate those development plans considerably.
Simplicity has built and rented out 159 homes so far, has a further 345 under construction and another 592 planned, having invested $122 million so far.
But now Stubbs wants to speed up the venture and build nationally.
“We think this will be a long-term game changer for housing in New Zealand,” Stubbs said.
He anticipates Simplicity’s funds, including this new one, spurring 25,000 new homes: 10,000 homes would be build-to-rent properties by Simplicity Living; a further 10,000 would be developed via Simplicity loaning money for low-cost mortgages for a Simplicity member; and 5000 would be developed by buying bonds to fund community housing providers to build their own places.
Simplicity members would get first-home loans for housing at rates lower than bank and fixed floating rates, Stubbs said.
Already, $180m had been loaned by Simplicity for low-cost first-home mortgages to members “and that’s 287 families helped to buy their first home but now we want to do the same for 10,000 families around the country”.
“All up, 25,000 new homes could be built or funded in the next 10 to 15 years,” Stubbs said.
The homes developed by Simplicity Living were being built for 100 years.
Investors in Simplicity were already getting returns from the just-built homes via Simplicity Living through rents from those new homes, capital appreciation and the one-off development profits, Stubbs said.
The homes were also being built far cheaper via the Stubbs/Brealey partnership.
Simplicity Living is wholly owned by Simplicity Wholesale Property Fund and the new homes rising were being built at 35 per cent below the typical market costs due to the partnership with Brealey, Stubbs said.
“These are warm dry homes and Simplicity Living is a strongly performing business,” he said.
Simplicity Living is about to start construction of its biggest project: a $225m five-block, 297-unit build-to-rent apartment scheme in Mount Wellington with a podium to link the scheme together.
Reiputa is Simplicity Living's new scheme for 80 Mt Wellington Highway. Photo / Simplicity Living
Reiputa [whale tooth ornament] is the new venture for one, two and three-bedroom units in the 12-level scheme at 80 Mt Wellington Highway on a site which is a six-minute walk from the nearest railway station.
Reiputa was designed by Brewer Davidson Architects and is on the corner of William Harvey Place. Earthworks will start soon.
The scheme includes 222 car parks, 297 bicycle parks, 15 visitor bicycle parks and associated loading areas.
Atop tower two, the northern half of that level will be a communal area for the scheme and the southern half will be fitted with a solar panel farm.
“The apartment buildings are positioned around the circumference of the site, with over 8000 square metres of lush native landscaping which provides a communal recreation area for the whole of the development. At the centre of this landscaped oasis is a pavilion which also functions as a communal asset and connects via a network of pedestrian pathways to the access points of the site,” Shane Brealey said this month.
The design for Reiputa was subject to a rigorous review by the Auckland Urban Design Panel and the consent process over the course of 10 months.
In another scheme, Simplicity Living shows a vast new development planned for Ascot Ave, Remuera. Images on its website show a series of towers rising in the suburb as rental accommodation.
Anne Gibson has been the Herald’s property editor for 23 years, has won many awards, written books and covered property extensively here and overseas.
