Beck family secures Blackstone backing for Caulfield build-to-rent

The world’s biggest real estate ­investor, Blackstone, has clinched its first build-to-rent project in Australia.

Max Beck, whose son Sam has joined Blackstone for the next stage of Caulfield Village. Picture: Sarah Matray

The world’s biggest real estate ­investor, Blackstone, has clinched its first build-to-rent project in Australia in a deal worth more than $300 million with the family of prominent Melbourne property developer Max Beck.

Blackstone has signed a contract with Beck Property Group, run by Mr Beck’s son, Sam, to build the next stage of its $1.5 billion Caulfield Village mixed-use project in eastern Melbourne being developed with construction group Probuild.

The Blackstone and Beck project, still subject to development planning approval, will include more than 400 apartments and a full-line supermarket as well as specialty retail stores.

Sam Beck brokered the deal on behalf of the Beck and Probuild consortium, which has fully sold out the first two stages of the huge Caulfield project that it won the rights for six years ago.

Blackstone signalled its interest in investing in Australia’s nascent build-to-rent sector last year, after a long but ultimately unsuccessful battle for the $3.35bn ­Investa Office Fund.

The US outfit bought a half share in December last year in the A-grade tower at 60 Margaret Street in the Sydney CBD from Hong Kong firm PAG for $420m and last month it announced its biggest deal in Australia yet.

Blackstone agreed to pay the listed Scentre Group $1.52bn for office towers above and around Westfield Sydney shopping centre in the city’s CBD, acquiring 100 Market Street and 77 and 85 Castlereagh Street via a 299-year leasehold interest.

But the Caulfield project will be the first residential rental foray in Australia for the giant, which has more than $US512bn ($740bn) in assets globally.

Located just 9km from the Melbourne CBD, the Caulfield project is situated near public transport links and is close to ­Monash University in a sought-after area for renters.

Beck and Probuild won the bid for the Caulfield project in 2012, with Max and Sam Beck and long-time Beck family executive Barry Shepherd joining with Probuild to win the rights for the project from the Melbourne Racing Club, which operates the adjacent Caulfield Racecourse.

The Beck and Probuild consortium pipped two listed developers, Lendlease and Mirvac, for the prize, and it ­announced plans for a 13-stage project that would take an estimated 15 years to ­complete.

The plans include more than 1500 apartments in buildings ranging from two to 20 storeys on a site nestled between the racecourse and Caulfield train station, with two stages of apart­ments and other residences and retail space already completed.

The site has also been earmarked to hold 10,000sq m of ­office space and 15,000sq m of ­retail space, including a supermarket and 2000 car spaces.

Mr Beck’s fortune was estimated at $692m on this year’s edition of The List — Australia’s Richest 250, published by The ­Australian.

Before winning the Caulfield bid, Sam Beck undertook residential projects in other Melbourne suburbs such as Alphington and on St Kilda Road, long a haunt of his father’s former construction and development giant Becton, which was run in partnership with another member of The List, Michael Buxton.