As Australians embrace low maintenance lifestyles, demand for townhouses is rising amid tight supply. Westbridge is meeting the market – and delivering opportunities to investors, with its new Cottesloe Fund.
For many Perth residents, the idea of moving from a house on a large block to an apartment isn’t always appealing. Townhouses are a popular option to fill the gap – the catch is that the supply of townhouses falls well below demand.
The latest Census data from the Australian Bureau of Statistics confirms townhouses account for just 13% of housing stock nationally and has historically been even lower in WA.
Damian Collins, Chairman of Westbridge Funds Management, explains, “There is a lot of opportunity for developers in the townhouse market. We know home buyers often don’t want the maintenance of a large house and land, but they also want more space and privacy than an apartment offers.
According to Mr Collins, townhouses fill what he describes as the “missing middle” of the property market.
He adds, “In targeting this gap in the market, we'll be delivering a development that not only serves local market demand, but also offers strong appeal for investors in the project.
Cottesloe Fund fills the “missing middle”
Reflecting high demand in Perth’s townhouse market, Westbridge has launched its new Cottesloe Fund for wholesale investors.
The Fund will develop eight double storey luxury townhouses on a generous 1,518 square metre block located in Eileen Street, Cottesloe.
Spread across three levels, each townhouse will feature a minimum of 3 bedrooms and 2 bathrooms, as well as private rooftop decks to take in the stunning ocean views.
The homes are expertly designed by award-winning firm DKO Architecture to suit the premium location just 100 metres from Cottesloe Beach.
Townhouses – construction advantages
The appeal of townhouse developments goes beyond substantial market demand.
Mr Collins explains, “One of the advantages of the townhouse market is that it has not experienced the same level of cost escalation we have seen in apartment construction.
“Forward demand in the home building market has dropped off significantly, which further supports the strong feasibility of these projects.”
Targeting over 50% return on equity
The Cottesloe Fund is an attractive opportunity for wholesale investors, with a targeted return of over 50% on equity.
As an added point of appeal, the property currently comprises 12 fully leased one-bedroom units, which will provide holding income until construction commences.
Mr Collins acknowledges that interest rate movements will always have an impact on the property market, however he points out that Perth’s property market is well-placed to record robust capital growth.
“The great thing about WA is that we have the lowest median house prices in the country, the strongest state economy, and there are plenty of jobs, which is attracting people back to the state.
“Many forecasters believe Perth households are fairly well insulated from rate rises, and we are confident we are going to see healthy property price growth over the next couple of years,” adds Mr Collins.
The Cottesloe Fund gives investors an opportunity to benefit from rising property values in Cottesloe – one of Perth’s most sought-after addresses, while also tapping into growing demand for townhouses.
Not surprisingly, the Cottesloe Fund has already attracted significant interest from investors, however Mr Collins says there are spaces left for investors who act fast.
Investors who are interested in this fund will need to obtain a copy of the Information Memorandum before investing by emailing info@westbridgefunds.com.au, or calling 9321 5566. As with any investment, the target return is not guaranteed and is subject to risks.
To register your interest – or to find out more about the Cottesloe Fund, click here or call 9321 5566.
