Simplicity And NZ Living Launch Major Build To Rent Housing Programme

Simplicity, a default KiwiSaver provider, announced today a significant build to rent housing programme, in cooperation with major home builder NZ Living.

The long term intention is to build high quality, affordable homes for rent across New Zealand, providing many New Zealanders with another housing option.

"This is a very well proven model overseas. Pension funds in Europe commonly invest 5-20% of their funds this way, and achieve solid returns,” said Sam Stubbs, Managing Director of Simplicity.

"Within 18 months we‘re aiming to build and rent one home a day,” he said.

The homes will be built by Simplicity Living. Certain funds within the Simplicity KiwiSaver Scheme (not including its default fund), and the Simplicity Investment Funds, will own and provide funding to Simplicity Living through a wholesale funding arrangement.

The apartments and terrace homes will be Homestar 6 rated, with a 100-year design life.

The full NZ Living team, expertise and established subcontractor & supplier base will transfer to Simplicity Living. Shane and Anna Brealey, the owners of NZ Living, will manage Simplicity Living on a pro-bono basis.

“We have decided to devote the next phase of our lives to building as many affordable, quality homes for rent as possible,” said Shane Brealey, Managing Director of NZ Living.

“Simplicity shares our long term vision,” he said. “With our skill in building and managing, and their ability to fund at scale, we are well placed to make a positive difference in the housing sector,” he said.

“NZ Living has completed or has in construction 700 new homes, selling at a discount to valuation of $30 million, to assist mostly first home buyers to get on the property ladder,” said Mr Brealey.

Subject to necessary approvals, Simplicity Living will purchase NZ Living’s two remaining developments in Auckland, with 159 apartments in Onehunga and Point England.

“We aim to rent for the long term, so families, the elderly and those saving for their first home can have true housing security without having to own a home,” said Anna Brealey.

Build to rent housing continues Simplicity’s history of disruption of the finance sector. As well as very low fees on KiwiSaver and Investment Funds, it currently offers first home loans at a 2.25% floating rate.

“With Simplicity Living, we have a huge opportunity to offer high quality homes at long term, affordable rents,” said Mr Brealey. “The returns should be very reliable too,” he said.

Simplicity intends to offer its members the first option to rent the homes.

Simplicity was recently appointed a KiwiSaver default provider. It has $3.9 billion of funds under management and over 74,000 members in its KiwiSaver and Investment Funds.

Simplicity was recently awarded Consumer NZ’s KiwiSaver ‘People’s Choice’ award for the second year in a row, and Canstar’s ‘Most Satisfied KiwiSaver Customers’ award for the third year in a row. It is also Morningstar’s ‘Fund Manager of the Year - KiwiSaver’ for 2021.

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