Mirvac CEO Susan Lloyd-Hurwitz seeks tax parity for build-to-rent

• Perth is on a ‘mild upward trajectory’ says Ms Lloyd-Hurwitz

There was no logical reason why income from a build-to-rent should attract a different withholding tax for a foreign investor than an office.

Mirvac chief executive Susan Lloyd-Hurwitz, in Perth to celebrate the start of the final component of the $354 million Latitude at Leighton urban renewal project, was responding to questions about the impact on Mirvac of changes to negative gearing, capital gains tax discounts and withholding tax charged on income from managed investment trusts if there were a change of government next month.

“The build-to-rent asset class is one of the largest real estate asset classes in the world and one of the most valuable income streams and there is no reason why it should attract a different tax rate,” she said.

“We have communicated to the Labor Party that we think that is a very positive change and certainly will attract more capital into the sector.”

Ms Lloyd-Hurwitz has been an advocate of build-to-rent, this week saying it is a housing option “we desperately need” and will, most likely sell itself.

Previously she has pointed out that renting is mostly a fairly “miserable experience” for tenants because under Australia’s model the landlord is the customer, not the tenant.

“The average renter in Australia rents for 10 years and they move on average five times within those 10 years and usually not by (choice),” she told The West Australian this week. “The social dislocation of that is huge. People have to find new schools, new doctors, new (ways to) commute. There’s the uncertainty about where you are going to live.

“The build-to-rent model gives you the security of a home. You paint the walls, you can bring a pet, you can stay for as long as you like as long as you are paying the rent.

“I think it will be adopted very swiftly.”

The day Mirvac announced it was building its first build-to-rent project in Sydney’s Olympic Park, someone rang to join the waiting list. It is expected to be finished by mid 2020.

Ms Lloyd-Hurwitz said over time Mirvac wanted to incorporate an element of social and affordable housing into its build-to-rent but she stressed that Mirvac was in the business of quality “market housing” and an affordable component would be negotiated with community housing providers “over time”.