The Borough, Denman Prospect stage one, two apartments to be sold as built-to-rent plans change

Capital Estate Developments, part of Terry Snow's Capital Airport Group, had previously proposed a three-stage, rental-only precinct, dubbed The Borough.

It was the largest build-to-rent project underway in Canberra with 700 apartments including some affordable rentals.

The emerging build-to-rent model refers to large-scale housing held in single ownership and rented out long-term.

The group said it was "still committed to build-to-rent" and would deliver an affordable rental precinct in the third and final stage.

Capital Estate Developments director Nick McDonald Crowley said the decision was due to a recent change in guidelines by the ACT government.

As the developer of the entire Denman Prospect suburb, Capital Estate Developments is required to deliver 20 per cent affordable homes for purchase.

In June, the ACT government announced developers that are required to deliver housing for affordable could apply to convert this commitment to affordable rentals.

The recent change will allow Capital Estate Developments to amend its development application for stage three so all homes will become affordable rental properties.

So long as they are rented for a minimum 10 years and managed by a registered community housing provider, the homes will count towards the group's requirement for 20 per cent affordable housing.

An ACT government spokesperson said the initiative was part of the 2023-24 budget announcements.

"In addition, developers also need to agree to the ACT government holding their security bond or a bank guarantee for up to 10 years following commencement of the affordable rental dwellings," the spokesperson said.

Both the federal and territory governments have committed to boosting the build-to-rent sector, announcing tax changes and land releases in the latest budgets to support the growth of the housing model.

The Borough stage three was originally proposed to include 330 apartments, but that would be increased to 400 in the new plans.

Despite initial plans for an entirely build-to-rent project, the apartments were previously "dictated by the size requirements of the build-to-sell thresholds", Mr McDonald Crowley said.

The size of the units, mix of dwelling types and communal areas had been adjusted to better meet the demands of rental tenants, he said.

Mr McDonald Crowley said the group was in discussions with a community housing provider and the rental properties would be offered at 75 per cent of market rental value.

The stage three rentals would sit within the proposed Stromlo Reach estate.

"We expect the initial designs to be complete and ready to be presented to the [National Capital Authority] design review panel by the end of 2023," Mr McDonald Crowley said.

Capital Estate Developments managing director Stephen Byron launched The Borough precinct in December 2021.

In a statement at the time, he said the group was "delighted to be able to bring this new rent only development to Canberra, which will work towards helping ease Canberra's current housing shortfall".

When the group submitted its development application for the first stage of The Borough in November 2022, it detailed a number of communal facilities for future residents.

There would be a solar farm with more than 3000 solar panels and battery storage to enable residents to live mostly "off-grid", the development application stated.

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Rooftop spaces, drone landing zones, two shared cars for residents to hire and community gardens were also in the plans.

Mr McDonald Crowley said there would be some amendments to these facilities in the revised proposal.

The first apartments at The Borough are expected to be released for sale in late 2023, subject to final design approvals. Pricing had not yet been finalised, Mr McDonald Crowley said.

"We are working closely with our builder, Elevated Constructions, to lock in the build price at the most efficient levels we can, without compromising the quality of the precinct," he said.

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