Novus on Spencer’s design preserves elements of the heritage Dalston Bakery building (Image: Novus)
Australian build-to-rent platform Novus has tapped Japan’s Kanden Realty & Development to invest in a 190-unit BTR project in Melbourne, with the partners seeking to add much-needed supply to the local apartment market.
The 19-storey project, called Novus on Spencer, will provide studios and up to four-bedroom rental residences in the inner suburb of West Melbourne, the companies said Thursday in a release. The construction at 405-421 Spencer Street will take an “adaptive reuse” approach to preserve key elements of the heritage bakery building at the site.
The launch of Novus on Spencer, scheduled to come to market in late 2027, marks the Sydney-based developer’s third Melbourne project and follows the November opening of the platform’s first operational asset in the city, the 163-unit Novus on Sturt in Southbank, a joint venture with M&G Real Estate that reached 98 percent occupancy within six months.
“The customer response to our mid-scale approach has been strong and Novus on Spencer will continue to evolve and solidify this strategy,” said Novus CEO Adam Hirst. “We are very proud to be working alongside one of Japan’s leading institutional investment groups, Kanden, a company with a shared vision of a sustainable future.”
Easing a Supply Crunch
The development represents the first direct investment in the Australian BTR market for Osaka-based Kanden, a property arm of Kansai Electric Power Group that participates in residential, hospitality and commercial projects in the US, Europe and Asia Pacific. Financial details of the venture weren’t disclosed.
Novus co-founder and CEO Adam Hirst
Kanden previously teamed up with Aussie builder Castle Group to develop residential subdivisions in New South Wales, including a plan announced last month to build and sell homes on 126 lots in the Schofields suburb 45 kilometres (28 miles) northwest of central Sydney.
Melbourne’s apartment market has seen the addition of just 250 completed units in 2025, according to JLL, with 1,907 completions anticipated for the rest of the year.
“2025 is projected to record just over 2,150 units in inner Melbourne, half the annual average of the last 10 years,” the consultancy said.
Kanden director Masaki Toyooka said Novus on Spencer would play a significant role in addressing the housing shortage.
“We believe that Novus on Spencer is uniquely equipped to meet the growing expectations for the build-to-rent market, driven by the strong demand in Melbourne,” Toyooka said. “Recognising Novus’s proven expertise and strong potential, we are honoured to partner with the company on our first direct investment project in the build-to-rent market.”
Growing Platform
Founded in 2021 by former Mirvac executives Hirst and Jason Goldsworthy in partnership with Sydney-based builder Aliro Group, Novus aims to build homes for 10,000 people in key cities across Australia.
In addition to the three Melbourne locations, Novus is developing two projects with over 600 units in the Sydney suburbs of Chatswood and Parramatta with British asset manager M&G as majority investor.
Novus had sought to raise more than A$1 billion ($660 million) from Asian and North American institutional investors to finance BTR projects in Sydney and Melbourne, the Australian Financial Review reported in April.
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