HOUSING: There’s a new player on the housing block that looks set to entirely change the rules in terms of market models.

Smart Urban Villages brings together sustainability, the sharing economy, European leasing models and a viable investment asset into a package that aims to transform the conversation on housing affordability.

It has just completed feasibility studies for five sites, two in Canberra, two in Melbourne and one in Sydney, co-founder and director Ben O’Callaghan told The Fifth Estate.

The urban eco-village model looks to sites within 15 kilometres of a CBD, ranging in size from 2000 square metres to 10,000 sq m, with between 20 to 50 dwellings to be developed per site.

By being positioned within the 15km zone, occupants will have easy access to infrastructure including public transport, employment, education and other necessities.

The scale of up to 150 residents is deliberate, as it is about ensuring people can make good connections and build a sense of community.

“We are looking for an iconic site so once the first [development] has been done, we can replicate and repeat it.”

The plan is to develop a mix of two-to-three-storey apartments and townhouses with shared open space and common facilities including share electric cars and food gardens.

Ben O’Callaghan

The company will also provide the infrastructure to enable people to live “an active community life”, Mr O’Callaghan said.

This includes both the hard infrastructure such as common spaces, and the soft infrastructure of governance and activities such as hosting shared meals for the first two years of occupancy.

Employing long leases

Instead of selling the dwellings, they will be retained by Smart Urban Villages in the form of a real estate investment trust and leased out on long, perpetual leases.

Long leases, generally not available in Australia, are common in Europe. Mr O’Callaghan said they have many benefits, including the ability to create community links.

“Millions of people rent in Australia and every 12 months they get stressed over whether their lease will be renewed. Europe solved this years ago.”

Fundamentally it is crash-tackling the myth that only a mortgage can give someone a sense of security around where they live.

“People shouldn’t have to have a mortgage,” Mr O’Callaghan said.

The projects will be internally funded via a mix of institutional investors and some debt financing.

Mr O’Callaghan said there were already talks underway with a large investment fund that has a considerable amount of capital it needs to spend on long-term ethical and impact investments but has not so far found a place to put its money.

Returns of 6-12 per cent expected

It is expected the villages will deliver returns of between 6-12 per cent for investors, he said.

The long leases will be open ended, he said, so if someone wants to rent for 50 years that’s possible. It’s also good for the investors to have that kind of security of rental income.

There will be no strata body corporate, however the aim is to have residents involved in decision-making.

He said the outcome has to be high quality in terms of both the buildings and the lifestyle, which will leverage the sharing economy trend.

“I think that’s the future – shared gardening, share cars in the basement, sharing services and assets.”

That might include people sharing items like computer printers, for example. They can also share services, such as babysitting for each other.

These “non-tangible” elements help ensure the developments can provide affordable living rather than affordable housing, Mr O’Callaghan said.

Sustainability and liveability prioritised

A sustainability consultant by trade, he said the design and construction will aim to achieve NatHERS ratings averaging eight stars for the dwellings.

Specific initiatives will include passive solar design, thermal mass inside the homes, natural ventilation strategies, rainwater harvesting and reuse, solar PV and energy efficiency.

Elements such as eaves for shading and a substantial amount of insulation will also be built in.

He said during research for his masters degree at the University of Sydney, he surveyed 75 homes in South East Queensland  and found that passive design elements contributed more to energy efficiency than operational and behavioural elements.

They have at least double the effect, he said.

The operating expenses for residents will be very low. In combination, all the sustainability elements are expected to make the houses function at “virtually net zero” for energy and water.

Liveability is also a consideration, and the design will aim to achieve a Silver or Gold standard under the Livable Housing Australia guidelines. A Green Star Communities rating may also be sought.

He said the design aspect was “easy compared to the soft stuff developers get wrong”.

The market is there

Since the company launched its idea to the public 18 months ago, 700 people have registered expressions of interest in renting one of the homes.

“There is enough demand to keep us busy for 20 years,” he said.

Mr O’Callaghan said the company was not only looking at undertaking developments in Australia. He envisions the model being replicable and scalable in the US, New Zealand and the UK, for example.

Wherever there are no long-term leases, and sense of community is lacking, it could work.

“We need more diversity in the housing space.”

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  1. Bring it on! The more this thinking encroaches into society, the better. Will it include earth as a building material, i.e. adobe, earthbag, rammed earth?

    Good luck!

  2. I am delighted that awareness and desire for ecovillages is growing. Many are disillusioned with standard suburban living. Ben O’Callaghan is on the right track with the housing model. But as Andrew in the posts above said – it’s all about community.
    If the neighbours/members cannot get along, community will not form. An important building block is the choice of a governance framework and education amongst home owners before the homes are built. This builds a solid base to ensure success in the project. I look forward to seeing more developments of this nature. All the best Joy

  3. Quoting from Home Ecology, the Bega Eco Neighbourhood project I co-designed in NAW, with approximately 120 residents which is the scale Smart Urban Villages seeks to target.

    Bega Eco Neighbourhood Case Study
    “The project was a ground up community project that involved the creation of a non-profit incorporate community association to purchase a 32 acre block of land on the outskirts of Bega township on the South Coast of New South Wales, Australia. The objective was to create 23 lot subdivision for a dynamic, thriving and diverse community to emerge, that lived in ecologically sustainable housing, two thirds owner builders and one third community eco-co-housing developed in partnership with a Co-Housing Coop from Melbourne that purchased 7 blocks, and built 14 duplex sustainable townhouses. The stormwater is treated completely on-site in bio-infiltration swales and temporary stormwater holding ponds planted out with AquaBiofilter floating wetlands species of wetland grasses. A neighbourhood natural swimming pool was built with the AquaBiofilterTM floating wetland plants.

    All waste water treated on site for re-use in the agricultural zone, whilst solar energy provides the majority of power needs for the eco-neighbourhood. A Neighbourhood Management Statement provides ecologically sustainable design criteria for houses, land use, encouraging permaculture designed gardens and agricultural production of food for the community and supply the local organic whole foods store.

    A community building was the first building completed to provide a cohesive community development space where future land owners and co-housing residents would be able to mingle, cook lunches and dinners together to get to meet and know each other prior to building their own homes and the co-housing duplexes. This resulted in many of the eco-neighbourhood residents getting to know each other, and provide in kind support to each other’s home building efforts, which built a well formed and friendly neighbourhood which ultimately validates the eco-neighbourhood concept.

    Linkages to the adjacent Steiner School and aged care facility created an intergenerational community with overlap spaces sold or leased to adjacent landholders, multiplying the positive social and environmental impacts. The Eco Neighbourhood accepted the overflow stormwater from the adjacent aged care facility, which provided valuable water resources to the new community, and solved the limited space issue for the facility whom had no further space for more rain tanks which were required to meet on site stormwater detention regulations. Another aspect of design intent to create meaningful connections to surrounding community that is tangible.

    The Steiner School adjacent was sold a portion of land to extend their school campus and create further informal play areas and space for vegetable and good forests that provide passive recreation and sustainabl food production skills to the school community. The newly developed school areas on eco Neighbourhood land led to a deep integrated form of partnership that strengthened community whilst also deepening the social and environmental impact.”

  4. What we are lacking in Australia is the range of models and the supportive bodies and thinking to allow all of them to flourish. We need them all, to be able to offer the solution that suits each subgroup in our communities.

    After spending a year researching cohousing and putting our own model together, UpChange – an over 50s cohousing model paired with an enterprise centre (so we never have to stop working) that will have strong links with the local community and be a platform to promote the older wisepreneurs … We now realise that many different models are needed, no constraints!!

    So pleased to see Smart Urban Villages getting this exposure with the rental model that can sit within the inner metropolis environments we have. Sunvillages in Canberra are working along these lines too.

    Narara on the central coast, is an awesome example of an intergenerational community, as is Illabunda in Winston Hills, with a strong governance being built and development of community buy-in.

    Each new model will have its governance model that will be ‘trialled’ and refined until we see these community-based neighbourhoods and complexes become more prolific.

    Cohousing, Collaborative housing, Co-living is new through the world over the last few decades and still needs time to develop.

    If the Greater Sydney Commission, and other planning bodies that hope to really effect the livability and sustainability of our lives in Sydney, can add these models to the proposed ‘blueprint’ and establish a ‘Housing Hub’ to communicate and promote the breadth of solutions, we may get the livability we want, and faster!

  5. As an ambassador for GEN International and a member of the leadership circle for GEN Australia, I think this is a wonderful development. My only concern is that this becomes a developers chant of ‘lets build it and they will come’. We see many such developments that pay lip service to community and build in an unaware environmental fashion, or build eco buildings but forget the need to build a community as well.

    Ecovillages are built around the community and this takes time. Our community at Narara started in 2007 and Bruns Eco village is building community now, before a sod of earth is turned. BTW, the reason for an ideal size of a company or community being 150 is that is near the top end of people remembering details about others, essential to building a community. Burns is following an ownership model similar to what is suggested.

    The real focus is in turning cities from energy sink holes into being at least sustainable in part. Building eco-burbs is a major part of that. Good luck!!

    1. Well said Andrew. We agree with all of those points. There will no doubt be some attempts by traditional developers which will likely fumble the community building aspect… however they’ll eventually learn that that’s as important as the physical infrastructure.

  6. What’s the point of having an amazingly sustainable house and then living in car-dependent sprawl?

    The European models this seeks to replicate consist of 4-5 storey apartment blocks connected to city centres by light rail and with zero parking in most cases.

  7. Interesting ideas I have followed for a little while, but have to say it appears still to be investment and gain on investment focused, which I do not think housing should be a part of (hence the insane house prices we have now) and housing cooperatives in Europe are often not seen as investment vehicles and strongly supported by governments (legally and financially). And as for affordability that needs to be seen because if rented out on market rates of the areas, then it will be unafforable other than the upper middle class, inner city slickers, pushing others even further to the fringe (so what is in a word).

    Furthermore if you use the term ecovillage you should rather define what that means, because there are clear definitions around (for example by the Global Ecovillage Network (GEN) representing thousands of ecovillages from around the world), which needs to fulfill a number of criteria on environmental/ecological, social, cultural and economic dimensions in order to be called an ecovillage. Otherwise we just create a case where every little more or less conventional development with a few sustainability gadgets calls itself an ecovillage, which in reality is just a marketing exercise I have seen way too often. Having recently visited many ecovillages and intentional communities around the world and done training in ecovillage design and also representing GEN in Australia, I can strongly state that the social and cultural components of any “development” are the key to success and failure of any project (and I do not means sharing a few items and having a meal together would be socially and culturally sustainable, absolutely not). I encourage and welcome open discussions on these aspects wherever is appropriate.

    And last but not least the Living Building Challenge is another but to some extent wider reaching sustainability concept than the others mentioned in the article and I encourage you to include it, particularly because we have highly experienced people on it (LBC) in Melbourne (Dominique Hes from University of Melbourne for example).

    Kind regards