_Introducing John-Paul Stichbury and Luke Shackleton: Pioneering the Living Sectors in Australia
To kick things off, we spoke to John-Paul Stichbury, Partner, Living Sectors, Valuation & Advisory, and Luke Shackleton, Director, Living Sectors, who recently relocated from our London office to Sydney. With the Living Sectors market in Australia seeing rapid growth, John-Paul and Luke share how they’re using their experience from the more mature UK market to support clients and unlock opportunities in the evolving Australian market.
Read on to find out more about their journeys, insights, and outlooks for the future, or watch the interviews.
Q: Please could you tell us a bit about your backgrounds, and how you came to be in your current roles?
John-Paul Stichbury (JPS): I joined Knight Frank in the UK in 2017, when the Living Sectors, specifically Build-to-Rent (BTR), were emerging. The market was entering a growth phase, and I was able to experience that firsthand. I then relocated to Knight Frank Sydney at the start of 2024 to help establish and grow the Living Sectors team here.
Luke Shackleton (LS): I’ve been with Knight Frank for eight years, with six of those years in the Student Capital Markets team in London. There, I was involved in some large-scale, successful transactions, building solid expertise in the sector. Now, seeing Australia in such a strong growth phase, I felt it was the right time to bring my experience from a more mature market to support and grow the Living Sectors team here in Australia.
Q: What’s the ambition for the team in Australia?
JPS: Our ambition is to become the go-to consultancy for the Living Sectors in Australia. Being genuinely connected at a global level allows us to set ourselves apart in the Australian market.
LS: Yes, it’s all about being the most connected team in the market. We have the global resources of Knight Frank at our fingertips, yet we offer a personalised, local approach tailored to the Australian market.
Q: What’s the current situation with the Living Sectors in Sydney?
JPS: With the country entering a rate-cutting cycle, we’re expecting an acceleration of inward investment, particularly in the BTR sector. This market is at the forefront of global investors' portfolios as they look to diversify.
LS: Investors are increasingly attracted to the Living Sectors because of their defensive characteristics, particularly the ability to adjust rental income streams more quickly than other sectors, making them resilient to high inflation.
JPS: In 2024, BTR apartment completions reached a record high, with approximately 4,300 apartments completed nationally. Looking ahead, we expect that number to rise significantly to around 6,000 apartments in 2025. There's also a substantial pipeline of around 8,900 BTR apartments under construction, with 20,000 more approved for development in the next five years. The BTR pipeline is most advanced in Melbourne, followed by Brisbane and Sydney. We expect that Sydney will really come into the spotlight this year.
LS: Turning to Student Accommodation, investor confidence remains strong, fuelled by supply shortages and buoyant demand. International student enrolments are well above pre-pandemic levels - twice what they were ten years ago.
ANREV’s latest Investment Intentions Survey showed that 43% of respondents chose Student Accommodation as a preferred sector for investment into Asia Pacific markets this year. This is up from 28% in 2021.
North American investors are particularly keen to deploy capital into the sector. We have already seen one of the largest deals for some considerable time with Greystar recently completing the acquisition of the GIC-Wee Hur JV portfolio (5,662 beds) for A$1.6 billion.
We expect further capital flowing into the Australian Living Sector largely driven by the current market volatility in the U.S. which has prompted a number of investors who were previously focused on the U.S. to seek opportunities elsewhere.
Q: What are the challenges and opportunities currently in the market?
LS: Australia is navigating several development challenges, including elevated construction costs, skilled labour shortages, high funding costs, and limited land availability. Addressing these issues is expected to drive the emergence of new deal structures and unlock new development opportunities.
Drawing parallels with recent growth in the UK market, we see strong potential in the repositioning and repurposing of existing assets. For instance, in October 2024, Dexus and Marquette Properties announced plans to convert a B-grade office building in Brisbane’s CBD into a 1,200-bed Purpose-Built Student Accommodation (PBSA) scheme. Projects like this enable investors to acquire assets that may fall below development viability, yet can be located in prime areas.
We also expect to see an increase in partnerships between universities and private developers, with universities contributing land or property and developers bringing the expertise needed to unlock value.
JPS: Yes, the development market is challenging, but we're starting to see a gradual recovery. One key win for the sector recently was the passing of critical legislative reforms for BTR tax policy, which shows that the Australian government recognises the importance of BTR in future housing supply.
Our latest Australian market reports offer a more detailed insights into our views:
Q: Finally…can you tell us something that people wouldn’t expect about you?!
JPS: I lived in France when I was growing up, which not many people know, especially since I’m terrible at speaking French!
LS: I used to be an amateur boxer, which is why my nose has a bit of a wonky shape!
John-Paul and Luke give more insights on the sector here:
For more information on unlocking opportunities in the Living Sectors market, contact our team, or connect with John-Paul Stichbury and Luke Shackleton directly on LinkedIn.