Social innovation in property taking off

IIG asset manager James Fitzgerald
IIG asset manager James Fitzgerald

The rise of B Corporations, themed community hubs, maker spaces, affordable housing funds and even showers for the homeless are some of the trends emerging in the social innovation space in Australia.

Like Fair Trade certification lets you know the coffee you should buy, B Corporation certification helps you recognise businesses with sustainable practices.

Impact Investment Group is Australia’s first B Corporation funds manager. Asset manager James Fitzgerald said B Corp businesses considered social, financial and environmental returns when looking at decisions on investments or products and services.

“B corps is a movement in business that is really going to take off in Australia,” he said.

The movement came to Australia in late 2013. Many US states have now mandated that businesses need to be B Corp-accredited for government procurement. In 2015, 450 new B Corps were certified globally and more than 11,000 new companies now use the B Impact Assessment, a free, confidential online tool.

IIG has approximately $500 million in investments under management and is growing rapidly. The group has several properties in its portfolio such as:

  • TAC building in Geelong (5 Star Green Star rating)
  • K1 Building in Brisbane (6 Star Green Star & five-star NABERS)
  • Gold Coast Surgical Hospital (planned 400kW solar system)

It invests in renewable energy such as the 11MW Williamsdale solar farm in ACT and the Chepstowe Wind Farm in Victoria. In addition, IIG provides venture capital for social enterprises – its $10 million Giant Leap venture capital fund was launched last month.

A hub for social change

The Dream Factory, at 90 Maribyrnong Street in Melbourne’s inner suburb of Footscray, is a 7500-square-metre hub for innovative start-ups, entrepreneurs with a social conscience and not-for-profits. IIG procured the site in a non-activated pocket of the suburb and has installed a 200kW solar system on the rooftop. Renewable power will be stored onsite with Australia’s first Tesla commercial batteries. Tenants will access renewable energy through an environmental upgrade agreement.

IIG's Dream Factory

IIG’s Dream Factory

Instead of going down the typical leasing path, IIG sought to give the warehouse its own story built around social change through innovation, design and technology.

“No one’s talking about impact on society and impact on community from their innovations,” Mr Fitzgerald said. “So we’ve launched the Dream Factory on the premise that it’ll be a really exciting hub for design and technology and social change.”

IIG has secured tenants including Engineers Without Borders and Inspire9, a co-working organisation for start-ups, freelancers and creatives (operating successfully in Cremorne).

“Another thing we have tried to do is mix the type of tenants,” Mr Fitzgerald said. “We have combination of not-for-profits and for profits. So because we have commercial tenants paying commercial rates, it’s enabled us to sign up other organisations who might not be able to pay those commercial terms on much favourable arrangements.”

A large community food hall is planned for the ground floor.

“This community food hall will activate that whole corner of Footscray. Hundreds per day will come through that site from the community.

“When you come and have a bagel or a coffee, 10 to 15 per cent of your purchase every time will go directly to supporting the social enterprises in that building.”

A space for making

The site will house one of Melbourne’s first genuine maker spaces (creative, DIY spaces where people gather to create, invent and learn) in the car park. The maker space will offer devices like 3D printers, sewing machines, drop saws and welders.

“I don’t think there is anything like that in Australia at the moment where you actually start up,” Mr Fitzgerald said. Entrepreneurs with a product idea can become a resident of Inspire9 and get access to the facilities to make a prototype. “We need people to get back to making things.”

Views for the whole community

Instead of handing over the rooftop to the highest-bidding tenant, IIG will ensure The Dream Factory’s rooftop stays communal. Tenants can use it for marquee events, employees can co-work or enjoy lunch there, and community groups can gain access for events.

“These are some of the best views in Melbourne – the port and the CBD. The rooftop will become a heart for the community there,” Mr Fitzgerald said. “It’s just so useful for them, because they just wouldn’t be able to get access to a premium site like that for their events.”

Funds for social housing

Across the CBD in Collingwood, Grocon’s proposed urban renewal development Northumberland is combining environmental initiatives with social innovation. The 11-storey building with a five-storey timber companion building will be among the first Australian buildings to achieve WELL Building Standard certification, a 6 Star Green Star Design and As-Built v1.1 rating, as well as a five-star NABERS Office Energy rating and a four-star NABERS Office Water rating.

Artist's impression of the Northumberland development. Image: Grocon

Artist’s impression of the Northumberland development. Image: Grocon

The tenant agreements at Northumberland will provide for one tenth of one per cent of the annual office rent to be paid into the Homes for Homes fund to create new social and affordable housing.

The Big Issue established the Homes for Homes initiative. It’s a voluntary scheme through which homeowners contribute a small portion of the price when their property is sold. Grocon is embedding this scheme in all of its residential projects (so far Swanston Square, Bouverie Apartments and 85 Spring Street).

“Northumberland has provided the opportunity to extend Grocon’s support for Homes for Homes by seeking to be one of the first commercial buildings to contribute to The Big Issue’s initiative in Australia,” said Grocon assistant development manager Angie Darby.

Clean break for rough sleepers

Northumberland will also provide a large end-of-trip facility for tenant employees who cycle or exercise during the day. Interestingly, Grocon has designed the facilities in partnership with Launch Housing to create amenities that are also suitable for providing managed shower facilities for people who are homeless or sleeping rough in the area.

Employees will utilise the facilities during the early mornings and lunch hours while homeless people can drop in during mid-morning and mid-afternoon. Launch will manage the facilities.

More innovation needed

Australia is crying out for social innovation, according to Mr Fitzgerald.

“I use that example of The Dream Factory because we are finding we just have so much demand for that model,” he said. IIG is now looking at other assets on CBD fringes around Australia. One is four times the size of the Footscray site.

It’s important to look globally. Mr Fitzgerald saw many co-working spaces while touring the US with Google and discovered the successful ones had key ingredients including a theme, a free education program and access to venture capital.

“The two that really killed it were the ones that had a maker space in the basement,” he said. “And the other thing that we don’t really do that well in Australia yet … accessing capital – having a venture capital fund for the building.”

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