Affordable housing as an infrastructure asset: A public-private partnerships approach

This thesis establishes new insights into providing and financing of Australia's social and affordable housing infrastructure within a public-private partnership (PPP) model. Social housing is considered an important piece of a broader housing continuum and is recognized as a type of social infrastructure (Infrastructure Australia, 2019). Social housing contributes to the effective functioning of society. Troy (2012) conceptualizes social housing as an essential infrastructure that enables economic productivity. From the perspective of affordable housing as an infrastructure asset, this research presents the outcomes to develop a new investment pathway via a PPP model highly used in procuring and financing infrastructure assets. In Australia, changing attitudes toward the role of government and housing policy have meant that funding and other support for the housing system have steadily decreased over the past decade. The shift of responsibility from federal to state governments has increased the importance of cross-sectoral partnerships and networks as vital institutional mechanisms. This responsibility shift points to the need to understand partnership arrangements to design and deliver housing and urban policy. Further, Australia's social housing reform promoting a multi-providers system has been characterised by contracts with community housing providers (CHPs). The multi-providers system guides the need for designing an investment incentive for CHPs to operate efficiently and leverage private finance. Lastly, an increasing housing policy imperative is identifying effective new ways of financing and delivering additional social and affordable housing infrastructure. Additionally, the establishment of the National Housing Finance and Investment Corporation aims to provide long-term and low-cost finance to registered CHPs. Registered CHPs can also access two sources of funding: state government subsidies and Commonwealth Rent Assistance. The shift in funding and financing arrangements is called to explore financing mechanisms closely linked to partnership arrangements. Housing policy reforms and inquiries address the need to understand partnership arrangements, to design an investment incentive for CHPs, and to explore financing mechanisms for achieving Australia's social and affordable housing infrastructure. This thesis aims to address Australia's housing affordability to inform housing policy by applying the existing delivery and funding models in the infrastructure sector. Also, this thesis applies ownership rights, one of the widely discussed concepts in infrastructure literature, to social and affordable housing. Correspondingly, the three objectives are to: (1) apply a PPP project delivery approach to social and affordable housing delivery, focusing on understanding risks faced by the public sector in a PPPs model. (2) analyze the relationship between asset ownership and cost efficiency. (3) apply a project finance model to finance social and affordable housing assets, focusing on understanding subsidy levels and debt sizing in a PPP project finance model.