Boman Group and JPC Group Launch Major 60 Million Dollar Push into Modular Housing
Boman Group and JPC Group are two major players in the Australian real estate and building industries who have combined their efforts and resources to initiate a new $60 million fund dedicated to accelerating the growth of the modular and prefabricated housing sector in Australia.
Boman Group in a joint press release with JPC Group announced that, as part of the fund’s activities, they have already made their first investment in an Australian modular housing business, however, the company hasn’t been named yet.
Why they are doing this
The point is that Australia is suffering from a significant lack of housing supply. A recent report positions the country as potentially falling short by about 260,000 new houses of its 2029 housing construction targets.
Boman’s CEO Eric Gao states that the way materials are produced can be revolutionized by construction innovation such as modular building, 3D printing, and advanced materials. Besides this being interesting for investors, he argues that it should be considered as a primary solution to the national housing shortfall problem.
Who brings what to the table
Before being rebranded in 2024, Boman Group was established in 2011 and now manages assets worth more than 860 million dollars.
JPC Group, founded in 1990, has the main focus of its activities in the areas of logistics, shipping, and building supply. Their investment vehicle JPCX will be the main source of capital to scout and scale up new building tech opportunities.
One of the directors of JPC, Paddy Jayawardena says that their work across different sectors like logistics, site delivery and supply chains has given them an insider’s view of how inefficient traditional construction is and hence, they want to use this insight to help the modular sector get bigger.
What this really means
For investors, this is positive news in that there is now a separate fund committed to modular housing in Australia which presents the first opportunity to take a position in a growing niche in its early stage.
The construction sector will welcome such a signal of the increasing trust in modular and prefabricated methods with open arms as it also forecasts a greater inflow of capital in better materials, technology and processes of building.
Success for housing supply could come down to accelerated construction, cost reductions, and the ability to bring more homes to the market, thus helping to alleviate the present shortage situation.
Look out points
At the moment, we only know that the fund’s first investment is in a company, which remains unnamed, thus limiting transparency at this point.
The success of the fund will revolve around the capacity of each portfolio company to scale up and deliver their promises. Modular housing has a bright future, but results depend on flawless execution.
Factors external to this like land prices, regulations and labour availability may influence the results and therefore pose challenges to the pace of progress.
Final takeaway
The new fund from Boman Group and JPC Group is a clear indication that they are seriously committed to the development of modular housing in Australia. The initiative connects capital with industry experience and is a perfect fit as it directly addresses a growing national need. The impact, if the plan goes as intended, would be a major reshaping of the way homes get built across the country.