84: Lighthouse Infrastructure's Peter Johnston

[i3] Institutional Investment Podcast

Peter Johnston is Managing Director of Lighthouse Infrastructure, a sustainable infrastructure and real asset fund management company that has more recently been investing in affordable housing for key workers. In this episode, we delve deep into the issue of affordable housing and how it presents an opportunity for institutional investors. Overview of Podcast with Peter Johnston, Managing Director, Lighthouse Infrastructure 01:00 I started out in a utilities business, where I got involved in supporting that business with the regulatory framework 03:00 Lighthouse started in 2007 04:00 Getting started in affordable housing 07:00 A report by Anglicare, showed that in Australia key workers pay away 50 per cent of their income on housing 08:30 Making the first investment, working with St George’s Housing 11:00 How do you structure the arrangement with the key worker tenants? 15:00 AustralianSuper has said these investments need to return between six and 11 per cent. Is that achievable? 16:00 We are using indirect subsidies, so we are not reliant on government 16:30 We need $110bn over the next 20 years for affordable housing and $180bn for social housing 18:00 Our model supports developers to build social housing, rather than to demand that of them 21:00 What is the role of Housing Australia in making this an institutional grade investment? 23:00 Is this a property or a sustainable investment? 24:00 Combining property assets with an infrastructure-like public private partnership structure 28:00 One of the challenges that we faced in making this sustainable is that it needed to be attractive to lenders as well as equity investors 29:00 What does the ideal investment look like in this space? 32:00 We have a pipeline of projects over the next two years that will see the fund grow to $1-2 bn comfortably