KPMG advised BaptistCare, a not-for-profit Christian-based care organisation that provides community housing and aged care facilities, on its successful bid to the NSW Government under the Social and Affordable Housing Fund (SAHF) program for the construction, asset management and tenancy management of 500 social and affordable dwellings in eight locations across New South Wales, including the inner west, north-west and south-west of Sydney, as well as Newcastle and north eastern NSW.

BaptistCare’s success with the SAHF program will allow it to continue its work in the provision of social and affordable housing for the most disadvantaged including older Australians who are at risk of homelessness or those struggling with high housing stress in the private rental market, as well as provide medium-term accommodation for women and children escaping domestic violence and who are rebuilding their lives.

The SAHF is a key component of the NSW Future Directions for Social Housing in NSW strategy that will result in more social and affordable dwellings linked with tailored support services to drive tenant and household independence.

KPMG advised BaptistCare on all aspects of the transaction including:

• the management of bid process from the initial stages of the transaction through to contractual and commercial close including assisting with the development of the final submission document to NSW Government
• commercial advisory and support in respect to the development of the commercial strategy to support the bid
• real estate advisory in respect to the selection and best use of the properties proposed for social and affordable housing under the SAHF program
• development of the financial model to support the bid
• recommendations on BaptistCare’s capital structure and debt raising to support the project
• assisting BaptistCare to identify and structure commercial arrangements with suitable delivery partners in the market
• environmental due diligence and guidance regarding maintenance costs
• financial due diligence
• taxation and accounting advice to support the bid.

KPMG’s Health, Ageing & Human Services sector specialists were also able to provide context to the bid through their work in respect to social and affordable housing across a number of markets in Australia and New Zealand.

The KPMG value add

Bringing together leading Deal Advisory specialists and deep sector knowledge in infrastructure and social and affordable housing, KPMG worked closely with BaptistCare to develop a compelling commercial offer to the NSW Government which encompassed an innovative debt structure, taking into account the nature of the BaptistCare organisation, the complexity of the services agreement, and the risk appetite adopted by NSW Government.

We were able to proactively identify issues and appropriate strategies as part of BaptistCare’s bid development process and refine financial models to support the BaptistCare commercial offer. Additionally, KPMG provided tax advice to support the commercial offer, including advice to preserve taxation benefits for a not-for-profit entity and GST rulings.

On 17 March 2017, BaptistCare was chosen from an initial 24 tenderers, of whom nine were shortlisted, and will build and manage 500 dwellings on land already owned by BaptistCare.

For more information on BaptistCare, visit their website – baptistcare.org.au.