In Falls Creek in Victoria’s High Country, Kate Moegel has needed to rent two entire ski lodges to keep her business open.

In popular tourist areas far from major cities, a lack of affordable accommodation for workers has seen staff jammed into unsuitable housing.

“We’re talking like pokey hotel rooms for staff,” Ms Moegel said.

“You could have two or three in a room and then they share in-common facilities, like kitchens and lounge rooms.”

To run a business with 63 apartments, a cafe, restaurant and bar, the general manager of St Falls Resort needs 100 staff in winter.

Until now they have been crammed into two ski lodges, which is expensive for the business and uncomfortable for staff.

Ms Moegel said the accommodation is not ideal, especially when the business tries to encourage workers to stay all year round.

“To retain those good workers — and some of them have families and children — it’s hard to accommodate that ‘on mountain,'” she said.

As the housing pressure rises, innovative approaches to solving the shortage of essential workers are taking hold.

New investment models for worker housing aims to fix a glaring problem and bring huge sums of money with it.

The first steps in the plan? Buying an airport and evicting some possums.

The plan to build new housing in a tourist hotspot

The Grollo name is best-known for skyscrapers.

Think Rialto, Eureka Towers and Crown Casino in Melbourne and the Governor Phillip Tower in Sydney, which were built by Grocon.

The privately owned development, construction and funds management company has stepped heavily into the worker accommodation market.

First it created 400 beds at the Mount Buller ski resort the company owns, and now it’s renovating the derelict Bogong Village, near Falls Creek.

It was built for workers constructing a dam in the 1940s and largely left to the elements since then.

“It was pretty much … the possums were living in the houses, it was quite run down,” said Grollo Group property director Martin Ansell.

“But you could see the scope of how we could make it work.”

The project renovated 26 cabins, with a tavern to open next year and plans for building a further 300 beds. 

This season 140 staff lived in Bogong Village, travelling the short distance to ski resort Falls Creek on a provided bus.

“They don’t have to say: ‘I’m not (opening) nights because we don’t have staff.’

“It’s a better result.”

The Grollo Group has a long lease at the Bogong Village site and last year bought Mt Hotham Airport, with a view to housing hundreds of staff for the nearby ski resort by winter in 2026. 

As the nation grapples with a housing shortage that is making it harder for remote and coastal communities to lure workers, the company isn’t alone in seeing an opportunity.

It makes money from renting the beds to businesses, who will commit funding sometimes years in advance. 

Since many jobs — particularly in remote areas — come with accommodation as part of the salary package, the businesses get the advantage of having better quality lodgings and finding it easier to lure and retain staff. 

With Grollo Group estimating a cost of around $100,000 per bed, it sees the potential to have a $1 billion business, based on building 10,000 beds, spreading into different regions across Australia.

“The capital is out there that’s interested in this, and housing is very much on everyone’s tongue at the moment,” Mr Ansell said. 

“It’s just coming up with the right sort of concept.”

Australia’s history with government-supported housing

From Broome to Byron, Port Douglas to Perisher, finding housing affordable for workers — and for the businesses that will often be footing the bill — is an issue.

“What we’re seeing is that this is a problem that’s being outsourced onto communities, onto local government and onto businesses,” said Maiy Azize, the spokesperson for lobby group Everybody’s Home.

The core problem, in her eyes, is that federal governments long ago vacated the sector by reducing the percentage of housing it built and operated.

“As recently as the early 80s, about one in three renters in Australia was actually renting from the government. They had the government as a landlord.”

That’s not uncommon globally.

The definitions of affordable, social and essential/key worker housing aren’t clear-cut. 

What is clear is that Australia has far less than it used to and a much smaller percentage of supported housing as a share of overall dwellings.

Data from the Organisation for Economic Co-operation and Development (OECD) group of nations shows how rare it is in Australia for any level of government to provide your housing, compared to similar high-income countries.

• The Netherlands: 33 per cent
• Denmark: 22 per cent
• OECD average: 8 per cent
• Australia: 4 per cent

Ms Azize said in Vienna, it is “60 per cent social housing”.

“Australia actually used to be really good at providing housing for workers,” she said.

“If you worked in construction, if you were a public servant, if you were a teacher, you often had housing provided to you by the government.”

The federal government is back in the game, promising to build 1.2 million new homes by 2030. 

Even if it doesn’t hit that target, it is a massive increase after decades of low investment left social housing as a thin safety net for extremely vulnerable people.

But getting more supported housing for essential workers, fast, will take a lot of money. 

And it’s flowing in.

Super funds are investing big

In late July, Australia’s biggest super fund AustralianSuper and another of the heavyweights, HESTA, poured $250 million into affordable housing developer and manager Assemble.

The funds hold a majority ownership stake in the venture, which aims to scale up the housing Assemble had already been building.

That largely includes apartment blocks near Melbourne train stations, which are a mix of affordable, build-to-rent, build-to-rent-to-own and private housing.

“We will leverage our combined expertise to provide innovative housing investment opportunities for our investment partners,” Assemble chief executive Carolyn Viney said in a statement when the deal was announced.

Another big player is Aware Super (formerly First State Super).

It is building numerous housing projects in Melbourne and Sydney, with a substantial portion of the apartments rented out at 80 per cent of the market rate.

At a February sod-turning ceremony to mark the launch of a 135-apartment project in Zetland, near Sydney’s key airport, Aware Super chief executive Deanne Stewart said funds could play an important role in “providing such crucial infrastructure”, while still making good money for members.

“It’s no secret there’s a desperate need for more housing across Australia, and in Sydney that need is particularly acute.”

From a tiny shoebox to a lodge overlooking a dam

With no quick solution, business owners and communities are going to great lengths to be able to house staff. 

Without affordable accommodation their businesses can’t function. Without beds for nurses, teachers and police, the communities can’t run either.

When NSW hospitality industry billionaire Justin Hemmes bought the historic Lorne Hotel for $38 million, he also rented a pub about 500-metres further along the Bellarine Peninsula to house his staff.

In the past year, the ABC has reported on business owners buying large homes and derelict motels, doing up an old mini-golf course and refurbishing an aged care facility all to house staff. 

Cloncurry, 1,700 kilometres north-west of Brisbane, only has a population of 4,000 people.

But its council is building houses for long-term rental, to lure people to stay.

Brendan Stewart is someone who has benefited from the new approaches in Falls Creek, once the possums were cleared out.

As a head chef at St Falls Resort, he has just spent his third winter in the mountains and previously lived in a lodge with more than 70 people.

“Everyone was four in a tiny little shoe box of a room and sharing a bathroom and not much personal space,” he says.

This year he is living in the refurbished Bogong Village, which overlooks the dam and is only a short bus ride from the kitchen where he works. 

He and colleagues in the ‘Chef House’ are delighted with the place, which has an outdoor deck and more space. 

While sharing bedrooms with one or two others in the provided accommodation remains standard, he said it’s better than living with so many people.

“It’s our own house, rather than sharing a kitchen with 72 people,” he says.

“Just being able to walk in, look at a space and not have 20 people jumping all over me being young and whichever. Because I’m old!

“I’m 40 years old now, I need my personal space. It really makes my work environment a whole lot better to have a little bit more personal space.”

The living situation makes it more likely he’ll return for future winters.

“Our home here is really, really lovely and respectful, compared to other times that I’ve been up the hill.”

Is there a way to bridge the housing gap?

To make housing affordable, there’s a gap that needs to be bridged.

It’s essentially the difference between what a property could make if it was sold or rented on the open market, and the reduced amount of return that comes from lowering the cost to be affordable.

What’s happening to fill that gap is things like councils and communities offering cheap land, government subsidies to build projects or businesses getting together and making a commitment to buy future beds. 

Developers like Assemble can use the mega-funds available to invest at scale, building more and larger projects. Many of the units are sold at the market price – whatever they can raise at sale or auction – with a proportion kept to be rented at below-market rate.

“We’ve gone from having really affordable housing in Australia, back when the government used to provide a lot of it to now being a country that’s really dependent on private investors, small time landlords and private developers to supply most of our housing,” says Ms Azize.

While affordable accommodation is a problem nationwide, it’s a particularly spiky issue in semi-remote regional areas popular with tourists. 

That’s because they need all of the usual essential workers, plus a hospitality labour force, at the same time as selling accommodation is a key part of the economy.

“We are definitely seeing that there are some communities that are getting squeezed more and they’re being pushed into finding creative solutions because they have no other option,” Ms Azize said. 

“Because communities need aged care workers, they need childcare workers.It’s not an option to not have these people live in their communities.”