Investment in the UK’s student accommodation sector has reached a new peak this month with a number of overseas property investment funds choosing to invest more than £2billion into the asset class.
The past few weeks have seen a flurry of activity in the sector as a number of high profile investment deals have reached fruition. Following LetterOne’s completion of a £532m deal for the 2,150 bed Pure student housing and their subsequent commitment to more than £140m worth of upcoming student properties, the acquisition of large student accommodation portfolios has continued as high net worth corporate and institutional investment groups look to benefit from the excellent yields on offer in the student market.
After several months of negotiation and a competitive bidding war, the Canada Pension Plan Investment Board has completed their acquisition of the Liberty Living student accommodation portfolio for £1.1bn. Consisting of 40 student accommodation developments located in 17 towns and cities across the UK, the portfolio of more than 16,700 rooms sees CPPIB enter the market as the third largest owner of student property in the UK. The investment marks the Canadian investment group’s largest ever European investment.
It was also confirmed this week that the US based Greystar Real Estate Partners has agreed to purchase the Nido London portfolio for around £600m. The purchase will see Greystar add to their existing UK based student accommodation investments with an additional 2,675 beds across the luxury student market in London.
The completion of these high profile investments has seen the student accommodation sector break new records for the asset class, drastically surpassing the figures that were achieved last year. According to CBRE, student property achieved more than £2.4bn worth of transactions in 2014, a new peak for the market. With this month’s large portfolio acquisitions now complete and student accommodation continuing to attract investors, it is likely that 2015 will welcome a new high for the sector.
The significant increase in interest in this area of the market indicates the current strength of the UK’s student accommodation sector, making now an excellent time to invest in the asset class.
Offering 9% NET rental return and an excellent contractual rental assurance of 5 years, Colne Hall is an exceptional student accommodation investment. Standing just 0.4 miles from the University of Huddersfield and directly next to Kirklees College, it is perfectly located for students in the area.
For more information on Colne Hall, please click here.