Pension Insurance Corporation (PIC) has invested £114m (€143m) in university student accommodation in central London.
PIC, which specialises in insuring the liabilities for defined benefit (DB) pension schemes, is the sole investor in a loan that will allow the University of London to redevelop accommodation in Bloomsbury in partnership University Partnerships Programme (UPP).
The Garden Halls accommodation in Cartwright Gardens, once complete, will provide 1,200 student rooms for the university and will be managed by UPP.
The allocation to student housing falls under PIC’s infrastructure portfolio, which includes other social housing investments.
PIC has insured close to £2bn of liabilities in 2014, requiring it to further develop its investment portfolio to match its longer-dated liabilities.
Investment manager at PIC, Delphone Deasy, said: “In the right investment structure, student accommodation is a good investment for PIC, providing long-dated, secure cash flows to help us match our pension liabilities.
“With £3.7bn of pension scheme liabilities insured by us last year and almost £2bn so far this year, we have a growing portfolio and appetite to invest in further opportunities of this nature.”