Allianz backs A$4bn Australian student housing fund as cornerstone investor

Allianz Real Estate is expected to announce on Monday that it has become a cornerstone investor in the multi-billion Australian Student Accommodation Fund managed by Scape Australia.

Sources said the first large wholesale fund to own core purpose-built student accommodation in Australia, is expected to raise between A$1.5bn and A$2bn (€962m-€1.3bn) in equity.

It is aiming to rapidly build up a portfolio valued at A$4bn.

IPE Real Assets understands that Munich-based Allianz is likely to contribute between 30% and 50% of the equity to be raised by the fund, which was unveiled last month.

At the time, co-founder and chairman Craig Carracher told IPE Real Assets the fund already had commitments “in the range of A$1bn.”

Carracher said then that he expected existing and new investors to anchor the new fund. The first close would be in the third quarter of this year.

Allianz first entered the Australian student housing market in April last year when it partnered with Scape Australia to establish an A$500m closed-end fund, Scape Australia Joint Venture 2

Allianz committed to A$250m in equity for a 50% stake in the joint venture.

Other Scape Australia investors include Dutch pension fund investors Bouwinvest and APG, a Middle Eastern sovereign wealth fund, German investor WPI, and the real estate arm of China’s ICBC International Holdings.

Sources told IPE Real Assets that on behalf of the new wholesale fund, Scape Australia had entered into exclusive negotiations with Goldman Sachs and Blue Sky, the joint owner of a student accommodation business known as Atira.

The Atira portfolio is expected to fetch A$675m, according to a source.

IPE Real Assets has been told that Scape Australia, again on behalf of the Australian Student Housing Accommodation Fund, is one of the potential bidders on the shortlist to buy the huge Urbanest portfolio, said to be valued “north of A$2bn”.

Urbanest, the fourth-largest student housing group in Australia, is currently owned by Washington State Investment Board and has been on the market since May.