AMP Capital infrastructure funds invest €444m in student accommodation

AMP Capital infrastructure funds have invested more than A$700m (€444m) to acquire a student accommodation concession in the capital of Australia.

AMP Capital Diversified Infrastructure Trust (ADIT) and AMP Capital Core Infrastructure Fund (CIF) bought the Australian National University (ANU) asset from Infratil and funds managed by Morrison & Co.

Brad Williams, ADIT portfolio manager and investment director, told IPE Real Assets that the transaction would lift the group’s total student accommodation platform to more than 5,800 beds.

The latest transaction will boost the platform by almost 4,200 beds across 10 existing residences on the ANU campus in Canberra.

Williams said AMP Capital would be ANU’s capital partner should it wish to expand its student accommodation facilities in future.

The original concession was established in 2016 and includes existing long-term outsourced facilities management arrangements. ANU retains responsibility for operations.

“AMP Capital has been successfully invested in university student accommodation partnerships for over 15 years,” said Williams.

AMP Capital first entered the sector in 2003 when it established a partnership with the University of Sydney, he said. Today, that partnership runs 650 beds.

Williams said AMP Capital has been able to leverage off the partnership to secure an agreement with the University of Melbourne late in November. It now runs 950 beds for the University of Melbourne (ADIT owns 100% of the Melbourne investment).

“Our large-scale portfolio of beds now provides our investors with access to long-term inflation-linked contracts with Australia’s top 3 ranked universities,” Williams said.

“This sector attracts strong interest because of the demand for accommodation by foreign students, and has delivered strong returns over the years.”

Infratil, which is listed in both New Zealand and Australia, currently jointly owns the ANU student-housing portfolio with other funds, managed by Morrison & Co.

Mark Mudie, Morrison & Co executive, said the sale enabled Infratil to focus on investments in its established platforms, targeting renewable energy, retirement services and growth in data and connectivity.