Barings invests £65m in student housing via forward funding with McLaren Property

Barings is providing £65m (€76.3m) on behalf of a pan-European real estate strategy to forward-fund a UK student housing project.

The fund manager said the core real estate strategy agreed to the funding of the St Gabriel’s Hall development on Oxford Place in Manchester with developer McLaren Property.

The purpose-built student accommodation (PBSA) project involves the construction of two new blocks and the part-refurbishment of two heritage buildings, delivering 319 student rooms totalling 104,259sqft, with an additional 5,005sqft of amenity space. Completion is expected in the summer of 2025.

Ben Pile, head of European residential investment and asset management at Barings, said: “St Gabriel’s Hall will be the fourth PBSA scheme to be delivered by Barings in the UK on behalf of our capital partners – and the second in Manchester.

“Given the continuing supply-demand imbalance for PBSA in Manchester, St Gabriel’s Hall will provide an attractive proposition to students who will find the mix of quality specification, extensive amenity spaces and attractive landscaped grounds, proximity to world-class institutions, and excellent transport links very appealing.” 

Darren Hutchinson, managing director and head of UK real estate transactions at Barings, said: “The sector has proven very resilient over the past few years which is why we see a strong opportunity to create modern, high quality stock that meets the aspirations of students against a background of constrained supply in the UK.

“Aside from PBSA as an asset class, we are very interested in further widening our exposure to BTR across the country in major cities.”

John Gatley, CEO of McLaren Property, said: “Student accommodation is attracting strong investor appetite, amidst what is otherwise a challenging funding backdrop, and we anticipate this will continue due to the resilience of our sector.”

David Atherton, divisional managing director at McLaren Property, said: “This partnership is a milestone moment for the project and secures the development finance required to bring this exciting scheme to fruition. McLaren Property and Barings have a shared vision to breathe new life into these redundant historic buildings and help set the highest standards of accommodation within Manchester.”

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