Singapore-based City Developments Limited (CDL) has enlarged its UK student-housing portfolio with the acquisition of five assets for £215m (€249m) via two separate transactions.
The portfolio comprises 1,863 beds across five purpose-built student accommodation (PBSA) assets in Birmingham, Canterbury, Coventry, Leeds and Southampton.
CDL made its foray into the UK PBSA sector in June 2022 with the acquisition of the 505-bed Infinity in Coventry.
Sherman Kwek, CDL Group chief executive, said: “The UK student accommodation sector continues to demonstrate strong resilience as students return to campus post-COVID.
“Our newly acquired assets are strategically located in cities where there is high demand but traditionally underserved by a lack of supply, providing further rental growth potential in the longer term.
“With universities in the UK enhancing their global positioning, it presents an exciting opportunity for us to amplify our presence in this sector and strengthen our recurring income.”
Four of the five assets were acquired from alternative real estate fund manager Harrison Street for £185m.
Located in Canterbury, Birmingham, Coventry and Leeds, they were developed by Harrison Street European Property Partners II in joint venture with Linkcity, the property development arm of Bouygues UK, and Crosslane Property Group.
Harrison Street the sale produced an attractive return, with a gross purchase price 33% higher than the cost to build them.
Paul Bashir, chief executive of Harrison Street Europe, said: “We are pleased to partner with the high-calibre team at CDL to complete the sale of these four, high-quality PBSA assets.
“Thanks to the hard work and execution capabilities of our team, the portfolio produced an attractive return in a difficult macroeconomic environment, demonstrating Harrison Street’s ability to identify assets that are backed by demographic-driven trends and exit through strategic portfolio sales.
“We will continue investing in PBSA assets across Europe with confidence given the attractiveness of these properties in the current market environment.”