M&G Investments is financing the development of a €63m 582-bed student accommodation scheme in Italy.

The manager said it is forward funding the five-storey building scheme in central Turin on behalf of its €4.2bn M&G European Property Fund.

The latest investment follows the fund’s forward funding of a 513-bed student accommodation asset in Bologna in November 2020.

The project, which is being developed by Stonehill Group, is expected to be ready for occupation in time for the 2023/24 academic year.

David Jackson, manager of the M&G European Property Fund, said: “Italy’s student accommodation sector offers strong market fundamentals and attractive projected income returns, with a higher entry yield than many other jurisdictions currently.

“This acquisition builds on the fund’s existing student accommodation asset in Bologna, and is in line with our strategic objective to increase our exposure to the broader living sector across Continental Europe, including student accommodation, the private rented sector and senior living.”

Gabriele Inglese, associate director, M&G Real Estate, Italy, said: “Turin brings M&G’s total real estate commitment to Italy - a key market where we are growing our on-the-ground presence - to more than €620m across its European fund range.

“Italy is one of the top EU countries for attracting international students; cities with globally-recognised universities and a constrained supply of private rented accommodation like Turin provide excellent prospects for continued growth.”

To read the digital edition of the latest IPE Real Assets magazine click here.