Partners Group and Host Student Housing have created a £1bn (€1.2bn) UK student housing and co-living investment venture.

The pair said the new joint venture has been seeded with two Host-owned operational purpose-built student accommodation (PBSA) assets in Leicester and Colchester, a PBSA development project in Bournemouth and a purpose-designed co-living development project in Guildford.

The partnership also has a pipeline of over £250m of PBSA developments totalling more than 1,000 beds in the prime Russell Group university markets of Manchester, Bristol, Edinburgh and Birmingham, the companies said.

Ultimately, the venture intends to expand through further developments in the PBSA and co-living sectors to hold a portfolio with a gross development value of a billion pounds, according to the firms.

Rahul Ghai, managing director, and co-head of private real estate Europe at Partners Group said: “A return to normality and strong demand fundamentals are making the post-COVID student accommodation sector in the UK an attractive investment opportunity.

“The sector is a key thematic focus for us and benefits from long-term tailwinds, such as favourable population growth trends and rising enrolment rates, as well as the continued strength of the UK’s higher education offering globally.”

Peter Holden, managing director, and co-head of real estate asset management at Partners Group, said: “We look forward to working with Host in this joint venture to continue to provide safe, energy-efficient assets to meet the increasing need for good value housing in key undersupplied university cities throughout the UK.”

John Nesbitt, managing director at Host, which is part of property company O’Flynn, said: “We have a shared ambition to build a new portfolio of top quality PBSA and co-living projects in the ‘living’ sector, which offers strong sector fundamentals and growth.”

Michael O’Flynn, chairman and CEO of the O’Flynn Group, said: “Our experience over 25 years in providing student accommodation in Ireland, the UK and across Europe will clearly benefit the joint venture.

“This is a unique opportunity, through Host, to collaborate with Partners Group in the development of PBSA and co-living projects. The scale of the joint venture will quickly position the JV as a leading player in a sector with significant growth potential.”

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