Canada Life Asset Management has provided £30m (€35.2m) in financing to the University of Kent through a long-term lease purchase of three student accommodation buildings.
The deal involves the University of Kent taking a lease back for 50 years at an initial rent of £1.33m per annum, subject to annual indexed uplift to the consumer prices index capped at 5%, Canada Life said, adding that on expiry of the leaseback period, Canada Life’s leasehold interest in the three student accommodation blocks on the university’s main campus is terminated for the consideration of £1.
Michael White, head of UK property at Canada Life Asset Management, said: “We are delighted to be supporting the University of Kent with a significant facility of £30m, to enable strategic reinvestment into the University.
“This 50-year financing arrangement reflects Canada Life Asset Management’s ongoing appetite to provide substantial, long-term facilities to high-quality sponsors that offer attractive income cash flows in support of our bulk annuity business.”
Trevor Pereira, director of estates and commercial services at University of Kent, said: “This arrangement is an important part of our future plans for the campus, freeing up capital to support the ambitious programme of work in our next institutional strategy.
“Leveraging income through our estate is increasingly important, with Canada Life’s support providing immediate funds to support us in the years ahead along with the long-term security needed for our accommodation offer.”
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