The Unite UK Student Accommodation Fund (USAF) has raised £306 mln (€426 mln) of new equity from new and existing investors.
The Unite UK Student Accommodation Fund (USAF) has raised £306 mln (€426 mln) of new equity from new and existing investors.
Allianz Real Estate, acting as a cornerstone investor, invested £100 mln of equity in the £1.6 bn USAF fund while a further £14 mln was raised from other new institutional investors.
Existing unitholders invested a total of £192 mln, including Unite’s investment of £60 mln representing the planned deployment of proceeds from its own recent equity fundraising, maintaining its stake in the fund at around 22%.
The new units will be priced at the prevailing quarterly NAV at the time when capital is drawn plus a premium of approximately 1.5%. The capital will be used to fund acquisitions and reduce leverage in the Fund, USAF said in a statement.
While the vehicle will initially use the funds to reduce leverage from the current level of 40% LTV, it expects to deploy the capital in new acquisitions by the end of the year.
Commenting on the transaction, Joe Lister, Unite's chief financial officer, said: 'We are delighted to have successfully raised over £300 mln of new capital into USAF providing the fund with capacity for acquisitions and the ability to further de-lever the balance sheet in line with our plans.'
He added: 'The strength of demand for USAF units together with the introduction of an investor of Allianz’s global standing is a real endorsement of USAF’s position as the leading fund in the sector, its historic performance and future strategy.'
USAF is an open-ended non-listed real estate fund and the largest specialist student accommodation vehicle in the UK currently holding a portfolio of 68 properties valued at over £1.6 bn which are located in 22 markets across the UK providing over 24,000 bed spaces.
Established in December 2006, USAF has raised equity capital totalling over £950 mln from UK and European institutional property investors on a periodic basis to raise funds for acquisitions and to manage leverage.
USAF has over 100 investors. Unite is the largest investor with a current co-investment stake of approximately 22%. Unite also acts as manager of USAF and operates its properties.