APG invests €100m in European student accommodation business

APG, the asset manager for the €356 bn Dutch civil service pension fund ABP, is investing €100 mln in The Student Hotel, a hybrid European student housing and hotel brand based in Amsterdam.

This pension fund investment will increase the equity capacity of The Student Hotel group to €250 mln. The group plans to invest more than €600 mln in its Dutch and European student accommodation portfolio in the coming 3-5 years.

'We think that the European student housing market offers a very compelling investment opportunity,' said Robert Jan Foortse, head of European property investments at APG Asset Management. 'The increasing international student mobility and integrated European education market requires flexible and high quality accommodation with trusted brands such as The Student Hotel to be available in leading university cities.'

The Student Hotel will focus on expanding in leading European university cities throughout the Netherlands, Germany, Great Britain, Italy, Scandinavia, France and Spain to attract international students, young professionals, and youth travellers.

The spending programme has already started with the acquisition of a 20,000 m2 vacant office building in Florence.

Scottish entrepreneur Charlie MacGregor founded The Student Hotel in Amsterdam in 2006. The company provides full-service accommodation with all-inclusive rates to students, trainees and travellers.

The Student Hotel currently operates over 2,750 rooms across six cities. It opened its first operation as The Student Hotel in Rotterdam in 2012, which recently doubled its capacity to 485 rooms to satisfy increasing demand.

The Student Hotel Amsterdam West is the largest hotel in the Benelux, with 707 rooms. In the summer of 2014 a fourth location, with 310 rooms, was opened in The Hague. This August, the first phase of the Student Hotel’s 574-room flagship hotel, named Amsterdam City, opened its doors. Also, under the brand Melon District, The Student Hotel operates 597 rooms in Barcelona and 191 in Paris.

The European expansion was initiated after an earlier equity commitment of €150 mln by Perella Weinberg Real Estate Fund II in 2014.

The Student Hotel aims is to create a €1 bn, core real estate portfolio, totalling over 10,000 rooms by 2020. Two locations are currently under development in Eindhoven and Groningen. The acquisition of a 20,000-m2 vacant office building in Florence will be finalised early October.