Global real estate institutional investment companies Ivanhoe Cambridge Holdings UK and Bouwinvest Real Estate Investors, alongside rental homes expert Greystar Real Estate Partners, have unveiled a new ‘develop-to-core’ venture focused on funding purpose-built student accommodation (PBSA) in the Greater Paris region.
The initiative, which will also create accommodation for young professionals, has an investment capacity of €1 bn.
Acting as majority shareholder, Ivanhoe Cambridge will manage the project alongside Bouwinvest and Greystar. The venture will deploy funds to target new acquisitions, including ground-up developments and projects already under construction.
The venture has already identified a significant pipeline of opportunities in the Paris region and is targeting a number of initial acquisitions over the coming months, with priority given to schemes with good public transport access.
Karim Habra, head of Europe & Asia-Pacific, Ivanhoe Cambridge, said: 'Greater Paris and co-living markets for student and young professionals are major growth areas for our European strategy. At the same time, the Covid-19 crisis is accelerating trends towards more premium flexible products and services in key locations.
'We believe this is the right time as the "alternative" housing market is well positioned with these trends and Paris is highly attractive given its higher-education institutions, while there is a significant growing demand for student housing.'
According to the venture, Paris remains characterised by an imbalance in the supply of high-quality student accommodation, despite the presence of a high concentration of higher education institutions.
Robert Koot, director European investments, Bouwinvest, said: 'The fundamentals of the student and young professional market are very robust. Demand for high quality – but affordable – housing from student populations in metropolitan areas around the world remains strong.
'We have already invested in this segment in the Netherlands and Australia and via this new joint venture are now broadening our exposure and diversifying our allocation to France.'
Greystar, which has nearly 30 years of experience in rental housing, works across more than 13 countries and has been active in France for close to two years, according to the venture.
Hideki Kurata, managing director France, Greystar, said: 'Our new venture with Ivanhoe Cambridge and Bouwinvest will give us significant firepower to deliver on our plans to utilise our expertise in investing, developing and operating high quality student accommodation assets across the world to build a highly amenitised portfolio from the ground up in an underserved global city with strong market fundamentals.'
