London-based developer-investor Kajima has partnered with Poland's Griffin Real Estate Partners (GRE) to acquire Student Depot, Poland's largest provider of student accommodation, from Oaktree Capital Management for around €60 mln.
By September, Student Depot will operate 2,000 beds across five sites in Poland, according to both firms, representing half of the Polish purpose built student accommodation (PBSA) market.
The deal was made in a 90:10 joint venture with entities controlled by GRE, the largest real estate investment manager in CEE, and from entities indirectly controlled by Oaktree, the global asset management firm specialising in alternative investment strategies.
The business was originally set up by GRE and Oaktree in 2015 has evolved to become the largest owner and operator of PBSA in Poland, and is the fastest growing provider in the country, GRE said.
'In recent years, the interest in high quality accommodation has increased among international as well as domestic students, with only around 1% of students having access to purpose built space in Poland,' said Nebil Senman, managing partner at GRE. 'With Student Depot, Griffin Real Estate created the market leader in the Polish student housing sector offering premium and modern student accommodation facilities. We are very proud to have the opportunity to create a new joint venture with Kajima and sharing the vision to further develop Student Depot and capitalise on the strong market fundamentals and latent demand for student accommodation.'
The business is set to open new sites in Gdansk in 2020, with multiple additional sites in Warsaw, Krakow and Wroclaw identified for delivery in 2021/2022 and beyond. The Warsaw-based enterprise currently owns and operates approximately 1,550 beds with sites in Poznan, Lublin, Wroclaw, and Lodz, with a further circa 500 being delivered this summer in the capital.
'This acquisition by Kajima Student Housing in partnership with Griffin Real Estate offers a high growth investment for the business, and comes with a significant development pipeline in the coming years. Poland is a high growth market for PBSA, and we are attracted by both the quality of the assets and the strength of the business’s management team,' said John Harcourt, director of Kajima Student Housing.
Poland is the sixth largest student market in Europe with 1.5 million domestic students, in addition to a strong and growing international body of students representing over 5%, increasing 15% year on year, Kajima said.
A recent joint study by Colliers International and CMS suggests that most major CEE cities will face a significant shortfall in student accommodation by 2028, with Warsaw having the highest deficit. Indeed, Poland was surveyed as the most popular market for both existing investment activity in student property, and in future activity, owing to this shortfall.
Jolanta Bubel, CEO at Student Depot, commented: 'Student Depot has grown into the largest and most recognisable PBSA brand in Poland, and we have commenced an ambitious development programme to continue this growth to capitalise on the demand from our customers for high quality accommodation.
'Kajima and Griffin are committed to support the business’s expansion, and we are excited to be able to take the company forward into its next phase of development.'
Legal advice was provided by Dentons, Weil, Gotshal & Manges, and BCLA; commercial transaction and due diligence advice was provided by Colliers International and Savills, technical advice by APP and tax and financial advice by Crido and MDDP.
