A joint venture of US groups KKR and Round Hill Capital has acquired the land and is forward-funding the development of a 698-bed purpose-built student accommodation (PBSA) scheme in Groningen, the Netherlands.
It is the joint venture’s second student housing development in the Netherlands, following the acquisition in July 2018 of a scheme in Utrecht, comprising 577 student beds and 173 residential apartments.
KKR and Round Hill make investments in student accommodation through multiple strategies including acquiring existing assets, developing new PBSA, forward-funding and repositioning assets across select university towns and cities across Europe.
The new Dutch scheme is located within a two-minute walk of Groningen University’s campus. It will offer 467 large en-suite studio flats and 231 short-stay units. Construction is due to complete in early 2020.
The building will be managed by Nido Student, Round Hill’s operational platform and brand for European student accommodation. The project - due to be built by Geveke - was acquired from a joint venture between Dutch real estate development firms Borghese Real Estate and Urban Developers.
KKR and Round Hill have secured financing for the project from Rabobank. KKR’s investment was made through its Real Estate Partners Europe fund.
Commenting on the acquisition, Michael Bickford, founder and CEO of Round Hill Capital, said: 'We remain committed to continuing to invest in and manage real estate in the Netherlands on behalf of multiple investors and we continue to pursue actively our student accommodation and residential strategies.'
PropertyEU reported on Monday that Round Hill is disposing of its entire Dutch residential portfolio with a price tag that could exceed €1.4 bn. Amassed in the last four years, the portfolio comprises nearly 10,000 units and generates annual rental income of some €75 mln.
Round Hill was the first international investor to become active in the Dutch residential market following the crisis and is said to be selling the package on behalf of US private equity giant Blackstone, among others.
A spokesperson for Round Hill declined to comment when contacted by PropertyEU.
Maiden UK student housing deal
Separately, Round Hill announced on Monday that it is forward-funding the development of four purpose-built student accommodation (PBSA) schemes across the UK together with private equity firm KKR. The deal is the first in the UK student housing sector by the joint venture.
The four PBSA development schemes are being acquired from and built by Watkin Jones and will provide a combined total of 1,815 beds. As part of the transaction, the JV has also agreed an option to forward-fund a 348-bed PBSA scheme in Bristol conditional on full planning consent.
‘This is our joint venture’s first student housing development scheme in the UK, where select areas of the UK student housing market still suffer from structural supply constraints in key university cities,’ commented Bickford.
The buildings will be managed by Nido Student, Round Hill’s operational platform and brand for European student accommodation. KKR and Round Hill have secured financing for the schemes from Wells Fargo. KKR’s investment was made through its Real Estate Partners Europe fund.
Round Hill was founded by Michael Bickford in 2002 as a real estate investor and manager and now has some $6.5 bn (€5.6 bn) of assets under management worldwide. The company’s European housing portfolio comprises around 100,000 units. It has a substantial portfolio in Germany and recently also entered the Finnish residential market. Round Hill is also active in the UK and Continental European student housing market through its Nido brand and platform.
