LaSalle funds build up 7,000 student bed portfolio in the UK

LaSalle Investment Management has acquired two direct-let student housing schemes under development in the UK for £20 mln (€28 mln) through forward-funding transactions.

As a result, LaSalle’s client funds will control just under 5,000 purpose-built student bedrooms along with a further 2,000 rooms in houses and conversions in the UK market.

Lace Market Studios in Nottingham was acquired for £10 mln, representing a yield of 6.6% and is being developed by Omni Developments. Designed by Church Lukas Architects, the nine-storey scheme will house 113 studios of which 24 will have balconies. Lace Market Studios will be the first purpose-built student housing scheme to be located in the historic Lace Market district of the city centre.

The second property is Upper Northgate Street in Chester. It was purchased for £9.3 mln, representing a yield of 6.4% and is being developed by Cityheart Ltd. Located near the Chester University campus, the property will comprise 117 bedrooms in a mix of studios and cluster rooms, across two blocks with 10 parking spaces. Students will have access to a common room, communal courtyard and cycling store.

'Whilst the sector has seen increased investor demand, transactional activity and resultant compression of yields throughout 2015, we believe that there is still value in student housing in selected markets,' said LaSalle director John Yeend.

LaSalle was advised by MacLaren & Partners on Lace Market Studios and Montagu Evans on Upper Northgate Street. Both schemes will be managed by Victoria Hall.