UK privately owned multi-family office LJ Group said on Thursday that it has committed a total of €100 mln of equity to Cresco Capital Group’s German student housing venture, Cresco Urban Yurt.

UK privately owned multi-family office LJ Group said on Thursday that it has committed a total of €100 mln of equity to Cresco Capital Group’s German student housing venture, Cresco Urban Yurt.

The partnership has made its first acquisition with the purchase of the landmark Frankfurter Tor building in Berlin and will invest over €60 mln to redevelop the asset into around 552 apartments, including ground floor and basement retail units.

The new student housing venture is led by Alexander Bürk, founder of the Cresco Capital Group and Daniel Schuldig, a former senior private equity executive.

'The acquisition of the Frankfurter Tor property exemplifies our focus on large redevelopment projects in prime locations,' said Bürk. 'We secured planning for the property in a short space of time by working closely with the local planning authorities, providing a strong concept which will revitalise the property by integrating it into the local community.'

Cresco Capital Group has acquired and developed properties valued at over €500 mln since its foundation in 2006, including Soho House Berlin.

STUDENT HOUSING BOOM
The equity raising is the latest for a student housing vehicle in Europe as the asset class continues to gain popularity among institutional investors.

Last week, Bouwfonds Investment Management raised new commitments of €110 mln for the Bouwfonds European Student Housing Fund.

The vehicle, with a target volume of €200-300 mln, is a special fund (in accordance with the German Investment Act) with a core risk profile which offers investors a rate of return (IRR) of 5.5% to 6.5% with a maximum loan-to-value ratio of 40%.

Meanwhile, Singapore’s sovereign wealth fund GIC has backed a £90m (€112 mln) whole loan facility for UK student accommodation provider Urbanest. The facility is secured against Urbanest’s scheme in Hoxton, East London and its soon to be completed development on the Regent’s Canal, Urbanest St Pancras.