Staytoo, MPC Capital's student accommodation brand, has selected Portugal for its European expansion plans.
Rainer Nonnengasser, managing director of MPC's micro-living business unit, said that Staytoo had been looking for an immature market to expand its student accommodation provision.
'We feel extremely comfortable in immature markets,' Nonnengasser told PropertyEU. 'When we started in Germany a few years ago the situation here was still charaterised by a pioneering environment. We feel that Portugal shows the same characteristics, with many international students driving demand, a lot of English-taught courses, high-quality education, and an almost non-existent supply of student accommodation.'
Hamburg-based asset and investment manager MPC Capital - which invests in real estate, shipping and infrastructure - focuses on micro-living, retail, office and logistics across its property business.
To date, MPC has invested mostly in Germany and the Benelux, with Staytoo operating exclusively in Germany, in the cities of Nuremburg, Bonn, Kaiserslautern, Leipzig and Berlin.
But Iberia would be the main development territory in 2017, Nonnengasser said.
'Right now, there is a government-supported dorm product in place in the main Portuguese universities, but it does not meet the requirement of today's young people, especially international students. Portugal has quite successfully left the crisis of the last few years behind, and another driving factor is that we have a partner there with whom MPC Capital has collaborated for more than 20 years in the shape of Laje Capital.'
Staytoo's first scheme in Portugal will deliver almost 250 beds in Lisbon, with a second development in the capital in the works, plus another two projects in Porto. 'We hope to roll out 1,000-1,500 apartments in Portugal in the first phase,' Nonnengasser revealed.
Spanish strategy
Beyond Portugal, Spain is likely to be the next market in Staytoo's strategy, but Nonnengasser said that it would probably avoid the cities of Madrid and Barcelona, which were 'fraught with planning issues'.
He said: 'What's really interesting are the cities lying along the Mediterreanean arc, beneath Barcelona and right across to Seville - so Valencia, Alicante, Malaga and Granada - there are a lot of opportunities there as they all have between 30,000 - 70,000 students, growing international populations, and extreme shortages in terms of the student accommodation offer.'
Nonnengasser said that Italy likely showed similar charateristics to the Iberian peninsula. 'But I couldn't say we've taken a decent look at that market. We're likely to focus on the Iberian peninsula for now, although I'm aware that CEE also has lots and lots of potential for the student market. We are mature enough to know we can't do everything in one shot, so our current focus will be Iberia.'
