Lenders NatWest and Virgin Money have backed a new student residence in London's Hammersmith at 181 Talgarth Road, which is currently under development through a forward funding agreement between Scape Living and Dominus Group.
Following a request for development financing by Scape earlier this year, NatWest agreed a £105 mln three-year funding solution to finance the development of the residence. NatWest credit back-stopped the full amount, however in order to manage financing capacity to support Scape with future opportunities, NatWest was also appointed debt coordinator and sought third-party liquidity pre-transaction close.
Virgin Money was mandated due to its experience in the sector and confidence in the transaction, agreeing to provide £52.5 mln and leaving NatWest with the remaining half.
The project will offer 713 beds a short walk away from Hammersmith Broadway station. In order to combat increasing rent prices in London, Scape are intending to let 357 of the 713 rooms under a nominations agreement with a London University at an affordable rate which is capped by the Mayor of London. The remaining rooms will be let privately.
The residence will offer a wide range of amenities including workspace and meeting rooms, a cinema, communal kitchens, a gym, roof terrace and bike storage. The building is targeting completion in June 2025, ready for the start of the 2025/26 academic year in September.
Harry Daws, investment director at Scape Living, said: 'Scape Hammersmith is a continuation of Scape’s journey to provide best-in-class student accommodation and will help to address the significant shortage of high-quality PBSA developments in London. We are thrilled to have partnered with NatWest to deliver this scheme as we continue to build out our significant pipeline of developments across the UK.”
DWF, CBRE and Gardiner & Theobald provided advice for the lenders, and Simmons & Simmons and Mayer Brown for Scape.
Scape Living is one part of the of the global Scape brand which has over 30,000 beds under operation and in development across the UK, USA, Australia and Ireland. In 2020, Scape entered into a £500 mln joint venture with APG Asset Management to deliver purpose-built student accommodation and Living assets across the UK, where both parties will be deploying significant capital over a number of projects. Scape will also be operator of the assets once built.
