UK student accommodation developer Unite Students has exchanged contracts to sell a portfolio of 14 properties comprising 3,436 beds in the UK to media organisation Singapore Press Holdings for £180.5 mln (€202 mln).
Completion is due later in September 2018.
The purchase price reflects a net initial yield of 6.3% and is marginally below book value, Unite said in a statement.
The properties are located in the cities of Plymouth, Huddersfield, Sheffield, Birmingham, Bristol and London and the deal is in line with Unite's strategy to sell assets with lower than average growth prospects.
'This sale is an important part of our ongoing strategy of creating a high-quality portfolio aligned to the universities with the highest student demand and the best long-term growth prospects,' said Richard Smith, Chief Executive of Unite Students. 'The UK’s high and mid-ranked universities are some of the most attractive for both home and international students, ensuring demand for our beds remains high. The transaction provides the investment capacity for our highly accretive development pipeline and target acquisitions that enhance our portfolio and support our earnings growth.'
Upon completion of the pipeline, high and mid-ranked Universities will account for 90% of Unite’s portfolio. The group’s proforma loan-to-value falls to 25% following the disposal.
