Pension Insurance Corporation backs UPP's student campus deal

Pension Insurance Corporation (PIC) is part funding University Partnerships Programme’s (UPP) acquisition of a student accommodation at Swansea University Bay Campus in Wales.

UPP said it has reached financial close on a £98m (€111.6m) deal with listed developer St Modwen Properties to establish a new, 45-year partnership with Swansea University.

As part of the deal, UPP will buy two companies from St Modwen, as well as a freehold property interest in further accommodation.

The transaction will include £63m of index-linked bond debt from PIC, an insurer of defined benefit pension funds.

The funds from PIC will be split across two debt tranches of £44.9m and £18.1m, with debt tenors of 44 years and 37 years respectively. 

UPP will invest £34.8m of subordinated debt and equity. 

The seller St. Modwen will receive a total cash consideration of £87.3m.

PIC’s latest investment takes the total it has invested in UPP schemes to over £300m.

PIC previously provided £86.8m of bond debt for UPP’s forward-funding of a £105m deal with the University of London in January last year.

Other UPP schemes that PIC has backed, include the University of London’s Garden Halls and the University of Kent’s Turing College.

With this new deal, UPP will acquire and operate 2,021 study bedrooms on the Swansea University’s Bay Campus in South Wales. 

UPP now has a portfolio of around 35,000 rooms under management or in construction.

Related images

  • UPP Swansea University Bay Campus

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