UK - Unite, the UK student accommodation firm 4.5% owned by Dutch civil service scheme ABP, last week sold £220.3m (€308m) of assets to the UK Student Accommodation Fund (USAF), in a move designed to fund its growth.
The transferred portfolio includes blocks in Manchester, Liverpool,
Sheffield and Aberdeen, most of them fully let for the 2007—2008 academic year, at an expected yield of 5.6%.
Following completion of the deal,Unite will have a 20% stake in the fund it set up in December last year, as its intention is to shift its business model towards co-investment and asset management.
The fund has a target size of £1bn by 2008 and a target 9% return so last week's acquisition will push up the fund's loan-to-value gearing to 47%.
Spokeswoman Tabitha Aldrich-Smith said taking the transferred assets off the firm's balance sheet would "sustainably fund our growth".
The firm also announced it was shifting a 46-property portfolio worth £21.4m at the University of Bath to fund manager Morley. Aldrich-Smith said it was selling the portfolio because "we couldn't do as much asset management as we wanted to".
The firm also has managed and pipeline assets worth £2bn, according to a presentation to analysts last week and this latest transfer follows the October offloading of assets worth £81.8m (€118m) to the fund.
Demographics - notably a 50% graduate target set by the UK government - have turned what was once a niche investment market into a growth sector as investment in the UK student accommodation sector totalled £600m in 2007.
Elsewhere in Europe, French real estate firm Gecina last week acquired the 12-floor Euralille Tour V in Lille for €14.2m in line with an expansion strategy within the student segment. Yield on this deal is 7%.
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