Unite to dispose of 13 student properties
Manager and developer of student accommodation, Unite Students, has exchanged contracts for the disposal of 13 properties, comprising 4,175 beds to a Brookfield-managed fund for £295m, its share of which is £102m.
The disposal, due to complete in the second quarter, is part of Unite's strategy to provide the capital to fund further growth in its development pipeline, which is focused on mid to high ranked University locations with the most secure long-term growth prospects.
It is the first stage of the company’s plan to recycle around £150-£200 m of assets this year to take advantage of the ongoing strength in the investment market for well let student accommodation.
The proceeds will be used to fund Unite's recent 3,100 bed on-campus acquisition at Aston University and the remainder recycled into the group’s development activity and further high quality investment properties.
The gearing and earnings impact of the transaction broadly offsets the impact of the Aston University acquisition, with proforma LTV now at 34% in-line with the group's target level.
Chief executive Richard Smith said: "This sale is an important part of our strategy to recycle capital to fund our ongoing investments, focused on the strongest university towns and cities, where we have deep university relationships and where we can provide the best accommodation and services for our students. Our development pipeline supports further earnings growth as we continue to invest in strong student markets."