Global specialist real estate investor Round Hill Capital has launched a new joint venture with Canada Pension Plan Investment Board (CPP Investments) focusing on purpose built student accommodation (PBSA) across Europe.
The JV, targeting assets in excess of €1 bn, will be one of the largest European student housing ventures and will invest in standing assets and developments across PBSA markets in Continental Europe. CPP Investments’ initial allocation of equity will be €475 mln.
Round Hill Capital has already notched up 40 PBSA acquisitions across the UK and Europe since 2002, including recent acquisitions in Spain, Germany and the Netherlands worth over €150 mln.
The new venture's assets will be operated primarily by Nido Student, Round Hill Capital’s specialist PBSA brand.
Michael Bickford, founder and CEO of Round Hill Capital, said: 'We are delighted to be partnering with CPP Investments in our joint mission to raise the quality of PBSA assets across the continent.
'This joint venture, one of the biggest European PBSA partnerships to date, represents another market leading investment platform for Round Hill Capital. With 40 PBSA acquisitions to date, worth a collective €1.8 bn, we are firmly established as a market leader.'
By year end the JV is expected to have approximately 2,000 beds secured in Spain and the Netherlands based on contracted assets and those under exclusivity.
Andrea Orlandi, managing director, head of real estate Europe, CPP Investments, said: 'Demand for high-quality student accommodation in many European countries is underpinned by structural changes, including increasing tertiary education participation rates and increasing international student mobility, but is contrasted by limited current supply.
'Our new partnership with Round Hill Capital will increase our exposure to this asset class across European markets, leveraging their deep sector knowledge and insight to meet the needs of students and drive long-term value for CPP contributors and beneficiaries.'
Brian Welsh, head of student at Round Hill Capital, said: 'There are unprecedented levels of capital looking to invest in resilient income streams, but the challenge many will face is having access to deal flow and having the market insight and data to extract maximum value.
'Our long track record in this sector and local presence in core European markets has helped us establish a market-leading position over many years.
'We are seeing significant scope for growth in many markets and together with our student operating platform, Nido, we have the track record to navigate the nuances that define many different cities across Europe.
'High quality housing remains in short supply in many locations and while much more can now be done online, the need for face-to-face engagement and the desire for a world-leading education will continue to drive customer growth across key markets.'