The London Student Accommodation Venture (LSAV), a joint venture between student housing specialist Unite Group (Unite Students) and Singaporean sovereign wealth fund GIC Investment manager, is acquiring two London student accommodation properties from Unite for £342 mln (€398 mln).
Barings is providing a £140 mln (€163 mln) eight-year fixed rate loan, on behalf of two institutional investors, to finance the acquisition.
The properties are located in Wembley and Whitechapel and offer 1,358 bed spaces, of which the majority are directly let to students. The Wembley asset, Arch View House, was completed ahead of the 2020/21 academic year, while the Whitechapel property is less than ten years old and has an excellent trading history, with 98-100% occupancy achieved over the last four academic years, prior to the pandemic.
Unite Students will continue to manage and operate the two London properties under its management agreement with LSAV.
This loan follows a £124 mln facility provided by Barings to Unite Students in 2014 and was repaid in July 2020.
Chris Bates, head of Europe Real Estate Debt Origination at Barings commented: ‘These modern properties are finished to a very high standard and are well located to meet the demands of students attending London’s numerous, world-renowned educational institutions. We look forward to working with Unite Students and GIC through their London Student Accommodation Venture and supporting them over the coming years. This new facility extends our long-standing relationship with Unite Students and underlines our commitment and conviction in the outlook for UK student accommodation sector, which continues to benefit from strong underlying demographic trends, despite the challenges faced during the pandemic.’