The UNITE UK Student Accommodation Fund (‘USAF’) is an open-ended non-listed real estate fund that focuses on acquiring and operating high quality student accommodation in the UK.
USAF is the largest specialist student accommodation fund. It currently holds a portfolio of 58 properties valued at over £1 billion which are located in 18 markets across the UK providing 19,468 bed spaces.
Established in December 2006, USAF initially raised equity capital totalling £370 million from UK and European institutional property investors. It was initially seeded with a £515 million portfolio comprising 31 properties acquired from UNITE Group.
USAF completed its most recent capital raise in December 2009, raising £167 million of equity. The capital raise was oversubscribed, reflecting the appetite from investors for the student accommodation sector.
USAF has now grown to having over 100 investors. UNITE is the largest investor with a current co-investment stake of 16.3%. UNITE also acts as manager of USAF and operates its properties.
UNITE Capital Cities Joint Venture (‘UCC’) is a joint venture with GIC Real Estate, the real estate investment arm of the Government of Singapore Investment Corporation (GIC). Established in 2005 to develop new properties, UCC holds a portfolio of 16 properties located in London and Edinburgh valued at £370 million. UCC has fully invested all of its equity and will continue to focus on the operation of its investment assets and any asset management opportunities within its estate. UNITE has a 30% holding in UCC, with GIC holding the remaining 70%.
| Oasis Capital Bank Joint Venture (‘OCB’) was established in August 2009 as a five year joint venture to develop three student accommodation properties in London with an estimated value on completion of £194 million. UNITE has a 25% stake in the vehicle, through a £13 million equity investment, with OCB holding the remaining 75%. The three assets represent the Group's entire 2010 development programme and will deliver 1,119 bed spaces on completion.
The transaction clearly demonstrated both UNITE's ability to attract co-investment and grow its management business building on the previous successes of UCC and USAF. It was also completed in a very challenging market environment, highlighting the relative resilience of the student accommodation market versus the wider commercial market.
UNITE has a further joint venture with Lehman Brothers, UNITE Student Village Joint Venture (‘USV’), which currently holds one property in Sheffield comprising 1,378 bed spaces. UNITE has a 51% holding in USV and Lehman Brothers 49%. Lehman Brothers was placed in administration in October 2008. UNITE has certain pre-emptive rights with regards to the joint venture and will continue to monitor the situation going forward.
Contacts
Mark Creedy Managing Director, Fund Management mark.creedy@unite-group.co.uk 0207 659 1810 David Faulkner Fund Manager david.faulkner@unite-group.co.uk 0117 302 7055 |