Unite Student has sold 13 properties to a Brookfield-managed fund for £295m.
The disposal, comprising 4,175 beds, is due to complete in the second quarter of this year, and is part of Unite’s strategy to raise capital to fund further growth in its development pipeline.
The portfolio is made up of a combination of wholly owned, USAF and LSAV properties located in Aberdeen, Birmingham, Bournemouth, Edinburgh, Glasgow, Liverpool and York. The properties were sold in line with book value. Unite’s share of the proceeds is £102m.
It is the first stage of Unite’s plan to sell £150-£200m of assets during 2017. The proceeds will be used to fund Unite’s recent 3,100-bed on-campus acquisition at Aston University and the remainder recycled into Unite’s development activity.
The gearing and earnings impact of the transaction broadly offsets the impact of the Aston University acquisition, with loan-to-value now standing at 34%, in-line with the group’s target level.
Richard Smith, chief executive of Unite, 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.”