Unite sells properties in £295m deal

The UK student accommodation developer has said it is selling 13 properties to a Brookfield-managed fund for £295m.

Unite Students said that the sale would give it money to fund further growth in its high-quality development pipeline – focused on mid to high ranked university properties with secure long-term growth prospects.

The 13 properties were located in Aberdeen, Birmingham, Bournemouth, Edinburgh, Glasgow, Liverpool and York and were sold “in line with” book value. The deal is expected to be completed in the second quarter of this year.

The FTSE 250-listed company is planning to recycle up to £200m of its assets this year “to take advantage of the ongoing strength in the investment market for well let student accommodation”. Unite’s share of the 13 properties being sold amounts to £102m.

Part of the money received from the sale will also help to fund Unite’s recent purchase at Aston University, the group said, broadly offsetting the impact of that acquisition.

Unite is among the developers benefiting from an uptick in interest in student accommodation, with investment in purpose-built student homes hitting its highest year on record last year. However, a study by consultancy EY warned late last year that investors could be hit by falling student numbers over the next 10 years.

The report cited new restrictions on student visas and tougher rules for EU citizens following Brexit as well as a drop in total numbers of 18 and 19 year-olds in the UK as factors likely to weigh on the sector in coming years.