Brandeaux is exploring an initial public offering of its redemption-hit £1bn student accommodation fund.
The group is understood to have appointed Morgan Stanley to look at options including listing the vehicle on the London Stock Exchange.
The flotation would provide an exit for retail investors in the open-ended vehicle – owner of more than 40 student housing schemes in 17 UK cities. The fund suspended trading and closed to redemptions on 1 July last year.
It would also allow for a change of the fund’s capital base, something the company was reported to have been exploring at the end of last year after approaches from several institutional investors.
A source said: “Brandeaux has been looking at an IPO but faces a big issue around duty to unit-holders in the fund.”
In a letter to investors at the time of the suspension, chairman Kay Brandeaux and chief executive Roger Boyland said the funds were “performing positively and own hard assets represented by high-quality UK property”.
They added: “The student accommodation funds have a modest amount of debt secured over the next 3.4 years to 10.7 years and comfortably meet all loan covenants.”
Investment in student property totalled £2.1bn last year – static on 2012. But there was a new weight of international money entering the UK market, including US companies Avenue Capital and Greystar.
Brandeaux’s IPO move comes at a time of increasing confidence from investors in UK commercial real estate, which has invigorated the equity capital markets.
One adviser said: “There is a lot of talk about listing at the moment, but you have got to be engaged and working on it now to hit the summer window.”
Earlier this month, Kennedy Wilson launched an IPO to raise £750m from investors for a new closed-ended vehicle which will invest in direct real estate and loans, initially throughout the UK, Ireland and Spain.
Last year, Hibernia REIT and Green REIT listed on the Dublin Stock Exchange, raising €365m (£300m) and €310m respectively to invest in the recovering Irish market.
Speculation is also mounting that Goldman Sachs may float a portfolio of secondary assets following a spate of acquisitions (see News analysis).
Morgan Stanley declined to comment.
bridget.o’connell@estatesgazette.com
