Hines has made its global debut in the student accommodation sector by forward funding a £150m UK portfolio.
The US investor, developer and fund manager is aiming to deploy around £500m into the UK student market over the next three years. It also expects to begin investing in student housing in mainland Europe this year.
The portfolio has been bought from McLaren, which will act as developer. It will total more than 1,100 beds when completed with locations in Cambridge, Oxford, Kingston, Aberdeen and two in Brighton.
Planning consent to develop purpose-built student accommodation has been secured on four sites, with approval on the remaining two expected later this year. Construction work will begin soon, with completion in 2017 and 2018.
Lars Huber, co-chief executive of Hines in Europe, said: “The fundamentals of the UK market are very strong with growing student population numbers driven by the strength and reputation of UK universities. We hope to further our presence in this burgeoning market, both in the UK and elsewhere, with further announcements expected soon.”
John Gatley, McLaren managing director, added: “This transaction represents the latest tranche of our total development portfolio of circa 4,000 units, and we remain active in securing further developments and investment opportunities in this sector.”
Hines is the latest name in a long list of blue chip firms to have moved into student accommodation over the past five years, as investors look to diversify from mainstream asset classes into alternatives to take advantage of the increasing institutional maturity of the sector.
According to CBRE research, £1bn has already been invested in UK student accommodation this year on the back of £5.7bn of investment in 2015.
In March, Hines announced its intentions to diversify its existing office, retail and residential portfolio into areas such as logistics, multi-family housing, hospitality and student accommodation.
Tudor Toone acted for McLaren; Savills advised Hines.
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