Student housing company Unite has sold eight properties for £133m to Aventicum Real Estate, as the group looks to improve its exposure to higher-ranked universities.
Unite said it had a circa £90m share in the portfolio, which comprises 2,284 beds. The disposals are priced at a net operating income yield of 6.5% and a 2% discount to book value.
Assets include properties in Coventry, Wolverhampton, Birmingham, Exeter and Manchester, and the portfolio has nomination agreements covering 28% of beds on short-term contracts.
Seven of the eight properties have already been sold, for a combined £120m, while the disposal of the final site in Manchester is expected to complete in the coming weeks for around £13m.
Richard Smith, chief executive at Unite Students, said: “This disposal forms part of our target to dispose of £200m to £300m of assets in 2021.
“The sale is consistent with our strategy of increasing our exposure to high and mid-ranked universities where demand is strongest, while delivering operational efficiencies that contribute towards our target for an improvement in our EBIT [earnings before interest and taxes] margin to 74% by the end of 2023.”
It comes after Unite announced earlier this month that it was extending its 50% rent discount for residents until the government’s advice to stay at home during the third lockdown lifted.
That came to an end yesterday, taking the discount period to 10 weeks in total, with forecasts predicting that it would cost the company £10m.
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