Student accommodation firm Unite has reported a 12% fall in first-half profit owing to a lower level of property valuation gains, but its underlying earnings rose and it increased its dividend.
Unite posted an interim dividend of 10.25p per share, marking an 8% increase on last year. Its EPRA net asset value per share rose by 4% during the period, while EPRA earnings rose by 16% to £61.2m.
The firm said its £1.4bn merger with Liberty Living will a combined company with £7bn of assets and 75,000 beds. Unite agreed to buy student housing provider Liberty Living’s UK assets from pension fund CPPIB in early July.
Richard Smith, chief executive of Unite, said: “The first half of 2019 has been a transformative period for Unite.
“Our proposed £1.4bn acquisition of Liberty Living will create a portfolio with a gross asset value of £7bn, comprising approximately 75,000 beds across the UK, with some 1.5m students requiring accommodation each year.”
The company has already reserved a record 92% of beds for the 2019-2020 academic year and is expecting to make rental gains over the next couple of years.
Smith said: “We remain confident in a rental growth outlook of 3%-3.5% for 2019/20 and 2020/21.
“Our development and university partnerships pipeline of 6,600 beds to be delivered over the next four years will further improve operating efficiency and generate significant earnings growth.”
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