Unite Students buys Aston Student Village for £227m

Manager and developer of student accommodation, Unite Students, has acquired Aston Student Village for £227m in a 50:50 joint venture with Singapore’s sovereign wealth fund GIC.

ASV, which represents Unite’s first major on-campus acquisition, comprises 3,067 beds across five large, detached properties on Aston University’s campus in central Birmingham.

Fully-occupied ASV is currently the only accommodation offered to students at Aston University, which has a student population of 11,000, with no additional accommodation available either under direct ownership or through nominations agreements.

Unite said the deal provides the company and Aston University with the opportunity to establish a long-term strategic partnership, including nominations, in due course. ASV takes Unite’s presence in Birmingham to over 5,000 beds, providing the opportunity to deliver efficiencies across the whole portfolio in the city.

The group said it plans to invest in the accommodation over the summer to provide the next intake of students with the Unite customer experience, adding that the acquisition creates “an excellent opportunity to demonstrate the benefits of its scale, operational capability and reputation, and open up further opportunities across the sector”.

The purchase price represents an acquisition yield of 5%, in line with recent transactions in the student accommodation sector. This yield will grow to over 6% following investment into the portfolio and the implementation of the Unite Students platform.

ASV will generate gross annual income of around £17 million for the 2017/18 academic year and will be immediately accretive to earnings and net asset value.

Chief executive officer Richard Smith said: “I am delighted to announce this acquisition, our first on campus. Birmingham is one of the top cities for students and this acquisition demonstrates the value of our strong relationships with Universities and also the benefit of our position as market leader, both by scale and efficiency and the service that we are able to offer to students as a result of our PRISM operating system.

“I look forward to strengthening our relationship with Aston University, working within the campus, helping to support their growth and providing their students with great accommodation and a service experience that will support their personal and academic achievements.”