PRESS RELEASE
10 October 2022
THE UNITE GROUP PLC
('Unite Students', 'Unite', the 'Group', or the 'Company')
ACQUISITION OF PILOT BTR INVESTMENT
Unite Students, the UK's leading owner, manager and developer of student accommodation, has acquired 180 Stratford, a 178-unit purpose-built build-to-rent ('BTR') property in Stratford, East London for £71m.
The acquisition will enable the Group to test its operational capability to extend its accommodation offer to young professionals and retain them as customers as they move on to the next stage in their lives. The property adds to the Group's significant existing presence in the Stratford market, where Unite already operates 1,700 student beds and has two further student developments in its secured pipeline. The acquisition of 180 Stratford will increase Unite's scale in the Stratford market to around 3,700 beds.
The property, which opened in 2013, is located on Stratford High Street approximately 5 minutes walking time to Stratford station as well as a wide range of local amenities. The property offers 319 beds across a mix of 1-bed, 2-bed and 3-bed units, as well as 11,000 sq ft of commercial space. The residential units are currently 99% occupied at affordable average rents of £28 per sq ft.
The property is expected to produce a yield on cost of 4.3% following a planned refurbishment starting in 2023. The refurbishment will incorporate a rolling upgrade of the existing residential units, the creation of new amenity space and the addition of seven new residential units.
180 Stratford will be integrated onto Unite's operating platform and will leverage the Company's existing operational capability for day-to-day management of the building and its development team for delivery of the planned refurbishment.
The acquisition and refurbishment will be funded from the proceeds of recent disposals and does not impact Unite's 2022 earnings guidance of 40-41p.
Richard Smith, Unite Students Chief Executive Officer, commented :
"As previously outlined, we believe that there is an exciting opportunity to grow our platform in the wider living sector by catering to the growing number of young professional renters living in major UK cities. We already serve this market through the 9,000 postgraduate students who live with us each year. This pilot BTR investment offers the opportunity to test our operational capability in the sector and understand the potential synergies with our student business.
"This property has good redevelopment potential and benefits from Stratford's growth as a major student, employment and leisure hub, as well as our significant local presence. These factors de-risk our investment and make it the ideal location to trial the extension of our Home for Success offer into young professional living."
ENDS
For further information, please contact:
Unite Students
Joe Lister / Michael Burt Tel: +44 117 302 7005
Unite press office Tel: +44 117 450 6300
Powerscourt
Justin Griffiths / Victoria Heslop Tel: +44 20 7250 1446
About Unite Students
Unite Students is the UK's largest owner, manager and developer of purpose-built student accommodation, serving the country's world-leading Higher Education sector. We provide homes to 75,000 students across 169 properties in 25 leading university towns and cities. We currently partner with over 60 universities across the UK.
Our people are driven by a common purpose: to provide a 'Home for Success' for the students who live with us. Unite's accommodation is safe and secure, high quality and affordable. Students live predominantly in ensuite study bedrooms, with rents covering all bills, insurance, 24-hour security and high-speed Wi-Fi. We also achieved a five-star British Safety Council rating in our last audit.
We are committed to raising standards in the student accommodation sector for our customers, investors and employees. This is why our new Sustainability Strategy, launched in 2021, includes a commitment to become net zero carbon across our operations and developments by 2030.
Founded in 1991 in Bristol, Unite Group is an award-winning Real Estate Investment Trust (REIT), listed on the London Stock Exchange and a member of the FTSE 100 Index. Unite is invested in and operates two specialist funds and joint ventures with institutional investment partners: the £3 billion Unite UK Student Accommodation Fund (USAF) and the £2 billion London Student Accommodation Vehicle (LSAV).
For more information, visit:
Unite's corporate website www.unitegroup.com
The student site www.unitestudents.com