Barings has agreed to forward fund the development of two purpose built student accommodation (PBSA) buildings in London and Manchester for a total of £43.8 million.
Both properties are expected to be completed in time for the 2022/23 academic year and are being developed by Alumno, the award-winning specialist PBSA developer that has delivered over 8,000 student accommodation beds across the UK.
Once complete, the c 4,600 sq m development in London will comprise 143 beds across a range of en-suite rooms in cluster flats and studio accommodation. It is located on Bermondsey Spa Gardens, less than 10 minutes’ walk from the local Zone 2 London Underground station and with good access to a number of world renowned higher educational institutions.
The site in Manchester will be developed into a c.1,100 sq m building containing 62 studios. It is in a central location that is highly accessible by foot, bus and national cycle routes and sits within the campus of Manchester Metropolitan University, directly opposite the Faculty of Science and Engineering and within close proximity of Manchester University Campus.
Darren Hutchinson, Managing Director – Head of UK Real Estate Transactions at Barings, commented: “These are two high quality PBSA assets in very strong locations in London and Manchester, which are both undersupplied markets supported by strong universities and a deep occupier demand. We are excited to work with Alumno to create well designed, contemporary accommodation that will appeal to a wide range of students.”
Gunther Deutsch, Head of Real Estate Transaction – Europe at Barings, added: “The U.K. remains one of the highest ranked countries in the world for higher education and we believe this transaction presents an opportunity to invest in two high quality schemes at an attractive entry point that will help to meet growing demand.
“This transaction is our first PBSA investment in Europe and the start of a wider Living investment strategy in our key jurisdictions including the Nordics, the Netherlands, Germany, the U.K., Italy, France and Spain. We are targeting €350 million of investments across PBSA, Build to Rent and micro/serviced living and will work with strong and experienced developers as we build our product pipeline and increase investment volumes.”
David Campbell, Founder / Managing Director at Alumno, commented: “We are absolutely delighted to have concluded this agreement with Barings, a major and world leading real estate investor. This is a huge boost for our business coming into 2021. It also highlights the confidence in bringing forward major investment into the PBSA sector, which has again demonstrated its resilience during these challenging times. We very much look forward to working with the Barings team and developing our relationship further and believe this will be the start of a strong, long term partnership.”