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Unite reports solid portfolio valuation rises
Student housing company Unite Group on Tuesday said its UK Student Accommodation Fund value was £2.23bn at December 31, an increase of 2.5% for the quarter and 5.6% year-on-year.
In a trading update, Unite said The London Student Accommodation joint-venture portfolio was valued at £1.16bn at year end, a rise of 5.2% on a like-for-like basis from the end of September and up by 9.2% year-on-year.
Unite said it had acquired a 1,000 bed development scheme in Leeds on a subject to planning basis and secured planning on the 600 bed new Wakefield site in Manchester during the quarter.
The group's development pipeline is now 7,500 beds over the next three years at an average development yield of 8.2% generating around 10-12p of earnings.
Unite in December acquired its second University Partnership scheme for 885 students at Oxford Brookes University.
The company said it had secured occupancy at 99% for the 2017/18 academic year, underpinned by 59% nominations agreements.
"The sales cycle for 2018/19 is well underway with 66% of all rooms already sold with 56% being guaranteed by nominations agreements (64% and 54% at the same time last year)," Unite said.
"The level of 2018/19 sales made so far supports the outlook for 3.0-3.5% rental growth on a like-for-like basis."
"The strong sales performance has been supported by further efficiency gains and Unite remains on track to deliver its 75% net operating income margin target and overhead efficiency target of 25-30 basis points in 2018."