UK: PBSA developer and operator Unite Group has acquired 180 Stratford, a 178-unit purpose-built BTR property in Stratford, east London.
The property has a purchase price of £71 million and is expected to produce a yield on cost of 4.3 per cent following a planned refurbishment starting in 2023.
The acquisition will increase Unite’s presence in the Stratford market to around 3,700 beds. It already operates 1,700 student beds in the area and has two further student developments in its secured pipeline.
The property, which opened in 2013, is located on Stratford High Street, and offers 319 beds across a mix of one-, two- and three-bedroom units, and 11,000 square feet of commercial space. The residential units are currently 99 per cent occupied at affordable average rents of £28 per square foot.
The company says the deal will enable it 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 acquisition and refurbishment will be funded from the proceeds of recent disposals and does not impact Unite’s 2022 earnings guidance of 40 pence to 41 pence per share.
Richard Smith, Unite Students CEO, said: “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.”
