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UK: London-based Tokoro Capital and US investment manager GCM Grosvenor have established a long-term strategic partnership targeting UK student housing assets.
The vehicle is supported by £75 million of commitments from GCM Grosvenor, providing around £200 million of investment capacity post leverage. The venture will focus on acquiring and repositioning traditional houses of multiple occupancy (HMOs) and first-generation purpose-built student accommodation (PBSA), targeting domestic students at more affordable rental levels than traditional, highly amenitised PBSA.
The partners say HMOs make up around 80 per cent of investable student housing stock in the UK but are predominantly owned by private landlords in fragmented portfolios. Ongoing regulatory, environmental, tax and financing pressures are turning many of these landlords into net sellers, unlocking an opportunity for institutions to deploy capital into this emerging sector at scale.
The partnership has already secured an initial seed portfolio of 440 beds, which, once closed, will position Tokoro’s management arm Homie as one of the largest institutional managers of student HMOs in the UK. Other large players include Student Cribs and the recently formed joint venture between Student Homes Management and Brookfield.
Max Bassadone, co-founding partner of Tokoro said: “Sanjay and I have been looking at this sub-sector of the UK student housing market for a long time and aggregated a portfolio under TKO-II demonstrating our capability both in terms of execution of this investment thesis and building an operating platform. GCM Grosvenor’s conviction in forming this vehicle with us further validates this.”
Tom Ferber, founder of Homie, said “We are really excited to partner with GCM Grosvenor to continue the expansion of the Homie platform. HMOs are the go-to housing solution for domestic students, especially in their second and third year, yet the sector remains largely untapped by institutional investors. This additional firepower will strengthen Homie’s early mover advantage in what we believe will be the next wave of institutional student housing investment in the UK.”
Peter Braffman, managing director at GCM Grosvenor added: “We are thrilled to partner with Tokoro and Homie to expand our European presence into the UK student housing sector. Their clear strategic vision and proven execution capabilities give us confidence in their ability to create value.”
Highlights:
- London-based Tokoro Capital and US investment manager GCM Grosvenor have established a long-term strategic partnership targeting UK student housing asset
- The vehicle is supported by £75 million of commitments from GCM Grosvenor, providing around £200 million of investment capacity post leverage
- The venture will focus on acquiring and repositioning traditional houses of multiple occupancy (HMOs) and first-generation purpose-built student accommodation (PBSA)
- The partnership has already secured an initial seed portfolio of 440 beds
