Unite Group plc (LON:UTG) Unite Students, the UK’s leading owner, manager and developer of student accommodation, today announces the sale of six properties to PGIM Real Estate for £184 million (Unite share: £76 million).
The properties, comprising 2,948 beds, are located in Birmingham, Cardiff, Leicester, Liverpool, Nottingham and Sheffield and have an average age of 18 years (Unite average: 13 years). 31% of beds are let on short-term nomination agreements (Unite: 53%, 5.8 years average remaining term). The disposal is part of the Group’s portfolio management strategy to increase alignment to high and mid-ranked universities which have the strongest outlook for student demand and support sustainable rental growth.
The disposals are priced in line with book value, reflecting an NOI yield of 6.2%. Proceeds will be recycled into asset management activity and used to meet redemption requests in USAF. The properties were held for sale at December 2023 and the disposal was incorporated into the company’s guidance for adjusted earnings of 45.5-46.5p in the 2024 financial year, which remains unchanged.
Joe Lister, Unite Students Chief Executive, commented:
“These disposals continue our disciplined approach of recycling capital for reinvestment and further increases our alignment to the strongest universities. The growth outlook for purpose-built student accommodation remains compelling and we are tracking a number of new investment opportunities at attractive returns.”
