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News Release

LONDON

JLL predicts £2billion of student housing assets to go ‘under-offer’ in Q4 2014


LONDON, 06 October 2014 – JLL is predicting significant activity in the student housing investment market for the final quarter of 2014, with £2billion worth of assets set to go ‘under offer’ by the end of the year, and full year volumes set to exceed 2013’s total of £2billion.

 
At the close of Q3 2014, £220million is currently under offer with a further £360million being marketed, and £1.5billion worth of transactions completed year to date. Significantly, 65% of transaction values - including portfolios - have been for assets outside of London.

 
Notable transactions in Q3 include the Unite acquisition of the Cordea Savills portfolio for £137million, the disposal of Collegelands, Glasgow which reflected a yield of 5.75% and the Blackrock acquisition of the Print Works, Exeter for £40million.

 
Philip Hillman, head of student housing investment at JLL said: “We are predicting a flurry of deals to near completion before the year draws to a close, with strong university enrolments and robust occupancy levels across the sector proving to be a key driver. 

 
“In particular, we expect to see secondary disposals come to market following realignment of purchased portfolios this year and an increase in forward funding transactions, particularly in the regions. Also, with the uncertainty of the Scottish referendum now removed, we expect to see more transactions take place north of the border.”

 
JLL data indicates that land values for well-located sites have seen an increase of 25% this year with provincial yields hardening for well-located, good quality assets. The development pipeline however is constrained, as a result of restrictive planning regimes and strong alternative use values. JLL data shows  that approximately 9,704 beds came on line in London for September 2014, though a diminishing pipeline is expected for the next four years.