Centurion announces first closing of global student housing fund

CENTURION Corporation has announced the first closing of its second student accommodation fund with total committed capital of S$70 million.

The Centurion Student Accommodation Fund aims to generate stable and recurring income to deliver a total return by investing in purpose-built student accommodation (PBSA) assets globally excluding the United States.

Of the S$70 million committed capital, S$60 million is by a "third-party cornerstone investor which is a reputable educational institution", Centurion said in a filing with the Singapore Exchange on Friday night. It did not name the institution.

The company's wholly-owned subsidiary Centurion Overseas Investments has committed to the remaining S$10 million capital.

Constituted as a private trust in Singapore, the fund currently holds a 133-bed facility, dwell Castle Gate Haus in Nottingham, United Kingdom, which was recently acquired by Centurion group and seeded into the trust.

The trust has issued drawdown notices of S$1.26 million and S$7.54 million to Centurion Overseas Investments and the third-party investor respectively, with the expectation of receiving the capital contributions by Dec 14, 2018. Upon the completion of the drawdown, the group will hold about 14.29 per cent stake in the trust.

The trust manager, Centurion Student Investment Management, and the trustee, Centurion Student ACM Trustee (I), are wholly-owned subsidiaries of Centurion Corp, which is also the sponsor of the trust.

Kong Chee Min, chief executive of Centurion Corp, said: "The successful first-closing of our second student accommodation fund reflects confidence in our management capabilities and also in the strength and resilience of the PBSA asset class."

The group's inaugural private fund - the Centurion US Student Housing Fund, which closed last year with US$89.5 million raised - has already shown positive returns, he added.

"We are optimistic that the launch of a second fund is the direction to expand our footprint across the different geographies in a sustainable manner," said Mr Kong.

"Investments through this asset-light strategy enable us to efficiently leverage our capital and resources to gain optimum returns in a relatively short timeframe. The trust will continue to build on our momentum and boost our fast-paced expansion plans to deliver higher returns to our shareholders.

"We aim to take this opportunity to continue working with like-minded investors to pursue these types of investment and management services opportunities to strategically grow our business," Mr Kong added.

Centurion owns, develops and manages purpose-built workers' and students' accommodation assets.