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Centurion to buy four UK student dorms for £20.1m
MAINBOARD-listed Centurion Corporation has signed a deal to buy four student accommodation assets in university cities in the United Kingdom (UK) for £20.1 million (S$38.9 million).
These new assets will add 519 beds to its student accommodation portfolio, bringing its total number of student beds to 3,208 across the UK, Australia and Singapore.
The assets - 37-bed Beechwood House and 140-bed Weston Court in Manchester, 157-bed Hotwells House in Bristol and 185-bed Garth Heads in Newcastle Upon Tyne - are located in the cities catering to university students.
The two Manchester properties are adjacent to the University of Manchester's Fallowfield Campus, while Garth Heads is in the heart of the Newcastle student community and within walking distance to Newcastle University and Northumbria University. Similarly, Hotwells House is within walking distance to both the University of Bristol and the City of Bristol College.
All four accommodations, which offer a mix of non en-suite, en-suite cluster flats and studios, are long leaseholds properties of 125 years each. Their purchase consideration is in line with their market valuation.
Centurion will pay using external financing arrangements and internal resources, including proceeds from notes issued under its multicurrency medium-term note programme.
Centurion CEO Kong Chee Min said that the latest acquisitions will be earnings accretive from the onset.
"As the higher education market in the UK continues its growth trajectory, we will continue to identify investment opportunities to carry out our growth strategy and to strengthen our position in this sector."
Centurion Corp was previously known as SM Summit, a maker of storage discs. In a reverse takeover deal in 2011 by private investment group Centurion, the company went into developing workers' accommodation. It forayed into the student accommodation business in 2014.
Centurion plans to further grow its student accommodation business in key educational hubs globally.
"This accommodation segment has proven to be resilient, bolstered by growing student enrolment and undersupply of purpose-built student accommodation," it said.
It expects to increase its overall portfolio from about 56,000 beds at end-March 2016 to 75,000 by end-2018.
The counter last traded at S$0.375.