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SPH acquires £133.7m portfolio of UK student housing, bringing total beds to over 5,000

SINGAPORE Press Holdings (SPH) has added £133.7 million (S$236.5 million) worth of assets to its United Kingdom student accommodation portfolio, increasing by 1,243 beds to 5,059 beds across 20 assets in 10 cities.

The company, which publishes The Business Times, in a regulatory filing on Tuesday announced that its three wholly-owned subsidiaries Straits Five, Straits Six and Straits Eight have entered into a sale-and-purchase agreement with Habitus Holdings, Privilege Holdings, Privilege Southampton Holdings and AIGGRE Europe Real Estate Fund I GP to acquire a set of purpose-built student accommodation (PBSA) assets in the UK for about £133.7 million in cash.

These acquired assets are located in Southampton, Sheffield and Leeds - where there are sizeable full-time student populations - and have a total capacity of 1,243 beds with strong occupancy rates of over 90 per cent.

Further, the purchase provides a rental guarantee that covers the 2018/2019 and 2019/2020 academic years, offering earnings visibility as SPH integrates the assets into its portfolio of PBSA managed assets.

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This acquisition was completed on Tuesday.

Including its recent acquisition of 380 beds in Lincoln and Glasgow, SPH's PBSA portfolio has a total capacity of over 5,000 beds across 20 assets in 10 cities.

SPH said: "The AUM (assets under management) are now in excess of S$600 million, establishing SPH as a leading PBSA player in the UK. With an enlarged platform, SPH can extract greater economies of scale and has started operationalising its asset management capabilities under the new Capitol Students brand."

SPH has a dedicated team of five in the UK and eight in Singapore overseeing the portfolio together with more than 100 employees managing these assets.

Sales and marketing capabilities have also been expanded, with a centralised marketing and sales office. A community portal is also being developed for the 2019/2020 academic year, supported with backend business processes and booking systems. The portal is envisaged to define the students' experience and be the connection through which Capitol Students partners the institutions and parents on the students' life-shaping campus journey.

SPH chief executive officer Ng Yat Chung said: "Since our first PBSA investment in September 2018, we have now successfully completed four acquisitions in the UK. These acquisitions are high-quality, cash-yielding assets in key student cities in the UK and will enhance our recurring income going forward. We remain disciplined in our acquisition pipeline, to build our UK PBSA portfolio to a platform of scale."

SPH closed one Singapore cent higher at S$2.45 before the announcement.