SINGAPORE Press Holdings (SPH) has acquired a portfolio of 14 purpose-built student accommodation buildings across six towns and cities in the United Kingdom for a cash consideration of about £180.5 million (S$321 million), it announced on Monday morning before the market opened.

The buildings, acquired in a sale and purchase agreement with Unite Group plc, have a total capacity of 3,436 beds. They include 10 freehold assets and four leasehold assets, and are located in established university towns and cities with large full-time student populations, namely London, Birmingham, Bristol, Huddersfield, Plymouth and Sheffield.

SPH, which owns The Business Times, said that student accommodation in the UK has growth potential, with demand expected from both domestic and international students, driven by a rise in enrolment of first year, international and postgraduate students. A record 27.9 per cent of 18 year olds in England were accepted for higher education in 2018, with enrolment projected to grow by 23.0 per cent by 2030.

SPH chief executive officer Ng Yat Chung said: "This cash-yielding acquisition will generate recurring cash flow, and is part of our ongoing strategy to diversify our business to new growth areas. It will boost our real estate asset management portfolio, establish us as an overseas owner of PBSA (purpose-built student accommodation) in the UK, and allow us to pursue other growth opportunities in this sector."

The transaction is expected to complete on or around Sept 13, 2018, with the consideration funded through internal as well as external resources. The consideration may be lowered by up to £13.7 million if actual income on certain assets is below 95 per cent of estimates, and Unite Group has provided a guarantee of up to £2.5 million to cover shortfalls between the estimated income and actual income of the assets as at Nov 30, 2018. SPH declined to disclose the estimated income. Net profit attributable to the assets being acquired was S$12.1 million in 2017.

SPH shares last closed down three Singapore cents or 1.09 per cent at S$2.73 on Friday.