GIC forms JV targeting US$1.4b student housing portfolio

Singapore

GIC on Monday said that it plans to, together with joint venture partners, buy a student housing portfolio in the United States that is worth about US$1.4 billion.

GIC, the Canada Pension Plan Investment Board (CPPIB) and The Scion Group LLC said that they have formed a student housing joint venture entity, Scion Student Communities LP.

The joint venture, through its subsidiary, UHC Acquisition Sub, plans to acquire University House Communities Group, Inc (UHC), a student housing portfolio in the United States, for a total of about US$1.4 billion from InvenTrust Properties Corp. This will include the cost to complete current development projects.

Through the joint venture, CPPIB and GIC will each own a 47.5 per cent interest in UHC. Scion will own the remaining 5 per cent, as well as manage and operate the portfolio. The joint venture will also pursue additional opportunities to acquire "high-quality student housing assets" primarily in Tier-1 university markets in the US.

The transaction is expected to close in mid-2016.

Lee Kok Sun, regional head for Americas, GIC Real Estate, said: "The portfolio is of high quality and we expect it to generate steady cash flows moving forward. Our confidence in the US student housing sector continues, given its positive fundamentals and potential."

Peter Ballon, managing director and head of real estate investments Americas at CPPIB, said: "The UHC portfolio represents a valuable opportunity to enter the US student housing sector with top-tier, well-located assets."