Q Investment Partners announces £40m exit deal for Edinburgh projects

PRIVATE equity (PE) real estate firm Q Investment Partners (QIP) on Tuesday (Feb 22) announced its exit from 2 purpose-built student accommodation (PBSA) projects in Edinburgh, UK.

With a combined value of £40 million (S$73.3 million), these projects have been sold to a core plus equity fund which is managed by QIP and backed by a consortium of institutional investors.

The first PBSA development, Edinburgh Straits Meadow, is fully operational and located at 61-63 London Road with a total of 198 beds. It has achieved 100 per cent occupancy for the 2021-2022 academic year.

Another project at 65 London Road is subject to a forward purchase agreement upon its development completion, which is expected in Q3 of 2022 - in line with the start of the 2022-2023 academic year.

The exit of both projects is expected to deliver total annual returns of more than 18 per cent, above QIP's initial target of 16 per cent.

It also gives investors visibility of the attractive risk-adjusted investment return that is available via UK PBSA, an asset class that is seeing high demand from institutional investors, added the Singapore-based firm.

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QIP's core plus equity fund has an initial assets under management target of £150 million by end-2022. It aims to invest capital in the acquisition of stabilised PBSA projects across the UK.

According to QIP, the fund has garnered traction among large private and institutional investors as interest in the UK's PBSA sector continues to be driven by a broader trend of reallocation to rented residential accommodation.

"PBSA is arguably the most accessible sub-sector for buyers looking to re-allocate to operational real estate, and this deal helps to give visibility of the attractive returns available in the sector for both private and institutional investors," it said.

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