Global alternative asset manager The Carlyle Group has announced its latest student accommodation acquisition through its joint venture, City Living.
It has acquired an office building in Rotterdam, which is the former headquarters of The Rotterdam Social Insurance Bank, for conversion into a new 250-room 'Student Hotel'.
Added to its other four schemes, City Living now expects to deliver over 1,600 student beds ahead of the 2013 academic year, in line with its target of 5,000 beds in the Benelux region over the next five years. Carlyle also has a London-focused UK student accommodation platform, which is targeting up to 4,000 beds and brings its target capacity to 9,000 in Europe in the next three years.
The property is strategically located between the Erasmus University campus and downtown Rotterdam, and subject to the receipt of planning approval, it is expected to be completed in time for the start of the 2012 academic year.
In order to meet the requirements of the broadest possible range of students, the asset will be managed as a 'Student Hotel', a new concept which offers flexible tenancies ranging from a few weeks to a full 40-week academic year. This will ensure that it can attract international students with varying course lengths. The property will comprise a mixture of individual rooms with access to shared kitchen facilities and self-contained studio apartments. In addition, each room will be fully furnished and will have access to shared study rooms, gym and other leisure and study facilities.
This is the fifth acquisition in the Benelux region for City Living, a joint venture between the MacGregor family and CEREP III, a pan-European real estate fund managed by The Carlyle Group. Other assets within the joint venture are:
- a recently refurbished 146-room student housing unit called Home Ruhl in Liege, Belgium, which has been 100% let since opening in September 2008.
- a 220-room development project adjacent to Home Ruhl in Liege, which is currently in the final stages of planning.
- a development project called Van Limburg Stirum Huis in The Hague, the Netherlands. Currently a retirement home, a planning application has been submitted for a 320-bed 'Student Hotel' scheme, which is expected to be completed ahead of the 2013 academic year.
- a 717-bed 'Student Hotel' redevelopment of a former office building in Amsterdam, which is expected to be completed ahead of the 2012 academic year.
The joint venture aims to grow a robust, well financed business model, which has significant growth potential in the provision of privately owned, purpose built student accommodation on flexible terms, which, to date has not been replicated in continental Europe. Similar to the UK, this asset class is underpinned by increasing numbers of students attending universities and an ongoing lack of supply, a dynamic which is especially acute in the Benelux region.
Agnès Riban, Director of The Carlyle Group, said: "This latest acquisition in Rotterdam will enable City Living to provide a new, high quality alternative for students in a city which suffers from a significant undersupply of suitable accommodation for students. The Student Hotel Rotterdam is an exciting new concept, which will accommodate the widest possible range of student requirements.
"We look forward to progressing this, and all our other student accommodation projects in the region, as we aim to capitalize on the strong dynamics of this market."
Charlie MacGregor, Managing Director of City Living, added: "This latest acquisition is part of our strategy of delivering up to 5,000 new beds in the next five years in the Benelux region. We have made excellent progress to date and will continue to build on our platform, working closely with the relevant local authorities to deliver our current pipeline, whilst continuing to look for further acquisition opportunities."