UBS Asset Management's (UBS-AM) Real Estate & Private Markets (REPM) business announces that the UBS Triton Property Fund has completed the acquisition of Orient House, a 184-bedroom student accommodation development in Fulham, West London, for €37.35m (GBP 31.5m), representing an average price per bed of €202,740 (GBP 171,000).
Orient House has been acquired from Imperial College London, which has operated the accommodation as part of its GradPad portfolio, catering exclusively to London’s postgraduate student community, since its purchase of the asset in 2012. Following the acquisition, Universal Student Living will operate the purpose-built scheme on behalf of UBS Triton, on a direct-let basis, targeting students studying across London.
Standing at circa 58,000 ft² (GIA), Orient House is arranged over seven floors, offering a number of different accommodation options, including 173 en-suite bedrooms in a variety of differently configured cluster flats and 11 studio apartments. There are also two common areas for occupants’ use, in addition to a student reception and management office located on the ground floor.
Located in the highly desirable area of Fulham in West London’s Zone 2, Orient House sits on Imperial Road, adjacent to Imperial Wharf Overground station, and is just a short walk from the abundant retail and leisure options of affluent Chelsea. With little direct-let Purpose Built Student Accommodation competition in the boroughs of either Hammersmith & Fulham or Kensington & Chelsea, tenant demand has been consistently high, ensuring minimal vacancies in recent years.
Orient House represents the fourth student accommodation addition to UBS Triton’s portfolio and its first standing investment in the sector. The initial three acquisitions were full development funding propositions in Newcastle (completed in summer 2016), Durham and Belfast (completion due in summer 2017). In line with its strategy, the Fund has successfully established a meaningful UK student accommodation portfolio totalling circa 800 bedrooms. The first three deals enabled the Fund to participate in the creation of 'best-in-class' accommodation in strong regional cities in central locations, with the acquisition in Fulham enabling access to the much coveted London market. UBS Triton’s overall portfolio comprises 32 high-quality assets, the majority of which are located in the South East of the UK, and is weighted towards offices, the industrial sector, retail warehousing, and now increasingly student accommodation.
Howard Meaney, Head of Real Estate UK and Senior Portfolio Manager for UBS Triton, commented: “London universities have over a quarter of a million full-time students, almost 70% of which are unable to access university or private sector accommodation. This demographic creates a demand profile which, combined with a lack of supply of direct-let purpose-built student accommodation, makes Orient House an exciting acquisition for UBS Triton, in line with its investment criteria and returns profile. Furthermore, now with an 800-bed student accommodation portfolio, the Fund has built up a meaningful expertise of this sector, enabling us to effectively manage our assets and ensure their value is maximised.”
UBS Triton was advised by Tudor Toone and Lawson & Partners on this transaction, while the vendor was advised by Knight Frank.