Asians look to UK student property investments

By Andrew Batt: Recent research from CBRE has revealed that more than £246 million (S$510 million) of student housing investment deals were transacted in the United Kingdom during Q1 2012, and this is on the back of a more than 50 percent rise in investments in this property asset class during last year.   Indeed, demand for long-leased products has risen, with annual yields growing to 5.5 percent in the top regional towns for student housing let out to universities, according to CBRE Research.

Furthermore, UCAS (the Universities and Colleges Admissions Services) has revealed that degree course applications from non-EU countries rose by an impressive 13.7 percent, controlled primarily by students from East Asia, and in particular Hong Kong.

In the last few months, Southeast Asia has seen the first attempts at marketing student accommodation to Asian property investors, with the likes of Liverpool, Bolton, Bradford, Sheffield and Cambridge appearing in media advertising throughout the region.

Ray Withers, Chief Executive of Property Frontiers, a leading student property investment agency active in the top university town of Liverpool, said: "As the very best asset class around, student accommodation is a proven and successful investment choice so it's hardly surprising that investment deals in this sector in the U.K. are on the increase. For us, Liverpool student accommodation is one of our most popular and most lucrative markets with this sector attracting particular interest due to its affordable price point and double digit returns."

He added: "Indeed, in spite of the 5.2 percent drop in 2012 degree course applicants in the U.K. compared to the same period in 2011, we are not surprised that applicants from non-EU countries, particularly from Asia, are on the up. Chinese students make up the largest overseas student group in the U.K., contributing around £2 billion (S$4.2 billion) to the economy and, with education being of high importance in Chinese culture and with Britain hosting some of the world's best universities, Chinese students and investors alike are starting to make their mark."

Liverpool presents an optimum buy-to-let environment for property investors, reaping significant returns from strong demand, with the Knight Frank Student Property Report 2012 identifying that average rents for apartments and en-suite rooms in regions such as Liverpool rose by four percent with total returns of around 10.5 percent last year.

For investors from Southeast Asia looking for an opportunity to invest, new high quality private student housing developments such as The Paper Mill, Liverpool (pictured) could provide the answer. As the latest student accommodation development from Property Frontiers, The Paper Mill offers en-suite student rooms set within a well located refurbished building in central Liverpool from £48,000 (S$100,000).

The Paper Mill comprises 102 en-suite student rooms and is situated in the heart of Liverpool, adjacent to Liverpool One shopping centre and offers investors a 10 percent net yield assured in year one. It's currently 60 percent sold. Related Stories:No additional curbs for HK property

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