Far East Orchard adds 3 dorms to UK portfolio for $99 mil
SINGAPORE (Mar 17): Far East Orchard has acquired a portfolio of three freehold student accommodation properties in the UK for £55.0 million ($98.7 million).
The newly acquired properties are the 133-bed Harbour Court and 166-bed St Lawrence House in Bristol, and The Glassworks in Liverpool with 323 beds.
With a total of 622 beds, the latest acquisition brings Far East Orchard’s total number of beds in its portfolio to 2,091 across eight properties in the UK.
Far East Orchard says all three properties enjoy strong occupancy due to favourable supply-demand dynamics and their proximity to university campuses and the city centre.
The properties will be managed by the facility manager of the group’s existing student accommodation portfolio in Newcastle upon Tyne, UK.
“Bristol is a strong regional city for PBSA, with two major universities and a sizeable full-time student population. It was identified by Savills as a first-class location for student accommodation development. Liverpool is one of the largest university cities in the UK and home to four higher education institutions,” says Far East Orchard in its press release.
Lui Chong Chee, group CEO and MD of Far East Orchard, says, “Since our entry into the UK student accommodation sector in 2015 via the acquisition of a portfolio of properties and land sites for development in Newcastle upon Tyne, we have expanded into three other cities – Brighton, Bristol and Liverpool. Our latest acquisition of three stabilised properties in established UK university cities is part of our strategy to enlarge our recurring income base, thereby reinforcing the Group’s resilience.”
Despite Brexit, Far East Orchard says demand for purpose-built student accommodation in the UK is expected to remain strong given the established reputation of the UK higher education system and a healthy student-to-bed ratio.
“We are confident of the long-term fundamentals of the UK student accommodation market and remain on the lookout for opportunities to grow our student accommodation portfolio. In line with our strategy to grow our recurring income base, we remain on target to grow our student accommodation portfolio to 3,000 beds by 2023,” adds Lui.
In Brighton, the group is developing Hollingbury House, a 193-bed student accommodation property, scheduled for completion in 2019. The completion of Hollingbury House will further scale up the group’s portfolio in the UK from approximately 2,100 beds to close to 2,300 beds by the end of this year.
Shares in Far East Orchard closed 1 cent higher at $1.27 on Friday.
