4th Oct 2007 07:01
Unite Group PLC04 October 2007 4 October 2007 UNITE ANNOUNCES SALE OF ASSETS TO THE UNITE UK STUDENT ACCOMMODATION FUND The UNITE Group plc ('UNITE'), the UK's largest provider of studentaccommodation, today announces the sale of three assets to the UNITE UK StudentAccommodation Fund (the 'Fund' or 'USAF') for £81.8 million. The assets comprise of 1,461 bed spaces and are located in the key studentmarkets of Bristol, Glasgow and Leeds. The properties are substantially sold outfor the 2007-2008 academic year and are expected to generate an average netyield of 5.70% over the forthcoming twelve months. Two of the assets were soldby wholly owned UNITE entities and one by UNITE's Student Village Joint Venturewith Lehman Brothers ("USV"). The transactions will deliver £1.2 million profit on disposal for UNITE,including a performance fee crystallising on disposal of the USV asset.Consideration will be in cash, releasing equity capital after repayment of loansof approximately £18 million that UNITE will reinvest into its developmentactivities in due course. The Fund is acquiring the assets entirely from third party committed equity,which has the effect of reducing its loan to value gearing to 46%. In line withits stated intention to dilute its holding in USAF to approximately 20% overtime, UNITE is not contributing further equity to the Fund as part of thistransaction. As a result, its co-investment stake in the Fund will reduce to22.0%. Mark Allan, Chief Executive of UNITE, commented: "The transactions we have announced today represent the first sale of assetsfrom UNITE to the £1 billion UNITE UK Student Accommodation Fund since itslaunch and clearly illustrate UNITE's positioning as a developer andco-investing asset manager. The three properties transferred are high qualityassets in prime locations. By leveraging UNITE's proven track record fordeveloping, delivering and then managing student accommodation, the Fund is ableto offer investors exposure to institutional quality property in a growing assetclass that offers more resilient characteristics than the wider commercialproperty market." ENDS For further details please contact: Tabitha Aldrich-Smith Telephone: 0117 302 7018UNITE Group plc Email: [email protected] Dido Laurimore/Lauren Mills/ Nicole Marino Telephone: 020 7831 3113Financial Dynamics Email: [email protected] / [email protected] / [email protected] About UNITE • UNITE is the UK's leading provider of student accommodation; • UNITE currently operates accommodation for 38,000 students in 135 properties, geographically spread in key university markets across England, Wales and Scotland • The value of UNITE's completed property portfolio is estimated to be worth £1.6 billion. • UNITE has a dedicated website for students who are looking to find accommodation at www.unite-students.com • UNITE is a founding member of the ANUK Code of Standards for Larger Developments, all properties are signed up to this code ensuring high standards of accommodation, service and security. UNITE UK Student Accommodation Fund At the end of 2006, UNITE established the £1 billion UNITE UK StudentAccommodation Fund and sold an initial portfolio to it for £515 million. Theprincipal objectives of this transaction were: • to release capital that was tied up in mature, stabilised investment assets for investment into higher added value development activity; • to provide UNITE with more growth capital in the medium term; and • to diversify UNITE's sources of income by providing a new, valuable revenue stream arising from management fees from the Fund. The Fund helped transform UNITE's business model to that of developer of newpurpose-built student accommodation and manager of funds which own studentaccommodation properties operated by UNITE and in which the Group has asignificant minority stake. UNITE Student Accommodation, designed for students • Dedicated on-site hospitality management team offering 24/7 support to customers. • A wide choice of rooms available from single studio flats for students who want to live on their own, or, typically 5/6 bedroom flats to share with friends. • Common room facilities, including Sky TV and pool tables, are often used for social events. A number of properties offer gyms exclusively for residents' use. • Rents and availability vary in each town/city and a variety of payment plans are in place to suit students. UNITE focuses on the provision and management of high quality, well-locatedstudent accommodation and hospitality services at affordable prices in stronghigher education markets. UNITE undertakes the planning work, development andmanagement of sites, often working closely with the Universities and Colleges todeliver accommodation for students across all ages and nationalities. UNITEdevelopments typically show high occupancy levels as demand continues to risefor places on UK Higher Education courses and for high-quality, safeaccommodation. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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