Unite Group valuations march higher ahead of new academic year

Student accommodation manager and developer, the Unite Group, issued its quarterly property valuation of the Unite UK Student Accommodation Fund (USAF) and the London Student Accommodation Joint Venture (LSAV) as at 30 June on Monday, reporting that USAF's property portfolio was independently valued at £2.32bn, representing a like-for-like increase of 1.2% during the quarter.

The FTSE 250 firm said the portfolio comprised 25,218 beds in 71 properties across 23 university towns and cities in the UK.

LSAV's investment portfolio was independently valued at £1.2bn, up 2.5% in the quarter on a like-for-like basis.

LSAV's investment portfolio comprised 8,477 beds across 13 properties in London and Aston Student Village in Birmingham.

The board said the increase in valuations was driven by rental growth, and an average two basis points of yield compression in USAF and six basis points of yield compression in LSAV.

It said the overall USAF portfolio ws valued at a blended yield of 5.4% and LSAV's portfolio at 4.6%.

Reservations for the 2018/19 academic year were said to be progressing “strongly”, with 89% of bed spaces let across all Unite properties, in line with the same point last year.

“Reservations for 2018/19 continue to perform strongly, in line with prior year, demonstrating the continued demand for our rooms and services,” said chief financial officer Joe Lister.

“The strong performance is driven by our focus on long term partnerships with high quality universities and our investment in locations where demand for purpose built student accommodation is the strongest.”