LONDON – March 15 , 2021 – Ares Management Corporation (Ares) (NYSE: ARES) and Generation Partners (Generation) announced today that the joint venture established by a fund managed by the Ares Real Estate Group and Generation have acquired BASE Glasgow, a further student accommodation asset providing 301 beds in Glasgow. This is the second transaction under a new initiative by Ares and Generation focusing on Purpose-Built Student Accommodation (PBSA) assets in the UK and brings the total number of beds in the current portfolio to 1,660.
The asset is located in Glasgow city centre and principally houses students from the Royal Conservatoire of Scotland. It was developed by Soller Group and provides high-quality accommodation together with bespoke facilities for students studying music, drama and dance.
“We are excited to complete our second transaction with the Generation team and add what we believe is an excellent asset to our expanding UK PBSA portfolio,” said Wilson Lamont, Partner and Co-Head of European Real Estate Equity in the Ares Real Estate Group. “We look forward to identifying additional high-quality opportunities in target markets throughout the UK as we seek to continue to grow the portfolio in this sector.”
Alan Artus, Chief Executive of Generation commented, “Following establishment of our joint venture with Ares and our acquisitions in Exeter and Cardiff, it is exciting to quickly expand the portfolio by adding such a unique asset in Glasgow. The Royal Conservatoire of Scotland is globally regarded as a centre of excellence and one of the world’s top performing arts education institutions and we look forward to working with them over the coming years.”
Savills Capital Advisors acted as Financial Advisor to Ares and Generation.
Ares Management Corporation (Ares) (NYSE: ARES) and Generation Partners (Generation) announced today that a joint venture established by a fund managed by the Ares Real Estate Group and Generation have acquired two student accommodation assets providing a total of 1,359 beds in the cities of Exeter and Cardiff for £157.5 million. This new initiative by Ares and Generation is part of a targeted residential investment strategy that will focus on Purpose-Built Student Accommodation (PBSA) assets in the UK.
The two assets which were recently completed by Mace Developments provide high quality buildings with a wide range of room types and an excellent provision of internal and external amenity spaces in two very strong locations.
“We are excited to partner with the Generation team on these attractive student assets and we look forward to identifying additional opportunities for further growth in this sector in the UK market,” said Wilson Lamont, Partner and Co-Head of European Real Estate Equity in the Ares Real Estate Group.
Alan Artus, Co-Founder of Generation commented, “Having been a major participant in the PBSA sector for the last two decades, including the creation of the Nido and Pure Student Living platforms, we look forward to working with the Ares team to assemble a significant portfolio focused on top tier cities and high-quality buildings.”
Savills Capital Advisors acted as Financial Advisor to Ares and Generation.
Generation’s joint venture with pan-European real estate investment manager, Europa Capital, the Europa Generation Student Fund has achieved its 97% occupancy target (101% of budgeted income) for the 2019/20 academic year across its UK student housing portfolio following strong demand from a diversified student base.
Approximately a third of students are in their first year of study with an additional third on postgraduate courses. Applications from Chinese students to UK Universities increased by more than 30% for this academic year, which is reflected in the portfolio where 43% of the students now come from China, with 37% from the UK, whilst only 6% originate from EU countries.
It has also announced that it achieved practical completion of its new development in Oxford.
Between Towns Court, Oxford, completed in late July and achieved 100% occupancy on opening in September. Located just off the popular Cowley Road, the building provides 140 high quality en-suite study bedrooms and four studios. The building let quickly whilst under construction reflecting the continuing shortage of purpose-built student accommodation in Oxford, and has proved to be particularly attractive for students studying at Oxford Brookes University, as well as postgraduate students at Oxford University.
Alan Artus, co-founder of Generation and Partner at Europa Generation, said: “Achieving near full occupancy is a significant milestone for the Fund and demonstrates that demand for high quality accommodation in strong UK cities, as well as the resilience of the UK PBSA market, despite wider macro uncertainty. The strong performance of our Between Towns Court asset, which has reached 100% occupancy in its first year, is further evidence of this. The opportunities for institutional investors to access the PBSA market in collective vehicles remain limited. Therefore, our ambition is to scale this platform, broaden our investor base and grow the portfolio throughout the United Kingdom.”
With practical completion of Highlight Parkgate at 43 Montpelier Hill in Dublin 7, Generation’s joint venture with Hattington Capital now has 576 operational beds in Central Dublin. The scheme provides a further 319 beds in addition to Highlight Thomas Street which opened in summer 2018. Dublin remains a structurally undersupplied student accommodation market with an increasing domestic and international student population
Generation’s joint venture with pan-European real estate investment manager, Europa Capital, announces a forward funding a new 197-bed purpose built student accommodation (“PBSA”) development in Canterbury for £19.6 million.
Alma Court, Canterbury is already under construction and will offer 156 en-suite study rooms with 41 studios, as well as communal areas for study and recreation. It will be completed in time for the 2020/21 academic year. Canterbury has a total of 25,930 full time students placing it in the top 20 regional student populations in the UK. Home to a UNESCO World Heritage Site, Canterbury has strict planning policies and has a tight supply of PBSA with only 9,800 PBSA beds. The property is well located for the University of Kent whilst also being close to Canterbury Christchurch University and the University of the Creative Arts.
Nick Kinder head of acquisitions at Generation and Partner of Europa Generation said; ” The opportunity to follow the Montreal acquisition and funding in a City of Canterbury’s quality was attractive to the Fund. Delivering the Montreal assets which combined the collective expertise of both WJ and Generation was a good experience and they are all very popular with students – I am sure we will achieve a similar result in Canterbury”.
Generation’s joint venture with pan-European real estate investment manager Europa Capital announces that it has let the office element of Oxford Point in Bournemouth to Regus in one of the most significant office lettings in Bournemouth in the last decade.
Oxford Point is a 486-bedroom purpose-built student accommodation building with c. 32,000 square feet of new office space across three floors with a separate entrance. The office space was acquired by Europa Generation, on behalf of the Europa Generation Student Fund (the “Fund”), as part of a portfolio from Watkin Jones Group in June 2017. The building was completed in September last year and provides accommodation for students of both Arts University Bournemouth and Bournemouth University.
International flexible workspace provider, Regus, has signed a new ten-year lease on the premium office space, which also includes 63 car parking spaces, at an annual rent of £582,676 (equating to £18.50 per sq ft). Regus has the option to extend the lease for a further five years.
Regus’ entry into the town provides a much-needed boost to Bournemouth’s co-working market where there exists a lack of high quality flexible office space. The new centre is due to open in early summer.
Located less than five minutes’ walk from Bournemouth train station, the new Regus at Oxford Point is the perfect place for businesses, small and large, to call home. From expertly designed meeting rooms to creative co-working spaces, Bournemouth’s newest flexible working hub has something for everyone. And its location at the heart of the city centre means that there’s plenty to do outside of the office, including visiting Bournemouth’s Natural Science Society or the Russell-Cotes Art Gallery & Museum.
Steve Holloway, UK Network Development Director at Regus, said: “We are delighted to be partnering with Europa Generation to open Bournemouth’s newest co-working space. As flexible working continues to grow rapidly across the country, this new centre will offer something new to the area’s businesses, benefitting everyone from local entrepreneurs to the larger businesses that call Bournemouth home.”
Gareth Davies, Director of Generation Estates said: “To have let the entirety of office space at this asset in Bournemouth is an important milestone. We are pleased to be providing the space for Regus’ first business centre in this location as part of their overall expansion. This letting also demonstrates Generation’s ability to successfully execute the asset management of ancillary uses on behalf of the Fund to underpin the generation of attractive returns for its investors.”
Europa Generation was advised by Montagu Evans and Goadsby. Regus was advised by Doherty Baines.
Generation’s joint venture with pan-European real estate investment manager, Europa Capital has raised new capital of circa £100 million for the Europa Generation Student Fund (the “Fund”), from a number of global institutional investors. The Fund currently has assets under management of £180 million comprising 1,561 beds which are operational in Bath, Newcastle, Sheffield, Aberdeen and Bournemouth and a further 144 beds in Oxford that are due to become operational this summer.
By establishing a portfolio of modern purpose-built student accommodation in UK cities, Europa Generation’s strategy looks to exploit favourable market dynamics and deliver a sustainable and growing income return to investors. Student accommodation is a mature and liquid asset type, offering highly resilient asset performance, strong rental growth and significant occupational excess demand over supply, driven in part by strong demand from international students.
Europa Capital and Generation’s combined track record in the “living” markets is in excess of 12,000 bed spaces across PRS and student accommodation in key UK and European locations. The venture further benefits from Generation’s track record in building two internationally recognised customer focused operational brands, Nido Student Living and Pure Student Living, which have a combined asset value well in excess of £1 billion.
Alan Artus, co-founder of Generation Estates and Partner at Europa Generation said: “The opportunities for institutional investors to access the PBSA market in collective vehicles are limited. Therefore, our ambition is to scale our platform with Europa, broaden our investor base and to grow the Student Fund’s portfolio throughout the United Kingdom. The student accommodation sector remains a highly attractive market that is resilient to economic headwinds and continues to offer favourable supply and demand dynamics. The shortage of modern, high quality accommodation in leading university towns and cities is demonstrated by the strong level of demand we see across our operational portfolio”
The property at 32 Thomas Street in Dublin 8 is a redevelopment of the former Frawley’s Store that closed in 2007 after more than a century. The scheme which involved sensitive refurbishment and conservation of buildings fronting Thomas Street and a new state of the art purpose-built student accommodation block behind the retained buildings provides 257 much needed student bed spaces together with new retail units. The property which was completed in August was fully let before the end of September. Highlight Thomas Street is situated within 2 minutes’ walk of the National College of Art and Design and 15 minutes’ walk from Trinity College Dublin, Royal College of Surgeons and Dublin Business School.
The portfolio which was sourced by Generation on behalf of the fund consists of 1,691 student accommodation beds and 14 residential units, all of which have planning consent .
The portfolio comprises
- Caledon House, Aberdeen – 199 beds
- Balley Fields, Sheffield – 543 beds
- Market Street, Newcastle – 225 beds
- Midland Road, Bath – 108 beds
- Oxford House, Bournemouth – 486 beds
- Between Towns Road, Oxford – 144 beds
Each scheme will be developed and built by Watkins Jones whilst Generation Estates will have input into the detailed design of each project. All of the assets will open in time for the 2018/19 academic year, save for Oxford which will open the following year.
Mark Watkin Jones, chief executive of Watkin Jones, said: “We are delighted to announce that we have successfully completed the sale of a portfolio of six student accommodation developments to Europa Generation for a gross development value of £165m. The group has now forward sold all of its developments that are planned for completion by September 2018.
Alan Artus, Director of Generation Estates said: ” We are pleased to have originated this significant transaction to seed the Europa Generation student accommodation fund.”
Europa Capital (“Europa”) and Generation Estates Limited (“Generation”) are pleased to announce the launch of Europa Generation, a new joint venture created to manage a new UK student accommodation vehicle.
Europa Generation will invest in prime purpose built student accommodation (“PBSA”) throughout the UK. The acquisition strategy is focused on investment opportunities where Europa Generation identifies potential for long term sustainable income growth. The vehicle will acquire well located assets, through forward-funding of new developments, direct development and selective investment acquisitions.
Europa Generation has used Europa’s balance sheet to acquire an initial £165m seed portfolio, comprising 1,705 beds in six schemes currently being developed by Watkin Jones Group, a leading developer of purpose built student accommodation in the UK. The assets are situated in Oxford, Bath, Newcastle, Sheffield, Aberdeen and Bournemouth. The schemes in Bath, Newcastle, Sheffield, Aberdeen and Bournemouth are due for delivery in time for the 2018-19 academic year while the Oxford scheme will welcome students for the 2019-2020 academic year. Europa Generation intends to build a portfolio of around 5,000 beds over the next few years.
Hugo Black, Partner at Europa Capital said:
“Europa Generation is being launched to capitalise on the continuing shortfall of high quality purpose built student accommodation in top tier university towns and cities across the UK. We are very excited to have established a joint venture with Generation Estates who have an unrivalled track record in this flourishing sector. Europa Generation will provide investors with access to individuals with a first class track record in the investment, development and operational management of PBSA assets across the UK.”
Alan Artus of Generation Estates added:
“We are delighted to have formed this partnership with Europa Capital to create a vehicle that will quickly become a leading investor in the PBSA sector in the UK. Our specialist skills and capability combined with Europa Capital’s undoubted expertise in fund management will provide investors with the opportunity to gain access to the robust long term returns available in the sector.”