Legal & General forward funds student accommodation development in Elephant & Castle.
17 May 2013
Legal & General Property (“LGP”) announces that it has agreed to forward fund a student accommodation scheme in Elephant & Castle, London, for a total consideration of £25.7 million. One of the most active investors in the sector, the deal represents Legal & General’s fifth forward funding of a major university-backed scheme, having invested approximately £330 million in the last two years, as well as having secured a £121 million, 10 year debt facility to UNITE
The development is pre-let to University of the Arts London (“UAL”) on a long lease term. The scheme will comprise 221 en-suite cluster rooms and student rooms and is scheduled for completion in August 2015, ready for occupation the following month to coincide with the start of the academic year.
Situated close to Elephant & Castle station, on a site that borders Hampton Street to the north and Steedman Street to the south, it is positioned in an area of major regeneration and investment. Additionally, a first-class location for student accommodation, it lies adjacent to UNITE’s 230-bed student accommodation block, and close to Victoria Halls’ 232 bed student block and the Strata residential tower, benefiting from excellent Zone 1 transport links.
The developer, Spiritbond Elephant & Castle Ltd, is a 50/50 joint venture between Spiritbond and Watkin Jones Group, both of whom are experienced developers of student accommodation with strong records for delivering high quality schemes on time. Furthermore, with impressive sustainability credentials, the scheme is targeting a BREEAM Excellent rating.
The second student accommodation deal agreed with a long term pre-let in place to UAL, it follows LGP’s forward funding of a 475-bed site in Finsbury Park earlier this year for over £57 million, which was also developed by Spiritbond and Watkin Jones Group. With over 18,500 students from 114 countries, UAL is the largest specialist arts and design university in Europe, with a ratio of six applications for every place offered. It is made up of six distinctive colleges, which are Camberwell College of Arts, Central Saint Martins College of Arts and Design, Chelsea College of Art and Design, London College of Communication, London College of Fashion and Wimbledon College of Art.
Adam Kerr, Head of Long Income Transactions at Legal & General Property, comments: “Representing the fifth significant student accommodation funding that has been undertaken by LGP in the last two years, this transaction demonstrates our continued ability to source rare opportunities in this attractive sector where there is a long lease in place and the income is underpinned by a strong university covenant.”
Jones Lang LaSalle advised LGP on the transaction.
Notes to editors
Legal & General Property (LGP) is a wholly-owned subsidiary of Legal & General Investment Management (LGIM), one of Europe’s largest institutional asset managers and a major global investor. LGIM manages approximately £406bn of assets on behalf of more than 3,300 clients (31 December 2012) and provides products and solutions spanning all asset classes. LGP is the third largest institutional property fund manager in the UK, managing or co-managing 16 separate funds or vehicles and two segregated mandates with an aggregate asset value of £10.6bn as at 31 March 2012.
These funds include:
Specialist Pooled Funds
The Leisure Fund Limited Partnership; Industrial Property Investment Fund; Arlington Business Parks Partnership; and the English Cities Fund
Single Asset Vehicles
Bracknell Regeneration Partnership; Central Saint Giles Partnership; Performance Retail Limited Partnership and Warrington Retail Limited Partnership
Life Fund; Linked Pensions; Linked Life; Managed Fund; Property Unit Trust; UK Property Income Fund; LPI Income Property Fund and the Hybrid Property Fund
LGP’s UK-focused fund management platform has built and retained a strong track record of out-performance across the sector. Owing to its size, diversity and penetration, it benefits from best in class banking and property industry contacts which, along with its wealth of in-house skill and expertise, have enabled it to continue to attract and secure high quality market opportunities. Taking a client-centric approach, the business places the highest priority upon integrity and transparency, leveraging upon the significant resources provided by the wider LGIM platform. Sector specialists cover each sphere of the market and are supported by LGP’s market-leading research capability.
LGP’s sector specialisms cross all facets of the real estate market. In particular, the Company has a major development platform, responsible for delivering the West End office market’s latest landmark, Central Saint Giles, and currently involved in developing its high profile Covent Garden scheme, Agar Street, as well as significant town-centre retail and leisure regeneration projects, including Bracknell, Trowbridge, Northampton and Eastbourne.
For more information please contact:
PR Manager, Legal & General Capital and Real Assets, LGIM (Property, infrastructure and alternative finance)
t: + 44 (0) 203 124 2777
m: + 44 (0) 7718 395 279
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