Arlington Investors, the Jersey-based real estate investment firm, has purchased two student accommodation assets for £85.5 million ($112 million; €99 million) taking its total spending on the alternative asset class to beyond £500 million in the last two years.
The two properties are located in London and Leeds, which cater to two of the UK’s largest student populations, and offer a combined 951 beds. The Leeds asset was bought with funding partner Aviva Investors, the UK insurer, and is leased to the University of Leeds (pictured). The London asset, which was acquired with Legal & General, also a UK insurer, is directly let to students across the capital’s universities. The seller was UK private real estate firm Rockspring Property Investment Management.
Arlington has now expanded its student accommodation portfolio to more than 7,800 beds since 2014.
George Shweiry, founder and chief executive of Arlington, said he believes that the UK student accommodation sector is “well positioned” to weather the immediate turbulence caused by the UK vote to leave the European Union. “Underpinning this is the strong and growing demand from UK and international students for spaces at the country’s higher education institutions, where good quality accommodation directly supports their learning needs,” he added.
Founded in 2013, Arlington Investors is the investment management arm of Arlington Advisory, the real estate advisory business, which acts on behalf of institutional investors and family offices from the Middle East and Europe. It has previously invested in other countries, but has a current focus on UK property. It has historically invested in a variety of alternative asset classes however student accommodation is today its main focus.
In 2014, Arlington completed a £245 million transaction for 4,500 beds from the Opal Student Property Group portfolio. A year later it purchased another 400 beds from Goldsmiths, University of London, and then in March this year, the firm acquired 1,445 beds, plus another 492 in development, from Spectrum and Sanctuary housing associations.
Arlington was advised on the London and Leeds deal by Osborne Clarke and Maguire Woods.