Spotlight on returns from flats for students

A London-based property investment company, run by South Africans, has an inflation-beating investment opportunity available in Greenwich, London. Michelle Swart finds out more

ONE of the main areas of investment opportunity for South Africans is investing in properties that offer strong rental and returns. A new offering from Propwealth, a London-based property investment company run by South Africans, is a student flat development in Greenwich, London, less than a mile from a main university.

This is said to be an inflationbeating, high-income student investment opportunity located in a city that is home to more than 290 000 full-time students across 40 different educational institutions. The investment could be ideal for those wishing to increase their income while also benefiting from the worldwide demand for property in London.

“Over the past year London property prices have risen and yields have dropped, but this niche market of the largely undersupplied student market is fast becoming the new investment class,” says Craig Illman, director at Propwealth.

He says that there is currently a shortfall of about 100 000 student rooms across London, particularly in central locations. For the discerning UK and overseas student this boutique development, consisting of 62 studio apartments and en suite student pods, will offer a luxury accommodation option and a fresh alternative to large, overcrowded halls of residence and private housing in the area.

Illman says that rents in the student sector have increased by 5% a year over the past six years which, when compared with 0,6% for the commercial property market as a whole, is a strong performance. Additionally, occupancy rates for student property are extremely high.

The student flats will be located just 0,8 miles from Greenwich University, which has more than 13 000 students, and 0,5 miles from Ravensbourne College, which has about 1 600 students. The development is also ideally located for students studying in two of the most distinguished further education centres for the arts, drama and dance — Bird College and Rose Bruford College.

The development will be a new build and is expected to be completed in November this year. Given the time frame and the proximity to the new academic year, the developer will guarantee the first year’s rent.

The accommodation will be built to a high specification, providing facilities over five floors. Each floor will have a number of communal kitchens and living spaces. The development will also provide office facilities, an on-site laundry, bike storage and a management office.

Illman believes that these student flats will offer an excellent return on investment that is well above the average rental yield. Furthermore, the management company in place will provide its expertise at a very competitive rate of 8% for full management. This reduces costs significantly and still means investors should achieve a net rental yield of at least 9% in a prime London location.

Units are priced from £75 000 to £85 000 each.

Propwealth will be hosting free seminars in Cape Town, Durban and Johannesburg during January and February.

Directors Anthony Doyle and Craig Illman will be hosting these information workshops on investing in the UK residential property market, which will also detail how investors can get positive cash flows from affordable investment strategies. They offer a bespoke service for South African-based investors including property sourcing, tenanting and full property management designed for long-distance armchair investors.

Seminars are being held in Cape Town on January 30, in Durban on February 4 and in Johannesburg on February 6.

Contact:

info@propwealth.co.uk www.propwealth.co.uk.