Bahrain’s GFH pays $100m to acquire student housing portfolio linked to top US universities

GFH Financial Group, a Manama-based investment bank, has signed an agreement to acquire a $100 million student housing portfolio affiliated with several top universities in the US.

The Bahraini company acquired the portfolio in partnership with Atlanta asset manager Student Quarters.

The US company is the sixth-largest buyer of student housing assets in the country and has completed transactions with a total value of more than $1.4 billion.

“This is another step in further building a diversified portfolio of well-positioned, stabilised real estate assets,” said Awais Majeed, executive director of property investments at GFH.

“With scarce comparable supply in flagship universities and growing ... enrolment numbers, we see strong prospects for the sector, which we will work to leverage with our partner, Student Quarters, which brings deep-rooted knowledge of the US student housing market and an exceptional track record to support income and value-generation for GFH and our shareholders,” he said.

The latest acquisition comes after the strong performance of the student housing sector, which has about 90 per cent average occupancy levels and a rental collection rate of about 100 per cent, backed by parental or guardian guarantees, the company said.

However, uncertainty surrounding the Covid-19 pandemic, which forced many students to study remotely, resulted in investment into the sector falling from $5.8bn in 2019 to $4.5bn last year, according to CBRE.

GFH’s student housing portfolio in the US includes buildings and amenities near the University of Arkansas, Florida State University and the University of Tennessee.

The acquisition of student housing assets is part of its expansion into specialised US property. Last month, the bank acquired a US warehousing and distribution logistics centre in Ohio for $100m.

GFH has also been investing in logistics assets across Europe, including supermarket retailer Tesco’s Avonmouth distribution unit in the UK, which it bought for $102m.

It also picked up the GP Logistics Centre in Spain for $96m, Amazon’s fulfilment centre in the Czech Republic for $165m and Amazon’s three last-mile assets in Spain for $100m.