City Waterside development is sold to German company in a £35.6m deal
FORMER DERELICT SITE WILL BE HOME TO 462 STUDENT FLATS
OPENING SOON: The development is set to be ready in the autumn
A MAJOR student accommodation scheme being built near the River Soar in Leicester has been sold for £35.6 million.
The 462-bed Tannery scheme, in Bath Lane, will have a cinema room, games room, fitness studio, lounges and study areas when it opens in time for the start of the new academic year in the autumn.
It is the latest addition to the £250 million-plus Waterside Regeneration scheme and a short walk from the city centre and De Montfort University.
Developer Watkin Jones has struck a deal to sell the building to German property investment company Deutsche Finance International (DFI).
The money will be paid when the building is completed and the accommodation will be run by Watkin Jones’ Fresh property management company.
Fresh looks after more than 20,000 student beds and build-torent apartments on behalf of institutional clients.
Since 1999, Watkin Jones has built 43,000 student beds across 130 sites, while this is DFI’s second student acquisition in the UK and its first with Watkin Jones.
The Waterside scheme has 415 en-suite rooms and 47 studios, and is going up next to the 600-bed
Merlin Heights student scheme, which was developed by Watkin Jones in 2016.
It also neighbours another Watkin Jones build-to-rent scheme currently in development.
The wider Waterside area – which was semi-derelict for years – stretches across the western side of the city.
It is undergoing £250-million plus of investment, including new hotels, offices, shared workspaces and the recent transformation of the semi-derelict Leicester Central Station.
Alex Pease, Watkin Jones’ chief investment officer, said: “It’s brilliant to secure institutional investment for this superb scheme that only adds to the growing desirability of Leicester’s dynamic riverside area.
“What was a brownfield site in need of regeneration will shortly offer hundreds a really attractive place to live with easy access to two respected universities, as well as the shops, bars and cafés of the city centre.
“The success of this second PBSA (purpose built student accommodation) scheme alongside our upcoming built-to-rent offer in Leicester showcases our ability to meet the very strong institutional and resident demand for UK residential for rent.
“The country’s growing market of renters increasingly value great homes with in-built lifestyle and welfare provision, while institutions are seeking high-quality assets that offer strong long-term returns.
“Working with DFI for the first time to complete this sale has been a real positive and the team look forward to continuing our relationship into the future. My thanks go to everyone involved in making the deal happen.”
Paul Nearchou, investment director at DFI, said: “This off market transaction represented a compelling opportunity for us to build on our UK student accommodation exposure and take advantage of the current market dislocation with the acquisition of one of the few newly constructed PBSA assets in Leicester.
“Watkin Jones is one of UK’s leading developers and we are confident they will deliver a high quality, modern product ready for the 2021/22 academic year.
“The outlook for the UK student sector remains strong, with supportive demographics and growing domestic and international demand.”