Hermes acquires three Greenwich PBSA assets

A fund managed by Hermes has acquired three purpose-built student accommodation blocks from Infrastructure Investments for over £18.57m, reflecting £155,000 per bedroom and 5% net initial yield. The three buildings, blocks J, K and L in the Rachel McMillan Student Village development, SE8, consist of 120-beds arranged in six-bedroom cluster flats. The blocks are let to Study Group on an FRI lease for a term of 30 years, expiring 24 September 2034, providing an unexpired lease term of 11.5 years, and a passing rent of £991,096. The Rachel McMillan Student Village is located close to the University of Greenwich and Goldsmiths, University of London. Beachrock represented Infrastructure Investments on the sale of the schemes. Beachrock partner Sam Ball said: “Property funds are seeking the safety of PBSA, a residential asset class underpinned by higher education. “At 5% NIY this transaction shows liquidity for a prime, well-let asset with an excellent rental growth story. “This transaction will give confidence to pension funds and overseas investors who will dominate the investment landscape.” See more occupational sales comparables information for Greenwich>> To send feedback, e-mail akanksha.soni@eg.co.uk or tweet @AkankshaEG or @EGPropertyNews