Unite Group PLC on Thursday said it has exchanged contracts for the disposal of nine properties to an affiliate of US private equity firm Lone Star Funds for £212 million.
The Bristol, England-based owner and manager of student accommodation said it will take a £140 million share from the sale of the 3,656 bed portfolio.
The company said the disposal is part of its strategy to ‘increase alignment to high and mid-ranked universities and those properties with the strongest prospects for sustainable long-term rental growth’.
The portfolio includes assets in Aberdeen, Leicester, Leeds, Nottingham and Sheffield. Unite will fully exit the Aberdeen market following the sale, it added.
The disposals are priced at a 1% discount to the book value in December and reflect a net operating income yield of 6.4% based on income in the 2025/26 academic year.
The sale is due to complete in August.
Unite said proceeds will be reinvested into its strongest markets, including its recently announced partnership with Manchester Metropolitan University.
The sales have no impact on the company’s earnings per share guidance for the 2025 financial year, which remains unchanged.
‘These disposals increase the alignment of our portfolio to the strongest university cities and continues our disciplined approach to recycling capital. Purpose-built student accommodation continues to attract institutional capital as the growing UK 18-year-old population and improving trends in international recruitment underpin demand for high-quality student accommodation,’ said Chief Executive Joe Lister.
Shares in Unite were down 0.1% at 855.00 pence in London on Thursday morning.
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