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Real Estate Investment Trust
Student Accommodation Investments
Student Property Sector
The amount of money ploughed into the UK's student housing sector in the first half of 2012 is more than double the volume recorded in the same period last year. According to data published by CBRE, nearly GBP 800 million has been invested in the market, a significant increase on the GBP 375 million recorded in 2011. Head of student advisory at the firm Jo Winchester commented: "There is no shortage of investor demand, but the market is hampered by a shortage of new, high-quality development opportunities."The organisation revealed occupancy of student accommodation is around 99 per cent, despite the hike in tuition fees. The main reason for the continued popularity for this type of housing is that there has not been enough development in recent years to keep pace with the growing number of undergraduates attending university in the UK. Ms Winchester noted the student property investment sector is likely to open up to a wider range of financiers if new regulations regarding the real estate investment trust (REIT) regime come into force. She explained this, coupled with a growing number of accommodation providers, will deliver "a greater choice of investment funds, as well as creating an alternative exit position for established operators".Research published last month by Savills revealed it is not only the UK's student accommodation sector that is growing in popularity. France, Italy and Spain have experienced increasing interest from investors who are keen to take advantage of the high levels of demand within the market, with all these destinations also suffering from an undersupply of dedicated accommodation options. As a result, yields generated in these three European nations within the sector are expected to be stable over the coming year and, in many cases, will be attractive when compared to other forms of property investment, the firm asserted.
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