NEW multi-million- pound student housing is being built in the region.
Land has been bought for a £20m development in Newcastle, while a seven-figure sum is being invested in the centre of Durham.
In Newcastle, Victus Capital has bought land with full planning permission for a 215-studio scheme that will be worth more than £20m upon completion.
The Pitt Street site is near Newcastle University Business School and is the first acquisition in the Victus European Student Accommodation Fund’s strategy to target the European student accommodation market.
Meanwhile, in Durham, local property development firm Angel Homes has begun work on a student housing project in the centre of the city, with the support of a seven-figure loan from Lloyds TSB Commercial Banking.
The street level of the three-floor 15,000sq ft property on North Road is currently let to seven retailers including a Yates Wine Bar and the British Heart Foundation, with the upper floors now being converted into high-specification student accommodation.
Manchester-based Victus’s Pitt Street scheme will welcome its first students in September 2014 and will be marketed and let through Prime Student Living.
Andrew Jamieson at Crosslane Group, Manchester, which is working with Victus in the development of the scheme, said: “Investment in UK student accommodation has provided strong returns and in areas of low supply of specific stock, such as studios in Newcastle, this will continue to be the case.
“We can clearly see that the student accommodation market in mainland Europe is around 10-15 years behind the UK in maturity, which means there are excellent opportunities for growth.
“We are committed to taking advantage of the student accommodation opportunities available in mainland Europe and have already established our first European joint venture partnership in Germany.”
Storeys Edward Symmons acted for Newcastle United in respect of the sale of the site. They also acted for Crosslane in respect of securing planning permission.
Angel Homes manages a portfolio of residential and commercial properties in and around Durham, and was started by local businessman Andrew Ward and his wife in 2003.
The student apartments Angel Homes is converting, and which they manage directly, will be arranged as four six-bedroom units featuring en-suite bathrooms, common lounges and kitchens, fully fitted interiors and wireless internet access.
Ward said: “There’s a constant demand for high-quality student accommodation in Durham and the new property is in a great location, being close to the university, the train station and shops.
“We bought our first investment property 10 years ago as a bit of a hobby, but it has steadily grown into a full-time business in its own right, and one which we thoroughly enjoy. We’re already looking at other opportunities to develop unused buildings around the city as well as improve our current portfolio further.
“I was amazed by how quickly this latest deal was completed, largely driven by our relationship manager at Lloyds TSB Commercial Banking who worked closely and tirelessly with us and our solicitors to provide the funding package that we needed to acquire and renovate the new property.”
Nic Franklin, property relationship manager for Lloyds TSB Commercial Banking, said: “Angel Homes’ steady growth is testament to the hard work and attention to detail of the team, and it has proven that by working closely with your banking partner, it’s possible to take advantage of growth opportunities, even in a highly-competitive sector such as property development.
“The swift completion of this transaction was the result of great teamwork by all those involved, including James McEwen from Gordon Brown Law Firm acting for Andrew, and David Ferguson from Dickinson Dees acting for the bank.”
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