Singapore’s Far East Orchard buys four student accommodation properties in UK

Visual from the Far East Orchard website

SGX-listed Far East Orchard Limited said it has acquired a portfolio of student accommodation properties within Shieldfield, Newcastle upon Tyne, United Kingdom for £40.9 million ($62 million)

The investment involves acquiring two land sites for development into purpose-built student accommodation, an existing student accommodation, and another student accommodation undergoing development. The latter is expected to be completed in the second half of 2015., the company said in its regulatory filing.

The property acquisitions will be funded by internal sources and/or external debt facilities, the company said.

The acquisition includes Turner Court, an existing operating building;  Rosedale Court, an ongoing development;  a land site for development of two buildings and another land site for development of three buildings. These  are located within walking distance of educational institutions such as Northumbria University, Newcastle University, Newcastle University Business School and Newcastle College, the regulatory filing added.

Far East Orchard’s group chief executive officer and managing director Lui Chong Chee said, “For the group, this move represents several milestones: an expansion of our property development beyond Singapore into Europe, and an extension of our development capabilities into the student housing sector in the UK, to develop our position as a leading regional real estate player. It also pools together the extensive experience from our established hospitality operations. As the UK student accommodation market has been structurally undersupplied, we plan to contribute and provide high quality purpose built student housing. In addition, this new asset class opens a door to stable capital growth in one of Europe’s major property markets for FEOrchard.”

According to global real estate service provider Jones Lang LaSalle (JLL), the UK student buy-tolet market is buoyant, and the picture is one of healthy, sustainable growth and overall stability for the sector despite well-publicised demographic dip in the number of 18-year-olds in the UK. JLL has forecasted an annual rental growth rate of 3-4 per cent for London, 2-3 per cent in university towns and 3-5 per cent regionally. Data from commercial real estate analytics firm, Real Capital Analytics, showed that the average investment yield for UK student accommodation was 5.8 per cent, compared to 5.1 per cent for offices.

In the last one year, FE Orchard acquired four hotels in Germany and Denmark for €21.0 million. The group also entered into a residential development joint venture project in Sydney, Australia.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.