ENBD REIT (CEIC), a top Shari’a-compliant real estate investment trust managed by Emirates NBD Asset Management, has acquired Dubai’s first purpose-built student residence from Global Student Accommodation (GSA).

The 424-bed property was bought from the global leader in student accommodation on a sale and leaseback agreement at a transaction value of Dh120million ($32.6 million).

The acquisition is ENBD REIT’s first in the student accommodation segment, and part of a strategy for diversifying its asset portfolio. As part of the transaction GSA has entered into a seven-year lease.

The property, Uninest Dubailand, was built in 2016 and is the first of its kind in Dubai. It is in close proximity to Dubai Academic City, serving students attending more than 30 institutions across the city. Responsibility for managing the property will remain with GSA’s operations team, under the Uninest Student Residence brand.

Tim Rose, head of Real Estate at Emirates NBD Asset Management, said: “We’re very pleased to announce our first acquisition since the successful listing of ENBD REIT on Nasdaq Dubai in March. This is an important step in our capital deployment programme, and a key milestone for the process of diversifying our portfolio beyond traditional asset classes. As GSA plans to grow its presence in Dubai and the UAE, we are looking forward to a strategic partnership that will allow both parties to support the growth of the Emirates’ education sector.”

The property comprises a 160,000 sq ft floor area covering two basement levels, a ground floor and nine upper stories, as well as a roof-top swimming pool. A total of 242 rooms offer 424 beds, with residents benefitting from amenities including a café, gym, entertainment room, cinema room, dedicated study area and outdoor terrace. The operator also provides a regular shuttle service to universities and shopping malls.

Following the acquisition, the ENBD REIT property portfolio’s total value is $349 million, with a net asset valuation (NAV) of $297 million, or $1.17 per share. Loan-to-value (LTV) ratio on gross asset value (GAV) is 32 per cent, with occupancy of 86 per cent across the portfolio. The portfolio’s weighted average unexpired lease term (WAULT) is 2.23 years, with offices accounting for 61 per cent of the portfolio, residential accounting for 29 per cent and alternative assets (including student accommodation) making up the remaining 10 per cent. ENBD REIT has a total of 8 properties across Dubai.

Nicholas Porter, Chairman of GSA, said: “I am delighted that GSA’s work to bring purpose built student accommodation to Dubai has attracted the attention of such a well-respected partner with a track record for investing in high quality, income generating assets in the UAE. This transaction demonstrates the strength of GSA’s vision to support the continued growth of the higher education sector in the UAE and we look forward to working closely with ENBD REIT’s real estate and fund management team.”

GSA is headquartered in Dubai, UAE and operates two brands Uninest and The Student Housing Company. Founded in 2007, the company is growing rapidly across Australia, China, Germany, Ireland, Japan, the UAE and the UK.  – TradeArabia News Service