Gatehouse Bank acquires first US student accommodation property in Texas
July 18th, 2011 - Gatehouse Bank plc (Gatehouse), a wholesale Shariah compliant investment bank based in the City of London, has completed the acquisition of its first US based student accommodation property in College Station, Texas. Gatehouse has acquired a total of $150 million of student housing properties to-date with this recent acquisition. The transaction was conducted in partnership with GSH Kuwait and is part of a joint investment with The Scion Group, a specialized student-housing operator and one of the most active acquirers of student housing assets in the United States. Arch Street Capital Advisors, L.L.C a US-based real estate advisory firm structured and arranged the transaction on behalf of Gatehouse Bank and GSH.
The College Station acquisition, at a current 98% occupancy rate, is forecast to deliver a stable and secure income flow with projected net cash yields of 7.0% per annum over 5 year holding period.
Fahed Boodai, Chairman of the Board of Directors at Gatehouse Bank stated, "This US acquisition earmarks Gatehouse Bank as a dominant force driving the delivery of global real estate income- producing investment opportunities."
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“Student accommodation is a sector of great importance that we believe will deliver strong investment opportunities for the maximum benefit of our GCC clients. Gatehouse’s expertise in this sector is proven by the delivery of core assets including two student accommodation transactions in the UK.”
Robert Bronstein, President of The Scion Group which partnered in the transaction, added, "We’re pleased to have the opportunity to maximize the potential of The Lofts at Wolf Pen Creek, among the finest student housing assets anywhere in the world. Scion is especially thrilled by the opportunity to join with GSH and Gatehouse Bank, which share our view that high-quality U.S. student housing is well suited to low leverage and a focus on current yields. We look forward to applying this philosophy to grow our partnership together."
Known as The Lofts at Wolf Pen Creek, the uniquely designed 310,422 sq ft property comprises 265 one, two, three and four bedroom loft-style flats and townhouses containing 683 beds, distributed among several buildings, most of them connected to one another to form an upscale resort-style community. Amenities include a 13,600 sq ft clubhouse, a theatre with stadium seating; an internet café and media centre; a business/study centre; two swimming pools; and a 24-hour fitness centre.
The property is minutes away from Texas A&M University, which is one of the largest in the United States. The Southwest and Southeast regions together account for almost 32% of all U.S. student enrolments and are one of the fastest growing regions nationwide. As a result, there is a significant demand for living space. Last year in the U.S. transaction volume in the student housing sector increased 250% in comparison to 2009 levels and there is a very real opportunity for investors looking to tap into this yield-generating growth sector.
To meet continuing demand for high quality real estate prospects, Gatehouse provides leading advice and opportunities, as well as detailed research and sector analysis, to investors across major international markets including the UK, Europe, Asia and the US. This latest transaction follows the acquisition of two earlier student accommodation properties in the UK, and brings the total value of Gatehouse Bank’s global real estate portfolio to in excess of $370million.
Gatehouse Bank
Gatehouse Bank operates as a Shariah-compliant wholesale investment bank based in the City of London focusing on: Treasury, Real Estate and Shariah Advisory services.
For more information please visit our website www.gatehousebank.com
GSH Kuwait
GSH K.S.C.C. is a dynamic global investment advisory firm based in Kuwait. From its headquarters in Kuwait and its subsidiaries in some of the world’s key financial cities; it structures, manages, and monitors innovative and exceptional global investment products on behalf of its investors.
GSH has extensive experience within the global markets, having structured and realized significant transactions in the US, UK, and France, far exceeding initial investment returns projections.
GSH is a subsidiary of the Securities House K.S.C.C.
The Scion Group LLC
The Scion Group LLC is among the most active acquirers of student housing assets in the United States, acquiring $350M of properties since 2007. Formed in 1999, Scion is focused exclusively on housing for college and university students and has managed over 10,000 beds across the U.S.A. Scion provides facility and strategic planning, financial consulting, development and acquisition-related services. Scion’s consulting clients have included 100 higher-education institutions in the U.S., Canada, Mexico and the U.K.
About Arch Street Capital Advisors, L.L.C
Arch Street Capital Advisors, L.L.C. is a full service real estate investment advisory firm. Arch Street specializes in assisting international investors with their U.S. real estate strategies including acquisition and joint venture advisory, financing advisory and asset management and disposition services. Since 2003, Arch Street has advised clients on more than $2 billion of acquisitions, dispositions and financings. Currently Arch Street manages a diverse portfolio of investments on behalf of its clients in the industrial, office, multifamily, health care and residential condominium development sectors of the U.S. real estate market. For more information please visit http://www.archstreetcapital.com.