Legal & General has acquired five student accommodation blocks and an academic facility at Exeter University, southwest England, for 拢76m (鈧�85.6m).
The UK insurer said Legal & General Investment Management鈥檚 real asset division acquired the assets on behalf of two separate funds as part of a joined up approach to satisfy its wide ranging investor needs across its fund management platform.
The student accommodation blocks have been acquired by Legal & General鈥檚 UK Property Fund for 拢49.6m, representing an initial yield of 5.78%.
Let to INTO University of Exeter on a 35 year lease, the student accommodation totals 517 rooms across five blocks.
The INTO Academic Facility was bought by Legal & General鈥檚 Limited Price Inflation (LPI) Income Property Fund for 拢26.4m.
The 36,000sqft teaching facility鈥檚 lease is guaranteed by the University of Exeter and is for a term of 30 years.
Matt Jarvis, fund manager at Legal & General UK Property Fund, said the fund will continue to target universities like Exeter which have modern purpose built living and teaching accommodation.
鈥淭his acquisition is in line with our strategy for the UK property Fund to target income producing assets on longer leases as well as our ambition to increase our exposure to alternatives.鈥�
Derek Gilby, Senior Fund Manager of the LPI Income Property Fund, commented: 鈥淭he ability for LGIM Real assets to purchase these two elements in different funds was key to delivering the deal. It also demonstrates the breadth of our fund management platform which has enabled us to collaborate to satisfy our differing customer needs.
鈥淭his is an excellent buy for the fund, offering a secure long term income stream from a top investment grade University as well as satisfying our objective of continuing to secure public sector tenants for the Fund.鈥�
