Unite expects annual growth on strong demand for accommodation

18th Nov 2013 07:25

- Unite expects annual retail growth of three per cent - Average lettings occupancy of 98 per cent- Disposal of OCB joint venture- Other planned disposals deferredUK student accommodation developer Unite Group said it expects average retail growth for full year to be three per cent. In a trading statement for the period from July 1st to November 15th, the group reported strong lettings performance for the 2013/14 academic year with average occupancy of 98%. The investment market for student accommodation assets continued to mature with about £1.65bn of transactions concluded year to date."We expect investor appetite for the student accommodation sector to remain elevated in 2014 although it is also likely that the volume of stock offered for sale will remain high, particularly following the closure to redemptions of two regionally-weighted retail investor funds in the sector," the firm said.As announced in August, the group has decided to liquidate its OCB joint venture with the disposal expected to be concluded in early 2014. Certain non-core asset disposals have taken longer to conclude than anticipated and the company now expects to have sold approximately £50m of non-core assets by the year-end, down from previous guidance of £75-100m.Remaining planned disposals have been deferred into 2014, but the view of realisable value remains unchanged.The development of Unite's scheduled 2014 completions is progressing in line with plan and the targeted 2015 completions will commence on site shortly. The firm said it continues to make progress with its LSAV London development pipeline, in which it has a 50% stake. Three regional development opportunities are now held under lock-out agreements, equivalent to 75% of target activity following the placing in June. "We remain focused on three clear strategic priorities; to continue growing recurring profit and cash flow through the delivery of rental growth, portfolio growth and cost savings; to establish a sustainable capital structure; and to enhance our portfolio quality further through our highly selective development activity and non-core asset disposal programme," the company said.RD