Unite Group property valuations rise in third quarter

9th Jan 2015 08:02

Student accommodation developer and manager Unite Group said the value of its two property portfolios rose by 1.2% and 1.4% in the third quarter.The larger regional portfolio, the Unite UK Student Accommodation Fund (USAF), which comprises almost 25,000 beds in 68 properties across 22 university towns and cities, was up 1.2% to £1.57bn.The London Student Accommodation Joint Venture (LSAV) in 2014, merged with the Unite Capital Cities joint venture (UCC) during last year so that it now comprises just under 3,000 beds in 14 properties between London and Edinburgh, rose 1.4% to £426m.The two portfolios are valued at an average yield of 6.5% and 5.9%, respectively."The USAF and LSAV portfolios have both performed well in 2014, with a further year of strong occupancy and rental growth supplemented by modest yield compression," said Unite chief financial officer Joe Lister."Based on indicative pricing of pending transactions in the market we expect yields to compress meaningfully from December 2014 levels during 2015 as those transactions complete."United said that the USAF property portfolio has increased in value by 3.9% and the LSAV portfolio by 4.6% over the year on a like-for-like basis, with rental growth contributing to approximately three-quarters of the movement.Unite shares were down 0.57% to 472.80p at 08:21 on Friday.