High Yielding UK Student Accommodation Investment
High Yielding UK Student Accommodation Investment
High Yielding UK Student Accommodation Investment
Highlights: • Prime city centre and waterside location • 8% NET per annum assured for 5 years • 227 self-contained studios spread over 8 floors • On-site facilities unrivalled on the local student market • Delivered fully furnished • Fully managed by Opto Studio Living • Award-winning Developer with a proven track record • 250-leasehold agreement • 10-year NHBC Certification upon completion • High demand location with over 50,000 students
High Yielding UK Student Accommodation Investment
Overview Opto Student Newcastle is a high yielding UK Student Accommodation Investment located in one of the country’s most under supplied markets. Designed to address the lack of available high-quality student rooms, Opto Student Newcastle is strategically positioned to cater for Newcastle University and Northumbria University students and offers city centre, waterfront accommodation. With a selection of highly desirable on-site facilities, Opto Student Newcastle is set to become one of the most desirable student accommodation buildings in the city.
Secured income
8%
NET per annum assured for
5
years
Fully managed
Proven returns
Established managed
Delivers a long-term and
company manages your
robust income stream
property on your behalf Hotspot location for Rooms delivered fully
student property
furnished
investment
High Yielding UK Student Accommodation Investment
Facilities • Gym
• Communal Kitchen with Dining Rooms
• Games Room
• Outhouse for Events
• Courtyard
• Laundry
• Cinema Room
• 24/7 CCTV
• Outdoor Seating Areas
• On-site Management
• Roof Terrace with River Views
• Secure Fob Lock Access
High Yielding UK Student Accommodation Investment
Why invest in UK student property? • Applications from international students • With the sector recording average occupancy levels of 99%, student property exceeded 100,000 for the first time ever in 2018 (UCAS) provides exceptionally reliable income • An impressive 505,680 students were placed in full-time UK higher education through UCAS in August 2017
• Around 43,500 EU student applied for places at UK universities in 2018 – up 3% from 2017 (UCAS)
• Student property has proven resilient to market fluctuations throughout history
• UK Purpose Built Student Accommodation (PBSA) is highly attractive to international investors
•
With a proven track record of returns • There is still room for growth. Only a fifth and strong demand from students, 2017 witnessed an impressive £5.3 billion of students live in university-owned PBSA. investment into the sector
High Yielding UK Student Accommodation Investment
Self-contained studios from £81,250
Investment options:
Option one: Pay £5,000 to Reserve a property Pay 50% less the Reservation Fee on Exchange of Contracts (28 days after Reservation) Pay 50% upon Completion 4% interest paid on deposited funds
Payment plan
Additional Legal Fees
Self-contained studio apartments within Opto Student Newcastle will be sold on a
A team of commercial solicitors, experienced in the UK’s student buy-to-let market, have been appointed to act on the behalf of investors.
leasehold basis for a period of 250-years.
Legal fees are estimated to be between £860- £1,100 fully inclusive of VAT, searches and disbursement costs.
High Yielding UK Student Accommodation Investment
5-year investment scenario
Conservative
Purchase Price
£81,250
8% annual NET income for 5 years
£6,498
NET income over 5 years
£32,489
12.5% uplift on Purchase Price
£10,166
Total income over 5 years
£42,654
ROI % over 5 years
52.50%
Annualised NET ROI
10.50%
*Please note financials are for indicative purposes only and may be subject to change Rental income is assured at 8% for 5 years, NET of all costs. Capital uplift based on yield compression assuming a conservative 3% rental inflation per annum.
High Yielding UK Student Accommodation Investment
Location St James Stadium Train station
0.8 MILES
City Centre
Sage Gateshead arena
0.8 MILES
0.6 MILES
Northumbria University Quayside
1.2 MILES
Newcastle University
1 MILE
0.4 MILES
0.2 MILES
With a total of 50,000 students, the development is perfectly positioned to cater to the shortfall of 28,035 students (64.6%) who are unable to access university or private sector student accommodation. • City Centre location Excellent transport links and walking distance to all local attractions and amenities. • Newcastle University Approx. 10-15 min walk from the development. • Northumbria University 5 min walk from the development.
• Quayside Located in the trendy waterfront and next to vibrant waterfront vibrant bars, restaurants and coffee shops. • City Centre The development is a short walk from the city centre and the main train station. • Close to the world-famous Gateshead Millennium Bridge and the Sage Gateshead waterfront concert venue.
High Yielding UK Student Accommodation Investment
A Global University City • Around 50,000 students • International students account for 15% of all students • 4% annual climb in student rents • 2 world-class universities (Newcastle University and Northumbria University) • Newcastle named the best location in the UK for student nightlife in 2017 • 6.3% rise in applications from students to study in Newcastle in 2017 • Student numbers up by 70% at Newcastle University (2000-2015) • Student numbers up by 110% at Northumbria University (2000-2015)
• 28,035 students (64.6%) unable to access university or private sector • Since 2007, applications to Newcastle higher education institutions have risen by 27.7%, from 47,965 in 2007 to the 61,235 figure recorded in 2016 • Newcastle University is given an overall ranking of 22nd in the Times Good University Guide 2018, up from 23rd place in 2016. For every place there are 6.5 applications • The University of Northumbria is given an overall ranking of 65th in the Times Good University Guide 2018. For every place there are 5.6 applications
The universities in Newcastle have 43,390 students but are only in a position to offer 8,906 students accommodation in halls of residence or bedrooms under nomination agreements. This represents just 20.5% of the full-time student population, illustrating an undersupply,” Knight Frank.
High Yielding UK Student Accommodation Investment
What is the address of the development? Opto Student, Newcastle, 85 City Road, Newcastle, NE1 2AQ.
yield is assured for 5 years at 8% NET. We estimate the yield will increase over time, in line with market inflation. You can sell your unit at any time to another investor through a UK or overseas agent.
Is there a rental assurance in place? Yes. 8% NET rental return is assured for the first 5 years of the investment.
Is there a benefit for buying into the project in the early off plan stages? Early investors will have the choice of the best units within the project and will be able to purchase a self-contained studio apartment at the best possible pricing.
What is the length of the leasehold? Each self-contained studio apartment is sold on a 250-year leasehold.
Is the sale handled by UK lawyers? Yes. A team of commercial solicitors, experienced in UK student property investment, have been appointed to act on the behalf of investors.
As a non-resident in the UK am I taxed on this income? If you are a UK resident then yes, you will be subject to tax. If you are a ‘non-resident’ in the UK, then you are classed as an overseas landlord and may apply to HMRC in the UK for exemption.
Can I sell my unit/s at any time?
Please note we cannot guarantee that an application to receive rent with no tax deductions will be accepted.
Investors are permitted to sell at any time after Completion.
When will the development complete?
Is there an exit strategy? The UK’s student accommodation market is fairly young therefore there have not been many resales on the market. As the investment offers such a high yield, we envisage that most investors will want to hold onto their investment long-term. The
The target completion date has been scheduled for Q4 2019. The development is already under construction.
High Yielding UK Student Accommodation Investment
Is there a warranty in place? Yes, the development will be completed to highest standard and, upon completion, will have a 10-year NHBC warranty.
When will the development be occupied and when will I receive my income? The apartments will be let out by the date of completion and the assured yield will be paid from this date, quarterly in arrears.
What happens at the end of the 5-year rental assurance period? Is there furniture included in the price of the apartment? Yes, all studio apartments within the development will be delivered fully furnished and ready to let.
At the end of year 5, investors will have the option to continue managing the unit through Opto Living. Investors will be responsible for the payments of the Management Fee, Ground Rent and Service Charge. After the assured period, investors can manage the unit themselves or appoint another management company.