UK student accommodation developer and manager the UNITE Group estimates the net asset value (NAV) of the UNITE UK Student Accommodation Fund to be GBP0.808 per unit as at 31 December 2010.
The figure reflects an increase of 1.1% during the fourth quarter and an uplift of 6.0% in the 12 months to 31 December 2010 (30 September 2010: GBP0.799 per unit, 31 December 2009: GBP0.762 per unit).
In arriving at the value of the fund’s units, its property portfolio – now comprising 21,697 beds in 64 properties across 20 UK markets – was independently valued at GBP1,231 million.
The movement during the fourth quarter represents an increase of 0.4% in the underlying gross property values (excluding those acquired in the quarter), driven by 0.4% of quarterly rental growth. With the majority of rental growth typically being recognised in the first half of the year, in line with the lettings cycle, the outlook for 2011 remains in the 3-4% range. Valuation yields remained stable during the quarter.
In the 12 months to 31 December 2010, the value of the property portfolio held throughout the year increased by 5.7%, driven by an average 13 basis points of yield compression and 3.5% of rental growth.
Following these movements and the acquisition of a portfolio of assets in the quarter, the average net initial yield of the portfolio held at 31 December 2010 stood at 6.67% (30 September 2010: 6.70%, 31 December 2009: 6.84%).
“USAF has delivered another strong performance in 2010 with 6.0% NAV growth and a total return of 11.0% to investors," says Joe Lister (pictured), UNITE’s Chief Financial Officer. "The NAV growth has been driven primarily by rental growth reflecting the ongoing demand for good quality, well located student accommodation.”
