In a statement, Coral, which launched its Luxembourg-domiciled Student Portfolio fund in 2009, said contrary to recent declarations made by Brandeaux the market is healthy and “remains robust and reflects extremely strong fundamentals”.
John Kenndey, co-founder of Coral, said “people should read between the lines and question broad contrary statements from interested parties”, highlighting recent independent analysis from property experts Savills and Knight Frank as being supportive of his case.
Coral defended the asset class in a statement released shortly after Brandeaux announced it was to suspend its entire fund range blaming a high volume of redemption requests and raising concerns about the amount of property on the market. Last week Brandeaux estimated that £2bn worth of student property was either already for sale in the UK or about to be.
However, Coral disputes this interpretation of the sector and quotes Marcus Roberts head of student investment a Savills in support.
Roberts said: “We are confident that student housing will continue to prove a counter-cyclical investment, but the market is not without its risks.
“Investors should consider investments on an institution by institution basis, remaining mindful of the city supply where there are multiple universities.
“Over and above demand as defined by student numbers, university rankings are normally the first reference point for prospective students and a good indicator of investment risk.”
Furthermore, Coral said significant recent institutional investment into the sector also supports the view that the sector continues to present a “huge opportunity”.
Coral said: “This [view] is supported by the wave of interest from institutions who have recently entered this market with the likes of Ginko purchasing UPP alongside the Dutch Pension Fund PGGM for over £1bn, Knightsbridge backed by Oaktree targeting over £1bn of student accommodation acquisitions and Unite looking to increase their holdings by up to £300m with new capital inflows from Legal and General and GIC partnership through Singapore.
“Also, Urbanest developing an overseas portfolio backed by significant institutional capital through the US and M&G entering the market via the Nido portfolio with a transaction over £400m last year – the list goes on.”
