Work has started on a new purpose-built student accommodation complex in Dundee.
The development site, previously a hessian fabric factory, is located between Douglas Street and Brown Street in the city centre and has been vacant for several years.
Full planning permission was granted for 152 studio flats, plus amenity spaces, with completion now expected by the start of the 2024/25 academic year.
The completed property will also feature a common room, gym, cinema room, dining room and laundry. The top floor will include a partly-covered terrace.
The £19m development has been part-funded by property investment firm Glenmore Group, alongside a bank facility from Puma Property Finance. Private equity firm Maven Capital Partners will act as asset manager on the project, which will be constructed by Aberdeen-based CHAP Group.
Maven has previous experience in the PBSA sector, having developed, managed and operated a number of properties across many of the UK’s university cities, including Glasgow, Edinburgh, Durham, Liverpool and Birmingham.
One such project was the Marketgait Apartments in Dundee, which Maven redeveloped in 2015 and was subsequently sold in its second year of operation at 100% occupancy, providing a return for Maven investors of 2.37 times multiple.
Dundee has one of the highest ratios of student population in the UK, with more than 17,000 full time students; a number which has increased 22% over the last five years.
This has resulted in a significant undersupply of good quality purpose-built accommodation in the city, which the new development is looking to help solve. It is situated less than 10 minutes’ walk to both the University of Dundee and Abertay University campuses.
Paul Johnston, partner at Maven, said: “The PBSA sector has a history of low volatility and, despite wider macro-economic issues, such as the cost of living, we are continuing to see strong appetite from both domestic and international students to continue their education in Dundee and to be able to access high quality accommodation which meets the expectations and needs of today’s students.
“Coupled with our experience at Marketgait in Dundee, as well as the many other PBSA development we have worked on throughout the UK, we are excited to be delivering a high quality, stylish studio product that is in particularly short supply.”
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