Round Hill Capital closes Smart Studio investment

Round Hill Capital closes €200m Smart Studio acquisition, marking the largest student accommodation investment in Portugal this year.

Smart Studios development in Portugal. Round Hill Capital closes the acquisition which is the largest investment in Portugal this year | PBSA News
Smart Studios development in Portugal. Round Hill Capital closes the acquisition which is the largest investment in Portugal this year.

Integrated global specialist real estate investor, developer and manager – Round Hill Capital – announces the official closing of a €200m Smart Studio acquisition of nine residences totalling 53,000 sqm in the Portuguese purpose-build student accommodation (PBSA) and co-living sectors. The transaction was advised by PBBR, JLL and Deloitte on the buy side, and CBRE, Savills, Arcadis and Morais Leitao on the sell side.

The investment is the largest PBSA and co-living transaction in Portugal this year, adding a total of 2,013 beds to the Round Hill European Student Accommodation (RHESA) partnership – the European PBSA Joint Venture between CPP Investments and Round Hill Capital – to create a 5,000-bed portfolio in just under nine months. 

The portfolio is mostly concentrated in the Lisbon Metropolitan Area (88%) with one asset in Oporto (12%). Around 900 beds will already be operational this year under the Smart Studios brand across five residences, with the delivery of the remaining four buildings set to be completed between 2022–25. Plans for the portfolio will have a strong ESG focus to improve energy consumption and social wellbeing for its tenants. 

“This latest investment has accelerated our investment pipeline across major Iberian cities, reinforcing our leading role in building and investing in European accommodation solutions. Iberia continues to exhibit positive investment opportunities and the acquisition of Smart Studios reflects this. With the support of our integrated on-the-ground teams, we are confident we will continue to identify strong investment and development opportunities from PBSA and serviced apartments to senior living and co-living across the region in the near future.”

Brian Welsh, Head of Student, Round Hill Capital
Roof top communal area at Smart Studios student accommodation scheme | PBSA News
Roof top communal area at Smart Studios student accommodation scheme.

Founded in 2015 by Ricardo Kendall, Smart Studios is a Portuguese developer and operator of purpose-built accommodation, offering an all-inclusive concept of living for students and young professionals. In 2018, the shareholders of Smart Studios started a strategic partnership with LX Partners to develop companies with strong growth potential, with the aim of sustaining the growth of the company.

“We are very pleased to have achieved such a great result of the sale process. We believe we have left Smart Studios in very good hands, with prestigious world class companies that are committed to the sector, and that intend to increase the offer and improve the quality of student accommodation with at least another 1,100 beds to be delivered in the next three years. I would like to express my gratitude to the Smart Studios team for their daily commitment to deliver such a great service to our clients and thank the support of all those involved in the transaction.”

Ricardo Kendall, Founder, Smart Studios
Smart Studios bedroom | PBSA News
Smart Studios bedroom.

Portugal attracts a significant number of international students due to its education offer, low tuition fees and quality of life available to young professionals in cities such as Lisbon and Porto. The growing student community has revealed a gap between supply and demand in the PBSA sector, where accommodation is still largely non-institutional and features outdated facilities. This new investment is intended to improve both the availability and quality of student accommodation to meet this growing demand.

“We are very pleased with this outcome. It was probably one of the most challenging deals that the team has been involved in. We committed all the efforts, experience and know how to provide the parties with strong support from start to end.

“It was a particularly complex M&A transaction, involving not only the existing assets and the Smart Studios operational platform, but also those assets under construction and the ones that will be delivered in the coming years. This has all been in the context of a global pandemic, inflation and rising interest rates arising from the macroeconomic environment.

“The company’s performance, with almost 100% occupancy rate, a high-quality team and unparalleled mix of assets, alongside strong market fundamentals, helped us prove that the PBSA sector can be very resilient even in the most adverse context.”

Igor Borrego, Director of Capital Advisors, CBRE Portugal