Investec provides loan to Moorfield Group for Lincoln PBSA

Investec provides a £15.6m loan to Moorfield Group for the development of a new purpose-built student accommodation (PBSA) scheme.

The student accommodation scheme in Lincoln. Investec has provided a loan to Moorfield Group for its development | PBSA News
The student accommodation scheme in Lincoln. Investec has provided a loan to Moorfield Group for its development.

Investec Real Estate has provided UK-focused real estate fund manager Moorfield Group with a £15.6m facility to fund the development of a new PBSA campus in Lincoln. Already under construction, the scheme will deliver 293 new student beds.

Located a short walk from the centre of Lincoln, the scheme will include four three-storey townhouses and five four-storey buildings, alongside an on-site reception and laundry facilities. The development is expected to complete ahead of the 2024/25 academic year.

“With UCAS expecting to receive one million applications annually by 2030, we remain bullish on the student accommodation sector’s compelling long-term outlook. It has an attractive, inflation-protected income profile supported by deep-rooted demographic tailwinds.

“Our 13-year track record providing a mix of domestic and international capital with a range of funding solutions means we are well placed to capitalise on the continued demand for new development. Working with repeat borrowers is central to our longevity – in particular with businesses like Moorfield, who deliver high-quality specialist schemes that are key to supporting the UK’s growing student numbers.”

Jonathan Long, Head of Corporate Lending, Investec Real Estate

According to Knight Frank’s 2023 Student Property Report, there are currently an estimated 95,000 new beds in the planning pipeline, significantly below the 263,000 additional full-time undergraduates anticipated between now and 2030. With this acute undersupply of student beds, investor sentiment towards the PBSA sector remains strong.

This sentiment is also echoed in Investec’s third Future Living report, which launched in September. The student accommodation sector saw the biggest shift in investor appetite, rising from tenth to first in terms of investor appeal in just two years.

“We have been investing in student housing for over twenty years and investor confidence in the sector remains resilient, with domestic and international investors keen to increase their exposure to an undersupplied asset class offering risk-adjusted returns and long-term income streams.

“We see a market opportunity in new-build development and refurbishment of existing stock, with both strategies responding to investor demand for high-quality assets with leading ESG credentials.”

Charles Ferguson Davie, Chief Investment Officer, Moorfield Group

In 2022, Investec passed £1bn of lending in the student accommodation sector, having funded 22,000 beds across 55 schemes in 23 UK cities since 2011. This is Investec’s second student deal with Moorfield, having previously provided a £18.97m loan for the development of a 282-bed PBSA scheme in Colchester.