As many readers may be aware the Wellcome Trust is a global charitable foundation dedicated to research and supporting the brightest minds. It also has some of the brightest trustees that oversee £16.4bn of assets to responsibly manage. The trust has recently announced that it has increased it's diversification into its property holdings by acquiring the remaining 50% interest in student accommodation venture iQ from Quintain Estates and Developments for £106.4 million as a cash buyout in line with the company's end of year valuation. The transaction now makes iQ a wholly owned subsidiary of the Wellcome Trust.
This is yet another example of the student accommodation sector attracting institutional investment on an increasingly commercial scale. The Wellcome Trust said in a statement that it "sees student housing as a robust and growing property sector that will continue to exhibit growth. This acquisition consolidates iQ as a major property asset in the Trust's investment portfolio". The trust originally invested in iQ in 2007 as a 50:50 joint venture partner with Quintain. Over the last seven years, the joint venture has grown to become one of the UK's largest and most successful operators of purpose-build student accommodation. The firm currently has over £431.9m of assets across 13 UK cities representing over 5,600 beds with a reported 99% occupancy rate.
The Wellcome Trust is not alone in increasing it's exposure to student accommodation. A recent StuRents article "Let's House Britain" publicised Legal and General's subscription to a 50 year bond. Aviva Global investors, Henderson's and Aberdeen Asset Management are other institutional asset managers who all have student blocks within their multi-billion dollar funds within the UK and abroad.