Sunway-backed PBSA fund launches in anticipation of post-pandemic bounce back

Sunway RE Capital and MBU Capital partner to manage student accommodation fund

LONDON, March 18, 2021 /PRNewswire/ -- Sunway RE Capital and MBU Capital have forged a transcontinental partnership to invest and manage Purpose Built Student Accommodation (PBSA) assets in the United Kingdom (UK), underpinned by signs of recovery in the sector. The collaboration has been pre-seeded through a combination of assets and readily deployable equity, totalling £110m.

The fund is supported by positive demand for undergraduate places and an acute undersupply of student accommodation exacerbated by construction delays, according to the latest PBSA sector update from property advisors CBRE. Meanwhile, the Universities and Colleges Admissions Services (UCAS) data revealed a 2% year-on-year increase in overall applicant numbers in June 2020 as well as a significant increase in applications from international students.

MBU Capital's property team, which has presided over more than 5,000 PBSA units, will seek institutional stock predominantly within Russell Group universities. Seeded assets already include units in Bristol, Manchester and Sheffield.

"Pre-pandemic, student occupancy rates were typically above 97%. Not only do we anticipate a bounce back in the near future, but the number of full-time students in the UK has reached a record level, and is only set to grow. This fund provides investors with the opportunity to capitalise on the compelling UK student market with an established and trusted partner," said Mohammed Iqbal, CEO of MBU Capital.

"We believe the UK is most likely to remain one of the world's most popular student hotspots and demand from overseas for high-quality education is expected to rise once travel restrictions have been lifted. We're optimistic about this sector and we've created a fund management team which has a track record of sourcing and delivering world class institutional stock," said Dr Tan Kok Heng, Executive Director at Sunway RE Capital, part of the Sunway Group.

The fund's management team will build the portfolio and associated infrastructure through best-in-class practices, in preparation of an exit through a real estate investment trust (REIT) listing within three years. The three-year fund is targeting to deliver an annual coupon of 6-8%, with an IRR of 12%.

About MBU Capital
MBU Capital is a privately-owned investment group. Founded in 2013 and based in Mayfair, London, the group focuses on opportunistic investments in real estate, education, natural resources and financial services.

MBU Capital brings a comprehensive range of skills and proven structure by a team of experienced investment managers, hedge-fund experts, real estate and corporate finance professionals, built on a strong ethos of corporate and social responsibility.

About Sunway Group
Established in 1974, Sunway Group is one of Malaysia's largest conglomerates with 13 business divisions that operate across 50 locations worldwide. Powered by a global workforce of 16,000 strong, its core interests are focused on real estate, construction, education, healthcare, retail and hospitality.

Through its unique "Build-Own-Operate" business model, Sunway Group's three public-listed companies, Sunway Berhad, Sunway Construction Group, and Sunway REIT, with a combined market capitalisation of RM14 billion, form a real estate value chain that aims to deliver enhanced sustainable value for all stakeholders.

About Sunway RE Capital Pte Ltd
Sunway RE Capital Pte Ltd invests in listed and unlisted funds established in Singapore. Sunway RE Capital's objective is to invest in real estate for recurring income along with a fund management platform. Its key investment focus is commercial properties and purpose-built student accommodation (PBSA) primarily in the United Kingdom.

Sunway RE Capital is also one of the sponsors of Elite Commercial REIT (ECR) which is listed in Singapore since February 2020 with a market capitalisation of £227M. ECR is the first and only UK- Focused S-REIT with a portfolio of 97 properties and an AUM of £319M.

Contact:
Abid Hussain
abid.hussain@mbucapital.com  
+44 (0)7949 426 648