Oxford Court, 46 Oxford Street

Leicester LE1 5XX

Overview

  • An opportunity to invest in a freehold prime fully operational student housing investment in the popular university city of Leicester
  • The property is located opposite De Montfort University campus and a short walk to the University of Leicester
  • 200 cluster beds arranged over four floors with communal areas
  • One year nominations agreement to the University of Leicester. Reviewed on a year-to-year basis which currently covers 125 (62.5%) of the beds
  • Fully let for 2017/18 with waiting list
  • Net Operating Income of £683,508 (£3,418 pa per bed space)
  • Potential for significant rental growth - there has been 5.6% rental growth in private PBSA between the 2016 and 2017 academic years in Leicester
  • Potential to add value through further refurbishment
  • We are seeking offers in excess of £10,400,000 (Ten Million, Four Hundred Thousand Pounds) for the freehold interest reflecting a Net Initial Yield of 6.25%

Location

Leicester is a major city within the East Midlands and is located 27 miles south of Nottingham, and 40 miles north east of Birmingham. The city is located at the intersection of two major railway lines - the Midland Main Line and Cross Country Line - it also benefits from excellent motorway links. Junction 21a of the M1 provides access to London, the North and Scotland. East Midlands Airport (19 miles) is the closest international airport and is accessible by car as well as being serviced by frequent bus routes.

Leicester is the largest economy in the East Midlands with an energetic city centre that includes Intu Highcross Shopping Centre plus various restaurants and bars.

Situation

The property is located fronting Oxford Street, with access to the rear on to York Street. Situated within an area predominantly given over to student residential, the property is ideally located. The surrounding area also offers a wide range of amenities, including local retail, pubs, bars and cafés and is within walking distance of John Lewis, Highcross Shopping Centre and St Martins Square.

Leicester train station is 0.9 miles away (12 minute walk) from the property with regular train services to Nottingham (29 minutes), Birmingham (49 minutes) and London St Pancras International (1 hour 9 minutes).

The site is located directly opposite the De Montfort University campus - Innovation Centre - close to the City Centre (0.5 miles), and within short walking distance to other university buildings.

Further information can be found in the marketing brochure.

Description

The property provides 200 bedrooms with offices for lettings and administration, student meeting rooms, laundry, study room, games room and external communal area providing bike storage and picnic facilities.

Standard clusters provide a fully fitted kitchen, shower room with WC and an additional WC. Superior cluster apartments have an additional shower room. Bedrooms have fitted furniture, double beds and Wi-Fi.

New bedroom furniture, kitchens and bathrooms were introduced in 2016.

Refurbishment works of the reception and laundry areas are planned and will be completed prior to sale.

There is potential to add value through further refurbishment.

Facilities included in the scheme:

  • Onsite Accommodation Team
  • Onsite Maintenance Team
  • Entertainment and Games Room
  • Wi-Fi Internet available up to 100Mbps
  • 24/7 Security
  • Secure Bike Storage
  • Laundry Room
  • External Communal Area
  • All Bills Included

UNIVERSITIES

Leicester is home to two highly regarded universities, with the University of Leicester growing significantly over recent years. The University is currently ranked 34th by The Sunday Times Good University Guide 2018 and De Montfort University is ranked 67th. The city has one of the largest student populations in the UK in excess of 70,000, including the Leicester colleges.

Both universities have been subject to increasing demand. De Montfort University has invested about £136m on its campus transformation project, which is underway. University of Leicester has a £1bn development plan and is continuing to invest £6m a year in resources and facilities.

There are currently 32,625 (84%) full-time students from the University of Leicester and De Montfort University combined with 38,730 students in total.

UCAS applications to both University of Leicester and De Montfort grew by 7% and 18% respectively between 2013-2016. University of Leicester had a 13% rise in 2016 enabling it to accept more than 4,000 new undergraduates.

STUDENT ACCOMMODATION

There are 15,715 total bed spaces in Purpose Built Student Accommodation (PBSA) in Leicester.

Private sector direct let schemes provides circa 8,515 bed spaces with the combined universities providing 7,200 through university owned accommodation and nominations agreements.

There has been 5.6% rental growth in private PBSA between the 2016 and 2017 academic years in Leicester.

The scheme is 100% let with a waiting list.

Further information can be found in the marketing brochure.

Tenure

Freehold.

Tenancy

The property is fully let with a waiting list for 2017/18 academic year. The University of Leicester has a one year rolling nominations agreement with Oxford Court to occupy 125 rooms. This is reviewed on a year-to-year basis and offers 44 week term lets. The remaining rooms (75) are direct let on a 46 week term basis.

INCOME PROFILE

A summary of the types of available accommodation and the Net Operating Income is shown in the link below. The current operational expenditure per bed is £1,300.

Gross Rental Income is £943,508 per annum and Net Operating Income is £683,508 per annum for 2017/18 .


An opportunity for an investor to acquire the freehold interest of a prime located student accommodation investment serving both the University of Leicester and De Montfort University.

MANAGEMENT

Currently managed internally - there is an operating platform currently in place managed by the vendor. There is a possibility for this management service to be continued for a purchaser.

ENERGY PERFORMANCE CERTIFICATES

An EPC dated 12th January 2011 has a rating of B 50 for the development.

Proposal

Offers are invited in excess of £10,400,000 (Ten Million, Four Hundred Thousand Pounds), subject to contract and exclusive of VAT. A purchase at this level reflects a Net Initial Yield of 6.25%, allowing for purchaser's cost of 4.80%.

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NET INITIAL YIELD:
6.25%
PRICE:
£10,400,000
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