KUALA LUMPUR: The Kumpulan Wang Persaraan (Diperbadankan) (KWAP) bought two purpose-built student accommodation buildings in the UK for a total of £39.75mil (about RM280mil).
It said on Wednesday the properties were 800 Bristol Road in Birmingham, which is a the four-storey freehold building, and The Mill House in Edinburgh, a six-storey freehold building.
“Both properties were acquired for a purchase price of £14.62mil and £25.13mil respectively, which totals up to £39.75mil. The estimated average net yield of the properties is at 5.08%,” it said.
The retirement fund said the properties were acquired from IP Investment Management (HK) Ltd and Maven Capital Partners. The estimated average net yield of the properties is at 5.08%.
KWAP CEO Datuk Wan Kamaruzaman Wan Ahmad said: “We are very pleased to add the two properties to our growing portfolio in the UK market as the acquisition aligns with KWAP’s aspirations to increase its international property exposure.
“We will continue to grow our presence in foreign markets without compromising on our risk appetite, in line with our mission to serve the pensioners of Malaysia,” he said.
The acquisition of both properties brings the total number of properties owned and co-owned by KWAP to 14. Its other international properties are in Australia, London and Germany.
The purchase of the properties was under the fund’s Strategic Asset Allocation, which currently stands at 40% fixed income, 45% equity, and 15% alternative investments.
Property investments comprise 9% of the allocation for alternative investments, followed by private equity at 4% and infrastructure at 2%.
As of Dec 31, 2017, a total of 75% of KWAP’s property investments were foreign properties while the remaining 25% were in the local market.
800 Bristol Road in Birmingham is situated in Selly Oak and within walking distance from the University of Birmingham. Surrounding universities include Birmingham City University, Aston University and University College of Birmingham.
Completed in 2016, it has 103 studio accommodations for students, in addition to a cinema room, function room, gym, study rooms, laundrette, secure bike storage and 11 car parks.
As for the Mill House in Edinburgh, it is within the Edinburgh Education Corridor. There are four universities in this area, including University of Edinburgh, Heriot-Watt University, Edinburgh Napier University and Queen Margaret University.
Completed in 2017, the building has 23 studios and 234 en-suite units, in addition to a gym, common room, games room, laundrette, secure bike storage and 12 car parks.
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