25 June 2018 – Eje Prime
Corestate wants its share of the student resident cake in Spain. The Luxembourg-based fund manager is finalising the purchase of new plots of land in the country, at the same time as it is starting to search for new opportunities in Portugal, according to explanations provided by the company’s most senior executive in Spain, Christopher Hütwohl. Corestate’s objective is to be ranked as one of the Top 3 operators in the sector by 2020.
The group is whereby seeking to fight off competition from companies such as Greystar, currently number one in the sector by number of beds following its acquisition together with Axa Real Assets and CBRE Global Investment Partners of Resa’s portfolio (formed by 37 assets) for €500 million. Another prominent operator is GSA, which acquired RIO’s portfolio for €180 million.
Corestate, which managed assets worth €22 billion at the end of the first quarter, is now launching new land acquisitions to build halls of residence for students, which will be added to the 206 beds that it is going to open in the Madrilenian district of Moncloa in September and the more than 300 that it will incorporate in Sevilla following the purchase of a plot of land in May.
According to Hütwohl, the company is currently finalising the acquisition of another plot on which it will build 400 beds and is “analysing four more plots” for 700 beds. Thus, Corestate’s plans include closing 2018 with more than 200 beds in Madrid and reaching 1,000 beds by 2020, which, according to Hütwohl “would place us as one off the Top three players in Spain”.
In parallel, the company has started to analyse its entry into Portugal with its business model. According to the head of Corestate, the fund is looking for opportunities in cities such as Lisbon, Porto and Aveiro.
The company is looking for plots on which to build with sizes that depend on the sizes of the halls of residence that they want to build, provided they are located in university cities. Nevertheless, Hütwohl warns that the “minimum size to achieve efficient management is 200 beds”.
“The student residence sector is becoming increasingly more competitive in Spain and we do not want to miss out on the opportunity and the advantage that our international knowledge affords us”, says the group’s executive in Spain (…).
Original story: Eje Prime (by P. Riaño)
Translation: Carmel Drake