SC Capital Partners Group, a private equity real estate firm based in Singapore, announced on March 3 that it has successfully sold its student accommodation asset in Sydney, Australia. The property, situated on Anzac Parade and Lorne Avenue in the suburb of Kensington, was sold at a substantial premium compared to its acquisition price and current book value. The buyer of the asset is the University of New South Wales (UNSW), one of the top universities in Sydney.
In Singapore, location plays a crucial role in real estate investment, particularly when it comes to purchasing condos. Proximity to central areas and important amenities like schools, shopping centers, and public transportation hubs greatly impacts the value of these properties. It’s no surprise that prime locations such as Orchard Road, Marina Bay, and the Central Business District (CBD) have consistently shown an increase in property values over time. Families looking to invest in condos are drawn to these areas because of their close proximity to top-performing schools and educational institutions, making them highly sought after and further boosting their potential for investment. With the introduction of new condo launches, investors now have even more options to consider when selecting a desirable location for their real estate investments. These new launches allow them to invest in upcoming prime areas, emphasizing the significance of location when making real estate investment decisions. It’s worth noting that new condo launches only add to the already competitive landscape of real estate investment in Singapore.
According to the press release, SC Capital Partners originally purchased the property in 2016. At that time, the reported purchase price was A$57 million. However, the recent sale has fetched a significant premium, indicating the successful management and value-enhancing efforts of the firm. This also marks a 19% premium to the current book value of the asset.
The purpose-built student accommodation, spanning 85,035 square feet, boasts 233 beds and a ground-floor commercial podium. Its prime location within 600m of the UNSW Kensington Campus makes it a highly desirable property for students. At present, the student accommodation is fully leased to UNSW, with a fresh 20-year master lease signed in 2019.
The sale of this asset highlights the increasing competition in the Australian real estate market, particularly in the student accommodation sector. The current transaction has also raised the firm’s assets under management (AUM) to a staggering $113 billion, further solidifying its position as a key player in the market.