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  • Amro seeks joint venture partner for €300 million capital investment targeting student housing opportunities in Spain and Portugal
  • Opens office in Madrid to manage rollout plans
  • Announces first investment in Granada, Spain – a 360-bed property that will open in 2020

Amro Real Estate Partners, the specialist student housing and build-to-rent investment and asset management business, is expanding its reach across southern Europe to capitalise on the potential of the purpose-built student housing market in Spain and Portugal.

CBRE Spain have been appointed to seek a joint venture partner for a capital investment of €300m to access the full potential of the market in Iberia. Amro has ambitious plans to create a 5,000-bed investment platform spanning the Iberia region through development, refurbishment, forward purchase and acquisition.

To help drive forward its expansion, the investment firm, which has significant experience of developing and operating student accommodation and build-to-rent assets in the UK, has opened its first European office in Madrid, Spain.

Amro has also acquired its first property in continental Europe, a development site in Granada, Spain on which it will develop a 360-bed student housing scheme to open in 2020.  A strong pipeline of further transactions has been established with around 3,000 beds currently under negotiation, of which 1,300 are under exclusivity across both Spain and Portugal.

The Iberia region has more than 1.8 million students yet only 97,000 beds. Competition in the sector is limited with much of the available product run by religious orders or public universities that is of substandard quality and often poorly managed.

Raj Kotecha, Managing Director at Amro Real Estate Partners, commented:

“The student housing market in Southern Europe shares characteristics with the UK student housing market of 10-12 years ago with demand for purposed built accommodation significantly outstripping supply and competition from professionally managed schemes being limited. This is a market still very much in its infancy and we believe our entry timing is ideal. We have an ambitious and well formulated investment strategy with a strong pipeline of schemes underway. Working with a joint venture partner who shares our perspective on the market opportunity will allow us to execute this strategy with speed.”

Amro’s Iberia pipeline spans ten cities that are home to some of the best universities in southern Europe including Madrid, Barcelona, Valencia and Lisbon. Amro will undertake new build development as well as the modernisation of existing student housing properties in order to deliver the same, high-quality product as it develops in the UK. It will be working with experienced local partners to help ensure successful delivery and management of its properties in the region.

The Amro management team has been involved in the development of over 20,000 beds in the UK student housing sector.

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Amro Real Estate Partners, the real estate investment and asset management business, has expanded its senior management team with the appointment of Marcus Adam as Development Director.

Marcus will be responsible for the development and delivery of Amro’s projects across its specialist areas of student accommodation and build to rent.

Marcus joins from University Partnerships Programme, where, as Construction Director, he was responsible for successfully delivering the multi-award-winning Garden Halls project for the University of London, setting new standards in the provision of student accommodation by the university sector.

Marcus brings over 20 years of construction industry experience in leading and managing project delivery. A graduate of the University of Greenwich with a degree in Design and Construction Management, he is also a member of the Chartered Institute of Building.

Marcus Adam, Development Director at Amro Real Estate Partners, said:

“I am hugely excited to be joining such an ambitious and innovative firm. Amro Real Estate Partners is a dynamic business with a strong track record in developing and operating high-quality student accommodation and build-to-rent schemes in the UK, and I look forward to working with the team as it implements its significant growth plans.”

Raj Kotecha, Managing Director at Amro Real Estate Partners, added:

“Marcus has a strong reputation for developing exceptional student accommodation schemes and we are pleased to be welcoming someone of his calibre to our business. As we look to expand, with a number of new projects in the pipeline, Marcus’ expertise in leading and managing the delivery of new developments will make a major contribution to our ongoing success.”

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According to recent research (Feb 2018) from Savills  the UK’s Build to Rent (BtR) sector continues to progress rapidly, with c. 104,500  units currently in the sector including  19,000 completed, 27,500 under construction, and c. 58,000 in the pipeline. Given the major shortfalls in the UK’s housing stock, the sector offers substantial potential for medium to long term investment.

What are some of the current challenges facing Build to Rent?

A Nascent Sector in its initial growth stages..

Whilst the US has a very established Multi-Family Housing sector, the equivalent BtR sector is relatively new in the UK. The lack of data on mature assets creates an additional element of risk for investors and developers. The only long-term data available is from the Buy-to-Let sector, which is rather fragmented, and tends to have different investment characteristics from purpose-built BtR assets.

The existing planning framework..

Currently planning guidelines and regulations for BtR developments are mainly based on the C3 (residential) use class that is associated with all new developments in the residential sector which includes the For-Sale sector. There are significant differences in the design and the delivery of housing in the BtR and For-Sale sectors that current regulations do not recognize. As a result, the lack of flexibility on such parameters such as unit mix, space standards, design, and parking could hamper the growth of the BtR sector. The draft New London Plan attempts to recognise some of these differences that should ultimately follow through into national planning policy.

BtR’s operating costs…

A fully managed building is one of the key features of BtR schemes. It is expected that as the sector becomes established, assets with good quality, hands-on management will trade at lower yields than those that do not have a good management strategy. US experience illustrates the sensitivity of long term yields to management/ operating costs, and it is crucial that we recognise this from the outset in the UK and ensure that our assets have built-in efficiencies from very initial design stages.

Please come back to peruse next month’s article on Building in design efficiencies…

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Welcoming our newly appointed Investment Director Jai Patel to Amro Real Estate Partners Announcement in the Property Week.  Jai is responsible for originating and structuring debt and equity financing, investment underwriting and financial analysis for Amro’s transactions within the student accommodation, Build to Rent and residential investment property sectors.

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Amro Real Estate Partners are delighted to announce that Patrick Crowe has moved into a new role within the team as the Planning & Research Manager. Patrick will be responsible for land and development research, and for managing planning applications for Amro Real Estate Partners. He will be working closely with the Development Director. Patrick is very pleased with his new role, and re-location to the company’s head office in London.

Kingston Futures Conference 2017

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The Kingston Future’s Conference 2017 was held on 27th June at The Rose Theatre in Kingston. Delegates from many different industries, all with a vested interest in Kingston, met to discuss the future of the borough. Amro Real Estate Partners were delighted to support the conference.

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