UPP Group Holdings Ltd., the U.K.’s second-largest provider of student housing, and the University of London announced a 140.7 million-pound ($240 million) project to build 1,200 rooms that will be designed and operated by UPP.
The 50-year deal for the project in the Bloomsbury area of central London will receive 113.8 million pounds of bond debt from Pension Insurance Corp., according to a statement today. The University of London will take an undisclosed stake in the UPP unit that will develop the property.
“There is an insatiable demand for that location,” UPP Chief Executive Officer Sean O’Shea said by telephone. “Within a three-mile radius there’s over 30,000 students.”
Investors are expected to spend 2.5 billion pounds on U.K. student accommodation this year, almost 25 percent more than in 2013, broker Savills Plc said last month. London-based UPP plans to invest more than 1 billion pounds on the construction of university residence halls in the next three years, according to its website.
The property in Bloomsbury is due to be completed during 2016, according to the statement.