true Birmingham B5 4SG

Super Prime Operational Student Accommodation Investment Opportunity

Slide 1/
Knight Frank - Strictly Private & Confidential
1
EXECUTIVE
SUMMARY

01
 EXECUTIVE SUMMARY
• Rare opportunity to acquire state of the art purpose-built student
accommodation in one of the leading student markets in the UK
• Prime location in Birmingham city centre with multiple retail,
transport and entertainment offerings on its doorstep
• 398 premium bedrooms consisting of 229 (58%) studio beds and 169
(42%) en-suite cluster flats
• Brand new scheme that will open for its first year of trading for the
2020/21 academic year
• Market leading amenity provision through out the scheme.
• Birmingham is home to 69,810 full time students across 5 x Higher
Education Institutions (HEIs)
• Severely undersupplied market - 64% of students in Birmingham
unable to access either university or privately owned purpose built
accommodation
• Operated by multi award winning management - True Student
offering a purchaser the chance to partner with a proven operator
with a track record on achieving above market rental levels and
100% occupancy
• Projected Net Operating Income of £3,095,208 for the 2020/21
academic year
• Strong future rental growth projections
• Knight Frank LLP invite offers in excess of £56,780,000 (Fifty Six
Million Pounds). This reflects a Net Initial Yield (NIY) of 5.35%
assuming purchaser costs of 1.8%

Knight Frank 3
BIRMINGHAM
STUDENT
MARKET

02
 MARKET FUNDAMENTALS
• Birmingham is home to 69,810 fulltime students across five Higher
Education Institutions.
• Since 2014/15, both total student growth (15%) and international
student growth (15%) have outstripped the UK average (11% and
13% respectively).
• Between university and privately owned accommodation there are
25,096 bedrooms available to students.
• Therefore, 44,714 (64%) of students are unable to access PBSA,
demonstrating a severe undersupply in the Birmingham market.
• Knight Frank's Student Property Index indicates headline rental
growth for purpose built student accommodation (PBSA) across
Birmingham of 3.6% for the 2019/20 academic year. This is higher
than performance across the UK as a whole of 2.4%.

64% OF STUDENTS UNABLE TO ACCESS PBSA

13%

23%

64%

University Owned Accommodation Privately Owned PBSA

Students Unable to Access PBSA

Knight Frank Source: Knight Frank Student Research, HESA 5

LOCATION

03
 LOCATION
• True Birmingham is located on the corner of Upper Dean
Street and Pershore Street in Birmingham’s city centre.
• The Bullring Shopping Centre, immediately to the north of the
property (2-minutes walk), is one of the busiest in the UK and
is home to one of only four Selfridges department stores in
the country.
• Birmingham New Street (6-minute walk) is the largest railway
station in the city and offers direct services to; London Euston
(1hr24m), Manchester Piccadilly (1hr27m) and Liverpool
Lime Street (1hr36m). A direct service also runs from New
Street to University Station (5-minute journey time)
allowing students to travel with ease to the University of
Birmingham.
• The property is located on the north-eastern corner of the
Chinese Quarter, an area home to a concentration of
Chinese owned supermarkets, shops and restaurants.
• The Birmingham Hippodrome, host to some of the largest Source: Knight Frank Research

touring musicals and shows is a short 3-minute walk from the Higher Education Institution Distance (straight line) Total Travel Time*
scheme.
University of Birmingham 3.62km 12-minute (cycle)
• The City’s vibrant area is Hurst Street is located immediately 15-minutes (train)
17-minutes (bus)
south (4-minute walk) of the property, and is famous for its Birmingham City University 1.13km 5-minute (cycle)
nightclubs, restaurants, cocktail bars, cabaret bars and 18-minutes (walk)

shops. Aston University 1.36km 6-minute (cycle)

15-minute (walk)

University College Birmingham 1.00km 7-minute (cycle)

19-minute (walk)

Newman University 8.15km 42-minute (bus)

Knight Frank * Source: Google Maps – live travel times can be subject to change 7
PROPERTY

04
 PROPERTY
Address Upper Dean St, Birmingham B5 4SG
PC Date August 2020
Tenure Leasehold (126 years remaining)
Number of Bedrooms 398
Room Split En-suite Cluster Flats – 169 (42%)
Studios – 229 (58%)
Amenity Festival Zone, Sky Lounge, Sky Kitchen, Gym, Cinema and
Study Zone

Due to complete in August 2020, true Birmingham will comprise 398 bedrooms across
ground and 10-additional floors.
The property will offer students a variety of Shared Apartments (en-suite cluster flats) and
true Club Suites (studios), all of which delivered to true’s impeccable standard and quality.
Spacious bedrooms are offered throughout with Shared Apartments ranging from 16-22 sq
m and Club Suites between 19-24 sq m.
Students will benefit from a variety of market leading amenity space serving to promote a
community atmosphere within the scheme. Residents will benefit from all of the below;

Knight Frank 9
 TRUE CLUB SUITES
True Club Suites offer students a self sufficient studio living space, allowing
for added privacy and independence. All bedrooms are fitted with their own
kitchenette and en-suite bathroom.
Kitchenette’s include a 2-ring electric hob, 3-way oven with grill and
microwave options and a full size fridge to allow students an independent and
self sufficient living experience. Ample storage room is provided for utensils,
pots and pans.
Students will benefit from full size double beds with mattresses and under bed
storage. A double wardrobe provides additional storage for students and a
large desks allow for a tidy and functional workspace.

The suites range from 19.2 sq m to 24 sq m in size, providing students with

a spacious studying and living environment.
The rooms are fully carpeted with multiple electrical sockets and charging
ports. Lighting installations allow for zonal control and various mood
settings.
Rooms are priced from £184 p/w to £257 p/w depending on tenancy length
and positioning in the building (true Student operate a dynamic pricing
model and therefore these prices are subject to change).

Knight Frank Indicative CGI images 10

 TRUE SHARED APARTMENTS
True Apartment Bedrooms offer students a traditional cluster flat living
experience. The apartment are made up of 5 to 6 en-suites bedrooms
and share a kitchen/dining/living area.
Bedrooms are designed and finished to an excellent specification in line
with the brand’s high standards. Students will avail of full-sized double
beds with ample storage beneath. Further storage is available within
provided wardrobes and storage units above desks. A large desk length
provides the perfect conditions for students to carry out their work.

The rooms are fully carpeted with multiple electrical sockets and charging
ports. Lighting installations allow for zonal control and various mood
settings.
With room sizing between 16.7 sq m and 22 sq m, the rooms offer students
both a spacious and sociable living environment.
Rooms are priced between £174 p/w and £257 p/w depending on tenancy
length and positioning in the building (true Student operate a dynamic
pricing model and therefore these prices are subject to change).

Knight Frank Indicative CGI images 11

 AMENITY PROVISION
In keeping with the true Student living experience, the scheme provides an abundance of amenity
space in both size and quality, positioned at the very forefront of the market. This allows students to
engage in the community aspect of the scheme as well as drive future occupancy, year on year
retention and rental growth.
The true Birmingham property provides;

• Gym (w/ access to professional personal training)

• Cinema
• Student Garden
• Sky Kitchen
• Sky Lounge
• Study Zones
• Festival Zone
In total the property provides of 942.5 sq m of amenity space, with an average of 2.3 sq m per
student. This is well in excess of the general average of 1 to 2 sq m per student which is found in
the majority of schemes across the UK.

Knight Frank Indicative CGI images 12

 AMENITY PROVISION CONTINUED…

Knight Frank Indicative CGI images 13

TRUE STUDENT
LIVING

05
 THE TRUE EXPERIENCE
True Student is a multi-award winning student accommodation brand where the
resident’s experience is at the forefront of everything they do. Not only is the physical
schemes market leading but so is the service. Super fast Wi-Fi, free cleaning services,
airport pick ups, premium contents insurance and help with registering with a GP and
phone provider are all examples of where true go above and beyond.

Emphasis is placed on Health, Community and Experience. Multiple free to attend

events are hosted through out the year to engage students on a social, academic and
life skills level. Events include;
• Photography workshops
• Seasonal parties (Chinese New Year, Freshers Fair, Halloween, Christmas, Moon
Festival, Easter, Summer trueFest & much more
• Networking events
• Team challenges
• Power brunches
• Cooking workshops

Commercial standard fitness studios and gyms are standard across true schemes and
allow students to develop their mental and physical strength. Facilities are supported
by the availability of personal trainers, yoga instructors and nutritionists.

True has a strong track record of attracting and retaining international students and
has an impressive track record of achieving 70% re-bookers vs a market average of
less than 30%. This is a testament to the quality of the product, service and strong
relationships with agents abroad. The transition for overseas students is made easier
by true’s all inclusive approach. UK domestic students continue to make up a large
proportion of residents. While achieving premium rents, the quality of product and
service has meant that rental levels are seen as representing good value.

Knight Frank 15
FINANCIAL
SUMMARY

06
 FINANCIAL SUMMARY
Room Name Room Type Average Size (sq m) No. of Bedrooms Bed Mix 51 Week Pricing** 44 Week Pricing**
Club Suites* Studio 19.2 - 21 219 55% £184 - £229 £197 - £252
Club Premium Suites Studio 24 10 3% £204 - £234 £224 - £257
Club Apartment* En-suite Cluster Flat 16.7 - 22 89 22% £174 - £214 £191 - £235
Club Premium Apartment En-suite Cluster Flat 18.6 - 19.7 80 20% £189 - £234 £208 - £257
TOTAL 398 100%
* Includes Accessible rooms and 'Listed' rooms
** True Student operate a dynamic and floor by floor pricing mode. Prices correct as at 12.08.20

Budgeted Income
The below forecasts Rental Growth at 3% p.a. and Operating Costs growth at 2.5% p.a.in line with True Student budgeting. Full detailed budgets are available on the dedicated
data site. Operating costs (inclusive of management fee and insurance) reflect a budgeted gross margin of 75% in Year 1 and a Net Operating Income of £3.10m.

2020/21 (£m) 2021/22 (£m) 2022/23 (£m) 2023/24 (£m) 2024/25 (£m)
Student Rental Income* 3.99 4.11 4.23 4.36 4.49
Summer Lettings 0.06 0.06 0.06 0.07 0.07
Total Rental Income 4.05 4.17 4.30 4.42 4.56

Sundry Income 0.07 0.07 0.08 0.08 0.08

Gross Operating Income (GOI) 4.12 4.24 4.37 4.50 4.64

Total Operating Expenditure** -1.03 -1.05 -1.08 -1.10 -1.13

Net Operating Income 3.10 3.19 3.29 3.40 3.51

* 98% occupancy
** inclusive of Management Fee & Insurance
Errors due to rounding

Knight Frank 17
PROPOSAL

07
 PROPOSAL & ADDITIONAL INFORMATION
TENURE PROPOSAL

Leasehold (126 years remaining) – Knight Frank LLP invite offers in excess of
Peppercorn rent £56,780,000 (Fifty Six Million Two Hundred
Thousand Pounds). This reflects a Net Initial
EPC Yield (NIY) of 5.35% assuming purchaser costs
of 1.8%
All relevant Energy Performance Certificates
will be made available on the dedicated data For the avoidance of doubt, Knight Frank would
site. like to confirm that our client is not obliged to
accept the highest nor indeed any offer.
VAT
DEBT ADVISORY
Knight Frank understands that the property is
elected for VAT. Knight Frank’s Debt Advisory team advises
those seeking to obtain real estate finance for Merelina Sykes Mike O’Sullivan
TRANSACTION STRUCTURE developments or acquisitions. The team is on
hand to guide and support clients throughout Partner, Student Surveyor, Student
the financing process to make it simpler and
The ownership is currently held within an
faster and to secure optimal lending terms.
Property Property
SPV. There is the potential to transact as an
SPV sale if deemed more suitable for an Knight Frank Knight Frank
incoming purchaser. For more information, please contact
Lisa Attenborough, 55 Baker Street 55 Baker Street
FURTHER INFORMATION lisa.attenborough@knightfrank.com London W1U 8AN London W1U 8AN
+44 (0) 20 3909 6846 +44 20 7861 1333 +44 20 7861 1437
A full information pack is available on the +44 7795 316 200 +44 7976 730 665
dedicated data site available at
www.truebirmingham.co.uk Viewings of the
asset are available via prior appointment only
through Knight Frank.

IMPORTANT NOTICE: 1. Particulars: These particulars are not an offer or contract, nor part of one. You should not rely on statements by Knight Frank LLP in the particulars or by word of mouth or in writing (“information”) as being factually accurate about the property, its condition or its value. Neither Knight Frank
LLP nor any joint agent has any authority to make any representations about the property, and accordingly any information given is entirely without responsibility on the part of the agents, seller(s) or lessor(s). 2. Photos, Videos etc: The photographs, property videos and virtual viewings etc. show only certain parts of
the property as they appeared at the time they were taken. Areas, measurements and distances given are approximate only. 3. Regulations etc: Any reference to alterations to, or use of, any part of the property does not mean that any necessary planning, building regulations or other consent has been obtained. A
buyer or lessee must find out by inspection or in other ways that these matters have been properly dealt with and that all information is correct. 4. VAT: The VAT position relating to the property may change without notice. 5. To find out how we process Personal Data, please refer to our Group Privacy Statement and
other notices at https://www.knightfrank.com/legals/privacy-statement.
Particulars dated August 2020.
Knight Frank is the trading name of Knight Frank LLP. Knight Frank LLP is a limited liability partnership registered in England and Wales with registered number OC305934. Our registered office is at 55 Baker Street, London W1U 8AN where you may look at a list of members’ names. If we use the term ‘partner’
when referring to one of our representatives, that person will either be a member, employee, worker or consultant of Knight Frank LLP and not a partner in a partnership. If you do not want us to contact you further about our services then please contact us by either calling 020 3544 0692, email to
marketing.help@knightfrank.com or post to our UK Residential Marketing Manager at our registered office (above) providing your name and address.

Knight Frank 19