Russian investor buys Birmingham student development
Birmingham’s “highly buoyant” student market has enticed a Russian investor to spend £10.6m on an accommodation block in Edgbaston.
AZ Real Estate, a consultancy based in London and Moscow, has bought City Edge on behalf of a private Russian buyer.
The Hagley Road development was converted from offices into 136 student bedrooms in 2016. The rooms are priced from £155 per person per week on a 51-week tenancy and, combined with retailer Guitar Guitar on the ground floor, delivers a 7.5% yield.
Alisa Zotimova, chief executive of AZ Real Estate, believes the strength of Birmingham’s knowledge economy gives investors the confidence to buy in the city.
She said: “This represents a significant acquisition with a strong long-term yield thanks to a highly buoyant student market, with limited supply of purpose built accommodation.
“The acquisition is also indicative of an emerging shift in investment trends, whereby clients are willing to forgo traditional trophy assets in favour of those with stronger long-term returns and projectable cash flow, many of which are now outside of the capital.”
City Edge, purchased with a lease of 111 years, is currently managed by Homes for Students.
