£10m Leeds office sale paves way for 43-storey student apartments tower
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Listed office specialist Regional REIT has exchanged and completed on the disposal of Arena Point, Leeds, for £10.65m.
It says the deal represents a substantial uplift of 15.8% against the 31 December 2020 valuation of the property. The building has been sold to Olympian Homes.
The completed development will be the tallest purpose-built student accommodation (PBSA) building in Leeds.
Other tall PBSA buildings in the city include the 23-storey Symons House and the 37-storey Altus House, which is immediately adjacent to Arena Point and also being delivered by Olympian Homes.
The £10.65m deal is the final part of a long-term business plan for this asset, which Regional REIT acquired with the adjacent two-storey casino and pub, known as the Podium Buildings, in March 2016 for £10.5m.
In July 2018, the Podium Buildings were sold to Unite Students for £12.2m for development into what is now the 16 and 27-storey towers at White Rose View.
The final disposal of Arena Point, which was constructed in 1965, has now secured profits after all costs for the site of some £9.3m.
The capital will be recycled into the Group’s pipeline of higher yielding office opportunities to diversify further its portfolio by geography and income streams.
Stephen Inglis, CEO of London & Scottish Property Investment Management, the asset manager of Regional REIT, said: “The disposal of Arena Point at nearly 16% above the 2020 year end valuation concludes the successful long-term business plan for the site; having generated profits after all costs for the site in excess of £9.3m.
“The successful final execution of this ambitious site plan is testament to the capabilities of the asset management team to add considerable value.
“We have a strong and growing pipeline of attractive new acquisition opportunities and intend to reinvest the proceeds of this sale into other mispriced office assets offering similar high returns in terms of yield and capital growth.”
Students living in the tower, which has now been granted planning consent by Leeds City Council, will have a choice of studio apartments, which include a kitchenette and an en-suite bathroom, and cluster flats that will include a series of individual study bedrooms alongside a shared kitchen, living and dining spaces.
The development will also feature a number of communal facilities on the ground and first floor including a reception and a common room. Other facilities proposed include a fitness room, cinema, study spaces, launderette, a winter garden and a roof terrace.
George Downes, development manager for Olympian Homes, said: “This project represents significant inward investment into Leeds to help maintain its position as one of the UK’s leading university cities.
“The development will be a landmark scheme, both in terms of its stature as Leeds’ tallest building, but also in its ability to provide high quality accommodation for students from across the country and internationally.”
Michelle Davies, director at DPP Planning’s Leeds office, said: “We are delighted to have obtained planning permission for such a prestigious development that will ensure Leeds can meet the ongoing demand for quality student accommodation.
“It was particularly pleasing to achieve this permission by way of delegated powers, following a positive pre-application presentation to the planning panel at the end of 2020.”