Secure Trust Bank : QIP and HG Developments secure £18m debt raise from STB

• The senior debt financing from Secure Trust Bank (STB) Real Estate Finance will support the development of two purpose-built student accommodation (PBSA) schemes, in Edinburgh and Egham
• The two schemes form part of the portfolio of assets for QIP's GBP£30M student housing equity fund, launched in September 2020

Q Investment Partners (QIP), the Singapore-headquartered private equity real estate firm, has, as part of a joint venture with HG Developments Ltd (HGD), secured a GBP£18M construction debt from UK retail bank, STB, to support its latest PBSA schemes in Edinburgh and Egham.

The funding will go towards the development of the two schemes, which have 76 and 107 beds respectively, and are due to be delivered by Q3 2022 in line with the start of the UK's 2022/23 academic year. These developments form part of QIP's GBP£30M student housing equity fund, launched last year to invest in PBSA projects.

This latest debt raise, which is QIP's second with STB, highlights QIP's continued success in finding and securing tier one PBSA assets within buoyant markets, and marks a further expansion of the firm's UK PBSA portfolio.

The resilience of the UK PBSA sector is underpinned by the continued strong demand for higher education in the UK. The 2021/22 academic year is already showing a rise in university applications compared to the previous year, and as the country continues to lift COVID-related restrictions, PBSA occupancy is poised to rebound and even exceed pre-COVID levels.

Abhinav Swamy, Head of Investment, QIP, commented: 'STB shares our conviction in the sector's resilience and positive fundamentals, and we are delighted to announce our latest UK PBSA investments with them onboard as our lending partner. These transactions reflect our continued focus on finding good development assets in tier one and niche markets with a clear demand-supply imbalance. We look forward to investing and expanding our portfolio further, and capitalising on the post-COVID growth opportunity we see in the market.'

The deal was led at STB Real Estate Finance by John Griffin and Richard Lynn, who commented: 'This represents the third opportunity we have funded for QiP and we're pleased to re-engage. STB has further capability to deploy senior debt into PBSA and other sectors where we remain active.'

The Edinburgh development at 65 London Road comprises 76 beds in self-contained studios in the heart of the Meadowbank suburb, directly opposite the Meadowbank Stadium. Designed by 3DReid, 65 London Road is phase two of a larger project by QIP and HGD, which is already in development. The 198-bed phase one scheme at 61-63 London road is expected to open in time for the 2021/22 academic year.

The 107-bed PBSA development in Egham was re-purposed from retail and is in a prime location close to the railway station and on the doorstep of renowned academic institution Royal Holloway, University of London. Both will be managed by Prestige Student Living, the premium subsidiary of Homes for Students, a top operator in the UK with 30,000 beds under management.