GSA Coral is very pleased to announce that it has further strengthened its position in the European student accommodation market by investing in a 2,234-bed portfolio in Madrid and Barcelona. The portfolio comprises four assets in Madrid, and a further two assets under development in Barcelona.
This is GSA Coral’s first acquisition in these core European cities and forms part of its long-term strategy to build increased allocation to key European markets as part of a diversified, global portfolio.
Madrid and Barcelona are characterised by increasing demand for student accommodation, but structural undersupply of good quality student housing. Spain in general is an attractive international and post graduate study location, particularly amongst international students. Barcelona is one of the top Erasmus student destinations, and three Spanish business schools are ranked in the world’s top 20.
The Madrid portfolio includes four assets in prime locations: Galdos (370 beds) is in the heart of the city’s main university campus; El Faro (358 beds) is in the well-connected Moncloa neighbourhood and is a brand-new award-winning building with state-of-the art facilities; and Claraval (186 beds) is in a city centre location near extensive amenities. The fourth asset is located in Alcala just outside Madrid, where the University is a UNESCO world heritage site and one of the longest standing European universities dating back to the 15th century.
In Barcelona, the Sants development will deliver 348 beds and is ideally located opposite the city’s main train station and southeast of the Barcelona Knowledge Campus. The second development, Campus Sur Diagonal, will comprise 504 beds and is located directly on the main Barcelona Knowledge Campus.
GSA Coral is very excited about entering Madrid and Barcelona, which have strengthening labour markets and rising domestic demand. At 3% for the past 12 months, the Spanish GDP growth has outpaced the average Eurozone rate and stock markets have similarly outperformed. Foreign direct investment in Spain increased 57% year-on-year at the start of 2017, with over €950 million of investment in the office sector in Q1 alone.
Not only are these markets strengthening economically, but the supply of student accommodation is in a relatively nascent stage when compared to more mature locations like the UK. As such GSA Coral is once again in a prime position to take first-mover advantage in what are becoming highly sought-after asset allocations by major institutional investors.
This investment represents another example of the very strong pipeline of opportunities to which GSA Coral has access, as it continues to grow its unique, geographically diversified portfolio in leading locations around the globe. We look forward to bringing investors further details on the Madrid and Barcelona portfolio in the coming weeks.