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USAF NAV up 2.0 per cent in Q4

The Unite UK Student Accommodation Fund (USAF) has reported an estimated net asset value (NAV) as at 31 December 2013 of GBP727.2m, reflecting an increase of 2.0 per cent during Q4 and an uplift of 6.8 per cent for the year.

The total return for the year including the payment of income distributions was 12.6 per cent.
 
In arriving at the value of the fund, USAF’s property portfolio comprising 21,673 beds in 59 properties across 19 UK towns and cities, was independently valued at GBP1,355m.
 
The value of the property portfolio increased by 1.1 per cent in the fourth quarter, and by 3.2 per cent in the 12 months to 31 December 2013. The increase was driven principally by rental growth of 2.6 per cent over the year and 3bps of yield compression in the final quarter. The portfolio is valued at an average yield of 6.64 per cent at 31 December 2013 (30 September 2013: 6.67 per cent).
 
Joe Lister, Unite’s chief financial officer, says: “USAF has delivered another strong performance in 2013 with a total return of 12.6 per cent. The fund’s consistently strong results, driven by steady rental growth and high occupancy levels and in the current quarter a small compression in average valuation yields, demonstrate the continued attractiveness of USAF and the UK student accommodation sector to investors.
 
“In December the government announced the removal of the student number cap from 2015, which is expected to lead to an increase in enrolments of up to 12 per cent. USAF’s portfolio is very well positioned to benefit from this expected increase in demand and, together with its low average cost of debt following extensive refinancing, the fund is well placed to continue to outperform in the coming years.”

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