Empiric Student Property (ESP), owner and operator of studio-led student accommodation aligned to top-tier universities, has provided a further update from its October 2024 equity fundraise into a new fully-operational acquisition, with news it has completed the buy-out of Selly Oak Apartments in Birmingham for £9m.

The company has also been granted planning permission to add 57 new postgraduate beds to its Bristol cluster.

Selly Oak Apartments, a 63-bed mixed studio and shared apartment scheme, is strategically located opposite ESP’s existing Selly Oak cluster and less than five minutes walk from the University of Birmingham, a growing top-tier Russell Group University.

The property grows the company’s total operational beds in the cluster to 430 and enables it to immediately unlock further operational efficiencies and improve the low amenity offer currently available to residents.

This operational PBSA asset has been acquired fully-let for the 2024/25 academic year and is expected to deliver a yield in excess of the targeted 6% from September 2025, as well as offering the potential for unlevered IRRs over the next five years in excess of 10%.

This is the second acquisition following the company’s equity fundraise in October and completes the deployment of proceeds that were earmarked for acquisition opportunities.

The remaining funds have been allocated to its postgraduate refurbishment pipeline and it remains on track with preparatory works across three of its existing sites earmarked for conversion to its postgraduate product, where it has allocated £10m for investment in 2025.

In the meantime, proceeds have been temporarily used to prepay a flexible debt facility.

The company also this week announced it has achieved planning consent from Bristol City Council for the transformation of College House, a former office building acquired in February 2024, into a 57-bed, all-studio student accommodation scheme for postgraduate students.

This consent improves upon the initial 32-bed residential permission obtained in June 2024.

College House is located moments from the University of Bristol campus and adjacent to the existing College Green site, providing access to extensive amenity and study areas within ESP’s existing cluster of accommodation in the city.

Proceeds from the company’s equity fundraise will be deployed towards the property’s transformation, which is expected to be completed and available for occupation in early 2026.

Duncan Garrood, chief executive of ESP, said: “The acquisition of Selly Oak Apartments completes the deployment of proceeds which were earmarked for acquisition opportunities, in line with returns indicated.

“Birmingham is a top-tier university city where over 50,000 students currently seek accommodation in a city with provision of only 27,500 PBSA beds, and less than 10,000 new beds currently consented for future development.”

Since March 2021 ESP has sold nearly £150m of non-core assets and will continue to dispose of non-aligned properties when market opportunities and appropriate pricing allows.

This acquisition, together with the planning consent achieved to expand its Bristol cluster, supports the strategy outlined in the October equity raise of growing a portfolio of high-quality buildings which enhance shareholder returns and benefit from increasing alignment to top-tier universities (currently at 87%).