Elite UK REIT has received planning approval from local authorities to convert Lindsay House in Dundee, Scotland, into a 168-bed purpose-built student accommodation (PBSA) facility.
The REIT manager shared previously that Lindsay House was a prime candidate for the conversion and that it was in the pre-planning and approval stage last year.
In addition, Elite UK REIT has signed a development management agreement with Mys, a Scotland-based development manager and PBSA operator, to manage the development of the proposed PBSA.
According to the REIT manager, Mys is the UK’s first student living operator to be awarded B Corp1 status, which reflects its stance on delivering a “values-driven” living experience. Mys currently manages over 2,000 student beds in the UK.
As at Dec 31, 2024, Lindsay House was valued at GBP1.49 million ($2.58 million). Following its development, the property is estimated to have a gross development value of GBP24 million with a return on investment (ROI) of around 18%. Its yield on cost is expected to be more than 7%.
The manager adds that it intends to maintain the property’s existing structures to reduce the time to market and that the new PBSA is expected to be ready for marketing and occupation ahead of the academic year 2027/2028 starting September 2027.
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“Securing planning approval for Lindsay House in Dundee marks a significant milestone in the broadening of our portfolio mix to other non-discretionary sectors such as student housing,” says Joshua Liaw, CEO of the manager.
“This redevelopment of Lindsay House will significantly transform the currently vacant property into a resilient income-generating asset and strengthen the REIT’s intrinsic value,” he adds.
Mark Findlay, director of development at Mys Asset Management, said Dundee is a market that “remains in short supply of high quality affordable PBSA”. As such, the redevelopment of Lindsay House is a “timely addition” to the city.
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Lindsay House, formerly a government workspace, is located in Dundee’s central business district and within walking distance to two universities - the University of Dundee and Abertay University.
Both universities have a combined full-time student population of around 16,165, putting the student-to-bed ratio at around 3.5 times given the estimated 4,620 existing PBSA beds in the area.
As at 9.38am, units in Elite UK REIT are trading 0.5 pence higher or 1.47% up at 34.5 pence.
