ASX listing in the offing for Campus Living Villages
Student accommodation heavyweight Campus Living Villages has kicked off a review of its capital requirements that could result in the first listing of its kind on the Australian Securities Exchange.
The student housing sector is being hotly pursued by institutional investors and CLV is weighing up options just over a year after internalising its management and it also expects to raise more from its superannuation fund backers this year.
The business, which also presents significant opportunities to expand in Britain and North America and was run by the Belgiorno-Nettis family’s Transfield Holdings until 2014, has appointed investment bank UBS to advise as it considered options.
The Australian understands these include raising capital from external parties, asking its superannuation fund backers to tip in more money, or potentially listing the 44,000-bed portfolio.
No decision has been made, and the company — led by former Qantas and Lend Lease executive Simon Hickey — declined to comment.
While a specific figure has yet to be floated, it is expected the company will have sizeable capital requirements, with Hickey earlier indicating a desire to expand in the US and into Ireland.
“We will definitely need to look at what equity we’ll need going forward, because obviously our equity is deployed in our current properties, and so we’re in the middle of that process,” he said in August last year.
Campus Living Villages CEO and ex-Qantas executive Simon Hickey. Picture: Campus Living Villages.
A number of potential capital partners, largely based in Singapore and Hong Kong, are understood to have approached, or are eyeing a deal with the company. It is currently backed by five major superannuation funds: REST, Hostplus, Equipsuper, Catholic Super Victoria and NGS Super.
A number of global funds heavyweights are already invested in Australia’s student accommodation sector, including the Government of Singapore Investment Corporation, which has partnered with Macquarie Capital to buy a stake in Iglu, CLV’s smaller peer.
Scape Student Living has also moved into Australia, backed by Dutch pension fund APG.
We will definitely need to look at what equity we’ll need going forward, because obviously our equity is deployed in our current properties
But GIC has invested a significantly larger amount of money into student accommodation outside of Australia, including in two funds run by British giant Unite Group — the London Student Accommodation Joint Venture and the Unite Capital Cities Joint Venture.
In Brisbane, fellow Singaporean private equity outfit Valparaiso Partners has launched several office conversions, redeveloping older buildings into hundreds of beds.
However, CLV remains larger locally than its peers, and could be more sought by investors after because of the on-campus position at many of Australia’s largest universities.
The company is due to officially open another facility at the University of Melbourne, with 648 beds, in March.
It sold a 454-bed site adjacent to the Queensland University of Technology in Brisbane to Iglu for about $50 million late last year.
This article originally appeared on www.theaustralian.com.au/property.
