A purpose-built student accommodation village leased to New Zealand’s second largest university on Auckland’s North Shore is up for sale.

The property is being marketed on behalf of its vendor and global asset manager; HRL Morrison&Co by Brice Clark, of Whillans Realty Group. It is being sold by tender, with tenders closing on March 10th.

Known as the Akoranga Student Village, the property delivers 204 beds across nine accommodation blocks. It is located directly adjacent to the Auckland University of Technology (AUT) North Shore Campus. The Akoranga Student Village is forecast to return approximately NZD $2.1 million for the financial year ending 31 March 2022.

Clark says the Akoranga Student Village provides an excellent hedge against inflation. Annual rent reviews are linked to the change in New Zealand’s consumer price index plus 1%. In the 12 months to December 2021, New Zealand’s CPI increased by 5.9% - the highest increase in 30 years. The income stream is underwritten by AUT who are also a crown funded organisation. AUT provide a 96% occupancy underwrite during each academic school year explains Clark. This underwrite expires at the end of the 2027 academic year.

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“Despite disruption caused by Covid-19, occupancy levels have remained high at the property. In 2020, the Akoranga Student Village had an actual student occupancy rate of 94%.” Clark says AUT had to only marginally top up the income to reach the 96% underwrite threshold. Intake for the 2022 academic year is looking robust with only a handful of rooms currently available.

“Unlike other purpose-built student accommodation assets, the Akoranga Student Village caters primarily to domestic students studying health sciences, education and sports and recreation courses. AUT’s North Shore Campus is well known for having one of the country’s top nursing programmes. The property has been insulated from New Zealand’s border restrictions and the impact this has had on international student numbers.”

From a global perspective, New Zealand’s student accommodation market is relatively untapped explains Clark. We have one of the lowest ratio of beds per equivalent full time student, particularly when compared to the UK, US and Europe. And of New Zealand’s eight universities, AUT has the lowest ratio with just 1 bed for every 14 students. In the 2020 academic year AUT had just over 20,000 equivalent full time students says Clark. There are only 1,403 purpose-built beds currently servicing the university.

“The opportunity to secure purpose-built student accommodation in New Zealand rarely presents itself. Over 70% of New Zealand’s student accommodation stock is currently owned by universities and charitable trusts - leaving just over 5,000 privately owned beds across the country.”

To request a copy of the Information Memorandum please email Whillans Realty Group marketing agent Brice Clark via the contact form below.