(MENAFN - Arab Times) Gatehouse has earned an excellent track record in student accommodation which is an attractive investment sector that delivers good yields for our investors, said Gatehouse Bank Board chairman Fahed Boodai, as he announced Tuesday at a press conference via video link, the successful delivery of the bank's realized investment in UK real estate through the sale of two properties as part of a UK student accommodation portfolio in a deal worth 34.4 million.
The event was organized within the premises of the Global Securities House (GSH), the mother company of Gatehouse Bank, in the Dhow Tower near Sharq and attended by GSH officials as well as media personnel.
In his address to the press via a video link from London, Boodai stated that the successful delivery of the 34.4 million UK student accommodation portfolio deal represents an excellent return for Gatehouse's investors, who have benefited from an internal rate of return of 18.6% during the two year holding period, and a return on investment of 37.2% on exit. The Board Chairman stated further that over the past two years his outfit has invested in the student accommodation sector on behalf of its investors, confident of the excellent return potential, which the bank believes it has successfully delivered in the realization of the UK student accommodation portfolio investment.
Boodai added that Gatehouse Bank was quick to seize the market opportunity to enable an impressive return on investment, promising that "we would deliver a solid return to our investors, and we have achieved that result yielding a 9.1% return in the first year, and an increase to 9.7% in the second year".
When the time was right, he continued, "We managed to deliver a successful exit result within two years, one year ahead of schedule as we have achieved our targeted returns. Importantly, we delivered the asset sale with a view to rewarding our investors with a profitable return on investment as a priority, rather than retain asset management fees for the additional holding period."
Gatehouse, has clearly demonstrated to its investor clients its ability to develop a commendable track record of transactional experience. This is due to its unrivalled expertise in the market, which includes a strong UK and US Real Estate team of originators, analysts, asset managers and a credit and market risk team who provide end-to-end commercial real estate solutions to investors.
Gatehouse Bank has the capability to source and originate successful acquisitions, and also return profits upon exit, to manage the full life cycle of real estate investment for investor advantage. As a Financial Services Authority (FSA) regulated bank, Gatehouse Bank is also uniquely positioned with a competitive advantage, given its ability to add a depth of product offering in liquidity and wealth management options for its investors, which adds further financial comfort and meets their objectives for wealth preservation.
In conclusion, Boodai stated that combined with its recent successful exit of the VA Oceanside Clinic property in the US for 54.5m, the student accommodation realized-investment showcases the caliber and track record of Gatehouse's cross continental transactional experience in the US and UK real estate market.
Commenting on the highlights of the transaction, Gatehouse's Vice President in-charge of real estate and student accommodation, Stuart Jarvis stated despite the economic downturn, average rental growth rates in the student accommodation sector have remained extremely resilient, certainly when one compares the rates to traditional real estate investments in the past year.
The bank, he continued, is seeing strong returns not just in London, but also in the regions, mainly due to the lack of supply of purpose-built student accommodation coupled with the rising demand of overseas students looking to study in the UK.
Gatehouse has earned an excellent track record in student accommodation; it's an attractive investment sector that delivers good yields for our investors. We continue to actively look for investment opportunities to complement our current investment portfolio of student accommodation in Glasgow and Oxford, said Jarvis.
Asked why the focus on student accommodation, another London-based executive of the bank, Abdulaziz Al-Turaiji said that that sector of real estate is where a lot of attention has been lacking, and given the recent economic downturn in Europe and the US, Gatehouse sees an opportunity in that sector where people are returning to the classrooms in their droves for professional re-orientation in response to the changing demands of the job market. "They are becoming students once more and will need accommodation", he added.
Gatehouse Bank established in London in 2007 and accredited in 2008 as a Sharia-compliant wholesale investment bank authorized by United Kingdom's Financial Services Authority (FSA), specializes in originating, structuring and funding investments in a Shariah compliant manner. It continues to provide an attractive portfolio of property investments for investor clients with more than 500m in total real estate acquisitions.
To meet continuing investor demand for high quality property investments, the Bank provides leading advice and opportunities to investors across a diverse range of properties ranging from office, student and logistics sectors. The Bank has six key areas of business, which include Capital Markets, Institutional Wealth Management, Real Estate, Placement, Shariah Advisory Services, and Treasury Products.
The bank has a mission to deliver value to stakeholders by providing focused solutions and business excellence in Shariah-compliant investment products and expertise across international markets. The structures the bank creates adhere to the core principles of Shariah, based on real partnership financing underscored by powerful ethical responsibilities, prudent risk management and complete transparency.
It is focused on supporting the development of real business needs and the trading of real assets.
This means it favours a risk sharing model, participating in the deal the bank structures through co-investment which is driven by a determination to generate sustainable and rewarding returns for all its stakeholders.