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IPE special report May 2018

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PGGM buys 60% stake in UK student housing provider UPP

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  • PGGM buys 60% stake in UK student housing provider UPP

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EUROPE - The €125bn asset manager PGGM has acquired a majority stake in UPP Group, a provider of student homes and infrastructure at university campuses in the UK.

PGGM said it purchased the 60% stake for an undisclosed amount from Barclay's Infrastructure Funds Management (BIFM) for its Infrastructure Fund 2010.

UPP is the leading provider of on-campus student accommodation infrastructure and specialist asset management services to the UK higher education sector.

It operates in close partnership with leading UK universities, it added.

In a statement, PGGM said: "The co-operation with UPP provides an excellent basis for the company to further strengthen and increase its portfolio by providing a stable and long-term capital base."

Henk Huizing, PGGM's head of infrastructure, added: "UPP has an excellent market position, and we support its strategy as well as its partnership model with the public sector."

Huizing said the deal was a good example of implementing the fund's direct investment strategy in stable social infrastructure sector, with a long-term focus.

"Furthermore," he said, "the inflation-linked stable cash flows are an excellent match with our clients' liabilities."

Sean O'Hara, chief executive at UPP, said the deal was a strategic fit with the company's business model and provided a strong platform for future growth.

The transaction is evidence of the increase of direct investments by institutional investors in infrastructure, as well as in residential properties and related sectors in the UK, according to Karen Smith, managing director of communications and investor relations at Macquarie Group, which advised PGGM.

PGGM, the asset manager for the €118bn healthcare scheme PFZW, has an increasing presence as a global investor in infrastructure, with a recent investment into a large wind farm in Mexico.

Earlier, it invested in a portfolio of predominantly Spanish and Latin American roads and a global network of oil storage terminals.

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