LONDON (dpa-AFX) - Unite Group plc. (UTG.L), a provider of student accommodation, announced Wednesday the disposal of two assets for 100 million pounds to the Unite UK Student Accommodation Fund or USAF. Of this, Unite share is 75 million pounds.
The deal represents a net initial yield of 5.5%. The assets are located in Birmingham and Newcastle and comprise a total of 1,155 beds.
In addition, USAF announces the launch and pricing of 85 million pounds of bonds issued under its existing debt funding platform, the 3.921% bond due June 2025.
Unite's share of the new debt represents approximately 2% of the company's total borrowings, on a see-through basis, as at 30 June 2019. The company said the issue supports a further marginal reduction in its cost of debt.
Joe Lister, Chief Financial Officer of Unite Group, said, 'The disposals by Unite to USAF form part of our plan to dispose of £150-200 million of assets per annum during the next three years following the acquisition of Liberty Living. These planned disposals will fund our development activity and support our target to reduce LTV to 35% by 2021.'
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