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RNS Number : 5876O
Watkin Jones plc
03 October 2019
3 October 2019
Watkin Jones plc
('Watkin Jones' or the 'Group')
Development Transaction update
Watkin Jones plc (AIM:WJG), a leading UK developer of
multi-occupancy residential property assets, with a focus on the
student accommodation and Build to Rent sectors, is pleased to
provide the following update on transactions in its two core
sectors.
Summary:
-- Forward fund of 762 unit mixed PBSA and Build to Rent development in Sheffield
-- Sale of 400 student beds across two schemes in Chester
-- Agreements for the development of 638 beds across two schemes in Glasgow and Edinburgh
-- Forward fund of two Build to Rent schemes, comprising 325 units, in Sutton and Bournemouth
-- Forward sale of a 35 apartment residential development in Chester
-- Further development of the PBSA pipeline with new sites
secured in Edinburgh and Bath and planning obtained for the Group's
site in Bristol
Student Accommodation (PBSA)
Forward sales / development agreements
Watkin Jones has completed the forward fund of a mixed PBSA and
Build to Rent site, with 691 student beds and 71 Build to Rent
units at Steelworks House on Rockingham Street, Sheffield, located
in close proximity to the University of Sheffield with AIG Global
Real Estate. The consideration payable to Watkin Jones is circa
GBP61 million, net of client funding costs. The development is
scheduled for a phased delivery between August 2021 and the end of
March 2022 and represents the fifth deal between the two
organisations.
The Group has also sold two PBSA developments in Chester to
Arlington Investors for a combined total value of circa GBP30
million. The first development on Hunter Street, which was
completed for the start of the 2019/20 academic year, comprises 77
studios, whilst the second development on Liverpool Road has been
exchanged on a forward commitment basis and comprises 323 beds for
delivery ahead of the 2020/21 academic year. The consideration for
the second development will be paid on hand over of the
development. Both schemes will be managed by Fresh Property Group,
the Group's specialist accommodation management company.
In addition, Watkin Jones has secured development agreements for
two PBSA sites in Scotland with CA Ventures, a Chicago-based real
estate investment company and a new client for the Group. The first
site comprises 422 beds in Cathedral Street, Glasgow, whilst the
second site comprises 216 beds in Dundee Street, Edinburgh. Both
developments are scheduled for completion ahead of the 2021/2022
academic year. The combined consideration payable for the
development works for both schemes is circa GBP50 million, net of
client costs.
Development pipeline
Watkin Jones has recently secured a prime site in Iona Street,
Edinburgh, located close to the city centre. The Group will now
seek planning permission for a scheme which comprises circa 270
student beds and a further 88 residential units. The scheme is
targeted for delivery ahead of the 2022/23 academic year.
The Group has also secured a circa 185 bed site on Lower Bristol
Road, Bath which is targeted for delivery ahead of the 2024/25
academic year.
Further to the announcement issued on 1 October 2018, detailing
the Group's development portfolio sale to the joint venture between
KKR and Round Hill Capital (the 'JV'), Watkin Jones is pleased to
confirm that the Group has now secured full planning consent for
the scheme in Bristol, which the JV had entered into an option
agreement to acquire subject to receipt of the planning consent.
The site on Wilder Street is in close proximity to the City centre
and Bristol University and comprises 348 beds, which are scheduled
for completion ahead of the 2021/2022 academic year.
Build to Rent (BtR)
The Group has forward funded two BtR developments to M&G
Real Estate for a consideration of circa GBP90 million, net of
client funding costs. The first site is situated in Sutton, London
and comprises 166 apartments for delivery in June 2021. The second
site, which is located in Bournemouth, is due for delivery in March
2020 and comprises 159 apartments as well as 37,000 sq.ft. of
commercial office space. They represent the fourth and fifth
transactions which the Group has entered into with M&G Real
Estate.
Watkin Jones is also pleased to announce that it has forward
sold a residential development of 35 apartments on Trafford Street
in Chester to an institutional fund managed by Hearthstone
Investment Management, for circa GBP5.2 million. Developed by
Watkin Jones' Residential division, the scheme is scheduled for
delivery in March 2020.
Richard Simpson, Chief Executive Officer of Watkin Jones, said:
"I would like to congratulate the teams involved in concluding
these various transactions as planned, underlining the resilience
and strength of the Group's business model, as well as that of the
sectors in which we operate. We highly value our institutional
clients and partners and it is pleasing to see a number of our key
relationships strengthened further at this time."
Capital Markets Day & Pre-Close Trading Statement
Watkin Jones will hold a Capital Markets Day for investors and
analysts on Tuesday, 5 November 2019 at Duncan House in Stratford,
one of the Group's recently completed London based purpose-built
student accommodation developments. On the morning of the Capital
Markets Day, the Group will issue its FY Pre-Close Trading
Statement for the year ended 30 September 2019.
- Ends -
For further information:
Watkin Jones plc
Richard Simpson, Chief Executive Tel: +44 (0) 1248 362 516
Officer
Phil Byrom, Chief Financial Officer www.watkinjonesplc.com
Peel Hunt LLP (Nominated Adviser & Joint Tel: +44 (0) 20 7418
Corporate Broker) 8900
Mike Bell / Ed Allsopp www.peelhunt.com
Jefferies Hoare Govett (Joint Corporate Tel: +44 (0) 20 7029
Broker) 8000
Max Jones / Will Soutar www.jefferies.com
Media enquiries:
Buchanan
Henry Harrison-Topham / Richard Oldworth Tel: +44 (0) 20 7466 5000
Jamie Hooper / Steph Watson
watkinjones@buchanan.uk.com www.buchanan.uk.com
Notes to Editors
Watkin Jones is a leading UK developer and constructor of multi
occupancy property assets, with a focus on the student
accommodation and Build to Rent sectors. The Group has strong
relationships with institutional investors, and a reputation for
successful, on-time-delivery of high quality developments. Since
1999, Watkin Jones has delivered 41,000 student beds across 123
sites, making it a key player and leader in the UK purpose built
student accommodation market. In addition, the Fresh Property
Group, the Group's specialist accommodation management company,
manages nearly 18,000 student beds and Build to Rent apartments on
behalf of its institutional clients. Watkin Jones has also been
responsible for over 80 residential developments, ranging from
starter homes to executive housing and apartments. The Group is now
expanding its operations into the Build to Rent sector.
The Group's competitive advantage lies in its experienced
management team and business model, which enables it to offer an
end-to-end solution for investors, delivered entirely in-house with
minimal reliance on third parties, across the entire life cycle of
an asset.
Watkin Jones was admitted to trading on AIM in March 2016 with
the ticker WJG.L. For additional information please visit:
www.watkinjonesplc.com
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END
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