GCP Student Living PLC (LON:DIGS) REIT provides exposure to the specialist purpose-built student accommodation real estate sector, with a focus on London (95% of the investment portfolio value). The sector benefits from a positive demand-supply balance and good levels of rental growth, while being much less exposed to economic-led cycles than mainstream commercial real estate. With a growing student population and competing demands for space, the supply shortage in London is particularly acute. DIGS aims for regular sustainable dividends with RPI-inflation linked characteristics and modest capital appreciation. Shareholder returns since the IPO are well ahead of the 8–10% long-term target.
High-quality portfolio in and around London
Growing numbers of international and post-graduate students are driving demand for purpose-built student accommodation (PBSA) in London while planning restrictions and competing demands limit supply. DIGS is achieving full occupancy and growing rents (4.1% this year) on its London-focused portfolio. Investor interest in London PBSA is strong and, with limited supply, prices have increased but, through its investment manager (Gravis) and asset manager (Scape Student Living), DIGS has built a c £760m portfolio of high-quality, purpose-built assets, 95% in and around London, with a pipeline of further opportunities in London and other locations with similar supply-demand characteristics.
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