Heed and IPIM launch Golden Visa Portuguese fund with Porto student housing development

Heed and IPIM launch Golden Visa Portuguese fund with Porto student housing development
The 151-bed student housing project in Porto acquired by IP Investment Management and Heed Capital, developed and operated by Amro Partners

Heed Capital (formerly Dunas Capital) and IP Investment Management ("IPIM") have made their first acquisition in Portugal, a 151-bed student housing development in Porto opening in 2023.

The joint venture between the Iberian Student Living (SF-1) in Singapore and Iberian Student Living - FCR in Portugal (“the Funds”) will be managed and advised by IPIM with Amro as the developer and operator. It will target 3 to 4 pipeline PBSA (Purpose-built Student Accommodation) acquisitions in Portugal and Spain over the next 12 to 24 months as an early mover to capitalise on the highly underdeveloped Iberian student housing market.

The 4,000 sqm buildable plot in the Paranhos area of Porto is located within the city’s main university hub, Polo II University Campus (Asprela), home to more than 35,000 students. Five higher education institutions all situated within a 5 to 15 minutes’ walk: the University of Porto, University Fernando Pessoa, Polytechnic Institute of Porto, Catholic University of Porto and Portucalense University.

The 151-bed scheme will comprise a mixture of individual studios, twodios, ensuites and doubles with amenities including study room, terraces, gym, MasterChef room, padel court and outdoor green areas. Construction is scheduled to begin during Q1 2022 with the completed development launching in summer 2023 under Amro Estudiantes, Amro’s student housing brand in Iberia.

The development will be designed to achieve a BREEAM Outstanding rating, making it a highly energy efficient PBSA building on completion in summer 2023.

Iberian Student Living - FCR is the first fund qualifying as an investment for the Portuguese Golden Visa programme that focuses solely on investing in PBSA. The Iberian PBSA market is largely underdeveloped and underserved as students have experienced a chronic shortage of professionally managed PBSA product. There are 21 students for every existing PBSA bed in Portugal and 15 students for every existing PBSA bed in Spain, a stark contrast to the more developed UK PBSA market, where there are 2.9 students for every existing PBSA bed.

Additionally, the Iberian PBSA market is very fragmented with no clear dominant PBSA market leader as the top 5 largest players operate only 9% to 13% of Iberia’s total PBSA supply. Specifically, Heed Capital’s fund seeks to capitalise on a rare unique opportunity to enter the Iberian PBSA market with experienced developers early and gain meaningful market share as an early mover.

Selina Williams, Executive Director of IPIM stated: “One bed available for every 21 students. 2.36x absolute growth in international student enrolment over 10 years. These are some compelling stats that have attracted institutional investors to invest in Portugal’s Purpose-Built Student Accommodation sector, one of IPIM's target European markets.

Portugal presents a huge growth opportunity and currently resembles the UK PBSA market nearly 10 years ago. IPIM, as an early mover, seeks to take advantage of a highly fragmented market, ripe with opportunities to deliver modern high-quality student beds to a fundamentally underserved and undersupplied market while also having the potential to capture meaningful market share early.”

Joaquim Luiz Gomes, Founder and Managing Director of Heed Capital (formerly Dunas Capital), commented that “Heed Capital is excited to enter this underdeveloped and promising market segment with the right partners. As Portugal’s attractiveness to international students continues to grow, we expect to be well positioned.”

Raj Kotecha, Co-Founder and Managing Director of Amro Partners, also shared that “Our expansion into Portugal is a natural next step following a string of successful acquisitions in Spain since we entered the Iberia market in 2018. The student housing sector has proved itself to be resilient over the last twelve months and the significant undersupply of student beds across the region is creating tremendous potential for growth. We remain focused on growing our presence in the region, with a pipeline of further acquisitions to be announced over the next few months.”

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