Barings and Rosethorn Capital pick up PBSA asset in Central London

Real estate investment manager Barings partnered with UK student housing manager Rosethorn Capital to buy a student housing complex in Vauxhall, central London.

Spring Mews London

Barings acquired Spring Mews on behalf of a European value-add real estate strategy for £101.1 mln (€120.0 mln) from CLS Holdings. 
The established, 378-bed property (306 clusters and 72 studios) boasts amenities like a gym, pool, cinema, and co-working space. 
The building boasts high-quality design and construction, achieving a "Very Good" rating under the BREEAM sustainability assessment method and an "A" rating for energy performance.
Rosethorn will oversee operations, aiming to optimize rental income and minimize expenses. 
Ben Pile, head of European Residential Investment and Asset Management at Barings Real Estate, said: “One of the world’s best cities for students, London is nevertheless significantly undersupplied with quality accommodation, and with delivery falling, this shortfall is likely to deteriorate over time. Spring Mews is an institutional-grade, stabilised asset that benefits from an excellent location, and therefore proved to be a compelling acquisition opportunity as we seek to expand our exposure to the living sector – in London, the UK and across Europe – on behalf of our capital sources.”
Rory Allan, managing director and portfolio manager for the European closed-end value-add real estate fund series at Barings Real Estate, said: "Spring Mews represents a rare opportunity to acquire a cash flow generating PBSA asset in a prime central London location with its severe supply / demand mismatch which is expected to continue to generate above trend rental growth.  The investment is projected to deliver strong risk-adjusted returns through asset management driven NOI optimisation with downside protection.  This is the third acquisition in as many months for our value-add fund strategies, all of which have been in the living sector, which is a primary focus at this current point in the cycle considering the sector’s resilient qualities.   We have a deep pipeline of further investments as we look to take advantage of opportunities thrown up by wider macro volatility and dislocation.”
Stephen Rigby, CEO at Rosethorn Capital, added: " The acquisition is a significant milestone for us as a new business and one that will serve as a fantastic springboard for future growth. The market remains very challenging." 
Located in Vauxhall, a popular area for student housing, Spring Mews is a short five-minute walk from Vauxhall Station in central London (Zone 1). This provides easy access, within 25 minutes, to prestigious universities like King's College London, LSE, UCL, and Imperial. Bonard estimates a student population of 232,900 within the area Spring Mews serves.