The Edinburgh-based company, formerly known as Grant Property, launched the investment vehicle in May, targeting prime city center properties in major university towns, looking to capitalize on a booming market.
He said he had attracted interest from existing clients wishing to transfer assets into the REIT, adding: “There are also active discussions with new clients, including institutions, wealth managers, private equity firms and family offices. A number of private owners have also approached the team to sell their portfolios to the REIT. »
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The firm, which was founded by Peter Grant 25 years ago, added that the REIT has been launched on the International Stock Exchange and will move to the London Stock Exchange as it grows, also stating that it is currently 100% occupied. .
Sandstone expects an annual dividend yield of between 3.5% and 4% in the first three years, rising to around 5.5% to 6% over the longer term, based on net asset value as of 31 March of this year. “Shareholders will receive dividends of at least 90% of the net rent the REIT receives,” Sandstone added.
He also pointed out that the financial vehicle is carbon positive, saying the real estate sector is responsible for 52% of global warming. The company works with the Energy Saving Trust to renovate properties to make them energy efficient, supplying them with green energy, while emissions are offset by planting trees.
Mr. Grant said: “Sandstone’s new REIT has had a successful launch, with strong interest from the financial industry and individuals.
“There are very few residential Reits in the UK, and the new Sandstone Residential Reit fills a void as we see strong investor demand for access to a truly attractive asset class that combines low risk and high returns. , in a tax efficient manner.”
Additionally, Sandstone claims that overall it has helped clients invest in over 3,000 ‘traditional’ residential properties in key UK university towns – Edinburgh, Glasgow, Dundee, Stirling, Liverpool, Manchester, Birmingham, Nottingham and Bristol.
He favors these properties over new construction because they “tend to be in better locations, have larger bedrooms and higher rental demand”. The company also quoted UCAS boss Clare Marchant earlier this month as saying: “2022 now holds the record for the most applicants and applications due to an increase in the number of 18-year-olds in the British population, a trend that is expected to increase. 2-3% almost every year.
Sandstone said its investments in student accommodation, on behalf of investors from 40 countries, represent a gross asset value of around £1bn in property.