The University of Sussex and Balfour Beatty have reached financial close for a new student accommodation project on the institution’s campus which will provide bedrooms for 2,117 students, together with new student amenities and a Students’ Union building.

Balfour Beatty was appointed as preferred bidder for the project in January 2015 and since then, alongside the University, has worked to secure detailed planning consent for the development. 

Balfour Beatty will invest equity of almost £23 million (US$29 million) (80% of the project equity) and will design, build, and operate the new residences for 50 years with the University acting as a co-shareholder investing circa £5.7 million (20% of the project equity) and continuing their delivery of pastoral care and student administrative services.

The financing of the project represents the largest UK wrapped inflation linked bond, post the financial crisis.

The first phase of additional accommodation is expected to be ready for the start of the 2018/19 academic year.

Balfour Beatty has achieved considerable success in the student accommodation market with an investment portfolio of nearly 5,000 beds in development or operation in the UK.  

University of Sussex Finance Director, Allan Spencer said:

“We are delighted at the response of investors to the University’s long term strategy and the funding structure developed with Balfour Beatty. The bond allows the East Slope Residences project to proceed and facilitates a key element of the University’s strategy to accommodate more students on our campus and to provide high quality residences with more social space and amenities.”

“The University has invested over £200 million in the last few years to redevelop our campus, with both landmark academic and residential facilities, as we continue to reinforce our position as one of the UK’s leading higher education institutions.”

Balfour Beatty Investments Director, Ian Woosey, said:

“Balfour Beatty is delighted to have formed a strong partnership with the University and secured this level of funding. We believe the fact that a bond of this size was able to achieve such attractive pricing demonstrates the underlying strength of the sector.”

“We look forward to providing the additional high-quality residences for the students at the University of Sussex, whilst maintaining the character of the natural landscape of the campus on the edge of the South Downs National Park.”