Student Accommodation Funds - Review and Comparison
The contents of this page should by no means be taken as a recommendation, and professional advice should always be sought. The contents of this page are designed to be a review of the popular investment sector - Student Accommodation. The review is impartial, and no recommendation is made.
 
 
The student accommodation sector is no longer a niche property market, according to property agents and consultants. The sector is recognised as an asset class in itself. A relatively small sector, which does seem to have some insulation against the risks in the wider property market both residential and commercial. Supply has been unable to keep up with demand, and the default on rental payments is very low when compared with the wider housing market. It can also be considered counter-cyclical, as more people enter higher education in bad economic times.
 
The amount of liquidity within the funds and the gearing does vary. In general the higher the gearing, the higher the volatility of the fund is likely to be. It is also important to consider if the fund keeps any cash in reserve, it maybe worthwhile trading off a little performance, to improve liquidity of the investment. Coral Portfolio fund is unusual for a small market, in that it is a fund of funds.

In general student accommodation funds carry offshore status, so they are beyond the jurisdiction of the Financial Services Authority (FSA). However they are usually regulated in good jurisdictions such as guernsey or jersey, coral portfolio is an FSA recognised fund.

 
 
The student accommodation fund review is a new section of the website, and we would like to expand its contents. If you represent a fund, or have information in relation to this fund sector, we would be interested to hear. Simply complete an enquiry to the right.
 
Brandeaux Student Accommodation Fund
Fund Objective
 
To deliver consistent annualised positive returns of 8% to 10% while maintaining a profile of low volatility performance. To invest in student and key worker accommodation throughout the UK. To provide Investors with access to an actively managed Fund holding assets with little correlation to traditional asset classes. To provide long term positive returns through a combination of secure income and capital appreciation arising from increasing rental values.

Offshore Regulated Fund
 
 
 
Coral Portfolio Student Accommodation Fund
The aim of the portfolio fund is to achieve a lower risk profile, and outperform cash deposits, via actively managed fund of assets. A fund of funds that invests in established UK student accommodation schemes, and also seeks exposure from Western Europe.
 

Fund Objective : To provide the investors access to a diverse range of student accommodation funds, available only institutionally with an exposure to an asset class with strong track record and fundamentals inc : Relatively low bad debts & supply/demand imbalance. High occupancy levels when compared with general rental sector residential & commercial.

 
Top 5 Holdings (30/11/10) : Unite UK Student (27%), Cordea Savills (20%), Crosslane (13%), University Capital Trust (11%), The Mansion Group (5%)
 
For more on the Coral Student Accommodation Fund Click Here
For the June Fund Fact Sheet Click Here
 
FSA Recognised Offshore Investment Fund

 

 
 
Quick Analysis
Performance 
 
The table below shows the return over the last 12 months of 5 key student accommodation funds (due to short history of some funds, only 12 months can be used as a fair comparison).
 
 
 
Volatility
 
How much has the value of the fund fluctuated in the past 12 months - Lower is considered preferable
 
 
 
The lowest volatility with average performance is the Brandeaux Student Accommodation Fund. To obtain a higher performance, a trade off on volatility has to take place.
 
To find out more about the student accommodation fund market, and/or how to invest, simply complete and enquiry below :

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Fund of Funds vs Group of Funds
The document below compares the performance between the Coral Fund of Funds, and a basket of student accommodation funds. The basket consists of Braemar, Brandeaux, PSG, and the Mansion group. All funds are denominated in GBP.
 
The coral portfolio fund of funds returns 14.7% since December 2009
The basket of student accommodation funds returns 23.59% since December 2009
 
It should be noted that the coral fund of funds, has exposure to the money markets, so is not 100% invested in student accommodation funds. Whether this is beneficial or not, will depend on the clients portfolio as a whole.
 
Click here for the Coral vs. Basket of funds comparison
 
Forecast
 
The PDF document below illustrates the forecasted return of the Coral Portfolio fund, compared with a basket of student accommodation funds.  Investing £100,000 over 20 years, gives the following predicted return :
 
Coral Portoflio Fund : £205,231 (based on high performance)
Basket of Funds : £285,825 (based oh high performance)
 
The downside projection between the two is roughly equivalent, however the upside projection is greater for the basket of student funds. The chance of getting back less than was invested is greater with the coral porftfolio fund of funds, according to the report.
 
Click Here for the full analysis