For the last eight years, I have had the good fortune to be a part of Pinnacle MC Global Network. Pinnacle has changed beyond all recognition since I started, reflecting the changes seen across this industry, seeing new competition come and go, and a constant movement towards increasing the longevity of this market.
One of the questions I am most often asked by prospective investors when in the Asia Pacific region is, ‘When the time comes, how can I sell these properties?’ This is a completely understandable position to take; an investment with Pinnacle is not an inconsequential amount of money. Whilst for many, these are long term investments due to the outstanding yield, while others may wish to sell their asset in the future and want to know there is an exit strategy.
When Pinnacle finished the development of its first project, Liverpool’s Falkland House in 2013, the market was still young, with a severe shortage of student housing in this country. Through the works of Pinnacle and other developers, the supply of suitable student accommodation has improved. However, there is still a long way to go before all students can benefit from access to suitable student accommodation. In some U.K. cities, the universities can still only cater for around 25 percent of student demand. The first round of properties is now fully bedded in, with developments completed, students moved in and investors being paid their yields on time. As rising property prices is a key mantra within Britain at the moment, investors are interested to know what capital growth is held within their properties.
Whilst previous experience for many dictates that selling property can be a time consuming process, this is not the case for student units.
The reason for this is simple. Whilst buying off plan has the benefit that you will be the first owner of the property, the downside is that it can be anywhere up to two years before the project is complete and you see your first return on investment. If you buy from the second hand market, your property will be built, tenanted, and ready to offer an instant return. On top of this, as the property has been built and enjoying inflation of its rent, the purchaser is likely to benefit from a greater return, in percentage terms, year on year.
For these reasons, many are turning to the second hand market, and as property within the U.K. can be sold to anyone, anywhere around the world, it makes it very easy to buy and sell. The investor can sell using an overseas or U.K. real estate agent or sell to a friend or family member.
Just like any other real estate the owner of each unit holds the title deeds, allowing them complete control over their asset. For any sale to take place a U.K. lawyer must be used, though this is a very simple process, with Pinnacle’s agents willing to introduce potential sellers with an approved firm.
Conveyancing in the U.K. is straightforward, with a typical completion taking just 4- 8 weeks. Every day I meet investors who are interested in ready built units – given a choice between an off plan unit with a wait of 12- 24 months or one which is ready built, which is bedded in, has a proven track record and a chance to earn instant income – many prefer the latter.
Due to the structured manner in which money from student property is accrued, it is a secure investment, gaining its capital growth in a steady manner, and as higher education is a recession-proof industry, it is unlikely to be affected by market volatility.
From my experience within the industry, Pinnacle’s developments are amongst the very best. Our attention to detail, from our agents, to our contractors, to simply the quality of our developments, means that whilst some of our competitors may produce products with a short shelf-life, I feel confident a Pinnacle development will stand the test of time, and therefore hold its value on the resale market. This holding of value should make the property more, rather than less desirable to the resale market. With this value, comes a guarantee that the property will retain interest from students, will keep returning its yield, and will remain in demand from other investors, therefore ensuring its price and status within the market.
From this, I hope I have been able to allay any fears that people may have about the resale of this product, as I truly believe that they’re a fantastic investment opportunity. As Director of a company that has sold more than 1,000 units in the past 12 months there can be no doubt of the appetite among investors all over the world for our student investments.
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Julie Harvey is Director of Sales and Marketing for student property
developers Pinnacle MC Global Network. With a degree in Economics and
Management, Julie has over 30 years’ business experience and over the
past 7 years has been instrumental in the development of Pinnacle’s
property sector.
Building up an impressive network of property agents from around the
world, Julie has spearheaded the sales of Pinnacle’s student
accommodation developments.
She spends much of her time visiting and supporting agents in China,
Hong Kong, Singapore and Malaysia, and looks after a 10-strong global
sales team that now handles enquiries from agents and their investors
worldwide. www.pinnaclemcglobal.com
Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg
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