DWS has made a sixth acquisition for its European Residential Growth Fund (ERGF), which is designed for German institutional investors. This transaction marks the first time a student residence has been added to the portfolio. The property's seller was LaSalle Investment Management. The asset, which commenced operations three years ago, is located in Seville.
The newly acquired student residence is characterised by its proximity to the Reina Mercedes campus of the University of Seville, which is frequented by over 22,700 students. Within a 30-minute radius, more than 66,000 students from various higher education institutions are concentrated in the city. The property is connected to Seville's main transport routes and offers access to public transport, as well as being close to well-known attractions such as María Luisa Park and the historic city centre.
The property features 544 beds and 111 parking spaces, and holds a BREEAM 'Very Good' certificate. A particular feature unique to the Spanish student accommodation market is that all rooms are equipped with their own kitchen. The so-called Premium units also include private terraces.
Infrastructure and Market Potential
The acquired property, known as Palm Studios, offers residents a wide range of communal areas designed for studying and socialising. These include study rooms, co-working spaces, a gym, a cafeteria, a dining room, a games room, and a cinema. A rooftop pool completes the offering, providing views over the city.
Seville has established itself as a key Spanish market for student accommodation, following Madrid and Barcelona. This is favoured by the high number of students and the growing interest of national and international students in the city. The limited availability of specialised student accommodation, coupled with increasing demand and the growth of the university population, is fostering the development of an increasingly professionalised and institutionalised market for 'Purpose-Built Student Accommodation' (PBSA) in Spain.
Dominik Wagenpfeil, Senior Portfolio Manager of the European Residential Growth Fund, stated that Palm Studios represents the ERGF's first PBSA investment and marks a significant step in expanding the fund's portfolio. He emphasised that while traditional multi-family housing forms a core focus, targeted investments are made in complementary housing concepts such as student accommodation to diversify the portfolio and benefit from different demographic and demand-driven growth drivers. He referred to the sustained high demand from institutional investors for European residential investments with robust fundamentals, confirmed by new capital commitments to the fund, which provide additional investment capacity. Wagenpfeil believes that student accommodation benefits from long-term structural trends, including increasing student mobility, an attractive demand overhang, and a limited supply of high-quality offerings. He added that with Palm Studios, a high-quality property is being acquired in one of Spain's most attractive university cities, which creates a foundation for further portfolio diversification through attractive housing concepts.
