Student Accommodation - Istanbul

Why Invest?

  • Student accommodation investment properties - fully completed and tenanted
  • Prices at £14,965
  • Clear exit strategy - developer buy-back option
  • 10% NET yield guaranteed for 10 years
  • Net of Turkish income tax
  • Purchase secured by a charge on freehold
  • No purchase costs, on-going management or maintenance costs
  • Management company, owned by the developer, experienced in student management
  • Less than 1 mile from three universities with over 19,000 students

Investment

This student accommodation offers a high yielding investment with prices at just £14,965.

The investment is a fully completed and operating student building. All rooms (which are being offered for leasehold purchase) are already 100% tenanted with students for the 2011/2012 academic year.

This is a fantastic opportunity as there are only 38 student rooms available, and student numbers are rising in Turkey at 8% per annum.

Location

This student accommodation is located in the popular western suburb of Küçükçekmece which has a population of 600,000. It is close to three universities having a total population of 19,000. The property is less than two minutes' walk from the Metro bus station giving fast access to Istanbul city centre.

Students usually like to choose accommodation close to their campuses, key transport links and night life which is why this investment is so attractive.

Property description

It comprises two blocks (one for male and one for female residents) of purpose built student accommodation.

The student rooms are designed to be shared between 1 to 4 people. All rooms are fully furnished with en suite bathrooms.

Investment protection

Investor's capital is secured by monies being held in an escrow account and investors having a charge on the freehold of the student building.

All purchases will be registered with the local Government Body of the Republic of Turkey by the developer and contracts notarized before funds are transferred.

All money is paid into the independent Turkish lawyer's escrow account to be used by the developer to purchase the property freehold. At the moment, the developer has a 10 year lease on the building with an option to purchase within the first year. Once the building has been purchased a legal charge for all investors will be placed on the building's freehold.

The business model of the developer is to sell the freehold of the building between years 3 and 10 at which time all investors' leases will be repurchased at a 20% premium.

Investors are able to assign their leases if they decide to sell during the 10-year period.

Background

Turkey's booming economy

Turkey is predicted to be the world's 9th largest economy by 2050. The Wall Street Journal has described it as "Eurasia's rising tiger", which is unsurprising given its reported 11% growth in the first quarter of 2011.

Turkey has a student population 3.78 million, with four of its 154 universities ranked in the Times Higher Education World University Rankings 2011/2012.

The country's huge population of young people - 73 million people with an average age of 28 - has led to an 8% annual student growth rate.

Also, many Turkish universities run international student exchange programmes. There are now 26,000 foreign students studying in Turkish universities from a total of 147 countries, including the UK, an increase of 59% over the past 5 years.

The combination of more home grown students and increasing numbers of overseas students has seen greater demand for student accommodation stock.

Istanbul - The Educational Hub of Turkey

Istanbul is the economic and educational centre of Turkey.

There are 36 universities in the city giving a total student population of 298,000.

Suitable accommodation is in short supply. Traditionally supplied by University Dormitories and Government Funded Dormitories, these can provide for only 12.7% of accommodation needed which is a shortfall of some 254,000 students.

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