An Exceptional Student / Aparthotel Accommodation Investment Opportunity INVESTMENT OPPORTUNITY Contents
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An Exceptional Student / Aparthotel Accommodation Investment Opportunity INVESTMENT OPPORTUNITY contents SECTION 1 - INTRODUCTION Swuite - The Next Level in Student Living for Ireland 4 The Market 6 Bed Space Supply and Demand 8 SECTION 2 - DEVELOPMENT Location of Swuite Bohermore 9 Aparthotel 10 Galway: A Few Facts 12 The Building 14 Quality 17 Facilities and Fit-out 18 Suite Types and Layouts 22 Building Floor Plans 24 SECTION 3 - INVESTMENT Investment: Sale & Leaseback 26 Payments Schedule 27 % Sale & Lease Back of high quality aparthotel Investment Timeline 28 5.5 Pre-Emption Rights 31 NET ANNUAL and student accommodation at a net annual Management Company 32 RENTAL RETURN rental return of 5.5% in Galway City Centre. FAQ’s 34 3 The Next Level in Student Living in Ireland and terrace areas. Our generous size rooms cater for single occupancy (during SECTION 1 - INTRODUCTION the academic year) and are all fitted out with private ensuite bathrooms, ample wardrobe and under-bed storage, a double bed and kitchenette. Dedicated universal access suites are also available. Following extensive market research on the student accommodation market in Ireland, UK and mainland Europe Iveragh Group has developed a unique brand that combines the pleasantness of ‘sweet’ with The facility is close to the city centre and all third level institutions in Galway the homeliness of an apartment ‘suite’ to create the brand ‘swuite’. The brand has been developed so city and will have a special appeal to international students looking to study and that all of our residents can avail of the highest quality living and at affordable rates while also delivering reside in secure high quality accommodation. During the summer months’ the assured yield generation to our investors. facility will act as an aparthotel in order to satisfy the huge demand for hotel beds in the Galway city area. The facility is within walking distance of the city Iveragh Group is actively developing the swuite brand in Dublin and Galway and in 2017 will have centre and all the city’s main attractions. 216 beds under construction. Swuite Bohermore, Galway is an innovative development designed to address the need for high quality student and self-catering holiday let units in the city. Swuite will To help ensure that all of our residents have an enjoyable stay at Swuite also manage and operate each of our residences to the same high standards all year around. Swuite Bohermore our on-site Operations Manager and the house management is dedicated to designing, developing and delivering the very finest student and aparthotel residences team are trained to assist in meeting our resident’s needs. Our reception is in Ireland. managed during office hours after which our live-in manager takes over to ensure our residence is secure and our residents safe. This boutique style facility offers high quality and professionally managed aparthotel and student apartments and ancillary facilities specifically designed for use by undergraduates, post graduates, visiting Investors will enjoy the benefit of a fully managed investment in a academics and visitors. It comprises 77 self-contained units over 4 floors in the attractive residential luxury purpose built aparthotel / student accommodation in the area of Bohermore. The suites are provided fully serviced offering comfort, security and luxury of a heart of Galway city. Swuite Bohermore will quickly achieve full fully furnished room whilst also benefitting from community living in the shared common / social spaces occupancy and deliver stable rental returns. 4 5 Current & Projected Student Numbers The Market 2014 167,991 There has been unprecedented growth in participation in higher education in recent years and this is set to continue based on projections in the ‘Report on Student Accommodation: Demand and Supply’ published by the Department of Education and Skills. These projections 2019 179,840 estimate that demand will increase from nearly 168,000 students in 2014 to nearly 193,000 students in 2024. This increased demand places pressure on existing infrastructure including an increasing demand for suitable student accommodation. The rapid populations growth in Irish cities has created a situation where there is fierce competition for space to live in Dublin and in other cities that host third 2024 192,886 level educational institutions throughout the country. The Higher Education Authority (HEA) has estimated that Sector: Pathways to Secure Occupancy and Affordable Supply, 25,000 new beds for students are needed nationwide and the which was published in May 2015, highlights the fact that Union of Students in Ireland (USI) has stated that the current nationally about 305,000 households (19%) are renting from lack of accommodation has forced some students to drop out a private landlord and the percentage of households renting is of college and has led to a host of negative situations among considerably higher in Galway at 40% and Dublin at 34%. students who do manage to stay in college. These include taking on unaffordable leases, sleeping on friend’s couches or in poor Given the rent increases that have occurred in recent years, the low quality accommodation and commuting from other counties to supply of stock and the level of student households in the private study in Dublin. rented sector and the projected increase in student numbers over the coming years, it can be argued that an increased provision of The demand for student accommodation impacts particularly on designated student accommodation, both on and off campus, has the private rental market and the trends in that sector are reported the potential, in the medium to long term to ease ongoing demand in a recent Daft.ie Rental Report which shows that rental costs are pressures in the private rented accommodation sector. This could increasing and particularly so in Galway and Dublin. potentially deliver real benefits for renters in the larger urban areas of Galway, Dublin and Cork. The most recent report from the National Economic and Social Council (NESC) on the private rental sector (Ireland’s Rental International Students The Government’s International Education Strategy ‘Investing in Global Relationships’ 2010-2015* included a number of targets to increase international students in higher education institutions and these have already been achieved. The availability of purpose built student accommodation on or off campus is a prerequisite for attracting new overseas students. In a recent report the Higher Education Institutions (HEI) stated that international students, at the time of recruitment, demand guaranteed accommodation for at least the first year. The projected increases in international students will put further pressure on availability of student accommodation for domestic students. * Source: HTTPS://www.education.ie/en/Publications/Policy-Reports/Ireland-s-International-Education-Strategy-2010-201-Investing-in-Global-Relationships.pdf 6 7 Bed Space Supply and Demand SECTION 2 - DEVELOPMENT Evidence suggests that students are having difficulty in sourcing accommodation in close proximity to their campus, particularly in large urban areas. The current demand for student bed spaces in both HEIs and private, is estimated Location of Swuite Bohermore to be just over 57,100 (public and private). Future bed space development is based on data submitted by HEIs as well as an estimate of private off-campus projects. The projected bed space development would result in total available beds of 39,696 in 2019 and 43,496 in 2024 as illustrated in chart below (including private) Galway City Centre 2014 2019 2024 1. NUIG Campus 1 2. GMIT Campus 2 Available Beds 31,296 39,696 43,496 3. University Hospital 3 4. Eyre Square, City Centre Demand for Beds 57,104 62,855 68,679 4 SHORTAGE 25,808 23,159 25,182 The demand for student accommodation currently outstrips supply and this trend continues to 2024. It is estimated that there is currently an unmet demand of about 25,000 bed spaces which has a significant impact on the private rental market. The property is located off Sean Mulvoy Road and Bohermore and make up approximately 20% of the population in Galway and are is adjacent to Joyce Roundabout at Cemetery Cross. It is within an essential part of Galway life adding energy and colour to the walking distance of the City Centre and almost equal distance city. The seaside resort of Salthill is always popular with residents between Galway University and University Hospital to the west and visitors and is within an easy access via bicycle, car or on and GMIT Campus to the east. Galway shopping centre is only a public transport. Galway is a main node point on the popular Wild five-minute walk. Atlantic Way and Swuite Bohermore will be a focal point on this journey offering secure bicycle and underground car parking. Bohermore has a mix of commercial, residential and public amenity and is dominated by low rise (predominantly two storey) residential and off street multi-storey apartment complexes. Galway Sportsground and Galway Hibernian Soccer Club grounds are close to the property. Galway Shopping Centre also includes Transport a multiplex cinema and other recreational amenities. This area is one of the main shopping precincts in Galway. The Bohermore area of Galway is server by a number of bus routes. Bus Lines 2e, 3, 9, 12 and 20 run close by and all public Source: http://trinitynews.ie/irelands-student-accomodation/ Galway really is a university city, with the NUIG campus being bus routes intersect close to our facility. Galway mainline train http://www.hea.ie/sites/default/files/student_accommodation_report_310815.pdf http://www.daft.ie/report/q1-2015-daft-rental-report.pdf located in the heart of the city centre with all amenities on its station in the city centre is also within walking distance of Swuite http://files.nesc.ie/nesc_reports/en/141_Irelands_Rental_Sector_MainReport.pdf doorstep and within walking distance.