Investment company AEW UK REIT said yesterday it had completed the sale, adding that the deal “realises a long-term change-of-use strategy for the asset, with contracts for the sale having been exchanged with a subsidiary company of IQ Student Accommodation (IQSA) in October 2020”.

IQSA gained planning consent for the demolition of the property and development of a 527-unit student accommodation scheme on 11 February 2022.

AEW UK REIT said the sale agreement had required it to “negotiate with tenants to bring the asset to vacancy and, as a result, following its sale the occupancy rate for AEWU’S remaining portfolio will increase to 91.6% from 86.97% as at 30 June 2022”.

“Reinvestment of the sale proceeds into pipeline assets under exclusivity is expected to provide a significant boost to the company’s earnings due to both higher levels of anticipated income receipts and lower running costs,” it added.

Laura Elkin, portfolio manager, AEW UK REIT plc, said: “As the culmination of a long-running business plan, we are delighted to see this sale complete. The disposal not only maximises the value of the asset but will increase occupancy levels across the remaining portfolio, reduce running costs and boost earnings, once capital is reinvested. The proceeds from the sale are already under offer to assets in exclusivity and, as such, we expect to make further purchase announcements in the coming weeks.”