Watkin Jones uses student housing expertise to add build-to-rent

Demand for purpose-built student accommodation remained strong, and eight schemes were forward sold during the year. Since the year-end a further five schemes have been forward sold, and the development pipeline provides significant earnings visibility, with 27 sites for 9,469 student beds. Of these, 15 sites have already been forward sold and seven more are in legal negotiations, while sites have been secured all the way through to 2019-20.

Further income is generated through its Fresh Student Living asset management business, which manages over 12,000 beds across 44 schemes, and is also gaining market share by securing work from outside the Watkin Jones' pipeline. The business model is also being used to initiate build-to-rent schemes. The first - a 322-apartment development in Leeds - has already been forward sold to an institutional investor, and Watkin Jones has launched Five Nine Living to offer managements services for build-to-rent schemes.

Analysts at Peel Hunt are forecasting adjusted pre-tax profit for the year to September 2017 of £42.7m and EPS of 13.4p (from £38.6m and 12.1p in FY2016).