Selling a portfolio of student houses is different from selling one house at a time, and different again from selling a purpose built block. Institutional buyers are now in this market, but they buy in a particular way. These are the steps that make the difference.
Decide what you are selling
A portfolio can be sold whole, in parts to different buyers, or with the operating business alongside the houses. Each produces a different buyer list and a different price. The single buyer who takes everything usually asks for a discount for doing so.
Prepare the information
Buyers price on evidence: a clean tenancy schedule, rents achieved against rents advertised, licences and their expiry dates, EPC ratings, compliance certificates and a record of capital spent. Gaps become price chips late in the process.
Get the structure right before you go to market
Whether you sell the properties or the company that owns them changes the tax for both sides. Moving properties between companies in the same group can be free of stamp duty land tax and tax on gains at the time, but the reliefs can be clawed back if a company leaves the group within three years for stamp duty or six years for capital gains. Take advice early.
Test the right buyers, quietly
A discreet process to a short list of buyers who can move quickly protects tenants, staff and value.
Plan for the Renters Rights Act
Buyers will check that tenancies and Ground 4A notices are in order. Getting that right before a sale avoids a renegotiation.
We advised Condor Properties on the sale of its 997 bed portfolio to Brookfield and Student Homes Management. For a free, informal view of what your portfolio is worth, call James Innes on 020 7850 4760 or email james.innes@chrystalcapital.com.
This article is general information and is not advice.