Galway student investment offers 6.5pc yield and vendor finance

The vendor, Radical Student Living, launched the 106-student-bed spaces at Edward Square on the market last October and its agent CBRE is quoting €13.75m for the property. With a gross passing rent including estimated summer revenue of €1.39m per annum, the price represents a net initial yield of 6.5pc.

This week the firm announced that it is also offering up to 55pc leverage to assist a purchaser to fund the purchase. CBRE declined to disclose the interest rate or terms of the leverage other than to say “it is competitive to the going market pricing”.

The property is fully occupied for the 2022/23 academic year. In addition, the property offers opportunities to generate summer revenue from the thousands of tourists who flock to Galway each year.

Originally developed by a Gerry Barrett property firm, Edward Square also accommodates a major Dunnes Stores outlet and is just off the city’s main shopping thoroughfare, Shop Street and 500m from Ceannt railway station. The development is 1km from the National University of Ireland Galway (NUIG), and 3.2km from Atlantic Technological University (ATU).

Collectively, NUIG and ATU attract over 25,000 full-time students each year.

Galway is Ireland’s fourth largest city with a population of over 80,000 people. It is also a thriving cultural city.