Newcourt acquires €10m British university site

ELY, the property division of Newcourt Group, has acquired a site in Birmingham for €10 million on which it plans to build student accommodation.

Ely said yesterday that the land is adjacent to Birmingham University, which has 25,000 students.

Ely said it will seek planning permission for a student accommodation block with 700 bedrooms. However, if it does not get planning from the local council it will not make any payment.

Ely chief executive Philip Marley said the acquisition of the site formed part of the company’s plans to develop student accommodation across Britain. It currently has developments in London and Nottingham.

A broker said yesterday that if planning for the Birmingham site is granted Ely will have 12 student accommodation blocks under development with some 6,000 beds by 2012.

Davy Stockbrokers analyst David Jennings said: “We recently put a base value on the Ely pipeline of 25 cents per share, applying very conservative development assumptions. If one strips this out of the current market value, the group is trading at a considerable discount to both its support services and recruitment peers.

“We believe that the catalyst for the stock will be the securing of funding for the student accommodation pipeline which we anticipate will be in place later this year. At this point, visibility and certainty surrounding that pipeline should increase substantially.”

Ely accounted for €19.8m of Newcourt’s €165m turnover in 2007. It also contributed €4.8m in profits, nearly half of the company’s total for the year.

Dublin-quoted Newcourt, which is also involved in recruitment and security services, acquired Ely in 2006.