Yield

For several years, investors looking for new forms of secure investments have become interested in student residences.

Halfway between classic housing under simple management and tertiary real estate under professional management, investments in student residences imply mastery of its dynamics and its players.

Although low-risk real estate investments are increasingly rare, the student housing market offers good potential. As the number of students continues to increase in many European countries, the need for student accommodation continues to grow. For France alone, there will be around 2.79 million students in 2020*. This number is constantly increasing and is expected to exceed 3 million by 2030.

Services

The branch specializing in alternative investments of Rodschinson Investment puts its experience at your service for an in-depth study aimed at valuing your investments and ensuring the balance of their operations:

• Carrying out market studies
• Rental value expertise
• Expertise of market value
• Audit of operators
• Optimization of operating business plans
• Financial work and rebalancing of normative ratios, EBIT, EBITDA, share of rent on turnover, FTE, etc.

Rodschinson Investment's experts also assist you in carrying out projects to purchase or sell alternative assets via:

• The sale of student residences
• VEFA for student housing and residences
• The search for an operator
• Negotiation assistance

Rodschinson Investment supports numerous investors in their development strategies in terms of alternative investments.

The experience of its consultants involves both in-depth knowledge of players, developers, investors and operators, as well as precise analysis of sector data.

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Specificities

Student residences are operated and maintained by a professional manager. The investors and the operator sign a commercial lease. Rental income generated by the operation of the residence is transferred quarterly by the operator.

The different types of accommodation:

• Individual studio, apartment t1, t1 bis or t2
• T3s, t4s and t5s designed for shared accommodation

The main selection criteria for these accommodations are:

• A secure and reassuring environment.
• Services to make daily life easier
• Additional services: Student residences generally have a gym, parking spaces, a meeting room, collective or individual work spaces, mail delivery and may offer a borrowing service small household appliances.

The advantages for investors:

• Secure annuity
• A tax-advantaged investment

Valuation

Student accommodation attracts high demand from investors due to the regular and relatively low-risk income it provides.

Given the regular income of stabilized establishments, the capitalization rate approach or a comparable approach are commonly used valuation methods.

Student housing generates significant demand from investors due to its stable income and relatively low risk.

Given the stable revenues from stabilized facilities, the capitalization rate approach or a comparable approach are commonly used valuation approaches.

IQ Student accommodation or IQ is the largest provider of student accommodation in the UK with over 28,000 beds.

With an occupancy rate of 97%, it generated a turnover of 223 million pounds and a net operating margin of 76.4% in 2019.

In February 2020, Blackstone, one of the world's largest specialist property investment firms, offered £4.6 billion to acquire IQ student accommodation.

It is the largest student housing transaction in the world.

To understand how Blackstone valued IQ at 4.6 billion, we use the cap rate approach.

First, from the annual filing, we calculate the company's annual net operating income

Calculate net operating income

Then we apply the appropriate capitalization rate for those properties. In the pie chart we see that IQ's installations are primarily concentrated in London, with a balance of 48 %s spread across other key Russell Group cities

Using market cap rates, we estimate the effective cap rate for IQ's entire real estate portfolio to be 4.1 %. Applying the derived values we obtain a valuation of £4.1 million.

This seems far from the reported deal value, but keep in mind that this is only the 28,015-bed portfolio. IQ also has 4,000 beds under development that are not bringing in revenue today. At the time of the transaction, 4,328 were under development.

We can assume that the value of these non-operational beds corresponds to their asset value. Proportionally, we value the pipeline at £502 million.

Adding the two values together, we get approximately 4.6 billion, which corresponds to the announced value of the transaction.

Value derived from pipeline beds

Pipeline Value = (Beds in Pipeline x Total Value) / Total Beds

Pipeline value = 14% x 3,700 M

Pipeline Value = £502m

Introduction

Corporate real estate is obviously largely made up of spaces intended for offices.

It is essential to be aware of developments in terms of organization and management in order to think about arrangements that support the company's strategy.

Develop an ergonomic space, define the size, location and layout of the offices, Rodschinson Investment is aware that your offices reflect the spirit and positioning of your company.

Attractive, they facilitate the arrival of young talents wishing to join the company, support your image among your partners and contribute to your expansion. The issue is strategic.

Services

Rodschinson Investment supports its clients in carrying out their projects thanks to its knowledge of local markets (including the gray market and off-market) and provides them with a tailor-made service.

Services for investors

Creation and capture of value throughout the life cycle of projects and real estate.

Services for businesses

Real estate decisions are thought of as real strategic tools, vectors of image and culture for your company.

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Specificities

Because office buildings can range from multi-tenant high-rise buildings in urban areas to office campuses in the suburbs, investors have a wide range of different investment opportunities. Additionally, in recent years a series of sub-asset classes have emerged, making the commercial office real estate sector even more interesting for investors.

Changing office needs

In recent years, the nature of office space has evolved significantly. The co-working model is a good example. WeWork is the best example of this trend, and many similar companies are contributing to this shift in demand. More and more businesses, large and small, are opting for open plan office space, with very flexible leases, as well as community facilities and group events. Co-working demonstrates the evolving demand for office space and our team of international experts is continuously responding to these changing needs.

Technology drives demand

The booming technology sector has been a major driver of new office space creation in recent years. Whether in London, Barcelona, Hong Kong or many cities across North America, the emergence of start-ups and related businesses has driven demand for office space. By some estimates, the technology sector is responsible for nearly a quarter of all new office leases over the past two years.

Long-term vision

The technology sector is not the only one driving demand for office space and therefore attracting more capital to this segment. Investors are increasingly taking a long-term view and analyzing, more than ever, the changing trends of potential tenants and their employees. Forward-looking investors and their development partners are looking to include facilities and features that align with tomorrow's employees. Good examples are bicycle storage, common areas, roof terraces, a bar, mixed-use spaces and gyms.

Valuation

Office buildings are sought-after investments due to the long lease duration which guarantees the stability of the real estate. Office buildings located in central business districts, such as La Défense in Paris or Canary Wharf in London, are often part of the core real estate investments of pension funds and real estate investment trusts.

Regular, recurring income over a long period of time is best assessed using the capitalization rate approach. On the other hand, if we assume that the annual rents of all properties in a region increase at the same rate and that the operating expense ratio is similar, the gross rental yield will provide a result similar to the capitalization rate.

In the constantly evolving mobility sector, each parking operation requires a review of systems, technology, equipment or operating contracts.

Our experts develop a successful parking program by identifying revenue opportunities, maximizing profitability, improving revenue control systems, improving customer service, reducing operating costs and improving customer satisfaction. audience.

We understand your concerns and needs and provide parking operation solutions aimed at business objectives.

Our consultants support a wide range of clients, whether it is a municipality looking to transfer its activities to a multi-site structure, or a university, an airport or a commercial property looking to generate additional revenue or improve customer service.

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Services

Rodschinson Investment helps companies design, update and improve their Parking operations.

We guarantee the use of the best smart solutions in the sector with cutting-edge technologies.

Our team is there to assess your needs, whether it involves determining the number of places, making a technological choice or conducting a potential study.

• Lease Administration
• Proactive asset and portfolio management
• In-depth feasibility study on parking
• Management of acquisition procedures

Our mission does not end with the acquisition of a parking lot. At ROD Parkings, we develop a well-planned business strategy to operate your parking lot like any other business.

To establish your parking lot business plan, we start by defining your goals and objectives and analyze the upcoming financial, regulatory and other requirements to operate your parking lot in addition to the money you have already invested in the purchase of the property. This way, you start earning income quickly, allowing you to recoup your investment as quickly as possible.

Specificities

Many investors seek stable, long-term returns in alternative asset classes. We see that an increasing number of them are moving towards the parking space segment. This relatively non-traditional real estate opportunity is driven by continued growth in the number of cars, while the desire to make cities greener has put pressure on supply. As a result, parking costs and therefore rental income are increasing.

Valuation

Parking businesses are often valued as a multiple of the revenue they generate. Special adjustments are made depending on whether businesses are new or have reached a state of stabilization.

Q-Park is a car park operator in Belgium, Denmark, Germany, France, Ireland, the Netherlands and the United Kingdom. Based in Maastricht, it is the largest parking provider in the Netherlands and the second largest in the European market.

Q-park was acquired by KKR, a leading investment company that manages multiple asset classes, for €2,905 million.

From a strategic perspective, the transaction gives KKR a significant European presence in a niche but relatively growing asset class.

Using previous deal methodology, we compare the Q-park acquisition to some of the recent peer acquisitions and their valuation multiples. We can see that the revenue multiple increases with higher EBITDA margin, while the EBITDA multiple is in a stable range of 13-16 among peers.

If we compare recent transactions involving Q-park's peers, SP Plus and NCP, they materialized for 137 million and 195 euros respectively, which is very close to the 0.8x EV/Revenue we have here.

As Q-Park has a higher EBITDA margin than its competitor SP Plus, it should have a higher revenue multiple. Assuming a multiple of 3.6x Q-park's turnover, we reach a value very close to 2.95 trillion euros.

We can verify this by taking the average enterprise value relative to the peer group's EBITDA multiple and applying it to Q-Park's EBITDA. Again, we obtain a value close to the value derived from the revenue multiple.

With proven returns, shared risks and profits on resale, residential real estate assets represent a great investment opportunity with limited risk.

The regulations governing this asset class present many complex specificities that it is important to master before getting started, such as recent texts on social housing or the risk of pre-emption...

A team of Rodschinson Investment experts is entirely dedicated to residential real estate issues.

The experience of our advisors allows them to advise you on the sale of individual housing or buildings and the valuation of assets.

Services

Thanks to the privileged relationship that we establish with each client, we take into account their specificity and their profitability objectives set together in order to offer a personalized proposition and results that meet expectations.

Rodschinson Investment advises and supports you in the sale of diffuse housing

• Transfers of co-ownership housing
• Sale of high-end properties
• Sale in batches of fully owned buildings (management, collective agreements, purging of pre-emption rights, etc.)
• Marketing on behalf of real estate developers (office or on-site sales, marketing strategy, back-office, etc.)

Support and strategic advice on residential asset arbitrage issues – en bloc sale:

• Transfer of assets
• Sale of company shares
• Land valuation
• Sale of residential or mixed-use buildings

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Asset valuation

After a complete analysis of the market and the local land situation, Rodschinson Investment carries out a valuation:

• Market research
• Analysis of the regulatory context
• Valuation of buildings with a view to selling them in bulk, in batches or over time
• Land development, transformation and revaluation of offices or housing