GFH Partners, a fully-owned subsidiary of the Bahrain-based GFH Financial Group, delivered a total proceed of 122 percent to investors after exiting from its first diversified US student housing portfolio.
The fund was invested in the portfolio of 1,200 beds across two assets near the University of Arkansas and Florida State University for the past two years.
Acquired in September 2021, the housing was repositioned by SQ Asset Management, GFH’s US-based specialised student housing asset management subsidiary. Several value-added initiatives helped increase the net operating income (NOI).
Both properties had occupancies at 100 percent and an NOI growth over the two-year hold period of greater than 40 percent.
These initiatives included the signing of the master lease with the University of Arkansas to take up 40 percent of the total bed spaces for three academic years, along with other operational improvements, and the rebranding of the properties to improve exposure within the market. It resulted in an improved operating income of approximately 14 percent compared to the original projections.
Nael Mustafa, CEO at GFH Partners, commented: “We’re delighted to announce another successful exit for the group. Leveraging the expertise of our US-based student housing subsidiary, SQ Asset Management, we were able to add considerable value to these investments over a short hold period that enabled us to exceed targets and effectively position the portfolio for a timely sale.
“Furthermore, this exit underscores our ongoing commitment to delivering performance on our investments and continued ability to bring to market unique income-yielding opportunities in well-performing defensive sectors and across multiple geographies.
“In addition to the US student housing sector, other key areas of focus for the group includes the medical offices sector in the US, regional education and healthcare opportunities, and investments in the global and GCC logistics industry.”
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