AN ISLAMIC investment bank which has its headquarters in oil-rich Kuwait, has snapped up a student accommodation block in Cowley for £28.95m.
The new building, on the former Territorial Army site at Slade Park, is built around a central courtyard and contains 350 en-suite rooms in apartments with independent kitchens and sitting areas, as well as 24 self-contained studios.
A spokesman for Oxford Brookes University, which will nominate the tenants in the block, said the new building will fulfil an important role as the university is obliged to reduce the numbers of students in privaet rented accommodation.
The Gatehouse Bank, a Sharia law-compliant subsidiary of Securities House Kuwait, will obtain a 9.63 per cent annual return on its money.
Sharia-compliant investors only put up money for projects which meet moral standards laid down by Islam and cannot invest in anything related to gambling or alcohol.
Philip Churchill, Gatehouse executive vice president and head of real estate said: “Student accommodation is an extremely well-established sector in the UK, worth £6.5bn.
“ It is also one of the few sectors experiencing rental growth at the moment, with average increases of five per cent per annum over the last six years.”
Paul Large, register and clerk to the board at Brookes said: “The university is currently able to accommodate the vast majority of its first year students but is under an obligation to the City Council to reduce the number of students living in rented private houses to 3,000 or less.
To do this we must attract students (typical second and third year students) out of private houses into other types of accommodation.
“There is no significant increase in student numbers planned and we are simply continuing to work towards reducing the number of students renting private houses and will continue to pursue responsible options to achieve this.”
This year Gatehouse has already bought two other UK halls of residence — in Loughborough and in Liverpool. Its total investment in the sector is now £150m.