The university has taken a lease on the 40,000-sf building at 141-143 Drury La. from Network Housing Association, which in turn has bought it from Patron Capital and Dawnay Day Structured Finance. NHA has set up a special-purpose vehicle with a charitable status for the conversion.

Recent research by King Sturge concluded that soaring student numbers in the UK presented both a fast-looming crisis and a business opportunity. The market will be driven by the government target of 50% of students going into university; the EU's 10 new member countries, which will attract 20,000 extra students; and Chinese student numbers that will continue to boom beyond their current figure of 32,000."New Government regulations will see many private landlords retreat from traditional student-lets at a time when student numbers are set to grow by at least 200,000, just to maintain the existing 43.5% of young people entering higher education and the growing demand for UK university places from overseas students," says Philip Hillman at King Sturge."While a number of universities and housing associations have spotted this looming miss-match of supply and demand," he adds, "there remains an immense opportunity for commercial investors and developers." Hillman also believes student accommodation is now established as an investment class and is ideally placed to benefit from the proposed introduction of REITs.