Dexus circles back on $2bn Campus Living Villages acquisition

The Griffith University student accommodation.

Dexus Group is thought to be back exploring an acquisition of Campus Living Villages, which is up for sale through Goldman Sachs for about $2bn.

The $7.7bn Australian listed real estate and infrastructure investor looked at the business last year, but DataRoom understands it is once again embarking on work for a potential deal through its infrastructure arm.

Campus Living Villages was on the market in 2024 but the sale process was suspended around February when offers were thought to have fallen short of expectations.

Various options were considered for the sale, including breaking the business up.

With a portfolio spanning over 7000 beds across three of Australia’s leading universities, Dexus is the largest on-campus student accommodation investment manager in Australia.

It has been investing further in the space, and one of its funds has been buying a B-grade office tower with plans to reposition the office space into a 1200-bed, high-quality, student housing complex.

It inherited the student accommodation business through its acquisition of AMP’s infrastructure management business in 2022.

Campus Living was initially touted for a listing on the Australian Securities Exchange and UBS was appointed.

Run by former Stockland executive John Schroder, it operates university accommodation in Australia, New Zealand, Britain and the US with 27,100 beds across 46 villages.

Each country has a substantial share.

Attempts were also made by the owners – Hostplus, REST, Equip Super and NGS Super – to sell the company in 2017 for $2bn.

Campus Living’s Australian assets are spread along the east coast – headlined by the University of Sydney, University of NSW, Griffith University and RMIT and Edith Cowan and Murdoch universities in the west.

UniLodge, which is also for sale through UBS, is the largest provider of student accommodation in Australia ahead of Scape and Iglu.

Last time Campus Living was up for sale, most of the appeal was in the British and Australian arms, while the US division was less attractive, being sub-scale and in more regional areas.

Dutch pension fund PGGM and Plenary took an early look but opted not to proceed.

Entities like Macquarie Group-backed Greystar, Morrison & Co and Singapore investors like Mapletree were seen as logical candidates to consider a purchase.

The renewed interest by Dexus in student accommodation comes as it does battle with its co-investors in Melbourne Airport, which allege it released confidential information about the airport when it was trying to sell off a 9.7 per cent stake in the fund that owns the asset.

For the year to June, it generated a 108.6 per cent increase in its net profit to $136.1m.