Target Information

Forum Asset Management is thrilled to announce a strategic collaboration with Brookfield Asset Management aimed at enhancing the acquisition of Alignvest Student Housing. Through this partnership, Brookfield will invest up to $100 million into Forum’s private real estate investment trust (REIT), the Forum Real Estate Income and Impact Fund (REIIF). Currently valued at $2.4 billion, REIIF is recognized as a leading owner and investor of purpose-built student accommodations across Canada, comprising 31 institutional-quality properties that provide approximately 10,500 beds for students.

The REIIF fund is strategically positioned in key university markets, catering to the growing demand for affordable and high-quality housing options. By incorporating Environmental, Social, and Governance (ESG) principles, REIIF not only aims for enhanced risk-adjusted returns but also addresses essential housing needs in academic environments.

Industry Overview in Canada

The real estate market for student accommodations in Canada has witnessed substantial growth due to an increasing number of international and domestic students. As educational institutions expand their programs, the demand for suitable housing has surged, often outpacing supply. This imbalance presents significant opportunities for investment in the sector.

Furthermore, government initiatives and policies aimed at improving the quality of housing for students further contribute to this dynamic landscape. With a commitment to sustainable development and community impact, the sector is becoming increasingly attractive to institutional investors seeking long-term growth prospects.

Canada's focus on maintaining high standards for living conditions in student housing reflects the importance of academic success, enhancing the desirability of purpose-built accommodations. This trend is bolstered by a robust higher education system that draws students from around the globe, further supporting the need for secure and dependable housing solutions.

Ultimately, the convergence of supply, demand, and strategic investment creates a fertile ground for growth within Canada's student housing market, establishing it as a preferred choice for institutional investment.

Rationale Behind the Deal

The collaboration between Forum and Brookfield is strategic, leveraging Brookfield’s substantial global portfolio and expertise in the student accommodation sector. Brookfield's commitment to providing up to $100 million to REIIF illustrates their confidence in Canada’s favorable long-term supply and demand fundamentals in the student housing market.

Richard Abboud, Founder and CEO of Forum, emphasizes that this investment validates Forum’s strategic direction and underscores the potential for substantial institutional investment in Canadian student housing. The infusion of capital from Brookfield is anticipated to enhance REIIF’s financial capabilities, promote growth within the portfolio, and amplify the delivery of necessary, well-managed student housing across Canada.

Information About the Investor

Brookfield Asset Management is a global leader in alternative asset management, with a diversified portfolio that includes real estate, renewable power, infrastructure, and private equity. With a current valuation of its global student accommodation portfolio exceeding $7 billion, Brookfield manages over 60,000 beds across key markets in Europe, the United States, the United Kingdom, and now Canada, thanks to its partnership with Forum.

Brookfield’s investment strategy is characterized by a focus on high-quality assets that provide robust, risk-adjusted returns. Their experience in managing large-scale, purpose-built student accommodations positions them well in Canada’s rapidly evolving housing market for students, aligning well with the needs and expectations of both investors and stakeholders.

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This partnership between Forum and Brookfield presents a significant opportunity for investors looking to capitalize on the mounting demand for student housing in Canada. The strategic allocation of funds into the REIIF demonstrates Brookfield's commitment to the sector, which is underscored by the ongoing trend of increasing enrollment in Canadian universities.

From our perspective, this investment can be seen as a sound decision due to the underlying fundamentals of the Canadian housing market. The combination of high service standards, governmental support, and recognized demand trends positions REIIF as a strong player in the sector, thus promising enhanced yields and total returns.

Moreover, the focus on sustainability and impact investing aligns well with current market preferences, suggesting that REIIF could attract additional positive attention from socially-conscious investors. By entering into this niche yet expanding market, Brookfield and Forum are well-positioned to yield significant returns from this investment.

Looking at the risks, it is essential to acknowledge the potential challenges in scaling operations quickly enough to meet demand. However, with Brookfield's established reputation and Forum's local expertise, there is a high likelihood that these challenges can be effectively navigated. Overall, this investment speaks to a favorable outlook for both parties involved.

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