Goldman backs Manipal's student living arm, to buy 74% for Rs 350 crore

  • October 17, 2017

Goldman backs Manipal's student living arm, to buy 74% for Rs 350 crore When: — Where: Category:

BENGALURU: Goldman Sachs is acquiring a 74% stake in Yoho - the student living business of Manipal Education and Medical Group (MEMG) - for Rs 350 crore. The Wall Street giant is betting on the prospects of Indian higher education triggering off-campus residences. 

Billionaire Ranjan Pailed MEMG is making huge bets in the nascent student living space even as educational institutions are monetising real estate and related infrastructure to stay focused on the core function. Millennials pursuing higher studies are also adapting to professionally-managed living spaces which, in some cases, may also cater to young working professionals. 

Mirroring what happened in the US and Europe some time ago, student living here too has received a professional makeover -compared to existing hostel facilities -with better hygiene, amenities and devoid of the hassles in dealing with multiple service vendors. Yoho manages more than 8,000 student beds (another 2,000 under construction) between Jaipur and Bengaluru, primarily servicing students enrolled with Manipal campuses. 

The investment from Goldman Sachs will help Manipal to expand the Yoho footprint and also roll out facilities for third party campuses. Yoho plans to add another 20,000 new rooms in the next five years. 

Pai and MEMG will continue to hold 26% in the student living business, which is valued at about Rs 500 crore after the investment. Both MEMG and Goldman Sachs declined to comment on the story. 

Student living is an evolved concept in western markets, attracting global inves tors like Blackstone and Canadian Pension Plan Investment Board. Blackstone forayed into the student living space with Nido London a decade ago. Some two years ago, student housing platform Liberty Living, owned by Canada Pension Plan, acquired some of the assets in the UK from Blackstone, besides acquiring over a dozen student residences to expand its footprint in Germany and Spain.