We continue to build on our exceptionally diversified and quality property portfolio after acquiring another attractive development site for student accommodation in Australia. Furthermore, we have also sold our 22.8% stake in Delta Properties to a women-led BEE consortium in a R1.45 billion vendor funded transaction.
While we managed to facilitate the sale of what is an illiquid Delta counter in a single transaction, locking in capital value, this transaction achieves far more, as it ties in with our own transformation initiatives to support the development of female leaders in the sector, while also boosting broader empowerment. Phumzile Langeni, a non-executive director of Redefine, is amongst the women participants in the BEE consortium.
As regards our student accommodation strategy, we already have a A$139 million development underway in Melbourne catering for 804 beds, while the new site at 500 Swanston Street is very well located in relation to Melbourne University with potential for up to 700 beds.
We are very excited about this development, as the market is so undersupplied. A JLL Student Accommodation report, for instance, says while total full-time students in Melbourne is just under 235,000, the existing supply of beds is around 19,200. Development is anticipated to begin in 2018. With a capital uplift potential and return on equity well ahead of offshore funding costs, the investment proposition is really compelling from a total return point of view.
We indicated previously we were looking to sell our Delta holding and can now report that we sold our entire holding consisting of 162 million shares at R9 a share – which means we locked in great capital value. Delta had previously acquired 15 government tenanted offices from Redefine in 2015 through the issue of shares to Redefine.
These transactions are another example of how we continue to effectively look through and be ahead of the property cycles and develop bespoke solutions to steer through them.
It is through strategic approaches such as these that Redefine has managed to establish a solid business foundation and build a pipeline of exciting growth potential despite the current challenges faced by our economy.