The Student Hotel secures fresh €145m ESG financing

The Student Hotel (TSH) has reached an agreement with UniCredit for social and environmental impact financing of €145 million for the development of two new locations in Rome and Florence.

Italy's export credit agency SACE is supporting the financing with a green guarantee of €54 million.

The loan includes terms for the achievement of a BREEAM “Very Good” rating for both locations and adherence to the EU Taxonomy for sustainable activities as criteria for the green guarantee.

TSH and UniCredit have agreed to include impact financing terms in the form of a discount on the interest rate, which TSH has committed to reinvest by providing students from disadvantaged socio-economic backgrounds scholarships in the form of rent reductions.

The loan follows existing financing agreed between TSH and UniCredit for hybrid hospitality model locations in Florence Lavagnini, Bologna and Vienna.

The projects are located in the San Lorenzo district of Rome and the Belfiore district of Florence. With these two new locations, TSH will have a total of five locations in Italy.

Construction of the Rome development will start in March 2022. The 396-room hotel will include a restaurant, a bar, meeting and co-working spaces and a gym, as well as a public park.

In Florence, the development consists of a 550-room hotel. Construction of the above ground started in September 2021 and the hotel is expected to open before summer 2024. TSH will invest over €160 million in the project. Alongside hotel rooms, a bar, gym, co-working spaces and public park, the Belfiore location will also include a public running track on the rooftop of the building.

The financing supports TSH’s growth strategy as it looks to open 10 hotels across Europe by 2025, taking the total amount of operational hotels to 25. TSH has recently secured €300 million from existing shareholders to fund the growth strategy.

What They Said

Charlie MacGregor, founder and CEO of TSH, said: “We are very pleased to announce a social and environmental impact financing agreement with UniCredit, further strengthening our relationship that was established in 2016, and with support from SACE. The sustainable and impact finance terms align with TSH’s continued commitment to minimize our environmental impact and maximize our impact on local communities as part of our growth strategy. We are proud to be able to redevelop these previously underdeveloped areas in Rome and Florence to become exciting locations where the local communities, guests, students, companies can come together.

Massimiliano Mastalia, Head of Corporate Italy at UniCredit, said: “We are proud to continue supporting TSH Group alongside SACE in its development. This is a longstanding relationship that will now allow for the transformation of two large areas in Rome and Florence into innovation and creativity hubs, aimed at connecting different communities of people, especially the youth. This will also increase the availability of quality accommodation, supporting a sector that was harshly hit by the pandemic. The deal is testament to UniCredit's commitment to promote and support the sustainable development of our territories, which is central to our Group's core purpose of empowering our communities to progress".