The deal to buy builders’ merchant Travis Perkins’ site in Paddington is subject to gaining planning approval.

Unite today said it would fund the total £150m development costs from the proceeds of its recent equity issue.

The firm stressed it was only committed to limited development costs at this stage and has optionality over a development start date, subject to market conditions.

The scheme is targeted for delivery for the 2023/24 academic year and should deliver a development yield in line with the firm’s enhanced targets for University partnerships in central London.

Discussions are already underway with University partners to support the scheme through planning, with a view to agreeing a long-term nomination agreement.

The development will target a BREEAM Excellent rating and incorporate a range of design features to reduce its embodied and operational carbon, supporting Unite’s transition to net zero development and operations.

The acquisition is Unite’s second partnership with Travis Perkins following the successful delivery of St Pancras Way in 2014 and, like St Pancras Way, the development will incorporate a new ground floor retail unit for Travis Perkins.

Richard Smith, chief executive of Unite Students, said: “Our latest land acquisition means we have now secured £175m of new development opportunities since our recent placing.

“This is a rare opportunity to acquire a zone 1 central London site in an excellent location, which will help to meet the growing accommodation needs of our London-based University partners.

“We remain confident in the growth outlook for London over the next decade, reflecting the global reputation of its Universities and a positive outlook for growth in UK and international student numbers.”