SME housebuilding lender, Quantum Development Finance, has provided a £30million loan to Asset Capital to fund the development of Melbury Court, a £46million GDV, 232-bed purpose-built student accommodation scheme in Durham.
Melbury Court is a five-storey scheme located on the northern edge of Durham, a 5-minute walk from the University Hospital and 10 minutes by bus to the university campus. Alongside the 232 beds, tenants will benefit from study rooms, a gym, games area, cinema and private dining area.
The scheme, which will be delivered by Caddick Construction and is due to complete in summer 2027, will provide much-needed student housing along with modern amenities to support the University of Durham’s fast-growing student population.
Due to planning restrictions in Durham, including a city-wide Article 4, student bed supply is heavily constrained, resulting in a limited pipeline of new PBSA beds. Alongside this, the university has seen a 22% increase in student acceptances in the 2026/27 academic year, creating extra demand for student housing.
This transaction marks Quantum’s second loan to Asset Capital in two years, reflecting a strong working relationship between the two parties. Asset Capital first received £11million funding from Quantum to develop a 34-unit mixed-use scheme in Harrogate, which completed in 2025.
This news comes after the recent announcement by Quantum of a £500million facility from Goldman Sachs, taking the international bank’s total funding capacity in Quantum projects to almost £700million. This funding supports Quantum’s recent expansion into the operational real estate sector as it broadens its lending activity to provide finance at all stages of a scheme’s lifecycle. Goldman Sachs’ facility allows Quantum to provide loans to more schemes across living sectors, including PBSA, Build-to-Rent and other operational asset classes while continuing to focus on SME housebuilding.
Sam Hudson, Head of Portfolio Management at Quantum, commented: “We are delighted to support another project for Asset Capital. Dan and his team’s deep knowledge of the PBSA market continues to be proven invaluable as they have obtained an excellent planning consent and executed a coordinated delivery strategy. We look forward to supporting them on this scheme to get essential new student accommodation in place before the start of the next academic year.”
Dan Newett, Director of Asset Capital, added: “Melbury Court will be built to achieve a BREEAM Excellent rating and will provide top quality accommodation and amenities for the University of Durham’s students for many years to come. Quantum has proven once again to be an ideal funding partner. Durham is not an easy place to get new housing approved and built, but Quantum got to grips quickly not only with our project but the dynamics in which we’re operating and structured a flexible facility that allows us to get work started on time so that we can deliver before next year’s new student intake arrives.”
