A UNIVERSITY has become one of the first educational establishments of its kind to raise millions of pounds for new accommodation projects through selling bonds.

The University of Brighton has secured £35 million to fund a major expansion in its student accommodation in Brighton and Hastings.

It is understood the university raised the cash through a private placement last month and that a single US investor, whose identity is undisclosed, is said to have purchased all of it.

It is believed to be the first case of its kind from any new university in the country and sees the higher education establishment follow in the footsteps of Cambridge, Manchester and the London School of Economics.

A University of Brighton spokesman said more details would be announced once the deal is completed in July.

Universities have begun turning to the bond market to raise funds for accommodation development as banks are reluctant to offer long-term lending.

Student accommodation is considered a great long-term investment because it has a reliable income stream but with a lower risk than other kinds of residential property development.

The University of Cambridge broke new ground by raising £350 million through a 40-year security bond in 2012 after being given a stronger credit-rating than the Bank of England.

The money will fund the second and third phases of the £33 million Varley Park scheme in Brighton, which will see the demolition of two 1960s student blocks, with three new ones being built.

It will also be used to fund the Station Plaza redevelopment in Hastings for 223 student rooms.

A University of Brighton spokesman said: “Barclays acted as sole placement agent and the university has raised £35m to fund student accommodation in Brighton and Hastings.

“The bond route was selected to provide long-term funding.”