Emirates REIT (EREIT) announced that it had acquired the interest on a 25,000 sqm leasehold land plot from the British Columbia Canadian School and that it had immediately leased back the property to the school operator for a 28-year lease term, providing an initial net income of 12% of the total development costs within the first year. The overall investment in the development of the school facilities is estimated to be AED88mn. EREIT has simultaneously entered into an agreement to fund the construction of the new educational facilities over two phases. This represents EREIT’s third school, which will increase the education sector portfolio to AED709mn, representing c26% of the total size of the portfolio. The school will have a built-up area of 17,156 sqm.   Management has indicated previously that it was looking to replicate the Jebel Ali School model, following its success. We view the above news positively, given that it is revenue-generating from the acquisition date, with a decent rental yield of 12%, and a long lease term. The incremental income from the acquisition is estimated at USD2.9mn (c4% addition to our 2017 estimate) until the development of the project is complete, which is expected to grow further once the school becomes operational, in line with the Jebel Ali School model. (Company disclosure, Mai Attia, Sara Boutros)   Emirates REIT (DU): USD1.11 as of 27 September 2016, Rating: Neutral, FV: USD1.24 per share, MCap: USD333mn, REIT DU / REIT.DI