The term “purpose-built student accommodation” (PBSA) refers to housing that has been specifically designed by private developers for students. It typically takes the form of private studio apartments or grouping flats (multiple rooms with shared kitchen and living areas), both of which have attached recreational amenities and today’s “cool” perks like cinemas, gyms, and games rooms.
It’s been widely covered in the media that the UK is facing a student housing shortage, particularly in cities such as Durham, Glasgow and York. It’s also clearly a concern that’s on the minds of a lot of students, as 50% of students in a survey said they are worried about the housing shortage. In addition, the availability of Houses in Multiple Occupation (HMO) for students is decreasing as a result of rising taxes and regulations landlords may exit the market, which will also raise demand for purpose-built accommodation.
As the expectations and demands of students have continued to grow in both the standard of their education and where they live, investors and developers have striven to match and very often exceed that expectation. Gone are the days of damp and cramped properties as the rise of purpose built student accommodation property with formal management allows not just top quality living but a range of services surrounding it.
Record levels of PBSA occupancy in 2022-2023 were accomplished, and even higher levels are anticipated for the academic year 2023–2024. As a result, the market will experience intense competition and significant rental growth. This should reassure investors that net income growth can continue despite a turbulent time. This type of investment is particularly favourable to foreign investors drawn by the discount provided by a falling pound, but UK developers can also get a great return on investment. Overall, strong rental growth and the underlying fundamentals will continue to drive PBSA investment in 2023, along with the possibility of high total returns.
Seraph Property Management can help on all aspects of management and support of purpose built student accommodation. At the design stage we will review and advise on facilities and layouts to maximise the return whilst minimising the management cost. During the build we will continually review the market and support the developer and set the process for marketing the accommodation in place. As the property manager we do not insist on keeping all marketing in house. We work with local agents to maximise the exposure to the right market locally and overseas to ensure the occupancy rate hits 100%.
Once built and occupied we will continue to ensure that all compliance requirements are met and the resident’s needs are attended to resulting in our high level of satisfaction rates, and increasing the likelihood of maintaining occupancy in our buildings throughout a resident’s academic career.
If you would like to discuss moving the management of your purpose-built student accommodation building to Seraph Property Management, or have an investment currently in the planning process we would be delighted to discuss your requirements.
Call us on 02921 671444 or email to discuss your property management…