Private sector taking larger slice of student beds market


The private sector is becoming increasingly influential in the student accommodation market according to a report looking back at the market in 2018.

The new research by Cushman and Wakefield states that the private sector’s interest has grown by 130% over the last four years, if beds provided by private sector partnerships on university campuses are included. The private sector accounts for 47% of all beds, where as in 2014 it had just a third with universities providing the rest.

Over 31,000 new beds were provided for the current academic year to set a new record total of 627,000. A further 36,000 are expected to enter the student market in 2019, but there is still a demand for more.

Demand exceeds supply in Manchester

Manchester is one area where the supply of new, purpose-built student accommodation falls behind demand. Place North West reports that in some traditional student areas, such as Fallowfield, there is pressure on the authorities to move students out given local opposition to Homes of Multiple Occupation. There are 24,000 specialist spaces in the city, but just 270 hit the market in 2018.

“The market in Manchester is diversified and competitive with high occupancy levels in both university and private sector schemes,” said David Feeney, student accommodation advisory at C&W.

“Given the low levels of development in the city, student accommodation is typically dated and of a low quality, compared to other large student cities.”

Liverpool has similar demand for purpose-built student stock, but compared to Manchester it has fared better, and brought 1,200 new spaces to the market last year. It only lags behind London and Newcastle in number of new spaces built since 2015.

C&W also show that the average price of a weekly en-suite rent in the regions is £132, while in London that figure is £223. They also reveal that the pricing differential between university beds and private ones has fallen and is almost identical, with both around the £144 mark.

Recent research from Which? revealed that 27% students have found their second year accommodation by the end of November in their first term – so savvy investors can see the demands for high quality places to live for the ever-growing student population.

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Some students at a university yesterday

Private sector taking larger slice of student beds market


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