“Recession-proof” Student Housing Investment Tipped For 2019.

Student accommodation has long been touted as a so-called “safe” investment. However, a recent study published by student housing research specialist StudentMarketing suggests that student accommodation has reached the point of being a ‘crisis-resilient’ asset class which is now ranked fourth in terms of development and investment goals by over 200 investment managers. With student...

Student accommodation has long been touted as a so-called “safe” investment. However, a recent study published by student housing research specialist StudentMarketing suggests that student accommodation has reached the point of being a ‘crisis-resilient’ asset class which is now ranked fourth in terms of development and investment goals by over 200 investment managers. With student accommodation in huge demand both in the UK and further afield in Europe, there is certainly a surplus in demand for rooms, and therefore if you’re looking to shore up your finances in 2019 it is certainly a wise investment.

With financial challenges facing universities throughout the United Kingdom and the Augar Review looming large on the horizon of post-18 education providers in terms of tuition fees, student accommodation has never been more important. It has been forecast that throughout 2019, a minimum of 29,000 extra purpose-built student rooms will be delivered – comparable to the population of Gibraltar.

Million Dollar Deals

Underpinning the fiscal viability of student property, 2018 saw an influx of foreign capital entering the UK student accommodation market, especially from Southeast Asia. One of the largest deals that took place in 2018 included Singapore Press Holding’s acquisition of Unite’s Mayflower portfolio for £180m, and internal investment coming from the likes of Arlington Advisors, based in St James’s, teaming up with Equitrix to invest £280m.

As an asset class, student accommodation offers a stable and steady income stream, as students have regimented study schedules and there remains an oversubscription to British universities. Furthermore, when compared with more established investments such as offices, purpose-built student accommodation (PBSA) the year-on-year growth is impressive:

Value of UK PBSA sector

2014 £30,900,000,000

2015 £39,200,000,000

2016 £42,500,000,000

2017 £45,800,000,000

2018 £50,500,000,000

2019 (predicted) £53,200,000,000

With both foreign and national investors vying for a place in the PBSA market, it is evident that there are still a plethora of opportunities when it comes to property investment – all you need to do is think outside of traditional boundaries.