Student accomodation sector ‘very positive’ after record results day and £2bn investment
The purpose-built student accommodation market has been further buoyed after record A-Level results today after investors spent £656m in the sector in the second quarter of this year.
Almost half (44.8 per cent) of all A-Level grades received were either A or A*, after exams were cancelled and replaced with teacher predicted grades.
There had already been a pick-up in investment transactions while universities are now gearing up for a record year for enrolment as 91% of students secured a place at their first choice university.
Although the pandemic has complicated university life for many students with online learning and international travel restrictions, investors have injected almost £2bn into the student accommodation sector in 2021 so far.
Cumulative deal volumes so far this year are 47 per cent higher than 2020 and 4 per cent higher than in 2019.
Property consultancy Knight Frank said investors were happy to look past the short-term disruption caused by the pandemic and were confident of the sector’s ability to deliver long-term, stable income.
Investors were motivated by a low supply of purpose-built student accommodation at many regional universities while student numbers have soared over the past few decades.
Merelina Sykes, Knight Frank’s joint head of student property, said: “It also reflects a wider pivot which has taken place over the last 18 months from institutional investors towards residential assets across all age groups.
“This trend has been compounded by the continued rising student numbers of both international and domestic student numbers, who want to study in the UK thanks to our world-class status as a leading provider of higher education.”
She added: “Today’s A-Level results will leave the sector feeling very positive for the year ahead. Acceptances are already up, but we wait for the outcome of clearing to get the full picture. However, if clearing plays as significant a role as it did in 2020, we will be in for a bumper year for enrolment.”