Student housing leading ‘remarkable’ transformation of regional cities, Deloitte report finds

A boom in student accommodation schemes has led a “remarkable” transformation of the UK’s regional cities over the past years, according to a new report by Deloitte.

The firm’s latest regional crane survey found nearly 8.200 student bedrooms were under construction in Belfast, Birmingham, Leeds and Manchester last year, a 40% increase on 2022.

The most dramatic findings were in Birmingham where the number of bed spaces being built went up 15-fold, from around 100 in 2022 to more than 1,500 last year.

Meanwhile, Manchester recorded the highest volume of student resi starts in the survey’s 24-year history with shovels hitting the ground on three schemes totalling 2,153 new bed spaces.

The residential sector has led the way in all four surveyed cities with 87 schemes under construction in 2023 and 28 breaking ground. 

Belfast has seen a tenfold increase in activity over the past year with 950 homes underway, while housing output in Birmingham city centre increased by 36%.

But it is the cumulative output across all sector over the last six years which “tells a remarkable story of the renaissance in regional city centre”, Deloitte real assets advisory partner John Cooper said.

The four cities have seen the completion of 55,000 homes, 6,700 hotel rooms, 11 million sq ft of office space and four million sq ft of educational space since 2018.

“This is genuinely transformative,” Cooper said. “Developers and investors, working in partnership with local authorities and city planners, are creating great places to live and work. 

>> See also: Manchester council approves bumper crop of major schemes

“New neighbourhoods have emerged and continue to take shape. Whilst there is still much to do, the last few years have paved the way for quality place-based regeneration and positive change across our regional cities. Looking ahead, there is a healthy development pipeline to match demand too.” 

The survey will be further bolstered in coming years by Manchester University’s £400m plan to build 3,000 new student homes at its Fallowfield campus and the city’s 1,700-bed Upper Brook Street masterplan, which will also include two major life sciences buildings.

The office sector has not experienced the same boom seen in the residential sector, with the 3.4 million sq ft of commercial space recorded in the four cities in 2023 being on a par with recent years.

This is despite Leeds achieving an all-time high of nearly 700,000 sq ft of completions across three schemes, the highest volume reported in the survey.

Manchester reported the largest share of space under construction at 2.2 million sq ft, and notably saw the amount of refurbished office space, accounting for 53%, overtake newbuild schemes for the first time.