Student digs developer comments on the market post-EU referendum
Student digs developer Unite says universities should have “near term” confidence in EU student numbers, as the firm said it added 2,100 beds to its development pipeline for 2018 and 2019 over the first half of this year.
Unite’s confirmed development pipeline stands at £675m over the next four years.
Commenting on the EU referendum result, Unite said: “Whilst it is too early to assess the impact of the referendum on EU student numbers, funding has been guaranteed for EU students for the next three years providing students and Universities with confidence in the near term.
“Despite the broader uncertainties created by the EU referendum, the demand:supply outlook for student accommodation remains favourable, and we will look to benefit from any opportunities that start to emerge.
“The fundamentals of the student accommodation sector are well understood by institutional investors and we have seen encouraging signs that the student accommodation market continues to function post the EU referendum.”
Looking at the broader picture for student numbers, Unite said: “Applications for the 2016/17 academic year are in line with 2015 overall and 3% up at high tariff Universities and we expect to see another year of strong growth in student intake. Given the growth in student intake over the last three years compared to 2013, overall student numbers in 2016/17 are expected to increase by 40,000-60,000 compared to 2015/16.
“We expect student numbers to carry on growing most strongly at high and mid-tariff Universities and therefore continue to position our portfolio accordingly. 82% of our income is generated from these institutions, up from 78% last year.
“Student numbers are expected to grow by around 90,000-100,000 in total over the next three years, exceeding the anticipated level of new supply of around 75,000 beds over the same period with the potential that supply levels will start to slow beyond 2018 as a result of the referendum.”