Record breaking student property investment propels asset class into the mainstream
A full report from Savills has claimed that student property is no longer an ‘alternative asset class’ for property investors.
The new Spotlight on Student Housing report has reported that record levels of investment in the UK has helped push the sector into the mainstream.
In the first three quarters of the year, $6.5 billion of investment was pumped into the UK’s student property sector.
This record investment has gone towards the development of purpose-build buildings across a variety of university towns and cities in the UK.
The report hailed top-tier universities with low supply such as London, Bristol, Oxford and Edinburgh as locations with great potential. Manchester was also pinpointed a key location for investment due to a strong demand from the city’s student population.
“Top-tier university cities in the UK with low supply have the greatest potential,” Paul Tostevin, Savills World Research commented.
The United Kingdom has a total student population of 2.3 million. 17% or 388,000 of these are international students.
In terms of beds the report outlines that there are just 524,000 purpose-built student beds in the country which is equal to 23% of the national provision rate.
Click here to watch this video to see inside a new-build UK student property investment.
First class investment
It is thought that rising investment in the UK’s student property market has been driven by an overall undersupply of rooms.
The report cites upward student mobility and the prestige of studying abroad has attracted students to the UK.
The UK is home to some of the world’s top universities and the education system is well regarded across the globe.
“The student housing market has come of age and is no longer a specialist or alternative investment class. Record levels of institutional investor activity are testament to its global potential as a mainstream real estate asset and we now anticipate that it will become increasingly well-established in a variety of countries,” the report states.