Purpose-Built Student Accommodation (PBSA) is considered a strong investment in the UK & Europe, often described as a mature and liquid market. During my 12-year career in PBSA, I have experienced rapid growth across the sector, with developments becoming increasingly innovative, evolving into something far beyond what I could have imagined all those years ago.
Whether you are a new investor to the market or looking to refurbish, develop and grow your existing portfolio, there are some fundamentals you simply cannot afford to get wrong.
Where to build
Supply and demand are widely discussed topics in PBSA, as, undeniably, the relationship between the student housing availability and the demand for it go hand in hand when it comes to being successful in this market.
To know where to build, you’ll need to have a knowledge of the nationwide market fundamentals of student population vs. bed numbers, as well as the ability to drill right into a micro-location level to identify areas to avoid and where the greatest opportunities lie.
Once you’ve shortlisted your locations, you’ll also want to consider other factors that will influence where to build:
- Other living categories such as co-living, BTR, and HMO
- Local building restrictions
- University growth projections
What to build
Having an in-depth view of the local competition will guide you in determining what you should or should not be building.
- Property and room features - What is being over delivered vs. under delivered?
- Room types and availability - What are the trends of room types and occupancy rates being achieved?
- Pricing and incentives - What are the red flags? Offering high incentives often indicates that filling a particular room type or location is challenging.
- Student reviews - What are students most satisfied with vs. least satisfied? What do they value the most vs. value the least?
Why build it?
Taking a student first approach to your development strategy is essential and by placing students at the centre of your organisational decision-making you can be sure to build something they want and need.
Customer need should always drive product development, whatever your market, and by doing so you will:
- Build brand trust
- Improve student experience
- Strengthen brand loyalty
Lack of PBSA in key university locations has a negative impact on students, often leading to rent increases and longer commutes for those who can afford what's available.
Student wellbeing starts at home, so ensuring student experience is nailed in PBSA is a big responsibility.
Summary
Ultimately, you need to make sure everything stacks up before you make your next investment and you need to consume an awful lot of data before doing so.
Collecting and interpreting data can be very time consuming but luckily for you StudentCrowd is home to the most comprehensive Data & Insights Tool - giving you all the information you need in one interactive space.
Additionally we’ve also added a Personal Analyst feature so for anyone in need of quick analysis or with limited resource, you can turn your data selection into charts at the click of a button.
Through StudentCrowd Data & Insights you can access:
Available until 27th September 2024
For a limited time only, you can sign up for a 2 week free trial of the Insight & Analysis Tool for up to 4 colleagues and experience everything we have to offer.
Better investment decisions start with StudentCrowd. Sign up here.
Martin Hadland, Co-founder and Managing Director of SFG, talks StudentCrowd
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