Published On: Wed, Feb 24th, 2016

Student housing construction climbed to a five year high in 2015

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student housing - number of bedroomsInvestment in student housing continued to grow in 2015, with contracts awarded to build more than 4,500 new student bedrooms, the highest annual amount in over five years.

The total value of construction projects for student housing was worth over £2.3 billion in 2015, with investment in the sector showing no sign of slowing down. There was an overall increase of 26 per cent in student bedrooms being commissioned for construction in 2015 compared to the previous year (see figure 1.1). The peak of student housing construction came in the final quarter of 2015, as contracts were awarded to build 2,117 units, the highest total recorded since before the recession.

Commenting on the figures, Michael Dall, lead economist at Barbour ABI, said: “Student housing has undergone a significant amount of change over recent years, with rising rental fees and a higher level of expectation from the occupying students.”

Universities and investors are behind a wave of more modern accommodation, with Wi-Fi to en-suites now becoming the norm as they attempt to attract prospecting students with high end living facilities. A wave of post-graduate accommodation has also come into play and I expect this to continue in 2016, as the majority of investors focused on bridging the gap for first year housing prior to 2015.”

“The removal of the cap on student numbers may have also triggered many universities to anticipate an increase in enrolment over the coming years, hence the jump in the number of new student bedrooms being commissioned in 2015. As investor appetite remains high for student housing, I expect it will be at the forefront for many contractors over the coming years.”

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