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News Release

JLL predicts Student Housing will account for £1 in every £10 invested in commercial property in 2017


LONDON, 4 July 2017 - Investment in the Student Housing market is booming, according to latest analysis from JLL. The figures show that £1.9 billion has been invested in the sector so far this year, compared to the £1.7 billion transacted in the same period last year. There is also currently over £3 billion of investment stock pending in the market which is anticipated to complete in 2017.

Student Housing has been a key driver underpinning the total growth in Alternatives investment volumes and is expected to account for 34.7% of Alternatives investment volumes this year. JLL believes that investment volumes will hit £5.4 bn by the end of the year, up significantly from the £3.2 bn reached in 2016 and that Student Housing will account for £1 in every £10 invested in commercial property this year.

Key transactions this year include the acquisition by Unite Students of 640 beds across two sites in Birmingham and Durham for £56m in May and Watkin Jones’ disposal of a development portfolio of 6 schemes to Europa Generation, providing 1,691 beds for £165 million.

JLL predicts that 70% of investment volumes in 2017 will comprise portfolio transactions.

JLL also believe that there will be further growth in University Student Housing Partnerships given there is an estimated requirement of a further £5 billion needed to meet demand to develop new beds and upgrade ageing stock.

Philip Hillman, Chairman of JLL’s Alternatives team, commented: “Amid a slowdown in some real estate capital markets, the robust and defensive qualities of Alternatives assets remain highly attractive in the current climate, as demonstrated by the strong levels of investment in the Student Housing sector in the first half of 2017.

“The softening of the ‘hard Brexit’ rhetoric as a result of the General Election result may lead to reconsideration of the Conservative manifesto pledge to keep student visas in any immigration cap. This will be further underpinned by demographic fundamentals as the number of 18-19 year olds in the UK is set to increase at a rate of 40,000 per annum for the three years from 2022. These are both likely to support a robust performance in the Student Housing sector.”

The full report can be found here.