PBSA sector in UK to reach £53 billion in 2019

PBSA sector in UK to reach £53 billion in 2019

Recent forecasts from Knight Frank have revealed that they expect the UK purpose-built student accommodation sector (PBSA) to reach a value of £53 billion by the end of 2019.

Thanks to a significant number of large institutional investments in 2018, the value of the PBSA market has catapulted, and this is expected to continue throughout 2019, demonstrating the investment potential and long-term resilience of the sector.

If Knight Frank’s predictions are correct, this will be a 72% rise in the value of the PBSA sector since 2014 which is just staggering. Much of the interest in the student property market is coming from Southeast Asia, the Middle East and North America with many high value deals being struck.

Driving this demand is the fact that UK student numbers continue to grow and that we have some of the top universities in the world on these shores. However, the supply of suitable accommodation to meet the demand can’t keep pace, making high quality PBSA developments a premium.

Commenting on the forecasts, James Pullan, Global Head of Student Property at Knight Frank, said: “Despite Brexit, global investors continue to acquire PBSA assets in the UK, fundamentally underpinned by the UK’s world-renowned higher education system. The asset class offers a stable income stream, with strong year-on-year rental growth prospects. When compared to more mature asset classes such as the offices sector, PBSA is standing out and that looks set to continue into the new year.”