Over €12bn to be invested in European PBSA over the next five years
The Class Foundation and Savills’ new European Purpose Built Student Accommodation (PBSA) Investment Barometer Report reveals that 93,600 beds, equating to EUR 12.3bn in investments, can be expected over the next 2-5 years; led by Spain, Italy, Germany, France, and Portugal. According to Savills, there are currently 1.94 million PBSA beds (public and private) in Europe, with an estimated total value of c.€286bn.
The report, published ahead of its largest industry on this market segment in Barcelona on 9th of November, includes findings from a survey of European investors and operators who collectively manage PBSA assets worth EUR 17.8 billion, highlights barriers that will impact investments into the PBSA market the next 2-5 years, with 45% citing that securing planning permission is a big challenge, as well as European and global economic growth, interest rate movements, inflation, housing, affordability and regulations. 62% of respondents also expressed that they intend to refurbish non-compliant stock for ESG regulations, while 23% plan to sell it.
Kelly-anne Watson, Managing Director, The Class Foundation, noted: “This survey is key in providing the industry with information on the ambitions and concerns of our investors and operators. The data shows the strength and confidence of the PBSA sector after unprecedented growth in recent years. Investors are eager to meet growing demand for PBSA by expanding in markets across Europe. However, a number of challenges present us with a reality check will need to be addressed by our community to ensure much needed student housing will be built.”
Richard Valentine-Selsey, Director, Residential Research, Savills, said: “It’s great to have such valuable insights from European investors as a result of this survey and what’s interesting is the future growth plans or the sector, but also the challenges preventing it from developing even further than that. Unsurprisingly, given the economic backdrop, equity and debt for development came out as the biggest concern. This does however also point to an opportunity for those investors who have already raised capital and are in a position to start deploying.”
As well as debt and equity, land acquisition and affordability were highlighted as the biggest challenges for investors in the report, with site connectivity remaining paramount when choosing green or brown belt land, closely followed by sustainability, construction costs, and complexity.
For further information and inquiries, please contact The Class Foundation or read more here.
About The Class Foundation:
The Class Foundation, established in 2011, operates as a partner-based non-profit organisation with the goal of advancing the professionalism and understanding of student housing across Europe. Serving as the largest European Student Living eco-system, its mission centres on being the foremost think tank dedicated to the realm of student housing and experience. With research, events, collaborations and awards, The Class Foundation fosters an extensive international network comprising more than 100 complementary partners creating homes for more than 3 million students. By facilitating connections among operators, investors, policy makers, universities, service providers and student organisations, we provide a community and platform for thought leaders to the exchange high-quality information and best practices.
Savills is a global real estate services provider listed on the London Stock Exchange. Savills operates from over 700 owned and associate offices, employing more than 40,000 people in over 70 countries throughout the Americas, the UK, Europe, Asia Pacific, Africa and the Middle East, offering a broad range of specialist advisory, management and transactional services to clients all over the world.
For further information, please contact:
PR Director, Savills
Marketing & Communication Manager, The Class Foundation
Research Manager, The Class Foundation