The recent global economic downturn caused a shift in peoples’ perception of what constitutes a ‘safe’ investment and moved the focus of investors away from the more traditional forms of property investment, i.e. retail and commercial property, towards sectors that had previously been considered a more alternative option, like student housing. Historically, the provision of student accommodation was strictly the domain of the universities’, yet increasing budgetary restrictions and tighter governmental controls, combined with an upsurge in the number of applicants over the past five to six years from both UK and overseas students, has meant that institutions have had to relinquish control of their assets and rely on specialists firms in the private sector, like Manchester-based Knight Knox International, to deliver affordable accommodation, at much higher standards than before. The provision of bespoke student accommodation by private property developers has become an extremely lucrative business, accounting for 27% of all student accommodation provision in 2011 according to a market report by CB Richard Ellis; by far the largest proportion compared to alternative types of lodgings, including those provided by the universities themselves. One of the main reasons behind this surge in demand for higher specification accommodation is the growing number of overseas students wanting to study for a British qualification. According to data published by UKCISA, in 2010/11 approximately 428,225 overseas students were registered on Higher Education courses in the UK, a rise of over 22,000 from the previous year. This increase in overseas students is something that James Pullan, Head of Student Property at Knight Frank, is urging investors to take heed of commenting, “the rise in global student mobility has created an excellent opportunity for investment in key European cities… the positive occupational demand for student accommodation has been reinforced year-on-year by the increase in overseas students, a trend that is being replicated across the world”. Private developers have long anticipated this need and, while London is traditionally one of the more popular choices for both students and investors alike, recently ranking 2nd in Knight Frank’s Top Ten Destinations for International Student Property, it is has extremely high living costs, highlighting why regional university towns are becoming a more affordable option, in terms of inexpensive rents and profitable yields. “We have always focussed on sourcing accommodation in regional cities and towns”, comments Martin Copeland, Sales Director at Knight Knox International, “as they generally produce higher yields over a longer period of time. “Our confidence in the longevity of the student accommodation market is reflected in the quality of the developments we have brought to our investors, and the projects we have in our portfolio for future release.” Specialists in the student accommodation sector for many years now, Knight Knox International sold over 5,000 properties in over 50 countries, ands has a wide range of developments in numerous regional cities which are currently generating yields of 10% in year one. Borden Court is a boutique student residence in the heart of Liverpool, within walking distance of both Liverpool John Moores and the University of Liverpool. Comprised of 117 single en-suite units, the development is equipped with communal facilities and amenities and is the ground floor has been converted into a shopping centre, comprised of high-fashion retail outlets, homeware stores and eateries. Nelson Square and The Bank are sister developments in Bolton, comprised of a mixture of studios, en-suites and single unit pods. Both located in the centre of Bolton, students have shared access to facilities. Lovell Park is a stylish refurbishment project in Leeds, with facilities for approx 66 students. The epitome of boutique accommodation, students will have access to hotel-style facilities, including free WiFi, LCD TVs and games room. For further information on the range of student accommodation developments available through Knight Knox International, contact +44 (0)161 772 1370. Alternatively, if you are looking to release the equity in your student accommodation investment, contact +44 (0)161 772 1390 and speak to a property consultant from studentpodshop.com, the UK’s first student accommodation resale site.
Rise in Global Student Mobility Presents Exciting Investment Opportunities Student Property Sector
Recently published research on both the UK student housing sector and the international student population has confirmed observations long held by global property investment firm Knight Knox International, in that the student accommodation market is the ideal long-term investment for any buy-to-let portfolio.