(Visited 68 times, 1 visits today)
(Visited 68 times, 1 visits today)

Investments in student housing increased by 7.6% in Europe

27 October, Milano Finanza

The simple little rooms with shared bathroom are long gone. The new-generation student accommodation features functional furniture, mini apartments equipped with any sort of comfort, common spaces, gyms, bike sheds and laundry rooms. They are actual places where to live, and not only where to study and work. Alessandro Ghisolfi, head of the Abitare Co. research centre, comments: “It’s the sign that the segment is attracting an increasing number of big real estate investors, investment funds, insurance companies, sovereign and retirement funds. These operators can provide a quality product meeting the needs of Europe’s growing student population whose yearly growth rate is higher than 5%. According to the figures, the European market is expected to reach 8 million students by 2025. In 2017 the global investments in student housing were equal to 15 billion euro, 7.6 of which only in Europe, the geographical area that registered the sharpest increase, +27% from 2016.

The UK was the first country to realise the opportunities offered by the segment, starting to promote already 15 years ago properties of high to medium quality which provided excellent returns (6.6% yearly gross average). In France, Germany and Spain, the average returns go from 5.5% to 7.5% gross a year. Ghisolfi continues: “The potential growth of the student population is an element that investors take greatly into consideration, as well as the quota of international students. Another factor is the prestige of the university”. The chart of the Times World University Ranking places the UK first with 40 cities included in the chart, followed by Germany (23 cities), Italy (12 cities), France (6 cities) and Spain (4 cities). Ghisolfi comments: “For what concerns Italy, although no increase of the student population is the expected in the near future (on the contrary, it decreased by 1.4% in 2016 from the previous year), the chronic lack of offer for student accommodation and the higher rents led to evaluate the opportunities of this segment. This trend mainly concerns big cities such as Milan, Rome, Turin, Bologna and Florence”.

Among the new projects, there is the one of the Dutch The Student Hotel (Tsh), which inaugurated in June a luxury student hall in Florence, overhauling and requalifying the historical Palazzo del Sonno, formerly the Ferrovie dello Stato offices.  The facility doesn’t cater only students but also to young travelling professionals. It features a terrace with a swimming pool on the top floor offering a panoramic view of the city. Tsh has already announced the opening of new similar facilities in Bologna and Rome. A new campus will open in Milan near Bocconi, featuring a gym, a swimming pool and a cinema. The construction is meant to be completed by 2020, offering approximately 600 beds. The initiative is brought by Hines which invested 85 million euro in the project. Aparto has been appointed for the management of the facility. Hines is intentioned to pursue its strategy in student housing with other projects in Rome, Florence and Venice.

Source: Milano Finanza

Translator: Cristina Ambrosi