13,000 More Student Beds Are Needed in Portuguese Cities

15 November 2017

The growth opportunities in the student housing sector are already a recurring theme when it comes to real estate investing. The latest study by JLL in partnership with Uniplaces shows that there are between 13,000 and 18,000 additional beds needed in the cities of Lisbon, Porto and Coimbra.

These numbers come at a time when the number of foreign students studying in Portugal has increased by 120% since 2010, and university accommodations continue to be very informal and fragmented at the three main centres for universities in the country, the report, Portugal Student Housing, stated.

The paper analyses the leading indicators of supply and demand regarding university residences in the three Portuguese cities, and present the most important national trends in student flows and housing characteristics. Lisbon is shown to have a need for an additional 10,000 beds at international standards, while the existing pipeline of developments would provide around 3,000 to 4,000 in the short-term. Temprano Capital Partners, Staytoo and Uhub are some of the private entities that are investing.

Porto requires about 4,000 beds, and has a short-term pipeline of 2,500 to 3,500 beds, with investments coming from MEFIC Capital and Round Hill Capital, as well as Temprano Capital Partners and SPRU. In Coimbra, there are about 1,130 rooms available, with 900 in public university residences and 40 in apartments managed by specialised operators. 22,000 students need accommodation, including 5,000 foreigners. The Collegiate and Staytoo are two of the international operators that are already eyeing the market.

Maris Empis, director of Strategic Consulting and Research at JLL, explains that “millennials are the new nomads. They seek high-quality universities in destinations with a good quality of life, security and a cosmopolitan style. Portugal meets these attributes and is increasingly sought after by foreign students.”

“If we add the Portuguese students who need housing in the cities where they study to the mix, we see that there is a huge imbalance between existing demand and the supply of high-quality university residences that have support and other associated services,” the executive stated. This situation has led to “an enormous opportunity for investors to develop and operate private university residences in the main Portuguese university cities, where this market is still in its infancy. This type of product is quite recent in Portugal and accounts for a small percentage of total student accommodations, which is currently dominated by a supply of private apartments without associated services in a very informal market. And because of this, “there is a huge opportunity for the development of qualified accommodation in line with European standards.”

For Miguel Santo Amaro, founder of Uniplaces, “the number of international students in our country has doubled since 2010, so cities and universities must work together to meet the real needs of students. In Portugal, this market follows the European trend and, as such, presents an enormous potential for growth, putting us on the radar of international investors who are beginning to look to Portugal as a vibrant new market,” he concluded.

Original Story: Vida Imobiliária – Ana Tavares

Translation: Richard Turner