What is the true outlook for the student residential market? How does the sector compare with others? How will the outcome of the 2015 election impact on higher education in the future? And how does the UK rank in terms of the European picture?
These questions and more were up for discussion at this year’s Student Accommodation conference, organised by Property Week and held at the Bishopsgate centre in the City of London. As media sponsors here at University Business magazine, we were keen to head along and find out what is really going on in the student housing market.
The sector has certainly changed and grown dramatically in the last decade. With the advent of high tuition fees and living costs, today’s students are no longer willing to put up with what was once considered acceptable student living. They are highly demanding, tech-savvy customers who want top quality accommodation with all mod-cons and providers who go the extra mile. It’s a highly competitive marketplace but one which presents excellent investment potential across the board.
According to Property Week editor Liz Hamson, 2014 has been an exceptional year for the student accommodation sector, with transactions set to reach £4bn by the end of the year; that’s double the value of 2013. It’s small wonder then that the conference room was busting at the seams with a mixture of developers, investors and university professionals keen to hear more.
Aside from the usual run down on market dynamics and projection for growth (which still remains strong,) there were several interesting sessions which focused more on the wider issues of the student and university sector, including funding for the future, as we head towards another general election, with key speakers including HEPI director Nick Hillman, CUBO chair and Director of Residential at Leicester University, Frances Stone, Chief Executive of Unipol, Martin Blakey and Michael Ferraby, Head of Finance at the University of Leeds.
As it turns out, it was very timely to look at funding issues for students as Chancellor George Osbourne made an announcement that very same afternoon on changes to postgraduate funding which should provide a boost to this declining sector of the student market with new government-backed loans, worth up to £10,000, available from 2016-17 and set to benefit 40,000 students.
This session was swiftly followed by an insight into the ‘millennials’ generation (those people born between 1980 and 1995) from the charismatic Dr Matt Carter, founder of Message House. He shared some great insights into what today’s student consumer is about at heart; from a passion for technology to being the ‘sharing generation’, more liberal minded and positive than their parents and keen to explore new experiences above anything else. However, he also warned us that this ‘google generation’ is more likely to complain (taking to social media to do so), more in debt than their parents and, perhaps, slightly deluded about their future prospects and wealth. All great food for thought for the audience.
After a great lunch of tasty bento boxes and networking, we could take our pick of an afternoon session so I headed for an interesting panel debate on the impacts of students on communities – the age old ‘town versus gown’ conflict. Chaired by James Hunt from Unite, and featuring speakers from Campus Living Villages, Balfour Beatty, Local Dialogue and Stride Treglown Architects, we certainly got the broad spectrum of views on just how to build Purpose Built Student Accommodation (PBSA) schemes which work for both students and the local communities.
It seems there is a real communication problem when it comes to the perception of students versus reality. As Mark Brown from stakeholder communications firm, Local Dialogue commented: ‘We tend to lump students together as one tribe, all acting the same. It’s a very black and white view which colours our inner response. But, often, concerns around the negative impact which student housing has, have, on the whole, not been recognised.’ The panel also concluded that of all student housing, PBSA schemes offer the best solution for both students and local residents as they offer the best levels of management and monitoring.
All in all, this year’s event was very well attended and received by the great mix of 480 plus people working in and fascinated by the ever-shifting world of student living. It will be interesting to see which predictions from the event come true as we head into 2015…