West Midlands Student Housing Developers Prepare For Post-Pandemic Surge
Developers are preparing the way for a new wave of purpose-built student accommodation in the West Midlands, despite the damage done to the sector’s income flows by the coronavirus pandemic.
Funding has been agreed for a 780-unit scheme in Coventry, whilst plans have been submitted for a 950-unit scheme in Digbeth.
An analysis by Knight Frank submitted to support the Digbeth application suggests that 15,600 Birmingham students are potential tenants and that current PBSA provision across the city is 12,000, a shortfall of 3,600.
An earlier Knight Frank report in August 2020 concluded that growth in student numbers over the next five years would mean there were two students competing for each PBSA bed.
Earlier this month councillors appeared sceptical about demand for student housing. Proposals from Hines’ Aparto student accommodation brand for 1,187 units in five buildings at a site at Selly Oak, close to Birmingham University, were knocked back by city councillors amidst doubts about the extent of demand for PBSA.
The 6-acre former Digbeth bus station site will see 950 student housing beds along with 1,500 apartments in several mid-rise towers thanks to a proposal from HUB Birmingham and National Express. Avison Young is advising.
In Coventry, Cain International, the privately held investment firm led by Jonathan Goldstein, has agreed an £80M development loan with Vita Group and an established real estate investment manager to finance the development of a 780-unit student accommodation scheme near the University of Warwick.
The 169K SF Vita Student development received planning consent in November 2019 and began construction in October 2020. It will be ready for occupancy in the 2022-2023 academic year and will be delivered in three phases, with the first 563 units anticipated to reach practical completion in September 2022 and the remaining units to be delivered in December 2022 and January 2023. The final scheme will comprise 73% studios, 7% ‘twodios’ (two independent student bedrooms with direct access to a shared kitchen and communal facilities) and 20% cluster apartments.
“The purpose-built student accommodation sector has demonstrated its resilience, and we are confident that its strong fundamentals will see outperformance and investment volumes continuing to increase in the months ahead,” Cain International principal Graham Keable said.
“Demand remains particularly robust from international students and we expect this to continue as the cap on growth in student numbers is removed, with the highest quality student accommodation schemes set to benefit most.”
