Amber Property Partner Unite Students Reports 94% Room Reservations for 2024-25

Key Points:

1. The Unite Student Group has shown strong demand, announcing that around 94% of its rooms are reserved for the academic year 2024-25. 
2. The Property Group's adaptability is evident in its ability to secure 1,000 additional beds through nomination agreements, a response to the significant increase in university demand. 
3. Reflecting a robust international interest, a significant 18% of the group’s portfolio is reserved for international students.
4. Unite Student is confident in its ability to yield a rental growth of at least 7% with an occupancy rate of 98%-99%. 
5. Amber shares a strategic partnership with Unite Students and lists 112 properties with the property management group.
6. Merchant City House in Glasgow and North Lodge in London were the top-performing Unite Student properties for Amber in the last academic year.

Unite Students anticipates a remarkable reservation rate of 94% for the academic year 2024-25. This reflects the robust demand for student accommodation in the UK. Ahead of the typical leasing timeline a substantial amount of student rooms have been occupied for Unite Students. Demand from UK universities has also surged, with over 1,000 additional beds secured through nomination agreements. This represents a notable increase compared to the same period last year on a pro-rata basis.

Unite Students leads the Purpose-Built Student Accommodation (PBSA) sector in the UK. The property group houses 70,000 students through 157 properties. The company has additionally collaborated with 60 universities, reflecting on the strong academic partnerships. The company also emphasises sustainability by achieving a net-zero carbon footprint by 2030.

The rise in demand is also seen on the international student’s end, as 18% of the Unite’s portfolio is now reserved specifically for international students. The company anticipates growth in the rental sector and occupancy with a yield of at least 7% throughout this academic year. The occupancy rate is set to be fixed at 98% to 99%. The forecast is based on the current rise in demand from international students and the strategic relationship between the universities and the Unite Student UK. 

Amber has maintained a strategic partnership with Unite Students over the years. Currently, we have 112 Unite Student properties listed with us in 2024. Among the Unite Student properties, Merchant City House in Glasgow and North Lodge in London were the top-performing properties during the last academic year, recording the highest number of bookings compared to other properties. The expansion of Unite Students and their active involvement in delivering high-quality student accommodation support in the UK is highly notable.

The industry landscape for Unite Students in the UK is exceptionally favourable, as the UK government has rolled out numerous student accommodation development projects. The Central Quay Project is on the edge of receiving full planning consent in Glasgow. This project offers 934 beds at a total cost of £124 million. It is projected to deliver a prospective 7.5% yield on cost. 

In another UK student accommodation news, the Unite Students joint venture with Newcastle University, Castle Leazes in Newcastle, planning consent has been granted to demolish the existing buildings. The property group has recently filed a planning application for 2,000 new beds on the site. This officially sets the stage for the business's entry into the joint venture in Q4 of this year. Unite Students seeks partnerships in London and other strong markets around as it continues to explore supplementary development opportunities during the ongoing expansion.

The property management group has also sustained a significant portfolio through their investments and joint ventures. Unite Students has invested in USAF (Unite UK Student Accommodation)  and also serves as a fund manager while holding a 28% stake. Unite Students London is also part of a joint venture with GIC and LSAV (London Student Accommodation), which has shown solid upward growth in their respective portfolios. 

The quarterly valuation of the USAF portfolio stands at a whopping £2.931 billion, reflecting a rise of 3.2%, whereas the LSAV portfolio has shown a growth of 2.8%, standing at £1.995 billion. These portfolio valuations are a testament to the stable property yields, as both USAF and LSAV are unchanged at 5.2% and 4.5%, respectively. 

With the political landscape changing in the country and the Labour Party coming into power, conditions are changing favourably for the education sector. The Labour Party’s manifesto is more inclined towards making decisions that favour a stable UK higher education scenario. This factor contributes to the factors that will facilitate the company's exponential growth.

The major growth areas for Unite Students student accommodation in UK have been Leicester and Liverpool, along with other cities where the Unite Student properties are available, such as London, Manchester, Birmingham, Leeds, and Bristol. The proximity of these properties to universities such as the University of London, the University of Manchester, the University of Birmingham, the University of Leeds, and the University of Bristol is what makes them one of the top student accommodation alternatives in the region.

TL;DR

According to the recent Unite Students news, the trading and lettings performance update has revealed a strong 94% reservation rate for the 2024-25 academic year. There is an additional surge in the university demand and Unite Students has secured 1,000 beds through nomination agreement. With 18% of its total portfolio being reserved for international students, Unite reflects upon the rise in demand for student accommodation in UK for international students. Also, the company is confident in delivering a rental growth of 7%, along with an occupancy rate of 98%-99%. With the significant increase in USAF and LSAV portfolios of 3.2% and 2.8%, respectively, there is a substantial rise in the quarterly fund valuations. At the same time, the political scenario has also turned out to be favourable for the property group, with the Labour Party’s manifesto more inclined towards a stable UK higher education landscape.