BRIEFING: Student Housing

Student housing has huge growth potential in Central and Eastern European countries, as demand is growing but there is very little supply, experts agreed at Investment Briefings’ CEE and Europe panel discussion, which took place in Warsaw this week.

‘There is a huge imbalance between supply and demand in CEE cities, which are increasingly popular,’ said Rainer Nonnengässer, CEO, International Campus. ‘Students have a hard time finding accommodation. This is what makes investments into student accommodation in the region so attractive.’

The sector is very small but it is destined to grow. ‘Student housing would be my investment choice in 2019,’ said Luke Dawson, Managing Director & Head of Capital Markets CEE, Colliers International. ‘It is a long-term, sustainable asset class that has got a lot of runway ahead.’

The harmonisation of standards and mutual recognition of courses is driving student mobility in Europe, while programmes like Erasmus have boosted student exchanges in Europe. ‘Warsaw, Prague and Budapest have gained much more traction recently,’ Nonnengässer said. ‘They are attractive cities, they are young and lively and the cost of living is lower than in other EU cities.’

Because construction costs are lower in the CEE region, International Campus ‘has the opportunity  to keep prices lower than in Germany, our main market, so we can attract domestic students and not just more affluent international students.’

The asset class is fast expanding beyond student housing to include co-living and micro-living for young professionals. ‘We are starting to look at co-living schemes as well as student accommodation,’ Nonnengässer said. ‘I believe that in the next few years the dividing line between residential, hospitality and concept-based living products will disappear.’

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