The outlook is positive for student housing in Europe, but some countries will fare better than others, delegates heard at Real Asset Media’s Student Housing, Micro-living and Co-living investment briefing, which took place online this week with over 780 participants from 40 countries.
‘Places with a good reputation and positive perception like Germany and Canada will be winners,’ said Samuel Vetrak, Chief Executive Officer, Bonard. ‘The UK, on the other hand, is a saturated market and it is likely to be penalised by the uncertainty over Brexit and access to European research funding’.
As the most mature market, the UK might find it is has a surplus of accommodation just at a time when international student numbers may decline because of travel restrictions and the after-effects of the pandemic.
‘There is undersupply everywhere in Europe except in the UK,’ said Douglas Edwards, Managing Director, Head of Equity Raising & Client Services, CORESTATE Capital Group.
The UK also relies more on Chinese and Asian students, while Germany and most of continental Europe have mainly students from other EU countries.
‘Many UK Universities have relied disproportionately on foreign students, so they could be facing financial pressures,’ said Philip Hillman, Chairman, Living Capital Markets, JLL.
‘If there is no second wave and the economy bounces back at the end of the year Germany, the Netherlands and Austria will recover earlier and faster than Mediterranean Europe,’ said Rainer Nonnengässer, Chief Executive Officer, International Campus. ‘These countries hold out the prospect of a job at the end of university, so we expect a steady increase of European students from less solid economies’.
Product preferences are likely to change after the pandemic as some social distancing may still be required, said Vetrak: ‘I predict there will be more demand for studio units and less demand for shared rooms’.
This will also give an advantage to Germany, Austria and the Netherlands, said Nonnengässer: ‘These markets started with studio layouts from the beginning and they are prevalent, while in Spain, for example, room sharing is the norm’.
According to a snap poll conducted among delegates, 46% believe there will be a fall of 30% in international student numbers, while 36% think the decline will be limited to below 20% and only 18% see a fall of 50% or above.