MIPIM: Student demand outpaces PBSA sector growth

While the number of companies involved in the purpose built student accommodation (PBSA) sector has more than doubled in five years to over 1,500 companies, student numbers and the demand-supply gap have grown more quickly. This has reinforced the sector’s resilience and long-term potential according to rented residential data specialist Bonard.

The firm pointed out that PwC and ULI have ranked student housing among the top three most investable asset classes for 2025.

The expanding ecosystem of investors, developers, and operators is driving the creation of sizeable student housing portfolios, and the growing number of active players enables more structured and scalable investments. This is fostering larger transactions and more sophisticated product offerings. “As a result, investors can now access bundled student housing assets, further enhancing liquidity and market efficiency,” said Bonard’s chief partnerships officer Stefan Kolibar, speaking at MIPIM this week.

European and Canadian student housing markets collectively comprise 430 portfolios according to Bonard data. “Based on dozens of conversations we’ve had at MIPIM this week, it is clear that the rented living sectors, including student housing, are high on the investment radar. The incremental involvement of institutional investors and core capital is expected,” Kolibar said. After stagnation in 2023, the volume of student housing transactions doubled in 2024, with a particularly strong uptick in the last quarter.

There was a 7.4% average increase in rents across the 953 buildings monitored by Bonard according to its latest data. Rents grew 11.3% in the UK while in Continental Europe the average increase was 5%. Denmark and Portugal recorded the steepest rises at 7.8% and 8.4%, respectively. Occupancy rates remained high, averaging 97% across all the countries surveyed, despite the increase in rents.

The volume of investments doubled in 2024 compared to 2023. “A particularly strong uptick in the last quarter indicates renewed confidence among investors, with an improved economic outlook expected to drive further growth in 2025,” Kolibar said.

The continued supply/demand gap was also confirmed by the latest statistics which showed that 27% of student cities experienced a decline in the number of purpose built student accommodation (PBSA) beds available compared to the number of international and mobile students.

A recent investor survey of 117 sector stakeholders conducted by Bonard indicated that over 70% of respondents plan to invest more in student housing in 2025 compared to 2024, supporting the firm’s prediction that the sector will benefit from the improved economic outlook.

“Based on our historical data, we do not expect international student demand to drop, and the student housing sector has strong fundamentals that will enable it to thrive despite the uncertainty caused by regulatory changes in specific study destinations,” said Kolibar.