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Record-Breaking New Student Bed Spaces Provided in 2018

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The UK student accommodation market continued to flourish in 2018, with 31,348 new beds delivered for the 2018/19 academic year, according to new research from Cushman & Wakefield. This has taken the total number of purpose-built spaces available to a record  627,115 and a further 36,000 new rooms are expected to enter the market in 2019.

Cushman & Wakefield’s UK Student Accommodation Report 2018/19 looks at the market across the UK, including demand and supply of new developments.

New data reveals the private sector has grown 130% in four years and now controls over half of all supply in the market, if considering on-campus partnership bed spaces as ‘private sector’ beds. This is a significant change from 2014 when universities provided two thirds of all beds in the UK. New supply has also been dominated by private sector development with 77% of all beds delivered by this part of the market in 2018.

David Feeney, UK Student Accommodation Advisory at Cushman & Wakefield, commented:

“The student accommodation market shows no sign of decelerating with another record-breaking year of student bed-space provision in 2018. Even with the uncertainty caused by Brexit we don’t expect the UK to become any less venerated as a top location for study and predict the upward trend to continue in 2019.

“Students are increasingly discerning when they select a university and the quality of amenity spaces is more important than ever to the success of schemes. With the private sector tendency towards individual rooms and amenity quality, there is a real opportunity for developers to meet increasing demand, in a market where students are not just weighing up the quality of their course, but the quality of facilities too.

“Over the coming year we will see more re-provisioning of bed spaces into high-grade communal spaces and an increasing number of private-university partnerships to achieve outstanding living spaces for students close to academic buildings.”

The Cushman & Wakefield Student Accommodation Tracker recorded 13,495 purpose-built student accommodation bed spaces in Cardiff for the 2018/19 academic year – up 11% from the previous year. The increase is due to two large-scale developments – a 463-bed Fresh Student Living development (Bridge Street) and a 378-bed CRM development (Crown Place), both located in the city centre. The CRM development at Crown Place is located within close proximity to Cardiff University, boasting studios and two-bed apartments that benefit from an on-site gym, a games room, a cinema room, on-site security and bike storage. With weekly rents starting at £139 and ranging all the way to £321 for a one-bedroom flat, this development is indicative of the growing luxury student accommodation market in the city.

David Feeney said:

“Cushman & Wakefield is concerned about the ongoing development of high-end studios in the market, which now makes up 17% of all bed spaces. Some of these schemes appear to have been driven by development appraisals rather than a true assessment of market demand.

“Between 2016 and 2018, the number of studios in Cardiff rose from 228 to 1883 – an eightfold increase – and this has led to occupancy issues in some developments, with average studio prices falling by 5.6% between 2017/18 and 2018/19.

“A further 2,779 beds have been approved for development, although our conversations with funders reveal concerns around the ongoing proliferation of studio beds. Indeed, we are aware of five schemes that are currently on hold. Selected developments have also applied for changes of use, suggesting there is an over-provision of luxury accommodation in Cardiff which is pricing out students. Despite this, we believe there is still room in the market for well-located en-suite products. These include Crosslane Developments Howard Gardens scheme which is set to open in time for the 2020/21 academic year and will be operated by sister company, Prime Student Living.”

Business News Wales