Investors retain enthusiasm for students

Paris Seine

Ivanhoé Cambridge and Bouwinvest Real Estate Investors’ have partnered with Greystar Real Estate Partners to invest €1bn to develop student and young professional housing in the Greater Paris region.

The venture was targeting new acquisitions, including ground-up developments and projects already under construction.

“There’s growing demand for scaled, student housing platforms in Europe,” says Nick Wride, head of student housing EMEA, JLL. “But scale of opportunity has historically been the big stumbling block for investors looking to deploy capital.

“Demand for high quality, affordable housing from student populations in large, metropolitan areas with top quality higher-education institutions is only one side of the story, it’s also about the attractiveness of those locations for graduate professionals; that then retains investor appeal well beyond current Covid-19 disruption.”

The Paris region accounts for around 37% of France’s estimated 2.6 million students, with investment in French student housing more than tripling last year to reach €1.1bn.

As home to three of Europe’s top eight cities in terms of beds-under-construction or in planning, the UK for now remained Europe’s largest market, according to research from Bonard.

Blackstone’s acquisition in February of iQ Student Accommodation for £4.66bn was the UK’s largest ever private real estate deal on record. Other significant investment in the sector includes Singaporean investor Mapletree’s purchase of several Unite Group units and last year’s £600m purchase by German investment manager DWS of a portfolio of assets from Vita Group.

“Demand for accommodation from a growing UK student population has been driving investment,” says Philip Wedge-Bernal, EMEA Living Research & Strategy director at JLL, pointing to an expected 27% increase in UK student numbers in the next decade, or 40,000 new students per year.