Student accommodation firm is developing four new schemes

Student accommodation specialist Unite Students says it is continuing to see strong demand for its properties.

As a result the Bristol firm is currently developing four new schemes across the UK.

Unite say it is continuing to see strong demand with 71 per cent of beds sold for the next academic year.

The company said it is confident of delivering rental growth of at least five per cent for the 2024/25 academic year.

Joe Lister, Unite Students chief executive, said: “We have seen a strong start to the 2024/25 sales cycle, reflecting the continued appeal of our fixed-priced, all-inclusive offer.

“The letting performance highlights the ongoing strength of demand from students and universities and underpins a positive outlook for rental growth for the 2024/25 academic year.

“We will continue to play a leading role in increasing the supply of much needed student accommodation at a time when HMO landlords are leaving the market at pace and the new supply of purpose-built student accommodation slows. We are committed to working closely with our university partners to ensure students have access to high quality, affordable accommodation.”

 Higher than expected rental income in the first term of the 2023/24 academic year has offset the impact of higher operating costs in the second half of the financial year.

Demand for the group’s accommodation has again been strong, reflecting the continuing shortage of high-quality student accommodation.

Across the group’s portfolio, 71 per cent of rooms are now reserved for the 2024/25 academic year, in-line with the record levels seen last year.

Unite is now on site with four development schemes in London, Bristol, Edinburgh and Nottingham, totalling 2,000 beds, for delivery between 2024 and 2026.

In addition, the Meridian Square project in London is expected to go to planning committee in late January and remains on track for delivery for the 2027/28 academic year.

Unite is tracking further development opportunities in London and strong regional markets at attractive returns and expect to add to its pipeline.

Unite completed cladding remediation works on 16 buildings across the estate in 2023.

The company continues to prioritise projects based on our external risk assessments and will make provisions for remediation costs on a further 10 buildings, the cost of which will be incurred over the next 12-18 months.

Unite recently reached agreement with a contractor to recover 75 per cent of our remediation costs relating to five buildings, a portion of which will be recognised in the group’s year-end balance sheet.

Unite ultimately expect to recover 50-75% of total cladding remediation costs through claims from contractors.

The firm expects to incur an additional £69 million provision  in the second half of 2023.

At 31 December Unite’s property portfolio was independently valued at £2,992 million, a 2.1% increase on a like-for-like basis during the quarter.

The portfolio includes 27,922 beds in 71 properties across 19 university towns and cities in the UK.