Student property firm says bookings have hit record levels
Student property firm Unite say bookings for the next financial year have reached record levels.
The Bristol based business has recovered strongly from the pandemic and say that 98 per cent of its rooms are sold for the next academic year.
Chief executive Richard Smith announced the news in a trading update.
He said: “Reservations for the 2023/24 academic year remain at record levels, with 98 per cent of rooms now sold, reflecting strong demand from both students and universities and the attractiveness of our fixed-priced all-inclusive offer.
“This supports an improvement in our rental growth guidance to around seven per cent for the 2023/24 academic year. Our strong leasing performance will continue to support our property valuations as the market adjusts to an environment of higher interest rates.”
Unite said the supply of purpose-built student accommodation is failing keep pace with growing student demand at the same time as private landlords are leaving the sector.
The company said it is uniquely positioned to address this housing need through its best-in-class operating platform, university relationships development and asset management capabilities.
Unite is committed to four development schemes with a total development cost of £339m and blended yield on cost of 6.7 per cent for the student accommodation elements.
The £179m remaining costs to complete these projects will be funded through the group’s cash and committed debt headroom of £393m.
During the quarter Unite completed a new £400m secured loan, refinancing its £380m bond which matured in June 2023.
Unite’s property portfolio has been independently valued at £2,923m, a 1.2 per cent increase on a like-for-like basis during the quarter.
The valuation increase is driven by quarterly rental growth of 2.2 per cent and a 5 basis point increase in property yields. The portfolio comprises 27,924 beds in 71 properties across 19 university towns and cities in the UK.