How to find opportunities for purpose-built student accommodation (PBSA)

The UK’s Purpose-Built Student Accommodation PBSA) sector continues to boom and show resilience in the face of a challenging economy. With universities expanding and taking in more and more international students, the demand for high-quality student housing represents a significant opportunity for developers and investors.

Understanding the PBSA market

PBSA developments offer professionally managed, high-quality living spaces designed specifically for students’ needs. Modern PBSA schemes typically include a mix of cluster flats with shared facilities and self-contained studios, complemented by attractive communal areas and onsite management. 

Key location factors for PBSA developments

Proximity to education facilities

Location remains the main driver of PBSA success. Sites within a 15-minute walk of university campuses typically achieve the highest occupancy rates. According to Knight Frank’s Student Property Report, developments within this golden radius command premium rents and maintain strong occupancy levels throughout the academic year. 

Transport connectivity

While walking distance to campus is ideal, high-quality public transport links can make slightly more distant locations viable. These PBSA sites should offer:

• Direct bus routes to main university buildings
• Good cycling infrastructure
• Safe walking routes
• Easy access to city centre amenities

Site requirements and planning considerations

Technical requirements

Modern PBSA developments need sufficient space for both living areas and essential amenities. Typical requirements include:

• A minimum site area of 0.2 hectares for urban locations 
• Space for communal facilities including study areas, gyms, and social spaces 
• Adequate service access for maintenance and deliveries 
• Bicycle storage and limited car parking

Planning success factors

Local authorities generally support PBSA developments that demonstrate:

• Integration with local housing strategies 
• High-quality design that enhances the local area 
• Sustainable building practices and energy efficiency 

Our planning applications tool offers detailed insights on successfully navigating the planning process.

Market analysis and site viability

Understanding local market dynamics is crucial. Key considerations include:

Supply and demand balance

Consider assessing existing student numbers and any university growth plans. Many institutions are expanding their international growth programs, driving demand for high-quality PBSA developments.

Competition assessment

Map existing PBSA developments and pipeline projects in your target area using Searchland’s site sourcing tool to identify gaps in the market and areas with development potential. 

Future-proofing your development

As the PBSA sector continues to evolve, you should pay extra attention to: 

• Sustainable design and operation
• Digital infrastructure and smart building technology
• Flexible spaces that can adapt to changing student needs
• Mental health and wellbeing facilities

Using technology to find profitable opportunities

Modern site selection requires sophisticated data analysis. Searchland's site sourcing workflow can help developers:

• Identify suitable sites near universities
• Assess planning constraints and planning red flags
• Track competitor developments via planning application alerts
• Monitor student demographic trends
• View local rental and lettings comparables to understand investment potential and spot areas of emerging opportunity
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Investment considerations

The PBSA sector presents a unique investment opportunity but requires careful financial planning. Recent data from CBRE shows that UK PBSA investments reached £3.1 billion in 2023, highlighting the sector's strong performance despite challenging economic conditions.

Yield expectations

Global commercial real estate service provider CBRE's latest UK purpose-built student accommodation (PBSA) Index has reported total returns of 9.8% for the sector in the year to September 2024, with variations based on:

• Location quality and proximity to top-tier universities
• Building specification and amenity provision
• Local market maturity and competition levels
• Management track record and operational efficiency

Development costs

When evaluating a potential site, we advise you to consider: 

• Rising construction costs and their impact on viability
• Premium specifications required for modern PBSA
• Ongoing maintenance and management costs
• Technology infrastructure investments
• Sustainability requirements and associated costs

Understanding the finances alongside location criteria is crucial to the success of a PBSA development. 

Ready to start your PBSA development journey? 

Book a demo with Searchland today and discover how our advanced mapping and analytics tools can help you find your next perfect PBSA opportunity.

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