A new trend in real estate investing

Alternative housing properties are mainly student homes and seniors’ homes. In the case of the former, the global transaction volume has increased by 87% in the last five years. The growing number of students combined with insufficient supply create a dynamically developing market that eagerly welcomes private investors.

– The analysis of data on individual cities obtained from StudentMarketing, which conducts research and collects data on student homes and micro-apartments, shows that the smallest opportunities for student accommodation are offered by: Rome (only 6,500 beds for 220.5 thousand students, i.e. only 3% of students), Porto (3.5%), Florence (3.8%), Barcelona (4.9%) and Madrid (5.7%). According to Savills, these cities provide investors with the best opportunities to invest their capital due to the large number of international students and high average rents in private dorms. – we read in the Global Living report.

The situation in Poland

The situation is similar in Poland. According to Savills experts, the number of foreign students in our country has increased fivefold over the last ten years. Polish universities are increasingly chosen by students from Eastern European countries. This creates great demand and a very dynamically developing market for new investments.

– The number of foreign students in Poland has increased fivefold in the last decade and in the current academic year it already amounts to 73,000. Poland ranks sixth in Europe in terms of student population, while experiencing dynamic economic growth and offering more attractive capitalization rates compared to Western Europe. All this makes our country one of the most popular investment destinations for many investors who are already present in Western European countries and are looking for growth opportunities in a stable environment – says Kamil Kowa, member of the management board and director of the capital advisory and valuation department, Savills Polska.

Several private companies have already noticed the investment potential. In the 2017/2018 academic year, nearly 1.3 million students studied in Poland, but only less than 130,000 can find accommodation in 490 dormitories offered by both public and private universities. people, i.e. 10 percent studying. The potential of this market was noticed by, among others, companies such as Student Depot, Basecamp, Golub GetHouse (Livinn) or even Zeitgeist Asset Management. Some of the investments already implemented or planned will offer a very high standard. Savills estimates show that in Poland the private student housing segment provides accommodation for approximately 4,000 students.

– Student housing in Europe is widely recognized as a legitimate asset class with sufficient liquidity. More and more investors, including foreign and institutional ones, consider investing in student housing as an ideal way to diversify their portfolios and obtain higher returns on investment than in the case of traditional asset classes. Investors also appreciate the fact that student housing is considered a recession-proof asset because the number of foreign students is constantly growing – it was growing even during the crisis a decade ago – adds Samuel Vetrak, CEO of StudentMarketing.

According to Savills, in 2017 the value of investment in the private student housing sector reached a record level of USD 17.5 billion globally, which means an increase of 4%. from USD 16.9 billion in 2016. More than half of this volume (51%, USD 8.9 billion) was accounted for in Great Britain and Western Europe – an increase of 35%. compared to USD 6.6 billion in 2016. The greatest investment activity in the student housing sector in Europe was recorded in Great Britain, Germany and Spain.