In a report released by realtors Knight Frank, France comes top of the league for investment in student property.
According to Knight Frank’s Head of Student Property, James Pullan, “Student property in Europe has performed exceptionally well as an asset class compared to traditional investments over the last year. In fact, it has outperformed every other commercial property class and delivered consistent returns throughout the economic downturn.”
As the number of students who travel oversees to study rises, cities that host the world’s best universities provide strong investment opportunities for developers and operators in the student accommodation sector.
The rise of the middle classes in emerging economies, the growing acceptance of international higher education qualifications across the world, and the new ‘Internet Generation’ of globally connected and well-informed student consumers has fuelled a growing pool of students travelling across the world to study at degree level and beyond. This presents strong investment opportunities in the cities that host the world’s best universities.
Europe dominates the globe in respect of attracting international students. Around 850,000 students from Asia Pacific, Africa, and North and South America study in Europe and about 50% of the 13.4 million students in Western Europe live away from home.
The 10 key European cities offering investment opportunities for operators and developers are:
1. Paris: International student ratio 17%. A quarter of a million students at 16 world-renowned universities that charge low tuition fees (except for the business schools). Private accommodation in Paris is generally expensive, meaning private student accommodation can be an attractive option.
2. London: International student ratio 33%. Reputation as a global educational hub but has highest cost of living out of the top 10 featured in this list.
3. Vienna: International student ratio 24%. Vienna is a well-known hub for students on short-term exchange programs. Fewer than one in ten students across Austria live in student halls.
4. Dublin: International student ratio 23%. A year-round demand from international students (one in four students at Dublin’s four top-ranked universities is international).
5. Barcelona: International student ratio 11%. Spain’s educational hub, with the country’s two most prestigious universities – attracts a large percentage of South American students.
6. Munich: International student ratio 15%. The city is considered one of the most desirable places to live in Germany. Demand for student accommodation far outstrips supply.
7. Lyons: International student ratio 14%. The city had four top-tier universities; the lowest cost of living out of the top 10 cities featured, and average tuition fees. Only 10% of French national students live in halls of residence.
8. Madrid: International student ratio 8%. Madrid is home to four universities in the QS Top 700 ranking. Private rented accommodation is favored by most students in Spain.
9. Milan: International student ratio 5%. Despite the low percentage of international students the demand for student housing is high; only 2% of Italian students live in halls of residence.
10. Amsterdam: A strong demand for student accommodation; however, complex regulations govern development.
Cities to watch that were not in the top 10 list include Liege, Copenhagen, and Stockholm.
Although mainland Europe is experiencing a high level of financial uncertainty and economic volatility, according to Bob Crompton, chief executive of Knightsbridge Student Housing, “You can’t ignore the economic difficulties in the Eurozone, but academic certainty overrides economic uncertainty.”