Investment in student residences recovers and registers more than 400 million euros to date in 2021, according to Savills Aguirre Newman. This volume is already 21% above the total investment in 2020, the year in which investment fell by 27% compared to 2019, due to the mobility restrictions imposed by the health crisis.
The profile of buyers and active players in the market is mainly international, although the creation of joint ventures (JVs) with international capital and local knowledge is becoming more and more frequent.
According to the international real estate consultancy, the student residence market in Spain is mostly in private hands and is characterized by a high level of obsolescence. The arrival of large international groups is promoting the improvement of the quality of the park and the average size of the assets and will allow the creation of a stock that adapts to international standards.
Nicolás Llari de Sangenís, Director of Student Residences at Savills Aguirre Newman, adds that "the growing mobility of foreign students, together with the new standards of accommodation in demand, is marking the high development of new projects".
Despite the fact that in the last five years the number of places in Spain has experienced a cumulative growth of 10%, the provision of beds stands at 7.1%, which means that the ratio of beds per student is 1: 14. In a mature market such as the United Kingdom, levels reach 33% and 1: 3, which highlights the enormous growth path that the Spanish student residences market must undertake.
During 2021, 20 projects will enter the market with 5,100 new places that will allow more than 100,000 beds in the market. Likewise, Savills Aguirre Newman considers that between 2022 and 2023 14,600 new places will be incorporated distributed among 36 projects. Despite the massive delivery of new projects, the provision of beds would only advance to 8.3%, resulting in a ratio of 1: 12.
Regarding the location of the new projects, Barcelona, Madrid and Seville will concentrate 53% of the new promotions and 63% of the places planned between 2022 and 2023.
The analysis of rates in student residences shows that tier 1 locations (Madrid, Barcelona and Valencia) would slightly exceed 1,200 euros per month, while tier 2 categories (Seville, Malaga, Granada, Salamanca, Pamplona and Bilbao) and tier 3 (San Sebastián, Santander and Zaragoza) are around 850 and 750 euros / month, respectively.