According to the latest report by the consultancy, the rapid growth in the number of students, which has registered an increase of 2.4% between 2020 and 2021, "will drive the demand for accommodation in the next five years in all major European university centers, especially in the main Spanish and Italian university cities ", which in his opinion" will end up putting upward pressure on prices ", mainly in locations with limited supply of beds.
Hence, Savills anticipates that the investment figure for 2022 will be close to 9,500 million euros, in line with the record registered in 2019, with an increase in cross border transactions and a greater number of active players in the market.
These forecasts include the start of a wave of portfolio transactions by the end of next year in this living segment, as the first generation of developers and operators "will be ready to sell their assets and divest."
Regarding prices, although they have stagnated in the last 18 months due to the pandemic, Savills believes that they will begin to grow smoothly next year, in line with the residential market in general. However, in certain cities in which the overall rate of provision of beds by number of students is very low, such as Rome, Milan, Valencia and Lisbon, the consultancy expects strong price growth.
And he notes that, in most European cities, the occupancy levels of university residences have once again reached pre-school figures, or are approaching them. Overall, occupancy is above 90% and further occupancy increases are expected in the next year.
Despite the fact that there is an important portfolio of projects in many European cities, the estimate is that the imbalance between supply and demand will worsen in the next 12 months, in part because most of the development activity has been in suspended during the pandemic and is now facing further delays due to disruptions in supply chains in the construction sector.