Unite to spend £175m on luxury student digs

Aaron Morby 14 years ago
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Student landlord Unite is forging ahead with plans to expand its student accommodation empire.

This year it aims to raise £175m to finance further expansion plans.

In a trading update, the firm said it had secured its first developments outside London.

Unite will now press ahead with plans for a new building in Reading and one in Glasgow. Both are ready to go with planning permission for a total of 1,000 rooms.

Mark Allan, chief executive, said: “Our development pipeline continues to grow and sites in London capable of providing up to 2,300 beds have now been secured under contract, option or lock-out agreements for delivery before 2014.

“In addition, we have started with two further schemes totalling 1,000 beds that will complete in 2011.

He added that reservations for the 2010/11 academic year were on target to deliver rental growth of 3% to 5%.

Room rental rates currently stand between £500 and £300 per week.

Allan said the student accommodation market would continue to grow despite looming higher education funding cuts.

“The growth in student numbers over recent years has exceeded the new supply of purpose built accommodation creating an ongoing demand/supply imbalance,” he said.

Unite said demand from foreign students jumped 29% this year.

While three years of record university intake will see student numbers soar by an extra 70,000.

Allan added: “In-built growth considerably exceeds the current supply pipeline of beds under construction in the UK of approximately 9,000 beds.

“The fundamentals of the student accommodation sector remain strong.”

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