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Student housing sector across continental Europe is coming of age, says new report by JLL

France, Germany, Ireland, Italy, The Netherlands and Spain are six key markets pinpointed for sustained growth over the next 10 years


Against the backdrop of increasing institutional investor appetite for higher education accommodation assets in European markets outside the UK, JLL will launch its 2017 European student housing report at MIPIM today. The report highlights the key trends investors should look out for and identifies six European markets in which the sector is poised for sustained and significant growth: France, Germany, Ireland, Italy, The Netherlands and Spain.

Key trends:

  • Markets in which student housing is emerging as an asset class are in high demand: Institutional funds, private equity and established operators – both international and domestic – are hungry for new portfolios in new markets. JLL estimates there is currently as much as €4- €5billion of capital looking for student housing stock across Europe. At the same time, there has been an explosion in the number of English Taught Programmes in key European markets where English is not the first language, with more than 6000 courses now on offer, compared to less than 500 only 10 years ago. European universities are set to gain greater market share of the international student market, currently dominated by the USA and UK.
  • Rapid increase in student population demanding better quality accommodation will spur more competition: International student numbers are set to hit 7 million in 2020, up from 4.1 million in 2014, and expectations of student accommodation have increased. European universities must take into account the need for modern, purpose built student accommodation if they are to remain globally competitive.
  • High growth potential with low risk: Student housing stock is often classified as residential in many of the key European markets. Consequently, yields are in line with the more established residential investment markets, providing lower risk for investors without sacrificing growth.
  • Europe offers a mosaic of opportunities: While there's a clear trend towards growth, the student housing sector in each market is at different stages of maturity and evolving at different speeds. In markets such as Ireland, Spain and Germany, the lack of supply is the main driver for investing. In France and the Netherlands, the strength of student demand is supporting growth.

    Philip Hillman, chairman of alternatives, EMEA, JLL, said: "It is an exciting time for investors in student housing across Europe. In the UK, the student housing sector is maturing and is now recognised as an asset class in its own right. Investors are now looking towards continental Europe for stronger returns. The six markets we've highlighted are emerging on the scene but they're also highly liquid and benefit from the same key underlying fundamentals as the more mature UK market. Europe offers a mosaic of opportunities with markets at different stages of evolution and developing at different speeds, giving investors a range of options to consider." ​