Royal Bank of Scotland Business’ Post

Please take some time to read another great issue of the NatWest Real Estate Digest. Key themes from the issue: - Student accommodation has been a top performing sector in recent years, but risks are emerging. - Universities are increasingly reliant on overseas students and numbers are predicted to fall. - Modelling from the OFS suggests that 3 in 4 institutions could be in deficit by 2026, so stock selection is critical. - In the mainstream commercial sectors, values are broadly stable, but investment remains weak. - Retail Warehouses and Industrial are expected to outperform, with offices lagging behind.   Please note that this series should be treated as marketing material and is in no way intended as investment advice.

Our latest views on the UK Real Estate market - November 2024: - Student accommodation has been a top performing sector in recent years, but risks are emerging. - Universities are increasingly reliant on overseas students and numbers are predicted to fall. - Modelling from the OFS suggests that 3 in 4 institutions could be in deficit by 2026, so stock selection is critical. - In the mainstream commercial sectors, values are broadly stable, but investment remains weak. - Retail Warehouses and Industrial are expected to outperform, with offices lagging behind. 

💡 Purpose Built Student Accommodation (PBSA) has remained a standout performer in commercial real estate. But sustained returns depend on higher education institutions maintaining student demand and financial pressures could pose risks. 🤔 Is PBSA still a first-class asset, or is it time to rethink its long-term potential? Click the link for more detail or read our key takeaways below: https://lnkd.in/eh6b8mC5

In this month’s Coutts Real Estate Digest, the Purpose Built Student Accommodation (PBSA) sector is the focus. PBSA has remained a standout performer in the commercial real estate space this year. However sustained returns depend on higher education institutions maintaining student demand (domestic and foreign) and financial pressures could pose risks. Is PBSA still a first-class asset, or is it time to rethink its long-term potential? https://lnkd.in/euCzkWXY #realestate #property #commerciallending #coutts

We are excited to share our insights on the #PBSA sector in Europe. Our research highlights the significant growth potential of this market, driven by declining interest rates and an increasing student population. We believe that the strong fundamentals of PBSA, indicated by high occupancy rates and resilience, position it as a prime investment opportunity for those seeking long-term capital appreciation. Delve deeper into our latest report to explore insights into the student housing landscape. https://cbre.co/4fxfaHF #StudentHousing

And this stat is not too far off from what exists in other professional industries. 📊 How do we solve the challenge of keeping up with future developments in CPD education for real estate professionals? Follow us for continuous updates on REA required CPD courses: https://lnkd.in/gqDpJUh4. 09-889-7653 (9am - 9pm) #RealEstateEducation #CPD #FutureTrends #eagent #rea_cpd

New reports from Knight Frank have found that total investment in UK purpose-built student accommodation has hit £3.3bn so far this year, up from £2bn at the same point in 2023. Nearly half of the deals in 2024 so far have been for lot sizes valued up to £25m, with deals in the £25m to £50m category accounting for nearly a quarter of investment.   The UK’s PBSA market remains an attractive asset class, accounting for nearly half of global capital going into the PBSA market worldwide. Strong investment volumes show the resilience of the market, continuing to appeal to investors, especially as they look to get a foothold in the UK market. https://bit.ly/3NTKPqJ #PBSA #Investment #PropertyMarket

🎓🏢 Unlocking Success: PBSA in Scotland 🌟   Despite clear economic headwinds, the PBSA sector in Scotland continues to shine, boasting record rental growth across the country's key academic cities.   Whilst rental levels continue to rise across the sector, affordability is becoming increasingly important for the student population and calls for government intervention are growing louder.  Working with government initiatives and regulations will be crucial to the sustainable success of the sector, along with diversification in the range of PBSA assets to ensure continued profitability for investors.   Further musings can be read in my recent EG article: https://lnkd.in/ezyiFEDG What are your thoughts on the future direction of PBSA in Scotland? Join the conversation below! #PBSA #Scotland #Dentonsrealestate #CommercialProperty

Whilst students waiting for the results of their A'Levels around this time of year is not an uncommon sight, adding to this the additional pressure of being able to find affordable good quality accommodation once you get into university, should be. With soaring mortgage rates, diminishing tax benefits and increasing regulatory pressures leading to a general exodus of private sector landlords, there is opportunity for institutional investors to step into the gap and deliver good quality Purpose Built Student Accommodation (PBSA). University applications still are at 6 per cent above pre-Covid levels (according to UCAS) coupled with an estimated reduction of 100,000-150,000 beds for students to rent in shared houses since 2021. In the recent Knight Frank report on PBSA, it was estimated that £2.45bn was invested in the first half of 2024 (more than double than the same period in 2023) of which £1.7bn was invested in Q2 alone as opportunity presents itself in the lack of PBSA around the country. Access the Knight Frank Report here: https://lnkd.in/ebKEnPKH Interesting article from the FT today here: https://lnkd.in/eQeEvHt4 #PBSA #development #studentaccomodation #WBDLiving

PBSA availability is facing a crunch point – incentivising investment is critical to meet growing demand: https://lnkd.in/eGgsiP3A cc Rob Waterhouse and GSA - Global Student Accommodation #pbsanews #pbsa #residential #studentaccommodation #builtenvironment #insights #residentialproperty