London University Housing Conference Student Housing Marcus Roberts Director

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London University Housing ConferenceStudent
HousingMarcus RobertsDirector Sarah
BeudenAssociate 30 June 2008
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Student Accommodation
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Overview

• Market Statistics
• Perceptions right or wrong
• Partnerships Success stories
• Student Minefield
• Planning
• Possible solutions
• Questions Answers

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Full-time students numbers continue to rise
Source Savills, HESA
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Rapid growth in overseas students in last five
years
Source Savills, HESA
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Students live predominately in HMOs
Source Savills, HESA
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Operational Private Student Beds by Borough
Source HESA, Savills Research
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Operational University Beds by Borough
Source HESA, Savills Research
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Institutional Beds VS Private Beds by Borough
Operational 07/08
Source HESA, Savills Research
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SupplyLondon Borough Supply Pipeline
Source Savills, ABI
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Direct Let Nomination Agreements by Borough
Source HESA, Savills Research
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Perceptions

• Private Sector Developers Agents
• Public Sector Universities Local Authorities

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Private Sector

• Wide Boys
• Arrogant
• Cowboys
• Money, Money, Money

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Agents

• Over- paid
• Do nothing other than put in big invoices
• Big lunches
• Unapproachable

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Public Sector Universities

• Move at a slower rate due to necessity and
  reporting structure
• Bureaucracy
• Increasingly commercially minded
• Suspicious of the private sector
• Protective of assets
• No clear policy on the student issue

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Current Challenges in Londons Student Market

• Continued under supply of student accommodation
• Significant Rental Increases
• Proliferation of Studio student schemes
• Difficulty in securing sites in London
• Tightening planning regime

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University Sector
Private Sector
Chemistry?
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?
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(No Transcript)
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• this is the reality

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Interiors
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Cluster Flats
4 Bed Apartment
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Student Studios
Studio Apartment Layout
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Commerciality of Sector

• Potential long lease structure
• University Lease
• Nominations Agreement
• Direct Let
• Secure income flow
• Less reliance on capital growth
• Dedicated management

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• within our industry there are many
  misconceptions that things are easier than they
  actually are (Anon)

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• can anyone relate to this?

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• have you ever tried to do something that looks
  simple but isnt

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Tying a Bow-Tie
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the student market can be a minefield
design development feasibility
planning nuances
supply demand dynamics
university private sector objectives
Land Values/ Rents
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Planning - what are the issues?

• What is our steer?
• Is it a priority?
• What is the need and where is it?
• Why should we become a dumping ground?
• Why should they get out of providing any
  affordable housing?

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Planning weighing it up

• Pros
• Adds to world city status
• Brings economic and social benefits
• Reduces pressure on private and affordable
  housing
• Counts towards housing targets.
• Cons
• Competes against other needs and targets
• Not counted as affordable housing
• Creates studentification

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Planning Mechanisms

• Locally
• Local Strategic Partnerships
• LDFs (including site allocations)
• Housing Strategies
• Education Strategies
• University Accommodation Strategies

• Regional
• Review of London Plan
• Housing SPG
• Housing Strategy
• Sub-regional strategies
• Education Strategies.

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Planning Solutions

• Short term
• Recognise that it is a need that is not going to
  disappear
• Start dialogue (were all here after all)
• Look at what we want and what we need
• Start to use mechanisms that are available to us
  now.
• All about working together
• (Sherlock Holmes not required!)

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Planning Solutions

• Medium/Long term
• Assess needs
• Introduce targets sub-regional/local?
• LDF process - policies/site allocations/implement
  ation
• Contribute towards affordable housing?

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General Market Comment

• 6.6 billion property market
• Expected growth to gt 20bn in the next 6 years
• Total of 2.3 million students studying in the UK
• 459,000 student bed spaces
• - Education sector 326,000 beds
• - Private sector 133,000 beds
• Expected further consolidation and stock
  transfers from Universities to the private sector.

Student Accommodation Bedspaces by Region
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Possible Solutions

• Increased partnerships between Universities and
  the Private sector
• Utilisation of existing campus land / assets
• - Ability to balance capital receipt for land
  with ability to structure accommodation type and
  lease / nomination agreements
• - Potential to refurbish existing stock though
  sales and agreement to the private sector
• Joined up approach to planning
• unlock difficult planning sites
• - ability to structure mutually beneficial
  structures
• Political pressure from Private and University
  sectors
• - Target the GLA
• - Target specific boroughs which could support
  student housing but dont

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experience and knowledge of a constantly
evolving niche sector (Anon)
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• remember things arent always as easy as they
  seem ....

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do it yourself Bow Tie Man.........
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.......... or the professionals
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Thank you for listeningAnyQuestions

• Sarah Beuden
• Associate Planning
• 44 (0) 7812 965 308
• 44 (0) 20 3320 8265
• sbeuden_at_savills.com

• Marcus Roberts
• Director Student Housing
• 44 (0) 7807 999187
• 44 (0) 20 7016 3799
• mroberts_at_savills.com