Event Summary
Education Property and PBSA | Summary, photos, and slides
Decarbonisation, retro-fitting of legacy buildings, attitudes to students politically and within the community, and return on investment were among the topics covered.
Held on 13 June at Innside by Melia in Manchester, the event was sponsored by LUC, Arup, and Yardi.
The first panel at Place North West’s Education Property and PSBA event featured Georgina Rose of JLL, Peter Greenall of Blackpool & Fylde College, Natalia Maximova of Sheppard Robson, Andrew McDowell of Arup, and Edward Tarratt of LUC. Credit: PNW
Net Zero
Dan Whelan, deputy editor of Place North West, opened proceedings by touching on a well-documented lack of good quality specialist housing for students across the country.
He added that while many schools, colleges, and universities are maintaining dated buildings, they are struggling to find the cash to reinvent themselves, especially universities with inflation biting into their coffers.
Andrew McDowell, associate director at Arup, said while universities are facing major challenges, the desire amongst the younger generations to achieve net zero cannot be ignored.
He pointed to the student protests at COP 2021, acknowledging that war and the cost of living crisis have possibly overshadowed net zero since then, but it is still important to the next generation: “I think Net Zero is still very much on the agenda, for big business especially, and for higher education institutions.
“They’re customers, whether businesses or students are demanding this.”
He added that many academic estates are old, historic buildings, and university’s do want to bring their emissions down.
Arup is advising institutions across the country with a view to making buildings and estates functional more climate resilient: “We don’t just want to do decarbonization, we need to do other things at the same time creating co-benefits.”
Ed Tarratt, an associate director at LUC, commented on trends, challenges, and opportunities with a landscape focus.
He said students now have changing expectations, ranging from safety and quality to health and wellbeing: “Top of the list is very much climate change.
“Schools, colleges, and universities require resilience to the impact of these fluctuations.”
Tarratt added that the growing trend of students working online presents a challenge similar to universities of that facing local government when it comes to trying to revitalize high streets.
Andrew McDowell, associate director at Arup, said Net Zero is “still on the agenda” at Place North West’s Education Property and PSBA event. Credit: PNW
Where will the money come from?
Georgina Rose, director of JLL: “You’ve not got the political support and that adequate funding that universities and colleges need to deliver what they need to deliver, they’re reliant on international students in terms of that income.”
Peter Greenall, vice principal at Blackpool and Fylde College: “The further education sector has gone through a similar period of around 10 to 11 years of static funding rates.
Looking to the future, Greenall wants the next government to be more supportive of HE and not pitch it against apprenticeships: “We’ve seen a lot of devaluing of higher education, and I’m a stronger believer HE has transformative powers to change the lives, aspirations, and opportunities of people who go through it.”
Natalia Maximova, associate partner at Shepherd Robson: “Quite a few projects we’ve been working on have stopped because of uncertainty.
Georgina Rose, of JLL, said tightening finances are leaving universities reliant on income from foreign students at Place North West’s Education Property and PSBA event. Credit: PNW.
“We are still working with universities but more on strategic projects.
“Physical projects are not coming forward in the same way they were five, 10 years ago. That’s down to this uncertainty of funding.”
Tarratt: “You need to provide the things they (students) can’t get from home, social interaction, access to nature. Can campuses strip away unnecessary buildings and actually create more landscape? You need masterplans to forward-think these issues.”
Rose: “You’ve got universities and colleges that are looking at surplus land and property, disposing of them to deliver other projects, and it works well when there’s that market there to deliver the funding they need.
McDowell: “It has to be looked at on a case by case basis.
“Across the country we’ve seen some terrific historic buildings refurbished by universities. There may not be as efficient, they probably cost more per sqm than a new build but it’s the character.”
Blackpool & Fylde College’s Peter Greenall told Place North West’s Education Property and PSBA event that the further education sector had been through a decade of “static funding”. Credit: PNW
Trends
Marcus Dixon, director of UK residential research at JLL gave a presentation with stats on the PBSA market: “The general trend we’re seeing is that the level of student accommodation is not sufficiently high to meet demand. This isn’t just a UK phenomenon, it’s something we’re seeing pretty much across all the European markets we cover.”
Dixon said there had been an increase in students across last decade, up to 600,000 full-time students.
He pointed to challenges around overseas students, a drop off in EU applicants, but a significant increase from non-EU including Hong Kong, China, India and parts of Africa.
Dixon said there was a shift away from university-owned accommodation to privately-owned PBSA stock: “Generally what we’ve seen is pretty significant increases in rent across the board.”
JLL research has found that “building new student accommodation doesn’t really stack up from a commercial perspective until you get over £200 a week”, according to Dixon.
Just more than 20% of Manchester’s students rent privately-rented homes across the city.
Dixon added that is more of a challenge to get that £200 a week in rent outside of London and South East.
He put forward the case that Manchester is in a good place in terms of student provision, no longer having a moratorium on developing purpose-built student accommodation, and could even be regard as pro-development.
Another factor Dixon touched on is the perception around students living in local communities, and the impact it has: “I think there’s sometimes quite a negative view in the community around student accommodation, which personally I think is wrong, but we do have that challenge.
“The lack of appropriate student accommodation means students are occupying properties within the private rental sector which could be rented by families or young professionals in city locations, but the reality there isn’t enough purpose-built accommodation to suite.”
This was echoed by George Tyson, project director at Downing: “Generally across the UK there’s very few council policies that actively encourage student development. They’ll accept, they’ll suffer it, very rarely do they embrace it.”
Dixon: “By providing appropriate accommodation you are freeing up other homes and I think that’s the message we need to be working on getting out there.”
Marcus Dixon, JLL’s director of UK residential research, gave an overview of current trends at Place North West’s Education Property and PSBA event. Credit: PNW
Viability
Tyson said the viability of developing PBSA is a real consideration: “It’s tough but in the right city, Manchester is a perfect example, where you get the right opportunity, it is still a viable proposition.
“You’re standard stock (in Liverpool) is viable, developing new is very difficult in Liverpool.”
Rachael Gordon, head of deal execution at Maslow Capital said creativity was key: “I think developers are pretty creative in trying to find ways to keep them viable.
“When we’re looking at a scheme and forecasting interest costs, that’s a lot better now than it was when we were doing that a year ago.”
Gemma le Marquer, chief customer office at Empiric Student Property, said getting the right balance between domestic and foreign students within a building is important: “We’ve got more domestic students than we used to have post-Covid, which is interesting.
“It varies massively city to city, building to building.
“Diversity within our buildings is something we’re really keen to encourage and we’re looking at different ways to build better diversity.
“If you’re a UK domestic student moving into accommodation and 90% of it is Chinese in there it can be quite isolating as an individual.”
Natalia Maximova, associate partner at Sheppard Robson, spoke about some of the challenges facing the industry at speaks at Place North West’s Education Property and PSBA conference, including uncertainty over funding for projects. Credit: PNW
Changing demographics
Dr Simon Merrywest, director for the student experience at the University of Manchester said tuition fees are being eroded by inflation, which is leading to large growth in international students.
He pointed to Manchester being able to offer direct flight routes to China, other parts of Asia and increasingly Africa.
Merrywest added that students are looking for more from their campus: “What we’ve got is a legacy estate of lots of lecture theatres connected by corridors and cafes, and what students is increasingly telling us is that the thing that would drive them to come to campus is spaces they can dip in and don’t feel the need to spend money when they’re there.
“Social spaces, places where they can make a drink for themselves, bring their own food, which feels more like a community space, that’s their own.”
Returning to where the morning started, Merrywest predicted that students will demand institutions and politicians progress with decarbonisation and they will be” held to account” if targets are not achieved and deadlines are missed.
What’s next?
Join Place North at one of our upcoming events:
Cumbria Development Update | 20 June
North East Emerging Development Hotspots | 27 June
Sustainability in Practice: Retrofit
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- Guests at the Place North West Education Property and PSBA event. Credit: PNW
