13
POTENTIAL INVESTMENT
LOCATIONS
The list of the top 10 UK cities for investment
takes into account recent growth in student
numbers, the number of university bed
spaces available and the percentage of
international students.
London has 291,000 full-time students
across 40 HEIs and a large proportion of
international students, but only 15.4% of its
students are housed in university-owned
accommodation. Knight Frank believe
there is huge scope for investment with
London requiring a further 100,000 student
bedrooms in the £150 to £200 per week
‘value’ price range.
The stature of the universities located within
the top ranking cities will have a long-term
impact on their demand. All cities in the top
“London has been highlighted by Knight Frank to be the number 1 city for student accommodation
investment”
Source: Knight Frank
Rank
Town/City
No. of HEIs
Total full time students
09/10
Growth in students nos.
04/05 - 09/10
Students vs. University
owned bed spaces
1
London
40
291,815
20.7%
15.4%
2
Kingston
1
21,675
39.9%
10.9%
3
Brighton
2
25,345
18.1%
21.5%
4
Edinburgh
5
46,270
12.4%
20.8%
5
Durham
1
14,290
2.6%
40.3%
6
Manchester
4
79,405
14.7%
18.7%
7
St Andrews
1
7,760
4.1%
50.2%
8
Bristol
2
38,560
18.0%
20.5%
9
Oxford
2
31,620
6.7%
54.3%
10
York
2
17,350
27.3%
33.9%
TOP 10 CITIES TO INVEST
(2012)
KEY QUESTIONS TO ASK BEFORE INVESTING
Once an investor has considered these things they should then focus on the micro case and ask the investment provider as many
questions as possible. Some of the key questions advisors should be asking include:
#1 HOW DOES THE INVESTOR OWN THE ASSET?
#2 WHO IS THE MANAGEMENT COMPANY AND WHAT IS THEIR TRACK RECORD?
#3 IS THE MANAGEMENT COMPANY ASSOCIATED WITH A UNIVERSITY?
#4 WHERE DOES DEMAND COME FROM AND IS IT SUSTAINABLE?
#5 WHICH UNIVERSITY DOES DEMAND COME FROM?
#6 WHAT OTHER SUPPLIERS ARE IN THE AREA?
#7 WHAT IS THE PREDICTED INCOME?
#8 IS THERE ROOM FOR INCOME GROWTH YEAR ON YEAR?
#9 WHAT COSTS WILL I BE LIABLE FOR?
#10 IS THERE AN EXIT IN PLACE? OR A PROVEN SECONDARY MARKET?
10 list include a high ranking (Russell group or
1994 group) university which should benefit
from the recent tuition fee rise and ‘flight to
quality’ from students. This should hopefully
result in stable demand and a requirement to
upgrade existing residential accommodation,
presenting the potential for retail investment
close to selective universities.
