As a follow up to our acclaimed industry report, Intelligent Partnership has published a report on Purpose Built Student Property – the first in a series of AiReports on specific investment sectors accredited by the Chartered Insurance Institute and Institute of Financial Planning for CPD purposes. Comprising a market update, demand and supply factors, investment considerations as well as investment activity and potential in the sector. Alongside this research is our first Alternative Investment Register, within which we list and detail all of the 98 purpose built student property investments we have collected data for.
This is the first comprehensive report focused on Purpose Built Student Property marketed to UK retail investors; considered more mainstream than other alternative investments there are a number of ways and opportunities to invest in the sector. Student property can offer distinct advantages to investors, including diversification, steady and predictable returns, strong performance and a hedge against inflation.
These are some of the reasons why the sector has seen such high growth in recent years, with over £2.7bn of investment from institutions, funds and retails investors going into the sector in 2012 alone. The main risks for investors include some overly optimistic and unsubstantiated claims in marketing literature, oversupply in certain locations, lack of an established re-sale market and liquidity in some funds.
The retail investment sector is dominated by directly held purpose built properties, with 46 schemes launched in 2012 and 28 schemes launched so far in 2013. Many of these properties are offered on long leasehold ownership with enticing guaranteed returns for the first one or two years. It is estimated that over £450m has been invested by retail investors from the UK and overseas into UK based purpose built student property since the start of 2012. It is also possible for retail investors to gain exposure to the market through collective investment schemes and investments with a corporate element, such as asset backed bonds.
The sector has not been without its issues however and the report touches on some of the reasons investors and their advisors should be cautions, understand the risks as well as the benefits and always conduct whole of market research on the sector, providers and products.
- Investment Case
- Market Update
- International Demand
- Demand vs Supply
- Investment Activity
- Investment Potential
- Investment Outlook
- Regional Spread
- Investment Register
The report is primarily aimed at Independent Financial Advisers with clients either considering or invested in the sector, however the content has a broader appeal to anyone with a commercial, vested or general interest in this relatively new and growing sector. Our aim is to make this an annual report that shines a light on the sector, to achieve that we require greater disclosure and participation from providers and promoters in the compilation of future reports in order to promote best practice and drive out poor practice.
Alongside this research is our first Alternative Investment Register, within which we list and detail all of the 98 purpose built student property investments we have been able to collect data for. Registered subscribers of Intelligent Partnership can access a complimentary copy of the report here and claim CPD towards their member scheme; other interested parties can purchase a copy of our report all by clicking on the following button:Access Report
We hope you enjoying reading our report on Purpose Built Student Property and as always we welcome your comments and feedback.