Student housing, a sub-set of the residential real estate sector, is defined as co-living spaces designed for students enrolled in higher education institutions.
Internationally, student housing projects typically have the following unique characteristics:
- The product is owned by a single entity or Fund (i.e. not sold in STRATA title format to individual investors) and units are offered for-rent only (i.e. not sold to the students)
- Rental contracts are non-standard to match the school year (i.e. 8 or 9 months)
- Product use is restricted; only university students can apply to rent a unit
- Product design is on a “co-living” standard with several units sharing a common kitchen, bathroom, and lounge facilities
- The product is gender-segregated, with either entire buildings or whole floors reserved for only male or only female students (due to the shared bathroom facilities)
- Unit sizes are small and may have two student occupants within a space as small as 25 m2.
- The product contains facilities which fit student lifestyles such as a recreation hall, outdoor sports facilities, a small market, and services such as laundry
- The product offers limited parking relative to the number of occupants as it is anticipated that many students will not have their own automobile and instead utilize a shuttle service or public transport.
WHAT DRIVES THE STUDENT HOUSING MARKET?
Not surprisingly, demand for this product type is driven by the number of universities and enrolled students that require housing. However, there are differentiators in this demand structure:
- Family student housing which applies mostly to post-graduate students that are older and maybe married or even have children has very different design requirements and represents a niche sub-set of the student housing market.
- Special housing for professors teaching at the university is a niche sub-set of the student housing market.
From a supply perspective, the situation is far more complex because students have multiple alternatives when considering their housing needs:
- The Student can live at their parent’s home and commute to the university.
- The Student can rent a room within a larger unit on the open market sometimes coordinating with other students.
- The Student can rent an apartment on their own
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