22 March 2016 | Marino Donati
The student accommodation sector in Birmingham is maturing, according to research by CBRE.
The commercial property and real estate services adviser says there are 24 developments in the city with planning permission. This represents 3,200 beds in developments ranging in size from 33 to 625 beds.
A record number of student beds are in the development pipeline and major assets are changing hands, showing that Birmingham’s student housing market is “coming of age”.
More than £5.5 billion of investments changed hands last year, compared with £2.2 billion the previous year, making student housing a mainstream investment option, says CBRE’s UK Student Accommodation report.
Although large portfolio sales had so far dominated the market, CBRE predicts that this will change in 2016, with more single assets trading.
Yields climbed last year, it says, returning to 2007 levels. Prime regional assets now achieve 5.50 per cent, with super-prime sites at 5.15 per cent.
CBRE predicts that a range of investors chasing a reduced pool of quality stock will keep up values.
“Strong investment volumes during 2015 and into 2016, together with a robust development pipeline, demonstrate that student housing is now a maturing asset class in this city,” said Rosie Young, associate director in CBRE’s Specialist Markets team, Birmingham.