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UK: 98% of Unite Q2 trading has already been booked

clock iconCreated At:17 July, 2023
write iconCreated By:Passant Mohamed

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This week, the UK's top owner, manager, and student housing developer, the Unite Group, presented their Q2 trading update. The report covers the Unite UK Student Accommodation Fund (USAF) and the London Student Accommodation Joint Venture (LSAV) for the June 30, 2023 quarter.

According to the statement, the company is reporting record levels of bookings across all of its facilities for the upcoming school year 2023-2024. They report that their rooms are currently 98% booked out, compared to 91% at the same time last year, and that this is a record high for The Group.

The percentage of nomination agreements between the company and individual institutions has also climbed year-on-year, rising from 52% last year to 56% this year. This increase represents nearly 2,000 more nominated beds, proving that universities nationwide increasingly rely on private partners to meet their increasing accommodation needs.

According to Richard Smith, Chief Executive Officer of Unite Students, the growth shows "strong demand from both students and universities and the attractiveness of our fixed-priced all-inclusive offer".

"Our strong leasing performance will continue to support our property valuations as the market adjusts to an environment of higher interest rates," he adds.

The supply of purpose-built student accommodation cannot keep pace with growing student demand at the same time that HMO landlords are leaving the sector. Unite is uniquely positioned to address this housing need through our best-in-class operating platform, university relationships development and asset management capabilities."

The Group is committed to delivering four fresh schemes in terms of development growth. The schemes' overall development expenses are £339 million.

USAF's portfolio, which included 27,924 beds spread across 71 properties in 19 towns and cities across the UK, was valued at £2,923 million at the end of the quarter. This reflects a quarterly increase of 1.2%. The increase was driven by 2.2% rental growth.

LSAV's portfolio of 9,716 beds spread over 14 London properties and Aston Student Village in Birmingham was valued at £1,940 million. Similarly, this is a 1.1% quarterly increase, driven by 2.0% rental growth.

The USAF and LSAV portfolios are currently valued at weighted average yields of 5.1% and 4.3%, respectively.


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