European PBSA: Investing in the future
City analysis of demand and investment drivers reveals the grade A growth opportunities
- Dominika Mocova
- Emma Rosser
- Nick Whitten
- Julia Martin
- Mason Gillard-Ellis
Europe’s purpose-built student accommodation (PBSA) sector has attracted investors' attention in recent years thanks to a rapid increase in demand from students across the globe. Over the past decade, the number of students in the EU and the UK has grown by 15% reaching an estimated 21.7 million in 2022/23. It is projected to grow by further 10% by 2030/31. This means an additional 2m students in need of housing solutions compared to 2022/23.
Investment in European PBSA has surged from €0.5 billion in 2008 to over €13.1 billion in 2022, reflecting CAGR of 27%, primarily targeting UK cities. Despite this growth, PBSA unmet demand across 40 key European cities amounts to 1.2 million beds. This is expected to increase by a further 8% by the end of this decade.
London, Paris and Barcelona emerge as top investment growth hotspots. The appeal of these markets reflects a mix of favourable historic and projected PBSA dynamics. These include robust demand, PBSA supply, liquidity, market maturity, rental growth, affordability and ESG compliance.
