With the number of international and domestic students on course to exceed pre-Covid levels, purpose-built student accommodation (PBSA) operators too are braced for a return to the stiff competition which so vividly characterised the sector before the health crisis.
By Ben Morley, Managing Director, true Student
Competition is already rife – and it’s about to intensify, so it’s more important than ever for operators to stand out amongst what is an undeniably booming UK PBSA market.
While most are quick to shine a spotlight on the location, quality and amenities of their schemes – and they are right to do so – such credentials will soon no longer cut the mustard, with the distinguishing factors and USPs of different schemes and operators quickly beginning to fade into uniformity.
Indeed, recent research by Knight Frank shows that most operators already meet these needs more than adequately, resulting in many new PBSA schemes – all with very similar offerings in terms of amenities, spaces and overall high-quality standards – coming onto the market.
So, where can PBSA operators turn next to make themselves stand out to students, landlords and investors in an increasingly crowded marketplace? The answer can only be one that lies beyond student accommodation itself.
At Bricks Group, our student accommodation brand, true Student, is setting out to curate unique cross-brand ‘ecosystems’ within our developments; incorporating other brands and businesses that fall under the Bricks Group umbrella into the PBSA buildings themselves to inherently enhance the living experience and service delivery for our guests.
For example, our 706-bedroom scheme in Swansea, which will complete this year, will be home to Bricks Group brand UTime Fitness. And there’s more to come. Doza, our unique pizza and doughnuts concept, will also launch at true Swansea following the inaugural opening at true Liverpool in the coming weeks.
This strategy serves as a value-add from a business point of view, of course, but also for guests who simply by living at one of our locations are automatically eligible for generous discounts and benefits at these brands. Moreover, these locations will be open to the public – creating an additional revenue stream, while helping to forge closer community ties between the students living in our buildings and nearby residents and neighbours.
The strategy is also one which has captured the attention of investors. In January, we announced the creation of a £400m joint venture partnership with Tristan Capital Partners’ CCP 5 LL fund, signalling a major vote of confidence in our plans. This will see Bricks Groupcontinue to develop, asset manage and operate the locations – but backed by the financial might of Tristan Capital Partners, enabling us to enhance the experiences on offer at our locations while solidifying brand value.
Deals and perks remain incredibly strong pull factors for students who, today, are increasingly spoilt for choice when deciding on which operator they would like to spend their money on. And while effectively all PBSA operators today provide some form of incentives programme, those on offer at true Student’s sites will be superior – both in terms of product and service offering as well as pricing – because we have full control over those complementary brands.
Ultimately, this initiative not only marks an exciting new chapter for Bricks Group and true Student enabling us to scale faster and further than ever before, but also for the PBSA sector itself.
We are confident that our flourishing ecosystem will help boost our already impressive retention, rental and capital growth at true Student sites, while also setting a new trend in motion for the sector at large – one which bridges the gap between student accommodation itself and a range of complementary sectors waiting to be tapped into.