Unite Group has announced a 0.3% reduction in rents across its student accommodation portfolio for the current academic year. This marks the first decline in over 25 years, excluding the Covid-19 lockdown period.
The UK’s largest student accommodation provider stated that falling international student numbers and an increasing proportion of British students choosing to live at home are key factors behind the rent reduction. University cities such as Nottingham, Leicester, and Sheffield have reportedly experienced particularly weak demand.
Despite the rent reduction, Unite achieved an occupancy rate of 95.6% across its 72,000 places, a slight increase from 95.3% in the previous year. Joe Lister, Chief Executive of Unite, commented that the company delivered reservations in line with expectations.
The company's property portfolio valuation decreased by 3.9% between July and September, bringing the total decline for the year to approximately 8%. In response to weakening demand, Unite is considering disposing of some halls of residence.