Stripe Property Group, a property developer and purpose-built student accommodation (PBSA) specialist, has reported a resurgence in the PBSA sector following a pandemic-induced downturn. The sector’s market size currently stands at nearly £4bn and is projected to reach £4.5bn by 2025.
Analysis of the latest PBSA sector data reveals a 67% increase in market size within the last decade, from £2.4bn in 2013 to an estimated £3.971bn. Despite experiencing a pandemic decline in 2021, the sector has rebounded in 2022, growing by 23% but remaining 4% below its pre-pandemic peak.
The PBSA market size had reached its highest point in 2020, valued at £4.1bn. However, it fell by 21% to £3.2bn in 2021 due to COVID-19 restrictions and the shift away from in-person higher education. The market shrank to its smallest size since 2016.
Stripe Property Group forecasts that the PBSA sector will recover to a £4.2bn market size in 2023, representing a 6% annual increase and surpassing its pre-pandemic peak by 2%. The sector is expected to continue growing, reaching over £4.5bn by 2025, an 8.1% increase.
James Forrester, Managing Director of Stripe Property Group, notes that the PBSA sector was significantly impacted by reduced demand for student housing during the pandemic. However, the returning health of the PBSA sector has been driven by a return to normality for many students and purpose built student accommodation is once again in very high demand.
The PBSA sector’s role in addressing the shortage of suitable student housing is poised to become increasingly important in the coming years.
