2 (Small) Reasons To Be Cheerful About Purpose-Built Student Accommodation
The coronavirus-inspired crisis in UK student housing could have a happy ending, if a planning inspector and a hospitality consultant have got it right.
The two glimmers of hope come as major purpose-built student accommodation operators discount fiercely amidst suggestions the sector needs government support if it is to survive.
Hospitality consultancy Host has suggested that PBSA could be rescued from potential financial ruin by being converted to more short-term flexible space for hotel-style use by students.
“We’ll see more short-term, flexible stays in a hotel-style environment that enable a more responsive approach to changing circumstances, while also providing quality accommodation,” Host commercial director Suzanne Carey said.
Host argued for a smart, hospitality-focussed accommodation operation, underpinned by the latest technology, connectivity and infrastructure.
“We can operate a tailored ‘day-by-day’ reservation system that allows students to book in and out on short stays of days or weeks rather than being tied into a 40-week contract. This makes the model financially viable, affordable for the student and flexible for the university, so occupancy and financial returns are maximised,” Carey said.
Universities are already reviewing their operations, not least to soften the financial impact from the coronavirus. According to a recent Association of University Directors of Estates survey, 65% of member universities have paused or canceled capital development projects. A further 54% have stopped maintenance work that was not connected to statutory compliance. Add to that, two-thirds of survey respondents have furloughed staff from their estates and facilities teams.
The second straw in the wind comes from the planning system.
This week Birmingham City Council considers an application from a Channel Islands-based applicant to build 1,187 student bedspaces on the site of a former Sainsbury supermarket at Selly Oak.
Locals had objected to the scheme, and the council’s planning committee were minded to refuse the application from Jersey-registered HPH Selly Oak Property Ltd for the site at Bristol Road.
Birmingham Council officials have advised against councillors pursuing their objection to the scheme on the basis that the coronavirus pandemic means demand for student housing is now much less certain than it was.
The official view, taken by a planning inspector examining a similar case, is that temporary shocks to the demand for student housing make no difference to long-term trends. Birmingham councillors have been advised to heed his advice.
The Selly Oak site is being compared to the former Plumb Centre site in Bath, where 80 student bedspaces were refused but the developer appealed the decision.
A planning inspector published his finding on 30 December 2020.
“The inspector acknowledged it is difficult to predict the effects of the COVID-19 pandemic on the future need for PBSA," Birmingham councillors were told. "However, he concluded that it is necessary to consider the matter over the lifetime of the development rather than the impact at this moment in time. He concluded that it was highly likely that there will be a strong demand for student accommodation and granted consent. This recent decision emphasises that [there is no] specific evidence COVID-19 is more than just ‘a blip’ in the otherwise upward trend of growing demand for PBSA.”
The bad news for the developers of the Bristol Road site is that councillors are expected to oppose the application regardless, on the basis that its scale and density is unacceptable.