Unite Looks To Reshape Student Portfolio After £417M First-Half Loss

Student accommodation specialist Unite Group has announced a £417M first-half pre-tax loss as it warned that purpose-built student accommodation is struggling under soaring construction costs.

The UK's largest student accommodation provider reported that the loss was driven primarily by a 6.4% fall in the value of its property portfolio, reflecting higher interest rates and softer investment markets rather than weakening occupational demand.

Adjusted earnings slipped 2% to £142M, while the company maintained its full-year earnings guidance and said demand at the UK's strongest universities remained resilient despite a more challenging backdrop.

A revaluation of Unite’s property estate dealt a £530M hit to its profits, the firm said. 

Following a strategic review, the landlord said it was taking “ambitious” measures to offload as much as £400M of property in a bid to focus on student tenants at the UK’s “strongest” universities. That includes it accelerating a wider portfolio-reshaping programme, bringing forward disposals of between 15,000 and 20,000 beds.

Unite has 1,653 beds under construction, comprising schemes at Hawthorne House in Stratford and Central Quay in Glasgow. It is reviewing options for a further 2,400 consented beds in London and Bristol, including potential third-party funding or disposal.

The group also expects to spend £61M over the next two years on fire safety remediation, although it anticipates recovering between 50% and 75% of those costs from contractors. 

Unite expects occupancy of 94% to 96% for the 2026-27 academic year alongside rental growth of 1% to 2%, but, speaking alongside the results, Unite Group Chief Executive Joe Lister warned that construction costs, tighter regulation and lower investment values are making new developments unviable across much of the country.

“New supply of student accommodation will slow significantly over the next two to three years, and we see the same challenges impacting the build-to-rent sector,” he said.

According to Lister, schemes outside London now require rents of more than £300 per week to make development financially viable, compared with Unite's current average regional rent of around £190 per week. 

Unite acquired student accommodation rival Empiric in August of last year and told shareholders that this acquisition fuelled its 11% jump in rents to £262M.