Covid-19 Impacts PBSA Valuation
27th Jan 2021
The newly released CBRE Student Accommodation Index has reported capital increases in the sector of 6.5% year-on-year for the 12-month period ending September 2018.
The rise in capital values for the period ending September 2018 is above the figure of 4.5% recorded in the previous year.
On a gross and net basis, rents increased 3.0% and 3.4% respectively, with annual total returns at a national level reported at 12.3% for the year to September 2018.
The index is split into Central London and Regional geographies, which is then categorised as Super Prime, Prime, and Secondary.
Student accommodation in central London outperformed regional locations due to capital value growth of 12.4%. Central London student accommodation's annual total returns reached 17.5% for the year, compared to 14.2% in the previous 12 months.
Total returns for regional student accommodation reached 10.5%, with capital growth recorded at 4.5%.
Student properties located in Super Prime towns recorded capital growth of 11.1%, compared to an increase of 6.0% in Prime Regional locations and a fall of 9.0% in Secondary towns.
Net rental growth in Super Prime and Prime Regional towns for the 12 months was reported at 3.6% and 3.9% respectively, but for Secondary locations it declined 1.5% year-on-year.
The largest assets performed best over the period, with those consisting of 500 beds or more reporting capital value growth of 7.2%, pushing total returns to 12.9%. This compares to total returns for small and medium sizes assets of 11.6% and 12.2% respectively.
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