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Unite Students Releases Latest Update

Posted by Richard Ward

Image courtesy of Flickr, Creative Commons

In their second update following the outbreak of Coronavirus, Unite Students has received requests to forgo rent on around 43,000-46,000 beds, which equates to around 62-65% of all owned and managed beds.

The balance is accounted for by students who wish to stay in their residences, as well as beds let under nomination or lease agreements, where Universities collect rent directly from students. So far in April Unite has received 94% of the rent due under their university partnerships.

In total, the company is expecting a reduction in income for 2019-20 of 16-20%, which represents an improvement on previous expectations.

Reservations for the 2020-21 academic year are at 80%, down from 81% recorded during the same time last year. The company has reportedly seen healthy levels of demand from UK students and is still seeing enquiries from international students.

Nomination agreements account for 70% of reservations secured for 2020-21, with more than two-thirds of these now contracted. Several universities have also begun to allocate students for the new academic year, suggesting they remain confident around their accommodation requirements.

The company has maintained its guidance for a £90-125 million reduction in its cashflow in 2020. After a review of operating expenses, Unite expects to realise £12-15 million in cost savings, in addition to £5-6 million of cost synergies in relation to the acquisition of Liberty Living.

Additional savings will be made through a reduction in salaries and pension contributions and deferred development and non-essential operational capex will ensure the business retains an additional £95-105 million of cash in the business in 2020.