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Unite Releases Its Latest Trading Update

Posted by Richard Ward

Image courtesy of Flickr, Creative Commons

In its latest trading statement, Unite Group has indicated that 88% of its bed spaces are let across its portfolio, down from 98% reported in 2019-20.

The figure is also slightly below the group's targeted occupancy rate of 90%. Whilst there has been a healthy level of letting activity since A-Level results were announced, it has been offset by a higher than usual volume of cancellations, particularly since the rise in Covid-19 cases.

The group said 21% of bookings are yet to check-in, either this month or in January, compared to just 4% at the same time last year. This indicative of the flexible tenancies being provided, to reflect later than usual university course start dates.

Nomination agreements for 2020-21 account for 57% of bookings (2019-20: 56%), with the remaining beds sold on a direct-let basis. UK students this year account for 45% of direct-let bookings, up from 38% in 2019-20, reflecting the company's increased focus on capturing market share from houses in multiple occupation.

On a like-for-like basis, rents on a weekly basis have increased by 1.1% and the group has retained its guidance for ERPA EPS of 22-25p for FY2020, albeit this is subject to universities remaining open and the company's expected check-in performance and rent collection over the remainder of the year.

As of 30th September 2020, USAF's property portfolio was valued at £2,808 million, representing like-for-like growth of 0.7% during the quarter. LSAV's portfolio was valued at £1,326 million, also up 0.7% in the quarter on a like-for-like basis. However, this growth was driven by a temporary reduction in stamp duty for residential properties and without this, valuations would have been flat in the quarter.