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Unite Students Latest Trading Update

Posted by Richard Ward in

Image courtesy of Flickr, Creative Commons

In its latest trading update, Unite Students saw its USAF portfolio increase by 1.1% on a like-for-like basis during the quarter. Meanwhile, its LSAV portfolio saw its valuation grow by 3.7%.

The student accommodation specialist has reported that 94% of its beds are now let across the whole portfolio (2020/21: 88%, 2019/20: 98%), which is slightly lower than previous expectations.

The company added that record university applications had not translated into higher student intake as expected, whilst grade information had distorted the distribution of students among its cities.

Positively, Unite said it had a waiting list for its accommodation that equates to c.1-2% in potential occupancy, which it hoped to be distributed across its other cities as disruption from higher grading unwinds.

For the 2020-21 academic year, the business has collected 96% of rent due, excluding the impact of the 10-week rental discount offered to customers for the second semester.

Commenting on the update, chief executive Richard Smith, said: "We have seen record demand for UK universities from UK school leavers and non-EU students, particularly for the strongest universities to which we are strategically aligned, although higher grade attainment and restrictions around international travel as a result of the pandemic have impacted occupancy in a small number of cities. There remains a strong outlook for student demand driven by demographic growth, rising participation rates and increasing demand from non-EU markets. This underpins our confidence in a rapid recovery in earnings and total returns, driven by sustainable rental growth, our substantial development pipeline and further opportunities to deploy capital."